Unions and Globalisation

Governments, Management, and the State at Work

Peter Fairbrother, John O'Brien, Anne Junor, Michael O'Donnell, Glynne Williams

• Publisher: Taylor & Francis
• Year: 2011
• Print ISBN: 9781138960633
• eBook ISBN: 9781136708190
• Edition: 1
• Topic: Economics
• Subtopic: Business General
• Index: Economics

In recent decades, trade unions have suffered major reversals and experienced declining memberships. Transnational corporations and state-owned multi-nationals have increasingly implemented deteriorating terms and conditions of employment, with vulnerable and insecure job contracts.

In this context, there has been a wide-ranging debate about the form of trade unionism, the bases for collective organization and struggle and the future of trade unionism. This book addresses these questions both theoretically, in relation to debates, as well as substantively via a series of selected studies. It is a must read for all those studying industrial relations, human resource management, the sociology of work and employment, economic sociology, economic and labor geography and business studies in general.

1State Restructuring in Two States

This book is a study of the modern liberal democratic state. The focus is on the Australian federal state and the unitary state of the United Kingdom (although also a partially devolved state). These two states, bound together by a colonial past, a financially-linked present and a shared political practice, often look to each other for examplars as well as for contrasts. Although governments in each country did not explicitly model these developments on each other, they occasionally cross-referenced to the other country. Over the last three decades, these two states reshaped and refocused their core administrative sectors. More notably, these changes to the administrative functions of the state have impacted upon workplace relations, labour organisation and state management. Public service roles have been redefined and reorganised, and in both countries there has been a process of institutional fragmentation and the promotion of individuated state labour markets. State sector employees and trade unions experienced and responded to structural changes in each state.

Both states followed different paths to similar destinations, adapting neo-liberal reform programmes, legitimated by invocations of the imperatives of globalisation. From the early 1980s, the administrative apparatus of the United Kingdom, the civil service, was restructured, initially by Conservative governments with the broad contours of this process continued by Labour governments. In Australia, public sector ‘reform’ was promoted initially by Labor governments and intensified by conservative Coalitions. In each state, governments of both political complexions sought to create managerial state structures, predicated on either the incorporation or marginalisation of organised state labour. Conservative governments actively sidelined public sector unions. In Australia, Labor governments initially incorporated unions into the restructuring processes; in the United Kingdom, as part of a so-called ‘New’ Labour approach to governance. In the case of the state sector, the government moved from attempts at partnership with civil and public service unions to efforts to marginalise them. In both states, trade unions developed into active opponents of managerial policies.

Our purpose is to outline and evaluate these processes, in particular examining the intersection between managerial initiatives and the ways in which public sector union leaders and activists in each country addressed the changed work and employment situations of their members. These responses were coloured by unions’ shifting capacities for action in restructured state formations, labour relations systems and labour markets. In particular, we seek to clarify the implications for unions of the apparent similarities between the restructuring approaches of the United Kingdom and Australian governments, and their impact on labour relations in both countries. There is, however, a puzzle in these processes. In each country, the election of assertive conservative governments and mildly social democratic governments were the reverse reflections of each other. The question is whether the parallels in process and outcome can be explained by business cycle phases, the overarching imperatives of globalisation, or the ideological triumph of neo-liberalism in these two English-speaking states? By focusing on the complex history and developing relationships between state managerialism and state trade unionism, we address key aspects of the research question, and in particular the pervasiveness of neo-liberal ideas in this process.

In the context of neo-liberal reform of the state, governments attempted to secure reform either through accommodations with or marginalisation of, state-based trade unions. In turn state sector trade unions, in articulating the interests of state workers, attempted to utilise their capacities to address such policies. Yet throughout this period of state reform, unions faced severe challenges, suggesting that they no longer had their former salience (Fairbrother and Yates, 2003). It has also been suggested that state sector unions may have been in a position to take the opportunities signified by state restructuring to more than just ‘make do’ and reposition themselves to question the detail and direction of these changes (Fairbrother, 1994; Danford et al., 2003). So the central question that we seek to address is, to what extent were state sector unions able to mitigate the effects of ‘reform’ or even influence its direction?

The focus of public service reform and the reconstitution of managerial structures present a challenge to employees and their unions. Civil and public service unions in both countries developed in the context of standardised employment and industrial arrangements, largely characterised by national level pay bargaining in the United Kingdom, and service-wide arrangements in Australia, mediated by compulsory conciliation and arbitration. Unions had to adapt to a fragmentation of both organisational and industrial relations structures.

In terms of the political climate for unionism, the restructuring of civil service work in the United Kingdom took place amidst a comprehensive assault on trade union power by Conservative governments in the 1980s. Public service reforms were a reflection of a wider exclusion of unions and a radical recasting of labour market regulation. In Australia, however, the first phase of comprehensive public service reform occurred within a context of limited experiments in industrial democracy and subsequently the managed decentralisation of the industrial relations system; predicated on unions co-operating with work reorganisation in exchange for wage increases. Thus, on the surface, the system in Australia was apparently more benign for unions, whereas in the United Kingdom unions were effectively marginalised. Nonetheless, and perhaps paradoxically, such developments presented both opportunities and pitfalls for the wider union movement's participation in economic and industrial relations restructuring.

From the second half of the 1990s, there was a reversal of the political climate in each country. Based on the institutional and industrial frameworks already laid down, what were the continuities and discontinuities between the major political parties in the United Kingdom under the Conservatives and most recently New Labour (from 1997–2009)? Did the Labor governments in the 1980s and 1990s in Australia commence the trends that escalated under the neo-conservative Liberal-National coalitions of the 1990s and 2000s, and to what extent has the re-elected Labor government of the late 2000s met the aspirations of those public sector workers who helped elect it on the promise of restored workplace rights?

These paradoxical trajectories focus the book. They serve to shape and refine the core questions that are addressed. Our aim is to explain how similar outcomes were apparent in each country, despite the distinctiveness of each state. First, however, we provide an overview of the argument that informs the book.

THE ARGUMENT

Whilst accepting the instability of capital accumulation since the 1970s, as evidenced in the financial crises of 1987, 1997 and 2007, our starting point is the neo-liberal offensive it helped generate. Neo-liberalism is an ideology where the core components comprise: (a) a rejection of the mixed economy and the promotion of capitalism (business, trade and competition); (b) the institutional encouragement of a marketised and international set of economic and financial relations; and (b) the reshaping of state policies and practices towards this end (Daniels and McIlroy, 2009: 4; see also Tickell and Peck, 2003). Central to this agenda is the restructuring and reorganisation of the state apparatus, not only to reflect a market and trade based economy, but also to become the model for recasting employment and industrial relations in an individualised and restricted way.

This agenda gave rise to the reshaping of public sector organisations based on market models, reinforced by attempts to enhance labour market flexibility by de-collectivising industrial relations systems. There was a restructuring of public sector organisations into agencies or cost centres, coordinated through new mechanisms of managerial control. Yet this process was not achieved in either country according to top-down blueprints: its implementation was varied and incompletely accomplished. The picture that emerges is complex and contradictory. On one side, governments are defining and embracing a neo-liberal agenda, with implications for managers, management and managerialism (McIlroy, 2009a and 2009b). The other side of this process is worker organisation and action. The means of resistance and compliance was largely via workers’ collective efforts, through union based negotiation, to influence the direction of change, as well as more ad hoc forms of resistance to its impacts (cf. Daniels and McIlroy, 2009). Unions in turn recast themselves, developing new ways of supporting workplace activity.

During the 1980s and 1990s, each state articulated distinct approaches in terms of policy formulation and institutional reform of their public services; they each promoted a managerial reform of their public and civil services. In pursuit of a neo-liberal agenda, social democratic governments in both Australia (1983–96; 2007–9) and the United Kingdom (1997–2009) formulated approaches that promoted an internationalisation of the domestic economy and reconfigured the domestic state apparatus, accompanied by partnership arrangements with trade unions; more thoroughgoing in Australia than the United Kingdom. Mirroring this policy approach, Conservative governments in the United Kingdom (1979–97) and Australia (1996–7) sought to marginalise trade unions as a condition for achieving this neo-liberal agenda. The two states developed these policies in line with the political configurations that distinguish both of them as liberal democratic states. Industrial relations in Australia are defined in part by the juridical-based approach that continued to prevail both as a goal of the policy process and as a mechanism for reform. In the United Kingdom, the state-specific bargaining arrangements are located within a more voluntaristic tradition and this has had the consequence that governments were better positioned in the attempt, more top-down and less constrained processes of institutional reform.

It is important, however, not to overstate the specificity of particular arrangements. Rather, it is necessary to locate the ways in which governments in distinct contexts may pursue the same broad objectives. During the 1970s, liberal democratic states, particularly in the Anglo-US orbit, faced problems relating to public expenditure and in these circumstances, governments of different persuasions began to consider neo-liberal policies. While the governments were different, the overall concerns appeared to be the same: namely how to recast the central administrative arrangements in each country to achieve a closer alignment between service provision and the national economies to achieve increased financial savings and enhance productivity. No longer were governments seeking to make judgements on services primarily on the basis of collective value.

Within the rhetorical framework of ‘modernisation’ and ‘reform’ and the increasingly perceived demands of ‘globalisation’, governments of various persuasions sought to redraw the boundaries of the state, via privatisation, contracting-out and outsourcing and as well as recasting managerial hierarchies, under the rubric of ‘New Public Management’ (NPM). Operational relations were redefined with the emergence of a more explicit managerial stratum and a more ‘managed’ workforce. This pattern of reorganisation played out differently in each country, depending on both the government in office and the overall structure of the state. Nonetheless, in each case, the aim was to secure more ‘accountable’ and thus more flexible state workforces.

Paradoxically, part of the explanation for the apparent similarity of outcome between the two states, is found in the different relationships that governments promoted with trade unions. These ‘reforms’ were predicated on two contrary processes impacting upon unions. On the one hand, the Australian model was predicated initially on incorporation, with unions conceived as (unequal) partners in the processes of restructuring. One outcome was the promotion of more vibrant forms of workplace representation in some of the major departments, such as social security and taxation (on the taxation unions, see Mathews, 1989), although these experiments were aberrant and short-lived. On the other hand, the United Kingdom model was predicated on the marginalisation of unions. In Australia, the period after 1996 was characterised by a more systematic marginalising approach by government.

Whilst this account gives weight to the importance of institutional arrangements in different societies and traditions (Hall and Soskice, 2001), by the end of the period under consideration, institutional and political differences appeared to be less important than a convergence towards union marginalisation. On the one hand, while Australia and the United Kingdom were both liberal market economies (where economic actors are coordinated via market institutions), institutional differences and historical practices weighed heavily on the detail of the relations between the state as employer in each country. On the question of state restructuring, and the relationship between state managers and unions, there was distinctiveness, particularly during the 1980s. On the other hand, over time, approaches coalesced around a common concern, irrespective of government in office, to restrict and focus the relationship between state managers, public employees and trade unions. In yet another twist it was precisely these marginalising tendencies that would appear to have provided the impetus for union renewal and revitalisation.

Unions in the state sector were transformed over the last thirty years. Up until the 1970s, these types of unions were centrally organised, accommodative and relatively quiescent. In the period that followed, these unions not only faced a process of restructuring, with its increased emphasis on managerial prerogative and discretion, they also sought to re-lay the foundations for collective organisation and operation. Such moves were contested and were often implemented in ad hoc ways; nonetheless, they were part of a process of union renewal, whereby these unions addressed their forms of organisation and attempted to promote and extend their capacities as collective bodies (Lévesque and Murray, 2002; see also Simms and Wills, 2004). However, while analyses are clear that unions organise and operate in relation to state policy and practice, class relations and labour markets (Kelly, 1998; Hyman, 2001), the processes, tension and contradictions involved in renewal are less so.

While these processes were at play in both states for much of the last thirty years, the latest financial crisis raises a conundrum about the future. Whilst it is likely that the major neo-liberal governments – the United States and the United Kingdom – and governments embracing neo-liberal economics – China and India – will rebuild financial arrangements and market practices, and attempt to rebuild threatened production and trade relations, the challenge for workers and their unions remains. In both Australia and the United Kingdom, these developments throw the relations of government with their core administrative services into sharp relief.

Clearly, the global financial crisis raises difficult and puzzling questions for public service workers, their unions and governments. Both governments have displayed a willingness to advocate direct forms of state intervention, more evident in the United Kingdom than in Australia, especially with a return to more active forms of financial regulation and control. However, it is likely that in both states the public and civil services will become both part of the means to implement interventionist policies but also an object for achieving financial stringency. It remains to be seen whether this recent bout of state intervention is merely temporary until the next crisis or a prelude to more sustained measures over time. More specifically, it is not clear what all this means for state workers and their unions, especially where they are the focus of restrictive wages policies. It is nonetheless, possible that these events could presage a process of union renewal as unions seek to address the specificities of the challenges heralded by this global financial upheaval.

APPROACH

In constructing this analysis, we take a longitudinal approach to the restructuring of public sector work from the late 1970s, when the legitimacy of both the post-war market/welfare state compromise and the twentieth century bureaucratic state came under challenge. Concentrating our focus on the civil and public service in each country, we explore ways in which a succession of structural changes to the state resulted in a recasting of relationships among state managers, public employees and state trade unions. The focus is comparative: to identify the processes at work in two historically-related states, the United Kingdom and Australia. The purpose is to identify how similar outcomes emerged in each country, despite the distinctive trajectories of change, in both form and process.

To provide the comparative foundation for the study, a matched study, we examine two major welfare to work (‘workfare’) institutions, Centrelink (Australia) and its predecessors and Jobcentre Plus (United Kingdom) and its predecessors. These two state sponsored bodies provide welfare and other services that constitute basic economic and social conditions. Whilst there is variation in provision of these services between the two countries, there is also sufficient commonality to justify a close examination of the way that management and workers have contributed to the shaping of these institutions over the last thirty years. Nonetheless, we also look further afield and refer to other institutional arrangements that make up each state, to throw light on the core focus of the study.

Whilst this comprehensive longitudinal database informs the analysis for each country, we have been rather sparing in our use of case study evidence, selecting just sufficient to carry forward the argument, and returning to the same agencies (such as Centrelink and Jobcentre Plus and their antecedents) at different periods in successive chapters. Whilst also relying on wider evidence, we draw quite heavily on these matched agencies: each represented about 20 per cent of their respective countries’ civil service workforces, and contained a wider than average grade distribution of employees. We have restricted the analysis to the core public service, and to the unions covering administrative officers – the Public and Commercial Services Union (PCS) in the United Kingdom and the Community and Public Sector Union (CPSU) in Australia.

The data are drawn from research over a thirty-year period. This material includes interviews with civil and public service managers including departmental heads, senior executives, middle managers and team leaders, as well as with administrative officers and front-line staff. It also includes interviews with national union leaders in each country, as well as regional and local union leaders and activists. Whilst only sixty interviewees are cited directly in the text, more than 120 in-depth interviews have been conducted in each country, and these have a background influence on the narrative. At different times over the last thirty years, all of us have been involved in briefing sessions and educational activity with civil and public service managers, employees and trade unionists. These experiences also inform our analysis. Similarly, our analysis was shaped by in-depth coding of archival sources. The Centrelink internal minutes are a case in point, although they are only cited directly several times. We also draw upon secondary literature on changes in public management, neo-liberalism, globalisation and trade union renewal and revitalisation, as well as on previous published and unpublished work by the five authors.

STRUCTURE

The organisation of the chapters is primarily thematic, being chron...

Table of contents

• Front Cover
• Half Title
• Title Page
• Copyright
• Contents
• List of Tables and Figures
• List of Abbreviations
• Preface
• Acknowledgments
• 1 State Restructuring in Two States
• 2 A Conceptual Analysis: Changing State Management and Trade Unions
• 3 Pathways to Change: The Restructuring of the Administrative State
• 4 Trade Unions Addressing Change
• 5 Remoulding the State Labour Process
• 6 The State, Depoliticisation and Unions
• 7 Public Sector Unions: Contesting Individualisation, Defending
• 8 A Way Forward?
• Bibliography
• Index