WFTU has prepared and published an Information Document on collective bargaining. The document is very comprehensive so far as the practical and tactical aspects of the subject is concerned. Moreover the method applied in preparing the document was really collective in the sense that an elaborate questionnaire was prepared and circulated to many trade unions and response received was substantial. I do not propose to revisit the areas covered by the document. In other words I shall confine myself on certain ideological, political and conceptual aspects of the subject.
Day to Day Struggle is Part of Class Struggle
WFTU is a strong believer of class struggle. Collective bargaining and for that matter day to day struggles on economic issues is certainly integral part of class struggle. To put it differently collective bargaining must not be viewed as a mere exercise for achievement of economic benefits in isolation from the perspective of class struggle. Collective bargaining must be understood as a measure of Relief to economic exploitation and Fillip to emancipation from capitalist class exploitation through class struggle.
It is necessary to have clear, correct and conscious understanding about trade union struggle on current economic issues linked with the ultimate aim of total emancipation of working class by building Socialist State. Two types of misconceptions arise. One is that trade unions are excessively engaged with economic demands. The other argument is that trade unions should shun so called economism and pursue protracted struggles for changing the socio-economic policies and the system. None of these arguments are tenable since they tend to draw a Chinese wall between struggles on economic issues and struggles for changing policies.
Arguing in favour of conducting struggles for higher wages and better service conditions and denouncing abandonment of struggles on economic issues Marx said: “By cowardly giving way in their everyday conflict with capital, they (working class) would certainly disqualify themselves for initiating any larger movement“. The trade unions in their day-today struggles, Marx noted, are fighting to secure better terms on which the physical or mental labour power of the worker and the employee are sold to the employer. In the bargain, the employer tries to pay the lowest minimum to the employee but the later tries to get the highest possible. The bargain that follows is finally settled on such terms as are mutually acceptable. It is this that forms the basis of collective bargaining between the employers on the one hand and the workers and the employers on the other hand.
The trade unions and other fighting organizations of the working people should, according to Marx, integrate their struggle for better terms on which the labour power is to be sold to the employer and struggle for the elimination of the system of wage slavery in which the owner of labour power is forced to sell his or her labour power to make a living.
Cautioning the working class against the danger of fighting only the effect and not the cause, it has been noted, “At the same time and quite apart from the general servitude involved in the wages system, the working class ought not to exaggerate to them the ultimate working of these every day struggles. They ought not to forget that they are fighting with effects, but not with the cause of those effects; that they are retarding the downward movement, but not changing its direction; that they are applying palliatives, not curing the malady.” (Communist Manifesto)
Legendry communist leader of India Comrade EMS Namboodiripad in his book “Collective Bargaining in the Struggle for Peoples Democracy” has said “The trade unions and other class-mass organizations are the primary weapons of class struggle. They however are not the only weapons of class struggle, which, in fact, has three faces – economic, political and theoretical.”
EMS continued to say, “The basis is the economic struggle which is the initial form in which the class finds its feet. Together with the fighting mass organizations of other sections of the toiling people, the trade unions fight the day-to-day economic battle, to which however are added two other forms – political and theoretical. Only by mastering all the three forms of class struggle can the working class lead other sections of the toiling people in the struggle against class oppression, defeating capitalism and its allies.”
As we differentiate between struggle to realise immediate relief and fight for ultimate emancipation, there is need to differentiate between elementary trade union Consciousness and Socialist Class Consciousness. Simply understanding the antagonism with the employers and willingness to fight for merely economic gains is not socialist class-consciousness. Socialist class consciousness means when the worker realize that along-with fighting the employers it has also to fight against capitalist state powers for establishment of Socialist State. It is this class consciousness that progressive and militant trade union movement has to gradually create in the course of the trade union struggles.
The Human Factor
The understanding of trade union movement regarding social dialogue has been put in thus: “Freedom of Association and the Right to Collective Bargaining are the bedrock on which social dialogue is built …Collective bargaining is the highest form of social dialogue”.
While engaging with the management in the process of collective bargaining the trade union movement must demonstrate the confidence in the process of dialogue that labour is supreme in production process, the difference between man and machine and for that matter the superiority of labour must be duly valued.
The interest of all other factors of production except labour can be regulated by managerial capabilities and technological level. But for human factor, the matter is something more than mere regulation or ensuring of proper combination of factors. And how, while pursuing surge in productivity, the industry will take care of the human factor involved in it, essentially determines how the human elements in the production process would respond as a collective forces to such process. The role of trade union particularly at the micro-level becomes mere reflection of such response.
Pointing out the necessity of difference in approach in dealing with men and machine Joseph Stiglitz, former Chief Economist of World Bank noted, “The work environment is of no concern for steel; we do not care about steel’s well being. Steel does not have to be motivated to work as an input”. Enhancing the contribution of working women and men to productivity growth is an integral part of all development processes and goes hand in hand with measures to enable workers to organize and express their views in a manner that also provides employers with a mechanism of dialogue and negotiations. Further, collective bargaining and the wider process of social dialogue improve the availability of information to workers and employers. (ILO Report 2004)
Labour being an essential and also a living input of production, the dialogue between labor and management is an organic part of the industrial operation process. The question is one of reorienting such social dialogue towards a regular process with required enhancement addressing the need of the hour.
In this connection, it is extremely significant to appreciate the reality that with the emergence of sophisticated technology based production system the workers are required to perform complex jobs, which require more skill and multi skill, more commitment and more sense of responsibility. This is distinctly a total departure from old imperatives when the workers had to only obey the orders mechanically. Management experts started to realize that, “How labor performs and not just how much he is paid has become the critical issue. This is true specially of modern high-tech industrial operations … To compete effectively firms need committed labor and not just cheap labor.” The imperative of enhanced social dialogue must be comprehended in the above context.
One of the most important pre-requisites for effective work place social dialogue is democratization of work place coupled with a modern and progressive management. It must articulate the art of involving everyone in the system – not only the workers, but also all level managers in a multi-tier management system in devising and carrying out a plan or strategy. This requires management to move above the influence of feudalistic approach dealing everything in terms of master-slave relationship. It has been noted that, “to change technology but not the operational climate is to invest in modern machines yielding higher production without investing on up-gradation of the skill of the operators, and the skill of the managers to tackle a modern industry.”
Now it is very important to note that democratic environment in the work place cannot be realized unless there is a democratic polity in the given country. The role of working class in struggles for promoting and protecting the democratic polity of the given country needs to be understood in this context. Thus it has been aptly noted that, “Social dialogue will thrive where there is democracy, good governance and political will. Solidarity and fair redistribution of wealth are essential. Tripartite structures at national level need to be strengthened and their decisions should be binding.” (Geneva Conclusions 2005).
Social Dialogue Defined
The conclusion of the International Workers’ Symposium titled ‘The Role of Trade Unions in the Global Economy and the Fight against Poverty, Geneva, 17-21 October 2005 has noted that Social dialogue cannot exist without respect for freedom of association and without independent trade unions … Social dialogue is both a means and a process to reach solutions to conflicts and problems in the world of work. The four basic conditions put forward for successful social dialogue can be summarized as follows:
Firstly, workers should enjoy the full right of Freedom of Association
Secondly, there should be strong and truly representative workers’ organizations
Thirdly, the rights and responsibilities of workers should be recognized;
Fourthly, mechanisms for negotiations and grievance procedure should be clearly set in place.
Impact of Scientific and Technological Revolution (STR)
In the current context of STR, trade union movement must understand that social soical dialogue or that must be understood in much wider connotation than its mere literal and traditional sense. The need for enhanced social dialogue or for that matter effective and meaningful collective bargaining model must be understood closely linking with the present era marked with the advancement of technology and its impact on the process and practice of production and industrial relations.
In the present global economic environment, the necessity for enhanced interaction between the trade unions and management to reach the further and finer details of the production and enterprise management cannot be dealt with only by traditional collective bargaining mechanism at enterprise or industry level. It must be expanded to much wider horizen, particularly keeping in mind the operational net work of MNCs spreading over different continents. Major technological and commercial changes are altering the pattern of employment and the nature of work worldwide. The structure and membership of employers’ and workers’ organizations reflect these patterns and change with them, albeit more slowly. Concrete evidence is emerging confirming that freedom of association and the right to collective bargaining can contribute to improving efficient industrial operations.
In conclusion, to leave no scope for any misinterpretation, we may reiterate that, “people are different from other factors of production and freely formed associations of workers … are vital to the efficient and equitable functioning of labour markets. As asserted in the ILO Constitution, labour is not a commodity and people have the right to be treated with respect. People are guided by their aspirations, personal qualities, motivation, family and financial circumstances and health, as well as desire to see themselves in relation to, and in association with, other people. (ILO 2004). These are very vital parameters based on which social dialogue needs to be conducted.
New Offensive Against Collective Bargaining
The employers have launched new offensive against collective bargaining (wage negotiations) with the motive to pass on the burdens of capitalist economic crisis on the shoulders of the workers. They have come out with anti-labour interpretation of pay. The paper titled “Performance-related and skill based pay”, written by the then Deputy Director, Bureau for Employers’ Activities, ILO, Geneva noted: “We now pay workers not for output produced, nor even for labour input provided, but simply for time spent on the job”.
The achievements of working class movement in successfully implementing the factors or criteria like cost of living job evaluation, service seniority coupled with bargaining capacity of the trade unions as the guiding principles for the purpose for wage revision are sought to be negated and replaced with “Performance as the major or for that matter the sole criteria. Thus observed “many employers are now seeking to sustain their competitiveness through pay increases which are more related to performance as a way of absorbing increased labour costs” (ibid)
Employers are no longer content in treating pay as cost or remuneration for the labour. Now they are conceptualizing pay as ‘tool’ for exploiting the workers for extracting more and more profit under the guise of ‘performance-based pay.
The performance-related, ‘flexible’ pay system is imposed on the workers by the employers mainly to achieve “automatic pay reduction” in the face of stagnation in market in the era of so called liberalisation and globalisation and indeed stagnation in the world capitalist economy. “In these circumstances a major concern for employers will be to negotiate pay system which:
• achieve a strategic business objective
• are flexible In that their variable component could absorb downturns in business and reduce labour costs
• are capable of reducing the Incidence of redundancies in times of recession
• through the flexible component of pay
• are cable to reward good performance without increasing labour costs” ( ibid. ).
Decentralised wage negotiations are pressed for by the employers with the ill motive to attcck the bargaining capacity of and power to oppose the new offensive by the trade unions. Thus it is noted The movement towards decentralisation of collective bargaining has been the result of the need to address efficiency and performance issues at the enterprise level (ibid).
What is alarming is that the employers are not content with enterprise level negotiations only. They are out to do away with the role of trade unions in negotiations and switch over to direct negotiations with individual workers The example of New Zealand has been cited to say: “The fundamental shift of Industrial relations to the enterprise level and the individualisation of the employment relationship. In New Zealand has provided ample scope for performance-related pay. Therefore it is Increasingly recognised that performance and skills criteria need to be injected into pay determination ; that It cannot be achieved through centralised or macro-level pay determination, and that changes have to be negotiated at the enterprise level” (ibid.)
Right to Organise, Right to Collective Bargaining & Right to Strike
Out of the eight ILO Conventions which are referred to as ‘Core Conventions’, one is Convention 87 – Freedom of Association and Protection of Right to Organise and another is Convention 98 – Right to Organise and Collective Bargaining. It may not be exaggeration to say that these two rights are two pillars of trade union movement. And strengthening these two is the third inter connecting pillar – Right to Strike.
Outlining the immense importance of these fundamental Conventions, the Global Report submitted to the 97th session of the ILC by the then Director General of ILO noted: “These enabling rights make it possible to promote and realize decent conditions at work. Strong and independent workers’ …organizations and the effective realization of right to engage in collective bargaining are major tools for engagement between employers’ and workers’ organizations to address economic and social concerns. It can strengthen weak voices and reduce poverty and social disadvantage. The exercise of these rights has a major impact on work and living conditions.”
Although there is no explicit ILO Convention on Right to Strike, there is mention about Right to strike in Convention No.105 (1957) -The Abolition of Forced Labour, prohibiting the use of forced or compulsory labour “as a punishment for having participated in strikes” and Recommendation No. 92. (1951) -Voluntary Conciliation and Arbitration Recommendation, stating that no provision it contains which “may be interpreted in limiting, in any way whatsoever, the right to strike.” Apart from that, there are ILO adopted resolutions and also specific observations of Committee on Freedom of Association (since 1952) and the Committee of Experts on the Application of Conventions and Recommendations (since 1959) established by the ILO Governing Body which have emphasized recognition of the right to strike in member States.
In the context of ILO Convention No 87 and Convention No.98 it is observed that without the right to strike, the right to collective bargaining is bound to lose its effectiveness in achieving decent outcome from collective bargaining. An expert has opined, “The right to strike is the logical corollary of the effective realization of the right to collective bargaining. If it does not exist, bargaining… becomes a dead letter.”
Multinational Companies and Collective Bargaining
The transnational dimension of collective bargaining is becoming increasing phenomenon. There are two significant developments in this regard. The first is the increased cross-border comparison of labour costs, flexibility and performance by multinational enterprises (MNEs) and the exchange of information and coordination of bargaining agendas by trade unions. The determination of labour relations in the era of globalised capitalistic economic order under the grip of giant monopolistic Multinational Corporations (MNC) is no longer limited within the confine of nation states. The then Director of ILO said, “The ever-growing presence of multinational enterprises means that satisfactory results from collective negotiations at the national level are increasingly difficult to obtain. It follows that workers feel themselves to be more and more dependent upon global circumstances beyond their control…”
The other problem trade union movement is confronting in the matter of collective bargaining in the era of imperialist globalization is transnational negotiations between so called Global Uniosn and a multinational enterprise which result in so called “Framework Agreements”. These agreements do not address wages and working time but rather address topics such as corporate social responsibility; the elaboration of key principles underpinning company employment policies; business restructuring; and particular aspects of company policy such as health and safety etc.
Systemic Crisis of Capitalism & Rights of Workers
The period since World War II (better known as Keynesian era) right to collective bargaining on matters of economic and other service conditions witnessed appreciable achievement. As a result of workers struggle, collective bargaining and freedom of association were recognised as basic rights and many countries witnessed institutionalised collective bargaining by framing laws and creating institutions.
However with the introduction of neo-liberal doctrine and the onset of cut throat competitive market driven economic regimes, barbaric attack on the working class have been mounted by the capitalist class under the plea of cost cutting. And with the financial meltdown and aggravating systemic crisis of capitalism manifested in the economies of capitalist countries, all round attack on trade union rights has been intensified ostensibly to pass the burden of the economic crisis on to the shoulders of the working class and in the process right to trade union and right to collective bargaining has become the worst victim.
Casualisation of employment, closure of factories/establishmnents, retrenchment of regular workers, no recruitment of regular workers, huge and horrific contractorisation and simultaneously swelling the rank of unemployed creating huge army of surplus labour are putting the trade union movement in greatly disadvantageous condition in the matter of collective bargaining. Workers are attacked with double-edged sword – no right to negotiate and also no right to agitate. The general trend has been not to raise wage levels, but to introduce cuts.
Casualisation of Employment and Collective Bargaining
Casualization of employment has become the biggest challenge having serious impact on right to association. The situation has been captured thus: “The concentration of power in the hands of employers at the expenses of wage workers (dubbed the `flexibilization of labour’) leads to rigidities in the hierarchy of the corporate managements. Employers unilaterally fix terms for hiring and firing, outsourcing, subcontracting and other means of increasing the rate of exploitation, lowering labour cost and increasing profits for global ventures.” Thus we have situation before us witnessing escalation of labour-capital conflict.
Asia in itself has been a different story with institutionalised collective bargaining only covering a small section of the workers as despite the diversity in the Asian region, very low level of organised workforce has been a persistent constant. They have been facing similar challenges as elsewhere and the existing low membership is further declining. Within the formal or organised sector, the enterprise level bargaining has been the dominant form of collective bargaining rather than sectoral or industry-wide bargaining. On the other hand, majority of the working population in Asia continues to work in the vast informal sector beyond the coverage of state laws, thus excluded from the ‘formal’ and legal mechanisms of collective bargaining.
Declining Trade Union Membership
Trade union membership too has been witnessing fall in many countries of the world. Two vital reasons attributed behind such development by the Director General (DG) of ILO are unemployment and privatization. The DG has noted, “The main cause of decline in the industrialized countries is the fall in employment in heavily unionized industries such as coal, railways, steel, shipbuilding and manufacturing in general. Recruitment in new service sectors and in smaller establishments has not compensated for these falls.
“Public sector unions have suffered less membership loss than those in the private sector. The fall in union membership is much less marked in countries where unions play a prominent role in the social security system.”
From this picture it is reconfirmed that workers in private enterprises are denied right to association and right to collective bargaining. Right to trade union in the private sector enterprises has been in the wane under the current economic and political dispensation particularly in the countries under the grip of International Finance Capital and MNCs.
To Conclude … …
The working class all over the world is confronting all round onslaughts. The real wage is going down, the share of wages in value added to production is sliding, living standard is going down. Social security measures are dismantled. Labour legislations protecting employment have been replaced by laws that enhance the arbitrary power of employers to fire workers, reduce compensation for firing and hire temporary and casual labour.
Precisely under the policies of Finance capital driven globalization the working class has been facing barbarous onslaught from the big business both domestic and overseas. Cases of trade union busting and attack on trade union rights are increasing in the developing countries, which are destination of choice for the MNCs. In such a situation, the right to freedom of association and right to collective bargaining is very crucial particularly for the most vulnerable workers in the Export Processing Zones, Special Economic Zones, and Call Centres, informal sector, rural sector, migrant workers, contractual workers and domestic sector wherein women are in dominant numbers.