According to recent TUC figures, trade unions are signing more new deals
than ever before. Heather Falconer reports on one of the latest partnership
agreements with Littlewoods
Seventy five new agreements were sealed with trade unions between January
and October 1999 – the highest number ever reported in a TUC Trends Survey.
"The old scare stories cut little ice with today’s sensible
employers," says TUC general secretary John Monks, stressing the
partnership approach that has become the unions’ rallying cry.
Among the companies graced by a visit from Monks in recent times is
Merseyside-based leisure and retail group Littlewoods, one of the latest
signatories to this 21st-century ideal of partnership. A massive 80 per cent of
union members gave a three-to-one vote in favour of the new deal with Usdaw and
GMB last October. Its timing could not have been better: the machinery is
swinging into action just as the new collective rights under the Employment
Relations Act 1999 come into force.
But group HR director Juris Grinbergs points out this has not been a case of
jumping before being pushed. "Obviously it is congruent with the
legislative trend," he says. "But the real genesis is the business
change process we started 18 months ago, which identified the need for a more
integrated organisation. It is happenstance that the Government has pushed in
the same direction.
"I am already on record as saying I am nervous of moving away from the
voluntary model. Our structures need to reflect the individual business so
legislation is a blunt tool. But I think we meet both the letter of the
legislation and the spirit of being more open and involving. So far nothing
frightens us – it is in line with our own thinking."
Historically Littlewoods was organised into six divisions, each with its own
culture and systems. Eighteen months ago it decided to integrate these into a
single business in the hope that it would make the company more open and
responsive to marketplace trends.
"The key at that stage was that our employee representative
arrangements structure should mirror where the business was going,"
Grinbergs says. "We were engaging in a culture change process to a more
open, single-status, flexible company more inclusive of the chapel of people
working in the business. For the business to be successful it needs its people
on side. We need to be able to engage with the whole of the workforce –
everybody has a contribution and a voice to be heard."
The business partnership board that has resulted perhaps owes more to the
European Works Council model than it does to the traditional collective
bargaining structure with its roots in 1970s industrial relations.
At the top of the structure is the business partnership board, comprising
the chief executive, operations director, Grinbergs himself and four other key
line managers from around the business. From the unions there are three
national officers. There are also 12 elected lay representatives putting
forward the interests of each part of the business. "The board’s
responsibility will be to engage in discussions on business direction and
negotiate on pay and core terms and conditions across the business," says
But the risk is that this body will become too remote from the diverse
businesses, so below it there are five partnership groups for each major
functional area of the business – call centres, high street, head office,
transport and warehousing – "the significant population areas where there
may be specific points of focus that need attention".
"This balances the need for a single company view to ensure consistency
of standards and practice with the need to avoid the bureaucracy that comes
from every decision having to come from the top."
It is a far cry from the previous set-up which saw 19 separate bargaining
groups across six divisions with review dates of 1 January and 1 July. "We
started negotiations in October and ended the following September,"
recalls Grinbergs, "with all the problems that came with negotiations over
time, leapfrogging, comparability claims and the sheer distractions of the
enormous amount of work involved."
Littlewoods has recognised trade unions as far back as anyone can remember.
It has been a sound relationship with no industrial action in living memory,
but it had outlived its era.
"Inevitably, trade union relationships are a product of their
time," says Grinbergs, who cut his industrial relations teeth at Birds Eye
at Kirby. "The last major review was in the late 1970s. Our business model
was moving towards a more inclusive, proactive employee relations environment –
a fundamental reengineering, really. But the strength of these old
relationships was borne out by the quality of the working party that led the
changes to the bargaining structure."
Following that intense period of key organisational change that started in
late 1998, the first informal meeting with unions on the new agreement was held
in February 1999. A blank sheet of paper lay on the table between the two
sides. The first couple of days saw this filled with ground rules on the
operation of the working party, and with "gaining a growing understanding
of the market and the business," says Grinbergs.
"We used that as the model for what was going to work for us. Business
performance was absolutely the first priority. Without that there could be no
job security or profit-sharing. That was an easy sell. The rest came along
logically once we had a clearly articulated vision for how we wanted to do
Consultation, involvement, partnership – the lexicon of modern-day
industrial relations often militates against precise definition. So an early
priority in the negotiations was to establish a common language.
"Partnership itself means involving the broadest population of people in
the earliest stage of decision-making with a common agenda of business success
and equality of voice in the determination of strategy thereafter," says
Grinbergs, as if by rote.
"Involving in this sense means involving people at the glint-of-the-eye
stage of decision-making, saying: we need to respond to the market in this way,
what do we need to do? As traditionally happens, the business decides what it
needs to do, the involvement is about how."
A successful partnership, however, also necessitates steeping employee
representatives in the ways of 21st-century business. The recent election of
the lay representatives was followed by an induction-orientation programme to
bring the representatives up to speed on key strategic and business performance
issues. "We need to give them the background and information to enable
them to play a proactive part," says Grinbergs.
The board’s brief is to take a fundamental look at how Littlewoods rewards,
recognises, communicates and involves all people engaged in the business.
"We will identify the key priorities in terms of conditions, the
commercial structure and so on and work to refine the processes we have in
Grinbergs is confident that the machinery will ultimately drive the process
of constant change that is a fact of life in today’s commercial environment.
"Where things get slowed down is where people are caught by changes they
don’t understand or that they have not been involved in. Through earlier involvement
you get a more holistic approach to all aspects of decision-making and
"This way you have a better chance of it working and speedier action.
There may be more preparation and groundwork but there is also a better
Grinbergs himself appears to feel acutely the burden of creating a genuinely
more inclusive, consultative culture. "We have touched a huge number of
employees and raised their expectations. We cannot afford to let them
Littlewoods business partnership
The five principles of partnership:
– Business success
– Stability and security of employment
– Independent trade union organisation
– Mutual benefits
– New ways of working
The commitment to action
– Resourcing, supporting and encouraging maximum levels of trade union
– Optimising effective decision-making through high-quality communications and
– Installing comprehensive education, training and lifelong learning
opportunities across the partnership
– Delivering a high quality of working life based on principles of equality
– Sustaining and developing the partnership in good faith over time.
Trade union trends
– 75 new deals in the 10 months between January and October 1999 – the
highest number ever reported.
– 136 recognition campaigns reported covering more than 70,000 workers – in 40
per cent of these, membership is more than 50 per cent
– 90 per cent of deals were in the private sector, 85 per cent were for pay and
other terms and conditions
– 48 per cent followed a specific recruitment campaign
– 40 per cent of respondents said impending union recognition rights had been
influential in securing new deals
– 60 per cent said new rights had changed the way they campaigned
– Source: Focus on recognition, TUC Trade Union Trends Survey, January 2000