PIECEWORK WAGE DETERMINATION IN COVENTRY*
| Published date | 01 February 1971 |
| Date | 01 February 1971 |
| DOI | http://doi.org/10.1111/j.1467-9485.1971.tb00971.x |
| Author | William Brown |
SCOTTISH
JOURNAL
OF
POLITICAL
ECONOMY
February
1971
PIECEWORK WAGE DETERMINATION
IN COVENTRY*
WILLIAM
BROWN
INTRODUCTION
This
study is part of wider research
on
collective bargaining institutions
in
engineering factories operating piecework payment systems. Its prime object
is to evaluate the extent to which movements in piecework earnings
can
be
accounted for in terms of labour market pressures, profits and productivity.
Insofar as this explanation is inadequate, it argues that deeper understanding
can
only come from analysis of the factory-level institutions of collective
bargaining.
The first section discusses data and definitions. It also establishes the
exceptional position of Coventry pieceworkers in the pattern of earnings
in
the national engineering industry. The second section analyses the effect of
the level of economic activity
upon
piecework wage drift. The analysis
is
developed with special reference to data from
two
typical engineering firms.
The
third
section begins
with
a very simple assessment of the
influence
of
variations
in
profits. It then evaluates, in the context of academic controversy
upon the subject, the extent
to
which piecework wage
drift
is explained by
increased labour productivity. Finally, the last section, by comparing the
institutions of the
two
sample
hs,
endeavours to indicate areas of study
which might help further understanding of piecework wage determination.
*The author would like
to
express
his
gratitude for the helpful criticisms he
received
on
the draft from several quarters and,
in
particular, for
those
of Professor
J.
R.
Crossley,
of Derek Robinson, of a Nuffield College
Seminar
and
of
his colleagues
at
the Warwick Centre for Industrial and Business Studies.
ofi
the
latter,
&off
Briscoe’s advice
on
econometric matters
was
invaluable.
Full
responsibility for aberra-
tions
in
the
end product
k
of
course. the author’s
own.
1
1
2
WILLIAM
BROWN
I
THE WAGE DATA
AND
ITS
BACKGROUND
This
study
is
based upon data collected
on
the average standard hourly
earnings of skilled production workers in certain engineering factories
in
the
Coventry district. It
also
uses similar data from
two
sample firms
in
the
district. The data originates from an agreement called the Coventry Tool-
room Agreement.
The Coventry
Toolroom
Rate
is
a unique phenomenon in the British
labour market. A descriptive account of its history
until
1963 has already
been given by Knowles and
Robinson
(1969) and only a brief account of it
is
needed
here. During the Second World War the emergency requirements
for armaments put special demands upon the skilled labour force of the
engineering industry.
In
particular there was special concern about the
supply of
skilled
toolmakers; men who are to
be
found in the
‘
toolrooms
’
of
most engineering factories and who work
on
the exceptionally demanding
job
of
making the
jigs
and specialist fixtures for machine tools with which
the production workers operate. The production workers (sometimes referred
to as
‘
direct
’
workers) have, especially in the West Midlands, customarily
been paid by results
(PBR)
under a variety of output related bonuses
generically called ‘piecework’. Toolroom workers,
on
the other hand,
because of the specialist nature of their work have been paid by the hour
on
‘
timerates
’-as
have many other
‘
indirect
’
workers. The
fear
the wartime
conditions brought was that high piecework
earnings
might draw labour
away from the
vital
toolrooms.
A
national agreement reached between the relevant trade
unions
and
the Engineering Employers’ Federation in 1940 accordingly determined
that
the ‘minimum earnings of skilled operators in the toolroom
.
. .
shall
not
be less that the average earnings of the skilled production workers in the
same establishment for the same number of comparable hours worked
.
.
.’
(Marsh, 1965).
In
1941. however, the Coventry and District Engineering Em-
ployers’ Association went a step further in
a
Local
Agreement which related
the earnings of all Coventry toolroom operatives to the average earnings of
all
the skilled production workers (fitters, turners and machinists)
in
those
member
firms
in
Coventry who employed toolroom operatives. The basic
intention was to prevent competitive overbidding among employers for
scarce toolroom labour.
As
Knowles and Robinson (1969) discuss, it
has
become
normal
practice for factories to pay their toolroom workers higher
than the Toolroom Rate by the addition of
‘
merit rates
’
which are open to
varying degrees of negotiation. These merit additions average about one
shilling per hour at the moment and have increased only gradually.
The Coventry Toolroom Agreement continues
to
operate.
Its administra-
tion requires that
all
those factories which are members
of
the local Engineer-
ing Employers’ Association and have both a toolroom and skilled production
workers, should calculate the average hourly earnings (excluding overtime)
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