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Collective bargaining - what is it and why it means higher pay for everyone

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When workers unite to call for better wages and conditions, the boss has to listen. That's called collective bargaining - and we need more of it.

There were few decades in the last century when work got worse, not better. But over the last ten years, that’s exactly what’s happened.

Work has become a harsher place, with less pay and less security. 900,000 people are on zero-hours contracts, 8 million people from working households are living in poverty, and the number of people going to food banks has sky-rocketed

People are working hard, but struggling to get by. Why? Because they don’t have enough of a say over their working lives.

It’s hard for one person alone to challenge bad bosses and bad working conditions.

But if everyone gets together and proposes better wages and working conditions for all, then the boss has to listen.

After all, it’s workers who generate the wealth of a company, not the bosses. Without them, everything would grind to a halt.

The bosses know this, so they have to sit down, negotiate and compromise – and everybody wins.

Workers joining together to negotiate with employers is known as collective bargaining. It changes the balance of power in the workplace – and it works.

But collective bargaining rights have been eroded for decades and the law makes it hard to get unions going in new companies.

So if we’re to give workers a better deal, we need to restore those rights.

We need to get rid of these outdated laws so unions can go into every workplace, get more workers together, and get on with the job of getting higher wages and a better deal at work for everyone.

Why do working people need stronger rights?

Average wages are still lower today they were before the financial crisis. Insecurity has risen sharply, with at least 3.7 million workers now trapped in some form of insecure work .

Victorian work practices have made an unwelcome return, with employers able to pick and choose workers on a daily basis and cancel their shifts with no notice.

For too many, work is unpredictable, insecure and doesn’t pay. That’s why more people are forced to work multiple jobs just to make ends meet.

These developments are changing the nature of the society we live in.

Inequality is sky high, while parents and grandparents know that their children are likely to have a less comfortable working life than they did.

And the gap between average wages and house prices has widened, breaking the link between work and home ownership.

Why has this happened?

Economic developments have played a part, but the fact that most people have little influence over the decisions that affect them at work is at the heart of this problem.

Government figures show that just 35% of UK employees said that managers were good at allowing them to influence decisions, while less than half thought managers were good at responding to suggestions from the workforce.

In a European league table of workforce participation , the UK comes sixth from bottom, with only Cyprus, Lithuania, Latvia, Bulgaria and Estonia performing worse.

How can we change this?

We need a higher minimum wage and a ban on zero-hours contracts.

But we also need to give working people much stronger rights to influence their working lives.

Not just a voice at work – but a voice to which their employer must listen and respond.

Our recent report into collective bargaining explains how we can achieve that.

It shows how workplaces with collective bargaining have higher pay, more training days, more equal opportunities practices, better holiday and sick pay provision, more family-friendly measures, less long-hours working and better health and safety.

Staff (especially women with caring responsibilities) are also much less likely to express job-related anxiety in unionised workplaces than comparable non-unionised workplaces.

Employers benefit too.

Collective bargaining is linked to lower staff turnover, higher innovation, reduced staff anxiety relating to the management of change and a greater likelihood of high-performance working practices.

And society benefits.

Influential organisations from the IMF to the OECD have recognised the role of collective bargaining in reducing inequality .

Despite these benefits, collective bargaining coverage has declined over recent decades, falling from over 80 per cent in 1979 to 26 per cent today.

Industrial changes and anti-union legislation have made it much harder for workers to come together in trade unions and speak up with one voice at work.

That’s why we need new rights for workers to benefit from the protection that collective bargaining brings.

How can we fix this?

We are calling for:

  • Unions to have access to workplaces to tell workers about the benefits of union membership and collective bargaining (following the system in New Zealand)
  • New rights to make it easier for working people to negotiate collectively with their employer , including simplifying the process that workers must follow to have their union recognised by their employer and enabling unions to scale up collective bargaining rights in large, multi-site organisations.
  • Broadening the scope of collective bargaining rights to include pay and pensions, working time and holidays, equality issues (including maternity and paternity rights), health and safety, grievance and disciplinary processes, training and development, work organisation (including the introduction of new technologies), and the nature and level of staffing.
  • The establishment of new bodies for unions and employers to negotiate across sectors , starting with hospitality and social care.

Collective bargaining is a public good. It’s what working Britain deserves – and that’s why the TUC is committed to making it happen.