Magazine article Management Today

Devolve to Evolve: The European Commission Have Put Forward the Fifth Directive Which Calls for Worker Directors, but the Future Pitfalls Make Radical Analyses

Magazine article Management Today

Devolve to Evolve: The European Commission Have Put Forward the Fifth Directive Which Calls for Worker Directors, but the Future Pitfalls Make Radical Analyses

Article excerpt

As a student in the 1950s, I recall being impressed by the reforms in industrial relations being introduced in West Germany, nd advocating similar changes in Great Britain. It seemed obvious that the exclusion of law from industrial relations had not produced a system which was 'the envy of the world'. It was more like the gun law that prevailed before Henry Fonda rode into town. What was needed was a system in which industry-wide trade unions had legally-defined rights and duties, so that management could make binding agreements with them, together with some statutory Provision for industrial democracy. It didn't work out that way. Never-theless, the issue of employee involvement is being raised again at EC level. The Commission, anxious that economic integration should be accompanied by measures to increase employee representation, put forward the Fifth Directive which calls for worker directors and works councils. These proposals have been vetoed by British governments. The Government and the CBI oppose any legislation on employee rePresentation. The other -ember states, with Varying degrees of enthusiasm, support legislation of some sort. A report on the subject, recently published by the BIM, (Involved in Europe, Discussion Paper 12), includes proposals designed to break the deadlock. The paper points out that Britain is the only state with no legal provisions on employee representation. It also shows that the provisions in other states vary considerably. At one extreme are the German and Dutch systems which involve both employee directors and works councils. German companies have always had a split-board system, in which supervisory boards of non-executive directors had oversight of the general affairs of company and appointed th board of executive directors Since 1952, one third of th members of the supervisory board have been elected by employees, and the proportion in large companies is now a half At the plant level, there are also works councils which can make representations, and in some cases take decisions, on such matters as times of starting work, working conditions and promotion. There is thus an extensive degree of emPloYee involvement at both the firm and the workplace level. At the other extreme are the provisions in Spain and France, which in practice do not amount to much. The BIN4 paper includes the results of a sample survey of attitudes among 3,000 of its members. The response rate was only 14%. This makes it hazardous to generalise about managers' attitudes, but the range of views is noteworthy. When asked what the UK Government should do about EC employee participation legislation, 24% supported the Government's policy of blocking any EC legislation whatsoever. Another 16% advocated the acceptance of all existing proposals as drafted. The remainder opted for, UK option' or a modification of existing proposals. The BIM then asked respondents what types of employee participation were practised in their companies, and how the respondents rated their effectiveness. Briefing meetings were the most common and highly regarded. Works councils and employee directors were Uncommon and less well regarded.

Several managers believed that a standardisation of procedures was doomed from the start, since national differences were too great. Some commented that management employees and unions alike were not sufficiently interested in communicating, and that the opinions of whole groups were often set aside as being worthless - management and employees alike needed to be educated'. …

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