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It’s Time for Workers on Boards

In an era of slow wage growth, precarious contracts and the looming shadow of Brexit, workers need more voice in the workplace. In 2016, this was recognised by prime minister Theresa May on the steps of No. 10, but action has failed to materialise. Rather than seeing an amplification of the voices of working people, worker representation in the UK has in fact got worse, with trade union membership registering at an all time low last year. Meanwhile, CEOs continue to receive bloated pay packages and public sector workers face real term pay cuts.

The government has failed to listen to itself on the need to focus on working people and social injustices, as well as take heed of the clear message from Brexit voters that they want greater say and power.

Introducing workers on boards (WOBs) would start to address the dramatic imbalance of power between workers and their employers. Significant reform in this area is long overdue. Rather than opening yet another consultation or watering down statements made in 2016, the Conservative government should be championing a legitimate model of WOBs that could have a serious, sustainable and positive impact.

We’ve been researching this issue and interviewing WOBs to find out about the real impact of workers in the boardroom, and the findings make interesting reading for anyone concerned about the voice of working people.

Crucially, WOBs have had an impact on improving terms and conditions for staff, and have been able to ensure decisions are made with worker wellbeing in mind. We've also noted the power of the ‘embarrassment factor’, where other board members are forced to argue the case for higher pay packages for executives with employees in the room - in one workplace annual bonuses for the boss have been restrained every year that the WOB we spoke to was on the board. Not only this, but WOBs feel the relationship between trade unions and management improved, and the union is now kept informed about changes in the workplace, where once they just used to read about these changes in the local paper.

However, the devil is in the detail, and introducing WOBs has to be done properly. Trade union involvement is absolutely essential for ensuring that the measure has teeth, and that a trade union member is elected to the position and accountable to other workers. This also means the worker has access to support, advice and training for a role with a lot of responsibility.

There are also very real concerns about conflicts of interest for WOBs. Can a WOB become compromised if they learn about corruption within the company? To address this, whistleblower protections will have to be part of any proposals to introduce WOBs in the UK.

Ultimately, introducing WOBs isn’t a silver bullet for UK corporate governance. It would certainly improve the representation of workers and have an impact on executive pay that’s been spiralling out of control, but we recommend it is introduced as part of a package of wider reforms. 

If the government was serious about tackling inequality at work, restraining out of control bonuses and ensuring workers have a genuine voice, they would be introducing WOBs as a mandatory requirement and they’d be bringing back sectoral collective bargaining.

You can find our report on workers on boards here.