Friday 6 February 2009

Wildcats and eurocrats

Guest post by David Coats, Work Foundation.

What should we make of the Lindsey strike and the associated wildcat action? Some have suggested that this is a sign of union resurgence, others have pointed to the narrow nationalism behind the dispute and trade unions at European level have begun to make the case for more effective regulation where one group of workers is posted to another country. With so many issues swirling in the mix it is difficult to get a clear line of sight on what really matters and what the implications of the dispute might be.

An obvious point to make is that the workers obviously believed that they had a legitimate grievance. Workers always feel under pressure when unemployment is rising and it is inevitable that skilled workers looking for jobs will resent the fact that they have been denied an opportunity to get work that has been apparently guaranteed to those from elsewhere in the EU.
Of course, understanding is one thing and endorsement of the workers’ tactics quite another. What is most unusual about the dispute is that formal union structures seemed to be almost irrelevant. In that sense the strike looked more French than British – a spontaneous expression of anger rather than a strategic step in a process that would lead to a reasonable compromise. For a time the unions almost looked like bystanders, struggling to understand the ungovernability of their members. They hadn’t endorsed the action, partly because that would have been a clear breach of the law, and they couldn’t therefore control the strike.

Far from being a tribute to the strength of the unions, the Lindsey case is a testament to their weakness. In a more orderly industrial relations environment the unions and employer would have acted much earlier to minimise the workers’ concerns. There might, for example, have been an agreement on the use of contract labour from elsewhere in the EU, clear opportunities for workers in the locality to compete on a level playing field for work or a protocol to ensure that the contracting process was handled with some sensitivity.

What seems clear is that the employer just ploughed on and gave little thought to the consequences. Far from working with the unions, no effort was made to encourage their involvement – or to listen to the anxieties that the unions might have expressed on the workers’ behalf. In this case the employer would have been better served by a robust relationship with strong unions that could have nipped the problem in the bud. After all, difficult trade-offs and compromises can only be secured by people who know what they are doing. Disorganised groups taking wildcat action can do little more than protest. To put the argument more plainly: good employers know that they are best served by strong and responsible unions.
Whatever may have been done differently by the parties in this case, we are still left with the questions about effective minimum standards in a European Union where free movement of labour is a fundamental principle. The argument so far as the posting of workers is concerned boils down to this: there should be a level playing field across the EU. If workers in one member state are posted to work in another member state then they should enjoy the same legal rights and conditions of employment as citizens of the second member state alongside whom they are working.
In theory this principle was given effect in the Posted Workers Directive, but the implementation in the UK only guarantees workers the same minimum legal rights as British citizens – so in the Lindsey case the Italian workers had an absolute guarantee that they would receive the national minimum wage rather than the negotiated rate that might normally apply to this group of workers. Yet this hardly amounts to much of a guarantee and will lead to a legitimate anxieties that free movement is more about undercutting and a race to the bottom than an instrument to secure a higher level of prosperity across Europe.
The risk to the legitimacy of the European project should be clear. Why should European citizens place a high value on the EU if they believe (even if it is not entirely true) that “Europe” is a source of anxiety, insecurity and falling living standards? Jacques Delors understood that the completion of the single market had to be matched by a social action programme, that unleashing creative destruction through market liberalisation demanded a new social contract. This is a principle that EU governments (and especially the UK government) will need to rediscover rapidly if the European project is to be kept on course. So far the European Commission has authorised a study by the social partners of the Posted Workers Directive. This looks a little feeble when judged against the pressures of protection and rising nationalist sentiment. Those of us who consider ourselves committed Europeans and supporters of liberal markets must make the case for a revived social Europe with vigour and determination. If we fail to do so then British (and European) social democracy could find itself in cold storage for another generation.

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