Should Works Councils Be Used as Industrial Relations Policy?

Article excerpt

The traditional model of adversarial labor-management relations used in the United States and Canada has been the subject of much reflection during the past decade. The high number of industrial conflicts coupled with sagging productivity growth have given rise to a search for new models of labor-management interaction. That search has led to discussions on the appropriateness and desirability of the use of Japanese managerial techniques. However, little attention has been given to the European institution of statutory works councils in which workers participate in the decisionmaking process at both the plant and enterprise levels.

Because of the decentralized nature of collective bargaining in Canada and the United States, experts in these two countries have generally considered works councils to have little relevance. They argue that there is no need for councils because workers are represented by unions at the enterprise level. Moreover, the unions generally have regarded works councils as inferior to unions and contrary to free collective bargaining. Also, management generally has viewed statutory works councils as potentially disruptive and an infringement on management rights.

Despite these formidable impediments, there are several reasons why the works councils concept deserves to be looked at once more. This article explores these reasons. It reviews the various collective bargaining schemes, reports Canada's experience with mandatory committees, and discusses the advantages and disadvantages of works councils and mandatory committees to unions, collective bargaining, management, and the wider public.

Collective bargaining and other schemes

The fundamental premise of Canadian and U.S. labor policy is that working people should be able to participate in decisions which critically affect their working lives. The primary mechanism designed to accomplish this is the Wagner Model, enacted in the United States as the National Labor Relations Act of 1935. Canada later adopted similar legislation, which gives employees the right to bargain collectively.

The original supporters of the NLRA believed that because of the many advantages of collective bargaining over individual employment contracting, the great majority of employees would opt for collective bargaining. The Wagner Model, in effect now for half a century, may very well have encouraged the great expansion of collective bargaining which occurred between the 1930's and the 1950's. However, it appears that the model is unlikely ever to produce universal or nearly universal collective bargaining. After five decades of experience, only a minority of employees in the United States and Canada participate in collective bargaining and U.S. participation is shrinking instead of expanding.

To some analysts, the fact that a majority of employees have not availed themselves of their right to bargain collectively is an indication that those employees prefer to negotiate their terms and conditions of employment individually with their employer. However, in the contemporary world of complex organizations, individual bargaining is not a viable alternative to collective bargaining. Each individual cannot negotiate in regard to broad enterprise-wide policy issues such as occupational health and safety, training, and technological change. If employees are to be involved in the initiation and administration of policies concerning such issues, a collective mechanism is needed. Otherwise, the only choices available are acquiescence in unilateral management actions or exit from the enterprise.

A currently popular substitute for collective bargaining is the quality-of-worklife schemes introduced voluntarily and unilaterally by employers. However, the voluntary approach to employment relations has two major drawbacks. First, experience to date indicates that voluntarism will result in only a minority of employees being involved. …