BARGAINING STRUCTURE AND THE CONTROL OF INDUSTRIAL RELATIONS
| Published date | 01 July 1982 |
| Date | 01 July 1982 |
| DOI | http://doi.org/10.1111/j.1467-8543.1982.tb00095.x |
| Author | S. G. Ogden |
BARGAINING STRUCTURE
AND
THE CONTROL
OF
INDUSTRIAL RELATIONS
S.G.
OGDEN*
BARGAINING structure has recently become a subject
of
considerable interest in the
study
of
industrial relations. It may be understood as the ‘framework
or
structure
through which negotiations are conducted’ and has four important dimensions:
bargaining levels, bargaining units, bargaining forms and bargaining scope.‘ It has
become an issue of major interest not only to students
of
industrial relations but also to
a wider audience whose main concern has centred on the implications of bargaining
structures for the development
of
incomes policies. This is largely a product
of
the
complexity of the way in which pay is determined. This is most visible in the number of
different levels at which collective bargaining over pay takes place: these include
industry bargaining between employers’ associations and trade unions at national.
regional and district levels; company bargaining at group, divisional and establishment
levels; and the largely informal bargaining that takes place between shop stewards and
managers within the workplace.’ The variety and complexity of these arrangements
are generally seen to be unsatisfactory not least because they are highly fragmented,
encourage the pursuit
of
comparisons, breed competitive bargaining, are
a
major
source of disputes, and produce the dissatisfaction which fuels inflationary pay
claim^.^
It is this connection between the system
of
pay bargaining and inflation that
exercises those concerned with the design of incomes policies. The reform
of
the
structure
of
pay bargaining is seen
as
a prerequisite for an effective incomes policy
since, unless those formally charged with the responsibility for negotiations have
operational control over pay bargaining, the determination of pay will not be
susceptible to Government attempts to regulate it.4
In addition
to
such macro-economic considerations existing bargaining structures
have been viewed as constituting a major structural weakness in the conduct
of
industrial relations in general. This view largely emanated from the analysis
of
the
Donovan reports which identified bargaining structure as a key strategic procedural
variable in determining the effectiveness of industrial relations. In characterising the
conduct of industrial relations in terms of the ‘two systems’ it contrasted the traditional
form of system of industry-wide agreements with the informal system of workplace
bargaining. The latter was seen as having progressively undermined the former’s
capacity
to
effectively regulate industrial relations, a process which, given the
informality, autonomy and fragmentation of much workplace bargaining, in effect
constituted a
loss
of
managerial control over essential aspects of work organisation and
labour costs. The major preoccupation of the Report, largely implicit but on occasion
acknowledged explicitly, was to restore managerial contr01.~ Its prescriptions
envisaged this being achieved through the reform
of
collective bargaining, with
particular emphasis being given to bargaining levels and bargaining forms. It strongly
advocated the introduction
of
a new level
of
formal bargaining at company and plant
level as a means of translating the regulative features of ‘formal’ Collective Bargaining
into
a
medium which could effectively cope with the pressures
of
workshop
bargaining. Emphasis was given to the development
of
comprehensive factory
agreements the importance
of
which was stressed by Flanders:
‘The construction of agreed normative systems covering the company
or
plant is
of
crucial
significance.
Its
importance derives from the fact that the company
or
plant
is
the
only
unit
of
*School
of
Economic Studies, University
of
Leeds
170
BARGAINING
STRUCTURE
AND
THE
CONTROL
OF
INDUSTRIAL
RELATIONS
171
regulation which can integrate the diverse and often conflicting normative aspirations
of
the
various work groups.”
In terms of bargaining forms significance was attached to the formalisation of plant
level industrial relations. Essentially this meant that rules
of
regulation should be
jointly authored and terms of agreements should be made explicit and precise by
ensuring that they were written down. The advantage of this was again noted by
Flanders:
‘Written agreements are needed in the first place to reduce uncertainty and ambiguity in the
relations between the parties
...
Formal agreements will also help to dispel the cloud
of
pretense and subterfuge which has surrounded all kinds
of
additional payments made within
the plant
...
Moreover the object
is
to
create a more controlled situation. and specification in
agreement
is
one important means
of
control.”
Thus the formalisation
of
industrial relations was predicted on the basis of the need
for
a reassertion of managerial control. and changes in bargaining structure were seen as
both enabling and facilitating greater formalisation. Achieving such a transformation
was not conceived
of
as being particularly difficult provided management accepted and
adopted the principles and methods
of
joint regulation and developed sufficient
resources for their implementation. These prescriptions were promoted
as
being
generally desirable and equally in the interests
of
trades unions and their members as
well
as
management. However such a perspective discounted both theoretically and
practically the possibility
of
trade union resistance, a factor which has proved to be
crucially important in determining the outcome
of
reform initiatives. This has been
prominent in the area of substantive issues’ but as will be argued below
it
has proved
significant too for the reform
of
bargaining structures. In what follows, an attempt is
made to assess how far the changes in bargaining structure prescribed by Donovan
have occurred and how far the predicted benefits have been realised. The next section,
based on case study evidence, details the problems one company encountered in
changing its bargaining structure, and highlights the role of union power as
a
major
determinant of bargaining structures. The final section examines more generally the
effect
of
union power on bargaining structures and assesses its significance.
DEVELOPMENTS
SINCE
DONOVAN
One clearly documented trend in changes in bargaining structures is the declining
importance
of
national agreements. Although precise definition of terms is evasive,
Brown and Terry have reasoned that the key characteristic
of
what are generally
referred to as national
or
industry-wide agreements in the private sector is that they
are multi-employer agreements. Using New Earnings Survey data they drew attention
to the extent
to
which multi-employer agreements are no longer
of
primary
importance in the wage determination process and are being effectively supplanted by
single employer agreements. Using Daniel’s survey evidence” Brown and Terry
concluded that multi-employer bargaining was the most important basis
of
formal
wage bargaining
for
19
per cent
of
adult male manual employees in the manufacturing
establishments surveyed and single employer bargaining
for
75
per cent. The main
reasons they gave for these developments were the advantages that accrue to firms
when they are large enough to benefit from independence in running their own
industrial relations12 and the incompatibility
of
aspects
of
greater formalisation of
industrial relations, such
as
Job Evaluation, with multi-employer bargaining. Deaton
and Beaumont’s survey results closely mirror those
of
Daniel, and in examining the
determinants
of
multi-employer and single employer bargaining found that high
regional concentration, high union density and multi-unionism were associated with
multi-employer bargaining, whereas large establishments, multi-plant firms,
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