New Labour's ‘Industrial Relations Settlement’: The Third Way?
| Published date | 01 June 1999 |
| Date | 01 June 1999 |
| DOI | http://doi.org/10.1111/1467-8543.00129 |
Annual Review Article:
New Labour's `Industrial Relations
Settlement': The Third Way?
Roger Undy
1. Introduction
In last year's review article, Robert Taylor (1998: 308±9) concluded that the
election of a Labour government in 1997 was likely, in retrospect, to be
seen as a turning point in the history of British industrial relations. This
prediction was at least partly generated by the promised labour legislation.
More recently, John Edmonds, General Secretary of the GMB and
President of the Trades Union Congress (TUC), was reported as telling
the Labour Party conference that trade unions wanted a ®nal settlement on
employment law that all the party leaders would accept (Financial Times,
30 September 1998). Prior to this statement, the Prime Minister, in his
Foreword to the White Paper Fairness at Work, wrote that the
Government's programme was to replace the notion of con¯ict between
employers and employees with the promotion of partnership, and that the
White Paper sought to `draw a line under the issue of industrial relations
law' (DTI 1998b: 3).
This review of 1998 focuses on the proposed industrial relations
settlement.
1
It ®rst sets the context in which the settlement was being
promoted; second, considers the framework of law that such a settlement
would establish; and third, in conclusion, asks what the new legal frame-
work indicates regarding New Labour's `Third Way' as applied to industrial
relations.
2. The context of the `industrial relations settlement'
The environment in which the lasting settlement was promoted in 1998 will
be discussed by, ®rst, examining the political and economic context of
industrial relations and, second, describing the key developments in the
subject area itself.
Political and Economic Context
The party political context in 1998 was one in which New Labour, with its
Roger Undy is at Templeton College, University of Oxford.
British Journal of Industrial Relations
37:2 June 1999 0007±1080 pp. 315±336
#Blackwell Publishers Ltd/London School of Economics 1999. Published by Blackwell Publishers Ltd,
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179-seat majority, looked set for at least two periods of government, not
least because the Conservatives appeared unlikely to overturn such a large
majority after just one term. The `Third Way' ideology of New Labour,
however, seemed less certain than its expected period of of®ce. There was
as yet no clear and detailed de®nition of the `Third Way'. The Prime
Minister de®ned it in economic terms as `not laissez-faire nor state control
and rigidity; but an active Government role linked to improving the
employability of the workforce' (Blair 1998: 27). Other interpretations of
the `Third Way' were, as will be demonstrated below, divided into two
camps. One camp saw it tending towards laissez-faire or neoliberalism and
following the policies of the Democratic Party in the USA; the other
perceived it as more closely associated with, and in¯uenced by, the kind of
active government normally associated with left-of-centre European
parties and social democracy.
A leading commentator in the ®rst camp who expressed concern over the
`Third Way' tendency towards neoliberalism was David Marquand. In May
1998 Marquand argued that, while New Labour had not yet acquired a
distinctive ideology, it was `Patently not socialist . . . not even social
democratic or social liberal' (Marquand 1998: 19). He further drew an
analogy between New Labour's ideology and a version of the `entrepre-
neurial ideal of the 19th Century', while also suggesting that they were
more attuned to Clinton's `Suburbanized New Democrats than left of
centre European Parties' (p. 19). Similarly, Andrew Marr characterized
New Labour's `Third Way' as `19th-Century liberalism' (Observer, 26 July
1998), while Corea (1998) also noted similarities between New Labour's
`Third Way' and that of Clinton. In the USA the `Third Way' was,
according to Corea, rooted in the recognition that
the process of globalization is irreversible and . . . the job of government
domestically is therefore to equip people to deal with the travails of the new
risk society, in which stable employment and other traditional forms of job
security can no longer be taken for granted [the consequence being that
government has to] empower individuals . . . ensuring portability of health care
and pension coverage when changing jobs (and provide) life-long learning Ð
training and education. (Corea 1998: 14)
Such an interpretation of the `Third Way' produced, for industrial relations,
a situation where New Labour appeared `more tender to employers than to
trade unions . . . and more wary of the European Social model than of
contemporary American mixture of hyper-individualism and social author-
itarianism' (Marquand 1998: 19).
The second camp was more prescriptive than descriptive and also owed
more to European developments in social policy than to the United States.
For example, White (1998), while noting that the substance of the `Third
Way' was `rather vague', also asserted, unlike Marquand, that it was not
`free market neo-liberalism' (p. 17). White, in more positive terms, saw
crucial `Third Way' values as `real opportunity' and `civic responsibility' (p.
#Blackwell Publishers Ltd/London School of Economics 1999.
316 British Journal of Industrial Relations
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