Industrial relations: a winter of discontent?

If Derek Simpson is to be taken at his word, it would seem employers should be preparing for a winter of industrial action.


In an interview with Personnel Today at last month’s TUC conference in Brighton, the joint general-secretary of Unite – the UK’s biggest trade union – warned that current disputes over pay are set to snowball.


“Employers and employees are under pressure, and that is going to push people into conflict.


“HR is in the front-line, and it will get more fractious. We are not seeking conflict, but it is coming to us because of policies outside our control,” Simpson said.


And according to research released by the Chartered Institute of Personnel and Development in the same week, many employers are already bracing themselves for strikes over the next 12 months.


The survey of more than 850 employers found that one-quarter of unionised organisations have been affected by strike action in the last year, and almost one in three believes they may experience strike action by some workers in the next 12 months.


Dark old days


So does all this uncertainty mean that we’re heading back to the dark days of the late 1970s – the so-called ‘Winter of Discontent’, where disagreements over pay led to widespread strikes, frequent electricity cuts and rubbish bags piled up on streets throughout the country?


There are, unfortunately, some striking similarities. Then, as now, it was a Labour government in charge, trying to keep pay rises under a given limit in an attempt to keep inflation in check. In 1978-79, James Callaghan’s government tried to enforce a 5% pay award ceiling, while this year Gordon Brown’s government has worked to cap public sector pay rises around the 2% mark. Whereas today Labour is behind in the polls to David Cameron’s resurgent Conservative Party, then Margaret Thatcher was waiting in the wings to claim victory at the 1979 general election.


Less members


But, says Andy Cook, managing director at employee relations consultancy Marshall James, there is one key difference between now and 1979, which makes a repeat on that scale unlikely – that is the number of workers who are union members. Thirty years ago, the total hovered around the 13 million mark. Today, union membership is around half that figure with only 25% of the workforce signed up.


There has, however, been a spike in industrial activity of late, with Cook claiming the past year has been the first time since the Thatcher era that a million working days have been lost to union activity.


He says: “There are pockets of militancy within the current leadership of the union movement, especially in the public sector, where government pay policy is having an effect.


“There have been attempts from unions such as the Public and Commercial Services Union (PCS) to join unions together in protest but we haven’t seen too much of this co-ordination and the TUC hasn’t been interested in orchestrating it.”


Private disagreements


PCS, the Civil Service union, is currently balloting its 300,000 members for industrial action over pay, as is the National Union of Teachers (NUT). But not all union-backed disputes are limited to the public sector.


According to Ed Sweeney, chairman of Acas, the government-back conciliation and arbitration service has presided over approximately 900 large-scale collective disputes in the past year – the majority from the private sector.


Notable cases include the dispute at the Grangemouth oil refinery in July over proposed changes to the company’s pension scheme, and the threats of industrial action over pay by airport baggage handlers at Stansted, Gatwick and Manchester in August.


And while the majority of these disputes where Acas has been involved have been over pay and terms and conditions, a sizeable number have also concerned redundancies (53) and changing work conditions (74). Around 20% have been about union recognition.


But where pay is the main issue, Sweeney says there are often usually deeper-lying causes. “Often disputes about pay are symptomatic of other issues, such as frustrations about not being treated fairly or a lack of recognition.”


Pay dispute


These issues, however, seem to be very much in the background in the current dispute between local government employers and the GMB, Unite and Unison unions over the current 2.45% pay award being offered to workers in local authorities, which Acas is expected to arbitrate in the run-up to Christmas.


Following strikes in July and with inflation on the up, Unison’s head of local government, Heather Wakefield, says the union has been “extremely disappointed” at employers’ refusal to make a fair pay offer, and has been left with little choice but arbitration.


“With the cost of everyday essentials rising by the day, our members cannot afford to take another pay cut,” she added.


Overshadowing


However, the financial and economic crisis has the potential to overshadow the current dissatisfaction over pay in the public sector, according to Gill Hibberd, director of people and policy at Buckinghamshire County Council and vice-president at the Public Sector People Managers’ Association (PPMA).


She says: “The heat is being taken out of the situation by the economic conditions. All the evidence shows that in times of a downturn, industrial relations become more stable.


“The strike action in July was far from convincing, especially in the South, and over the coming months if the situation doesn’t stabilise the unions will have to be more focused on saving jobs.”


This argument is picked up by Jim Savege, HR director at Cumbria County Council and the PPMA lead on pay, who says there is a danger that if unions push too hard for pay increases, local authorities will have to find the money by cutting services or jobs.


He points to the recent announcement from Oldham Council, in greater Manchester, where up to 850 workers face losing their jobs as the authority tries to tackle a budget deficit of more than £17m.


Savege has championed the use of total reward statements for public sector employees in a bid to help them appreciate the perks of working in the sector and boost the value they put on pensions and holiday entitlements, which generally compete well with what is offered by private companies.


Broader picture


“The pay awards being offered to local government workers are around the level of many in the private sector, where some employees haven’t even been given a pay increase this year.


“The unions need to understand the broader picture and help find a resolution that will ensure services are maintained,” Savege adds.


But, at the NUT, which this April held its first national strike in 21 years, assistant secretary John Dixon counters with a position currently held by many unions representing public sector employees, such as nurses, local government workers and teachers.


He says: “You still need fairness in good times and bad times, and we don’t believe it’s helpful to drive down salaries and the standard of living of public sector workers.


“The danger is that if pay levels drop, you won’t be able to attract talented staff in key areas. Teachers perform a vital role and if standards slip the problem could take years to address. It’s something the country can’t afford to ignore.”

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