Posts Tagged ‘Worker Directors’

Theresa May Reverses Promise to Put Workers on Company Boards

November 22, 2016

Mike yesterday put up a piece about Theresa May dropping her proposal to put employees on company boards. According to the Guardian yesterday, May said

“While it is important that the voices of workers and consumers should be represented, I can categorically tell you that this is not about mandating works councils, or the direct appointment of workers or trade union representatives on boards,” the prime minister told a packed room in central London.

“Some companies may find that these models work best for them – but there are other routes that use existing board structures, complemented or supplemented by advisory councils or panels, to ensure all those with a stake in the company are properly represented. It will be a question of finding the model that works.”

Mike points out that companies are already required to ‘regard the interests of their employees’, according to Labour’s Companies Act of 2006. This, however, doesn’t work, as corporate greed always drowns out the workers’ good sense.

Mike makes the point that her promise back in July to put workers on company boards now seems just a flat-out lie, made to maker her look electable. She never intended to publish plans for it by the end of this year. It shows she cares far less about workers and consumers than she does about the bosses.

Yet another U-turn from Tory Theresa, so now firms won’t have to have workers on their boards

This has all happened before. I can remember back in the 1990s there were similar discussions about work councils being mooted in parts of the press. The Financial Times did a piece on the issue, which reported that about 200 British firms had works councils. Then they asked the Tories about their perspective on them. They got a bland statement that said that they had no objections, but didn’t want to make them compulsory.

Which is pretty much what Theresa May has said here.

In fact, there was never much chance of May actually wanting to put workers on company boards. The Tory party, as I’ve said before, sees itself as the party of business, and as a rule, business hates the idea of worker directors with a passion. In the 1970s there were a couple of experiments with placing the workers in the boardrooms of state industries. One was in the Post Office, the other was in BAe. Both of those experiments were discontinued. In both cases there was considerable resentment of workers involved in management decisions by upper and middle management, although I think this lessened at one level in the case of the Post Office. One business leader, when he was asked for his view of the issue, stated baldly that they tried to do it to his firm, he would move the decisions away from the boardroom. And this is, in fact, one of the problems facing worker-directors. Companies can circumvent the issue of giving power to their workers by making sure that effective decision-making is moved away from their boards.

From a left-wing perspective, there are problems with putting workers in the boardroom. Companies can alter their power structure, so that real decision-making is kept out of their hands. There is also the problem that workers placed there may also become isolated from their fellow employees, and side with management rather than the workforce. Tony Crosland, the founder of the Social Democrat section of the Labour party, believed the difficulties were so great, that he opposed worker-managers, arguing that effective trade unions were a far better way of implementing industrial democracy. He noted that through their very powerful unions, American workers had a very large part in the practical management of their companies, although industrial democracy was never mentioned.

This, however, has all gone, gutted through nearly four decades of Thatcherism, Reaganomics and neoliberal economics. Thatcher and Reagan deliberately gutted the trade unions in order to expand the power of management, and their successors on the nominal left, the Clintons, Obama, Blair and Broon, continued their assault on the unions and workers’ rights. There was never any chance of May seriously putting workers back in the boardroom. It was simply a lie to prop up the façade of ‘caring Conservatism’, as Mike has pointed out.

We desperately need working people to get back their rights at work, and to obtain more power within their companies, both through formal industrial democracy and strong unions, if we are to save people from poor wages, zero hours contracts and poor working conditions. The Tories and Blairites in Labour will fight tooth and nail against this. But in the case of the Tories this week, May’s decision has shown that they cannot be trusted on this issue, just as they can’t be trusted on any other.

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The Bullock Report’s Recommendations on Worker Directors

September 21, 2016

The Bullock Committee was set up in 1975 to consider ways of introducing industrial democracy in Britain. One of the key players in this was Jack Jones, then the general secretary of the TUC, who persuaded his senior colleagues of its advantages and that having workers’ representatives in the boardroom would be beneficial. The report proposed the following measures:

1. Workers should have the right to elect directors onto the boards of companies with 2,000 or more employees.

2. These directors should be elected onto a single tier Main Board, not onto the upper level of a two-tier structure as in West Germany.

3. The number of worker directors should equal the number elected by the shareholders.

4. These two groups should agree on a smaller, third group of independents (the 2x + y formula)

5. Boards should be obliged by law to take account of workers’ as well as shareholders’ interests.

6. Worker directors should normally be trade unionists and be elected only by trade unionists.

7. The right to elect worker directors should apply in all companies with 2,000 or more employees, and should be triggered by workers’ request.

From John Kelly, Trade Unions and Socialist Politics (London: Verso 1987) 209.

This would have been the most radical proposal for worker’s control in Europe. It was too much at the time, and the number of worker directors were cut down in further amendments to a third, and then further forms watered it down still further until it was finally abandoned. The Labour party at the time had a majority of only five, and didn’t want the bother of fighting the Tories on the issue, and there was unfortunately little support for the proposals from the unions.

If it had gone through, it would have made British industry the most democratic in Europe, and gone some way to the socialist dream of the workers actually being able to take possession of the means of production, distribution and exchange. Theresa May has recently raised the issue of worker directors, but I doubt she really means it. If she does genuinely have something in mind, it will in no way be anywhere near as radical as that. My guess it’ll be token representation, at the most. Plus there’ll probably be a clause in it saying that you will forfeit some of your other statutory rights as an employee, just like Cameron tried to introduce.

Forget Theresa May. Demand the genuine article.