Managing Employment Relations: ACAS and Trade Unions in the UK

Introduction

The relationships between labour and management can be contentious or amicable, depending on the industry and the leadership involved. When these stakeholders reach an impasse over disagreements about wages, benefits, or working conditions, productivity is diminished, jobs can be lost, and national output inevitably suffers. To determine what can be done, this paper provides an analysis of the roles of two key stakeholders involved in managing the employment relationship within a UK context: the Advisory, Conciliation and Arbitration Service (ACAS) and trade unions. A discussion of the key challenges these stakeholders experience in managing employment relations is followed by an examination of how their different roles may impact employment relations within various UK organisations. Finally, a summary of the research and important findings is provided in the conclusion.

Trade Unions in the UK: Role and Decline

According to the editors of The Times 100, "A trade union is an organised group of employees who have joined together in an officially recognised organisation to further their common interests" (Benefits of employer and employee co-operation, 2013, p. 2). Trade union members typically share a skill, trade, industry, employer, or occupation in common, but some unions — known as "general unions" — are comprised of workers from a number of different industries (Benefits of employer and employee co-operation, 2013). All trade unions in the United Kingdom are created, supported, and operated by their constituents (Benefits of employer and employee co-operation, 2013).

The members of UK trade unions such as the AEEU, CWU, GMB, MSF, PCS, TGWU, and UNISON have received a good return on their investment in these organisations. Gall (2009, p. 60) emphasises that "the nature of the service provided, the 'product market' and its related organisational configurations are important in helping to explain why relatively strong and effective workplace unionism has been built and maintained." Although existing union membership may be relatively strong and effective in the UK, current trends suggest that trade union influence is declining. Lind (2007, p. 44) reports that "in general terms trade unions have been on the retreat since the 1970s in Europe when the 'Golden Age' of organised labour and social democracy had peaked."

The rate of decline for trade unions is not consistent among European Union member states. As Lind (2007, p. 45) points out, "there are major differences between the nation states concerning the decline in membership. In most countries membership rates peaked between 1975 and 1985 (France, Germany, Italy, the Netherlands, United Kingdom), while unions in other countries were doing well till the mid-1990s (Belgium, Norway, Denmark, Finland, Sweden)." Barling and Kelloway (1999, p. 124) similarly note that "the 1980s and early 1990s were witness to almost universal decline in union membership. For example, in the United Kingdom, unionization declined by approximately 25% or three million people during the 1980s."

Although trade unions may be struggling, some authorities believe they are not finished. Barling and Kelloway (1999, p. 124) emphasise that "the labour movement is facing considerable challenge is beyond question. However, the conclusion that unions will not survive these challenges is by no means certain." At present, three major trends are underway that may have a positive effect on trade unions:

Factors Shaping Trade Union Membership Trends

First, the number of women participating in the paid workforce has increased, with a corresponding decrease in men's participation. As a consequence, women have steadily increased their presence in labour unions and in 1993 accounted for 42.4% (1.6 million members) of total union membership. Second, the average age of the workforce has increased and was expected to continue increasing throughout the 1990s — a trend particularly pronounced in the unionised sector, where the workforce is, on average, four years older than the non-unionised workforce. Third, workforce education levels have risen dramatically: the percentage of individuals with education beyond secondary school increased from 29% in 1979 to 42% in 1989, while the percentage with fewer than eight years of formal education declined by approximately 50% in the same period (Barling & Kelloway, 1999, p. 124).

Although a number of European countries experienced dramatic decreases in trade union membership over recent decades, those decreases were accompanied by increases in general employment (Wu & Liu, 2010). According to Wu and Liu (2010, p. 146), "in several countries, such as the United Kingdom, the Netherlands, and Italy, unemployment rises even though their union density levels fall sharply." There also remains some question as to how effective remaining trade unions are in their collective bargaining efforts. Wu and Liu (2010, p. 146) note that "the effects of an increase in union bargaining power on wages and employment (hence output) are ambiguous, depending upon how unionization is modelled."

Some authorities argue that relatively low pay and high levels of wage inequality in the United Kingdom are attributable to labour market institutions. Grimshaw (2009, p. 439) advises that "the weakening of trade unions since the early 1980s, together with the declining proportion of workers covered by collective bargaining, have contributed to increasing wage inequality." The downward spiral in trade union membership slowed during the early 2000s, but representation rates remain low. Grimshaw (2009, p. 440) concludes that "despite a levelling-off of the downward trend in unionization and coverage since 2001, by 2006 the United Kingdom's pattern of industrial relations was undeniably that of an 'exclusive' system, with a trade union density of just 28 per cent and collective bargaining coverage of 34 per cent." Cape (2011, p. 9) adds that "the Government figures show that across the country trade union membership fell by 2.7 per cent. In the 1970s there were more than 12 million members in the UK; today that number has been halved."

The Advisory, Conciliation and Arbitration Service (ACAS)

Other authorities lament the loss of trade union-administered apprenticeship systems, which provided valuable training opportunities for skilled labour across several UK industries (Fitzgerald & O'Brien, 2005). The fundamental changes that have occurred in industry, management, and working conditions in recent years have also diminished the level of worker skill and control (Fitzgerald & O'Brien, 2005). According to Fitzgerald and O'Brien (2005, p. 18), "this has posed a significant challenge to trade unions who were also seeking to exploit opportunities for growth in expanding sectors of the regional economy." These trends have adversely affected the ability of trade unions to represent their constituencies: "Trade unions have approached this change in differing ways, shackled, to some extent, by the industries they have organised, their regional traditions and methods of operation" (Fitzgerald & O'Brien, 2005).

Established in 1974 pursuant to the Employment Protection Act of 1975 in an effort to improve employer-employee relationships in the UK (Gregory & Cavanagh, 2007), ACAS is tasked with negotiating disputes that arise between employers and employees, as well as establishing relevant codes of practice and principles to promote more harmonious workplace relationships (Benefits of employer-employee relationships, 2013). According to the editors of Monthly Labor Review (1999, p. 40), "The Advisory Conciliation and Arbitration Service has a statutory duty to attempt conciliation in cases brought to industrial tribunals under the [Employment Protection] Act."

ACAS has been highly successful in promoting improved working relationships between employers and employees in the UK, due in large part to the expertise it brings to the collective bargaining table (Benefits of employer-employee relationships, 2013). The editors of The Times 100 add that "where problems start to arise in a company, it is an easy process to consult with ACAS to find ways of improving relationships. Because ACAS has experience of dealing with so many workplaces, it is able to suggest guidelines for harmonious relationships in nearly all situations" (Benefits of employer-employee relationships, 2013, p. 2). The increase in the number of claims heard by ACAS is attributable to several factors, including: a growing appreciation that the tribunal and conciliation system is open to all claimants; greater use by trade unions of individual rights legislation to complement or substitute for collective industrial action; and the development of case law and legislation arising from Europe, particularly as regards part-time workers, sex discrimination, and pension rights (More Conciliate Than Fight It Out, 2008, p. 4).

Employment rights in the United Kingdom encompass both contractual and statutory claims. Gregory and Cavanagh (2007, p. 30) note that "contractual claims are dealt with in the High Court or County Court. Statutory claims are dealt with in the Employment Tribunal." Created in 1964, the Employment Tribunal is the primary venue for the resolution of employment disputes in the UK today (Gregory & Cavanagh, 2007). Gregory and Cavanagh (2007, p. 30) describe the Tribunal as "a centralized, bureaucratized instrument which gives the government oversight of most of the employment regime, whether or not unionized and whether or not public or private sector." The Tribunal serves as a clearinghouse, resolving a wide range of claims including unfair dismissal, redundancy, workplace bullying, and discrimination (Gregory & Cavanagh, 2007). Its membership consists of a chairman (a lawyer), a representative from one of the employer federations, and a representative from a trade union or a consulting organisation for employees (Gregory & Cavanagh, 2007).

Conclusion

The research showed that two key stakeholders involved in managing the employment relationship within a UK context are the Advisory, Conciliation and Arbitration Service and trade unions. Trade unions were shown to have been in decline for the past several decades, though membership levels have now stabilised somewhat. Trade unions in the United Kingdom perform the same types of activities as trade unions elsewhere, representing the best interests of their membership before management and government. The research also showed that ACAS was established pursuant to the Employment Protection Act of 1975 in an attempt to improve employer-employee relationships in the United Kingdom. Although ACAS decisions are binding on the parties involved, the process is entirely voluntary and can be terminated at the behest of the aggrieved parties and taken to the Employment Tribunal for disposition.