I’ve blogged recently about the system of Socialist Self-Management, which the Communists set up in Yugoslavia under Tito. As well as the management boards in factories and other enterprises, this also set up a system of workers’ councils, which were given powers to supervise and review the decisions of the managerial board. These councils were co-ordinated at a national level through a chamber set up as part of the National Assembly. The first legislation laying the system’s foundations was the Directive on the Establishment and Work of Workers’ Councils of State Economic Enterprises of December 1949.
One of the objectives of the system was to give workers more experience of management, and to train them up to take their places as members of the executive. Article 1 of the Directive stated
Subject to a proper organization and functioning of workers’ councils, workers will be given an opportunity not only to acquire a better insight into the work and problems of the enterprise but also to exert a direct influence on production and the management of the enterprise. Workers will thus gain enormous experience, and every opportunity will be provided for executive cadres of the enterprise to be drawn from the ranks of the workers.
Article 1, paragraph 3 specified the councils’ duties. They were to
– review the proposed business plan of the enterprise, consider the elaboration of the basic plan of the enterprise for the various plants, and of the basic plan for construction of community amenities and give its opinion on them;
– review the house rules of the enterprise and give its criticisms;
– propose proper measures for the improvement of production, rationalization of production, raising of labour productivity, lowering of production costs, improvement of quality, new production developments, savings, and reduction of waste;
– propose measures for a better functioning of the enterprise and for the elimination of technical and administrative defects;
– discuss the work norms of the enterprise and make its recommendations;
– review the deployment of the work force and make its criticisms and recommendations;
– see to the proper training of technical personnel;
– make recommendations for the classification of administrative posts and the internal organization of the enterprise;
– review the draft rules governing work discipline in the enterprise, consider measures designed to prevent infringements of work discipline, absenteeism and arbitrary resignations, and make its recommendations;
– participate in supervising the utilization of public property, consider cases of vandalism, wastefulness and other cases of an irresponsible attitude towards public property, and recommend measures for the prevention, elimination and uncovering of such incidents;
– see to the proper application of occupational safety programmes.
Paragraph 4 stated that ‘The workers’ council has a special duty to do everything in its power to remove difficulties arising in connection with the fulfilment of planned targets and to combat all forms of indifference or hostility as seen in disparagement of our capabilities’.
The councils were to be elected at the beginning of each year by all the workers and office staff. These would be convened by the trade union chapter executive, but non-union members would also be allowed to vote. The work’s director was an ex officio member of the factory council. One elected, the members of the factory council were to elect a president and secretary from their own ranks. Moreover, if the trade union executive considered that the workers’ council or some of its members were not fulfilling their duties correctly, he had the power to call a meeting of all the workers and elect a new council, or replacements for those council members, who weren’t doing their duties properly.
At first the people voting for the council, or placed on it, seem to have been very small. Article II, paragraph 5 states that ‘The membership of the workers’ council should represent between 1 and 5 per cent of the employed workers and office personnel. Article 10 of the Basic Law on the Management of State Economic Enterprises and Higher Economic Associations by Work Collectivities of June 1950 expanded and clarified this. It stated that the workers’ council of an enterprise shall consist of between 15 and 20 members …. In enterprises which have fewer than 30 workers and office personnel, the entre work collectivity shall make up the workers’ council.’
The workers’ councils were to meet once a month to discuss the enterprise’s monthly business. Decisions were to be made by voting with a show of hands. The enterprise’s director had to be abide by their decisions. If he didn’t agree with them, he had to refer them to an administrative-operational officer. The workers’ council similarly had the right to refer the administrative-operational officers decisions to the higher state executives, if they disagreed with them. Under Article 26 of the 1950 Directive, the management board of each enterprise was to be elected by the worker’s council.
This legislation clearly gave the workers a significant degree of power over the operation of their enterprises through their councils, though I don’t know much power they exercised in practice compared to the demands of the state bureaucracy. The two architects of the system, Milovan Djilas and Edvard Kardelj, later fell from power for ‘Anarcho-Syndicalist deviation’. Nevertheless, this legislation does point the way to how a similar system could be set and adopted elsewhere to give their workers a voice in the management of their enterprises. Similar legislation was introduced in Germany in 1952 and 1976. The Financial Times did a feature on factory councils in Britain back in the 1990s. They estimated that there were 200 or so firms in Britain, which had them. A spokesman for the Conservative Party stated in the article that they did not have any objection to them, they just didn’t feel they should be compulsory. My guess is that with the more aggressive attitudes to management introduced by the Tories, there would be considerable opposition within the Tory part to any such system. The similar German system of Industrial Codetermination was attacked, at least partly, by the employers organisations as an attack on property rights. Nevertheless, the Germans considered their own version of workers’ control as leading to social and industrial stability. It says something for practical common sense of modern, democratic Germany that this was achieved through drawing workers into the system and giving them more rights, rather than the complete suppression of workers’ rights by the Tories.
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