Collective pay bargaining on rise

06-06-2005

UK workers are increasingly using their right to collective bargaining when talking to employers about pay rises, Incomes Data Services (IDS) has found. IDS said national pay bargaining has "re-emerged" after being "largely extinguished" under Margaret Thatcher-led governments.

It added salaries rose an average 3.1% in the three months to April, less than the inflation rate.

The union Amicus said legal changes in 1997 had made group bargaining easier.

Weight of numbers

Amicus said that the increase in group bargaining was the result of a lengthy campaign to make workers more aware of their rights.

The UK's largest private sector and engineering trade union also said it would continue to expand its plans to bring more collective power to industries, adding it was now turning its attention to the engineering sector.

KEY NEW PAY DEALS* Blockbuster Video 3% increase from March
Cadbury Schweppes 3.7% increase from April
Greggs 4.5% increase from April
Homebase 3.25% increase from April
Nestle Rowntree 3.7% increase from April
Virgin Retail 3% increase from April
Waterstones 3% increase from May
*Source: Income Data Services

According to Amicus figures, workplaces with collective bargaining and trade union organisation - especially in the aerospace, shipbuilding and motor vehicle industries - tend to get much stronger pay deals.

Critics argue that a group deal penalises the best-performing workers and unfairly rewards the worst, while making it more difficult to incentivise staff members.

It also limits companies in how flexible they can be in regards to their pay structure.

'Retrograde step'

A spokesman for the EEF, which represents employers in the manufacturing, engineering and technology sectors and used to take part in collective pay discussions, said that any change would be a step backwards.

Since collective bargaining stopped in the industry in 1989, companies have put in place a various methods of reviewing pay that function well, the EEF said.

"Our view is that if its isn't broken, don't fix it," the spokesman explained. "While working with trade unions is essential, we feel that going back to something we got rid of almost 20 years ago would be a retrograde step."

But for Amicus general secretary Derek Simpson, the benefits of the collective voice are very evident.

Power in numbers

"Collective bargaining will help to restore better employee pay, skills and pensions," he said.

"It will help attract more young talent into engineering which is blighted by recruitment difficulties and skills shortages."

The IDS report - based on 200 pay settlements that affected a total of four million employees - also found that there were "clear divergences between settlement levels in different parts of the economy".

While the median wage increase was 3.1% during the three months to April, in manufacturing the figure was higher at 3.5% compared with 3% in the services sector - both public and private.

The biggest rise was more than 5%, while there were pay freezes in a number of industries.

BBC News

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