New Employee Relations Strategies in Britain: Towards Individualism or Partnership?

New Employee Relations Strategies inBritain:Towards Individualism orPartnership?Nicholas Bacon and John Storey

Abstract

This article addresses the themes of individualism, partnership and collectivismin British industrial relations by reporting on a detailed three-year case-study-based research project. Drawing on this data set, we offer insights intopractical developments in contemporary workplaces and into the thinking ofmanagers and employee representatives as they attempt to steer new paths intheir relations. In particular, we examine what happens in practice when seniormanagement teams, in previously collectivized organizations, set out with theexplicit intent of shifting the balance of emphasis towards more ìndividualized'relations with employees and/or to devise new `partnership' arrangements.

1. Introduction

The public policy debate on social partnership has recently moved to thecentre stage of British industrial relations. Following the election of `NewLabour' in 1997, the government's `Fairness at Work' programme and theEmployment Relations Act introduced new rights for individuals and tradeunions (Undy 1999; Wood and Godard 1999) aiming to `replace the notionof conflict between employers and employees with the promotion ofpartnership in the longer term' (DTI 1998). This new agenda has involvedgovernment engagement with European Union (EU) social policy, a nationalminimum wage and an extension of rights for individual employees andtrade unions, including a statutory route for union recognition. This newpublic policy environment challenges managers to reappraise attempts madein the 1980s and 1990s to manage employees more directly rather thanthrough unions (Purcell 1991; Storey and Sisson 1993) and to reintegrateunions into the rule-making process.

The main purpose of this article is to explore what happens whenmanagers in organizations working with trade unions through traditional

Nicholas Bacon is at the University of Nottingham. John Storey is at the Open University.

British Journal of Industrial Relations38:3 September 2000 0007±1080 pp. 407±427

# Blackwell Publishers Ltd/London School of Economics 2000. Published by Blackwell Publishers Ltd,108 Cowley Road, Oxford OX4 1JF, UK and 350 Main Street, Malden, MA 02148, USA.

collective bargaining seek to change their approach. It tracks instanceswhere managers have pondered both derecognition and partnershipapproaches. It reports the results of an intensive three-year study of asample of organizations, identifying and tracking new developments inindustrial relations (IR) policies and practices in some considerable depth.In order to assess these developments, the study examined in detail thecompeting management logics that were at play in those situations whereorganizations attempted to restructure industrial relations.

2. Partnership in industrial relations

The current debate on `partnership' has developed against the backcloth of`the further contraction of collective industrial relations' (Cully et al. 1998:28). This has been evidenced in several ways, including, most notably, thedecline in overall union recognition, from 66 per cent in 1984 to 53 per centin 1990 to just 45 per cent in 1998 (Cully et al. 1998: 15). In 47 per cent ofworkplaces there were no union members at all Ð à substantial changefrom the 36 per cent of workplaces in 1990' (p. 15). This has been judged tosignal a transformation in the landscape of British employment relationswhich has created a `representation gap' (Towers 1997). Many employeesare now deprived of effective representation, and this state of affairs hastriggered debate on whether public policy should fill this gap and if so howrepresentation might be delivered and implemented.Accompanying the overall withdrawal of unions from many workplaces,

managers have also reduced the emphasis placed on collective agreementsin those circumstances where trade unions remain recognized. In assessingchange in collective agreements between the beginning and the end of the1980s, Dunn and Wright (1994) outlined a relative stability in proceduralagreements including issues such as union recognition. However, thisdisguised a greater degree of substantive change, especially with regard tothe exercise of managerial prerogative in areas such as changes to workingmethods. The 1998 Workplace Employee Relations Survey indicates an evendeeper `hollowing out' of agreements, with joint regulation no longer beingthe norm even where union representatives are present. In one-half of theworkplaces with worker representatives there were no negotiations takingplace over any issues (Cully et al. 1998: 110). The evidence now stronglypoints to many trade unions `withering on the vine', and where traditionalindustrial relations procedures remain in place they increasingly come toresemble a `hollow shell' (Hyman 1997). It is against this background ofunion marginalization that recent public policy pronouncements havesought to encourage the idea of a `partnership approach' to industrialrelations. Most notably, in his Foreword to the White Paper Fairness atWork, the Prime Minister stated: `This White Paper is part of the Govern-ment's programme to replace the notion of conflict between employers andemployees with the promotion of partnership' (DTI 1998: 1). He further

408 British Journal of Industrial Relations

# Blackwell Publishers Ltd/London School of Economics 2000.

stated that his àmbition for this White Paper goes far beyond the legalchanges' proposed and is `nothing less than to change the culture of relationsin and at work . . . Already, modern and successful companies draw theirsuccess from the existence and development of partnership at work' (p. 2).

The central problem, however, is the inherent ambiguity of this concept Ða fact that has been noted by other commentators (e.g. Undy 1999; Ackersand Payne 1998). As Undy (1999: 318) has observed, `What one party, orcommentator, means by `̀ partnership'' is not necessarily shared by others.'Some authors have identified in the partnership agenda a leading role forunions in encouraging the adoption of high-performance work practices(Appelbaum and Batt 1994; Bacon and Storey 1996; Coupar and Stevens1998; IPA 1997; Kochan and Osterman 1994). The social actors such as theTUC, the CBI and the Institute of Directors have revealed `widely differinginterpretations' of partnership (Undy 1999: 318). These range from anemphasis on unitarism and individualism to one on pluralism and col-lectivism. Lacking any sufficiently clear statement from New Labour as tothe precise meaning of the term, Roger Undy (1999) in his review is reducedto inferring that perhaps it aligns broadly with the IPA's (1997) wellpublicized stance. Moreover, he records the shifting positions on partner-ship adopted by the CBI. In this article we argue that, rather than focusingtoo much attention on the public pronouncements of the variousinstitutional heads, a more fruitful set of clues to the likely constructionsof meaning around the partnership concept can be traced in the concreteactions and interpretations of managers and employee representatives insidethe blackbox of workplace relations. Thus, we unpick the recent historyenacted by social actors who have been actively engaged in the search formeaning in the domains of partnership, individualization and collectivenegotiation.

Experiments in these domains raise some interesting questions about thefuture role of trade unions. First, does the adoption of a `partnership'arrangement indicate a broader and significant change in management styleentailing a re-engagement with trade unions? Would new agreements withunions require managers to devise coherent, long-term strategies formanaging labour in the tradition of companies that Fox (1974) labelled`sophisticated moderns'? Or are managers simply behaving in short-term,contradictory and opportunistic ways? The US literature on mutual gainsenterprises (Appelbaum and Batt 1994; Kochan and Osterman 1994)suggests, at the very least, a strategic linkage whereby managers use part-nership agreements to underpin important changes in work reorganization.Alternatively, where managers are reshaping their relations with unions butare not adopting a `sophisticated modern' commitment to joint governance,does this amount to the pursuit of a consistent ìndividualistic philosophy'associated with non-union companies such as IBM (Dickson et al. 1988)? Itis quite possible that new agreements indicate neither, but simply representthe mixing and matching of unitarism and pluralism in a time-honouredBritish fashion (Edwards et al. 1998).

New Employee Relations Strategies in Britain 409


If new agreements represent changes in management style, this wouldindicate a break from the underlying pluralistic preferences of managerswhich appear to have been remarkably consistent between 1980 and 1990(Poole and Mansfield 1993). The widespread pluralism among UK managerscompared with their more unitarist counterparts in the USA has encouragedTowers (1997) to argue for the appropriateness of legislative changes in theUK in order to support trade unions. However, the opposition shown bythe CBI to New Labour's Employment Relations Bill suggests that Towersmay have underestimated the extent of latent unitarism in current UKenterprises. The 1998 Workplace Employment Relations Survey (WERS 98)(Cully et al. 1998) also indicates that unitarism may be the norm, with lessthan one-third of managers surveyed indicating they were in favour of unionmembership for employees (Cully et al. 1999: 87). In order to assess currentdevelopments, it is necessary to distinguish between partnership as part ofa commitment to pluralism and partnership as part of a non-union agenda.WERS 98, for example, once again confirms that management attitudescrucially affect union presence in the workplace (Cully et al. 1998: 19).A second point, leading on from the first, is the extent to which managers

and unions are sufficiently committed to new forms of relationshipinvolving closer co-operation. There are dissenting voices at the heart ofboth the CBI and TUC over whether partnership is a preferred arrange-ment. The head of the CBI is expressly opposed to the government's ideas ofsocial partnership, and the TUC is simultaneously pursuing an organizingand campaigning approach to membership growth (Heery 1998). Mean-while other observers have pointed to employer attacks on collectiveorganization (Claydon 1989; 1996; Gall and McKay 1994; Kelly 1996;P. Smith and Morton 1993). Although one recent review of partnershipagreements in six organizations discovered that `none gave serious con-sideration to ending recognition' (IDS 1998: 4), as we will show in thispaper, the emergence of new collective agreements and the apparentconversion to partnership often follows explicit consideration of unionrecognition and may even form part of a longer term non-union strategy.A partnership agreement may not be the first choice of managers Ð orunions. For example, at United Distillers the alternative for unions was`de facto de-recognition' (Marks et al. 1998: 222). In such instances, markedby mistrust, partnership agreements may fail to improve relations betweenmanagers and unions, remain marginal to the main organizational decision-making, and in reality represent the lowest common denominator ofagreement.Finally, the future for a partnership approach is likely to depend heavily

upon what it can deliver. If partnership results in a reduction of unioninvolvement in management decision-making and less union influence(Kelly 1996), then union enthusiasm for partnership is likely to wane. Ourfocus on a number of case studies explores what happens when managersseek to reshape industrial relations policies. It provides detailed evidence onthe nature and implications of these new forms of agreement. In addition,



we probe the underlying policy preferences of managers with regard to therole of unions. In the next section we describe the research methods used inthe study before going on to discuss the findings and, finally, consider theimplications.

3. The case studies and research method

In order to examine how managers were reassessing the role of unions, wesought out organizations in the throes of change across a diverse range ofsectors. We studied large and significant organizations which we knew tohave two characteristics in common. First, they had a history of extensivecollective industrial relations; that is, trade unions had played an importantrole and, alongside managers, had over the years devised sets of commonrules and procedures. Second, they now had a number of influentialmanagers who were seeking to deal less with trade unions and more withindividual employees. Hence we do not seek to generalize our findingsbeyond such situations.

Good access was gained at multiple levels and multiple sites in thefollowing organizations: Unilever, Royal Mail, National Power, Cadbury±Schweppes, Ford Motor Company, British Rail, three NHS trusts and theCo-operative Bank. It is notable that half of these are either currently, orwere recently, part of the public sector. This undoubtedly arises from thefact that a redrawing of employee relations was high on the agenda at thetime of the research. (For an account of the wider public policy and politicalbackground, see Pendleton 1997; Pendleton and Winterton 1993.) Inaddition, two of the private-sector organizations Ð Unilever and Cadbury±Schweppes Ð had attempted to move away from their previously con-sultative and even `welfarist' managerial styles. (For the earlier backgroundon the latter case, see C. Smith et al. 1990.) Similarly, both Ford and the Co-operative Bank were notable for their erstwhile strong attachment tocontractual arrangements, and it was interesting to see how they were settingabout distancing themselves from that stance. These cases were selectedbecause their highly unionized nature provided traditional industrialrelations base lines from which to follow changes. The longitudinal natureof this study was derived not from a precise comparison of snapshots takenat the start and end of the research, but by following the dynamics ofmanagement policies as they considered, engaged in and reappraisedinitiatives. In each selected case, all main levels of the organization wereincluded Ð corporate, divisional and business unit levels. Two main`businesses' (or their equivalent) were studied in each organization. Inaddition to lengthy semi-structured interviews with a range of managersfrom different functions and levels at each site (lasting between one and fourhours), we also interviewed team leaders, trade union representatives, super-visors and employees. In all, we conducted over 150 semi-structured inter-views from 1992 to 1994 and continued to monitor subsequent developments



through to 1999. The main questions posed concerned management thinkingon the changing role of unions within a context of broader policies,including work reorganization and human resource development. The casestudies represent different types of organization: our aim is to portray thegeneral trends while not overlooking variations between the cases.

4. The findings

The first set of findings reported here concern the experiences of several ofthe case-study firms which became more hostile to unions and which hadactively explored the option of ìndividualizing' industrial relations. Thiswill establish the background thinking in those organizations that latersigned new collective agreements with unions.

The Pursuit of Individual Industrial Relations

Initial interviews suggested that the steps taken to sideline trade unionsbecame increasingly confident in the 1990s. For some, this meant a definiteattempt to de-collectivize relations with certain sections of employee; forexample, Cadbury±Schweppes derecognized APEX and MSF for thepurposes of pay bargaining involving 400 clerical and administrative staffand 350 managers. For others it meant allowing the existing trade unionstructure to remain in place (as the èmpty shell') while prioritizing indi-vidually focused employment policies Ð including individual accountability,target setting, appraisal and reward. In both types of setting managementteams were usually divided on the question of how far and in what ways anindividually focused employment relationship could be, or ought to be,developed and what it would entail.This shift towards individual relations was most noticeable in parts of

Cadbury±Schweppes, the Co-operative Bank, in the first wave NHS trusts,and especially in National Power. At Cadbury±Schweppes, a managerexplained how these factors converged in managerial thinking in the early1990s in a way that suggested that unions did not sit comfortably with thenew corporate thinking:

Collectivism via trade unions is something we want to remove. . . .We are not anti-union, it is just that they are incompatible with our current direction. I think we

can win by edict in the current climate and drive through changes against anyopposition hoping that in the end people will see there is no choice. (fieldworknotes)

A director described how the main board had increasingly come to regardthe company's `benevolence' as `complacency and not being exposed to thereal world'. In making 450 redundancies, the company had consideredworking with the unions to `minimize the pain' but had decided eventuallyto `select on the basis of demonstrated performance'. Managers in



Cadburys±Schweppes, the Co-operative Bank, NHS trusts and NationalPower had all contemplated and drawn up action plans for reducing unionpower and union presence following on from strategic reviews. Thesestrategic reviews involved senior managers from different key functions (notjust restricted to personnel managers) and moved beyond the desire forunions to `wither on the vine'. In one NHS trust a director recalled how, atlaunch date, the management board felt it had à blank page' with which towork, that ànything was possible' and this was ìrresistibly attractive'. Theboard decided to `make a stand' and refused to recognize the existing tradeunions despite a membership density of 80 per cent. Similarly, at the Co-operative Bank in 1991, when unions refused to accept redundancies and apay freeze, the new chief executive withdrew recognition, and èxhorted' allemployees to accept ìndividual contracts'. These managers had becomemore optimistic that they could change employee relations, moving beyondthe `safety' of marginalizing unions (P. Smith and Morton 1993), and wereprepared to risk confrontation and derecognize unions.

Yet, in practice, in many of our case companies we discovered that, whenmanagers reached this critical point of derecognizing unions, they `pulledback from the brink'. The failure of British management to take fulladvantage of their power at this time has been often noted but rarely fullyexplored or explained. We sought to probe this phenomenon. The managersconcerned offered two main reasons, which were broadly common in eachof the organizations although the emphasis placed on each varied betweenthe cases. First, managers reported that heavy threats to trade unions hadcontributed to an increasing level of employee apprehension and dissatisfac-tion. In the case of one of the NHS trusts in particular, after more than ayear of refusing to recognize any trade union, managers acknowledged a`persisting degree of employee mistrust of our motives even among thoseindividuals with low affinity with the trade unions'. In the light of this experi-ence, this trust eventually signed a recognition deal. At the Co-operative Bank,when managers later reflected upon their threat to introduce individualcontracts, they reinterpreted such actions as `short-term bargaining tactics'on their part. After a couple of years, collective contracts were reinstated.None the less, as one senior manager observed, the company had `tested theparameters'. Another explained the rationale very frankly:

I did ask the chief executive quite directly if he wanted us to move to derecognizethe unions. I even offered him various worked options and drew up the blueprintbut it was not the route he wanted to take . . . He had formed the judgement thatsomeone else would just come along and fill the gap. (fieldwork notes)

In many of these cases managers regarded employee apprehension asquite natural, given what one manager described as ùncertainty about thefuture of the business'. However, some managers interpreted such a reversalof policy as a victory rather than a defeat for their plans to bypass unions.This was often due to the second main reason some managers identified for`pulling back' from derecognition Ð the very threat of derecognition alone



had allowed managers to introduce many of the changes they had wanted todrive through. Consequently, managers did not revise their agreements withunions to enable changes to work organization and human resource policiesas had often been the case in the United States. Rather, such changes wereintroduced by managers unilaterally with agreements subsequently signedconsolidating the changes. At another NHS trust this was the key, as managersreasoned that threatening the unions enabled them to sign a recognitionagreement with binding pendulum arbitration, and in the meantime tointroduce a single pay spine and a performance management system.The issues of both trust and unilaterally imposed change were even more

important at National Power. Here major corporate restructuring andredundancies involved a cut in the workforce from 17,000 to just 7,000employees in just five years. One senior manager described how he had`sought to totally redraw the traditional pattern of employment relations',and another explained a mood among managers where `the virtuous circle inindustrial relations will be that people expect nothing out of it'. Many seniorfigures envisaged an entirely ùnion-free environment', and acknowledgedthat `some of our directors simply do not like trade unions'. But in fact, thesenior management team overall was deeply divided on the issue. Thesedivisions contributed to the company eventually signing a new agreementwith the unions (see below) after initially imposing changes and negotiatingsubsequent programmes of organizational change from what managersdescribed as à position of considerable strength'. Directors at the centreforecast that future negotiations would become ìncreasingly less importantfor the company'. However, managers again referred to the engendered`lack of trust' among employees as an important factor preventing a furthershift to individual relations. Moreover, managers were satisfied with thechanges they had achieved using the more limited methods which stoppedshort of full derecognition.Overall, then, when managers in our case-organizations had set out on the

path of individualizing industrial relations, most of them had not gonethrough with wholesale derecognition of trade unions for two main reasons:first, because of employee mistrust of their motives, and second, becausemanagers had successfully imposed their required changes without having totake that ultimate step. The thinking of many of these managers remainedgenerally hostile to unions, yet they were prepared to be pragmatic at leastin the short term. Nevertheless, it was plain that they had given seriousconsideration to ending trade union recognition and that, althoughmanagers did not in the main actually derecognize, the unions had nonethe less become less important.

The Pursuit of New Collective Agreements

As we have described thus far, even the companies most determined tomanage without trade unions had generally stopped short of full-blownunion derecognition. In some of these organizations and in the remaining



cases we discovered managers were working on redesigning traditionalcollective industrial relations. These initiatives were targeted at revising thekind of procedural agreements that Dunn and Wright (1994) had describedas `stable'. They amounted to attempts to move union relations on to a newfooting. Instead of directly undermining, ignoring or marginalizing unionsand worker representatives, a general tendency to engage them in new typesof arrangement was revealed in the cases. This entailed a strategy to involveworker representatives, in identifying business problems and enjoining themin agreed working solutions. However, there were some marked differencesbetween these initiatives and the `new industrial relations' model famouslydescribed by Bassett (1986). This thrust involved all the cases that initiallyexplored derecognizing unions and in addition, Royal Mail, InterCity,Unilever and Ford.

The New Framework Agreements (NFAs):

. were reached following an extensive process of preparation and analysis;

. are unusually far-reaching in scope;

. commit the parties to the `needs of the business';

. are novel in their extensive revisions to traditional custom and practice;

. give considerable recognition and security to trade unions;

. give worker representatives access to business information and strategicplans;

. give union representatives a say in important business operational matters.

Table 1 provides a broader view of the NFAs. These agreements representearly forms of what are now more commonly termed `partnership agree-ments' (IDS 1998). We found that there were two types of approach. Thefirst was to create outline principles and targets at national (company) levelwhile leaving detailed implementation to the local level (as in the case ofRoyal Mail, Ford, National Power and InterCity). The second was toconcentrate energies at the local level and to encourage lengthy and detailedjoint problem-solving. This second approach can be further subdivided. Incertain instances the result was a comprehensive document, as in the case ofthe `ground-breaking' `Horizon 2000' agreement in Lever Brothers andseveral NHS trusts. The `Horizon 2000' document, for example, containeddetails of new working practices, annualized and `banked' hours, newgradings, revised roles and agreed development targets (see Table 1). Inother instances the outcome was not codified into a single agreement butinvolved commitment on the part of management and unions at plant levelto co-operate more closely on key issues. Examples of the latter includedFord's plants at Bridgend and Dagenham, the Elida Gibbs company, andCadbury's Mouldings Factory at Bournville. All types of NFA involvedlong-term negotiations between managers and unions, but they took longerto agree where unions were stronger. We discovered that the different typesof NFA reflected a range of management aims and objectives that give aninsight into the thinking behind policies towards trade unions.



TABLE 1Details of the New Framework Agreements (NFAs)

Type Company Name ofNFA

Unions Reasons for NFA Contents Other features

Nationallevel

Royal Mail(Post Office)

NewDirections

Union ofCommunicationWorkers

Strong unions opposingflexible working, lowmorale, business re-shaping

Union involvement in strategicbusiness decisions from national tolocal; new disputes procedure to solvelocal disagreements at divisional level

Patchy up-take indifferent regionsleads to re-launching

Nationallevel

NationalPower

CompanyAgreement(identicalfor 3 groupsofemployees)

AEEU,NALGO,GMB, TGWU,UCATT &others

End of industry-levelbargaining, weak unions,decentralized to powerstations, privatization

Harmonized terms and conditions;new integrated salary structure;service-related increments abolished;performance-related pay; localdisagreements not referred tocompany level

Linked to 3.95%pay rise plus a lumpsum

Nationallevel

InterCity(BritishRail)

NewBargainingAgreement

RMT, ASLEF,TSSA, CSEU

Match industrial relationsto new regional businessesprior to privatization

New grievance procedure to solvelocal and individual disagreements atlocal level; new bargainingarrangements from industry to locallevels

Businesses pursuedifferentarrangements afterprivatization

Nationallevel

Co-operativeBank

PartnershipApproach

BIFU Improve relationship withunion after forcingthrough redundancies andrestructuring

Three-year pay deal, job securityclause and joint project teams totackle issues

Made possible afterchanges in seniormanagement andunion posts

Local (singledeal)

LeverBrothers(Unilever)

Horizon2000

(10 unions) Changes in detergentsmarket requiring fasterinnovation and higherquality standards

New working practices; annualizedhours and performance payments;harmonized terms and conditionswith new gradings; revised roles;development targets for training

Employees voted toaccept althoughunionrecommendedrejection

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Local (singledeal)

NHS trusts Recognitionagreements

RCN, COHSE,NUPE,NALGO andothers

Trust status presentsopportunity for newcontracts, internal market

Single pay spine; performancemanagement systems with PRP

Trust terms andconditions forced totrack nationalWhitley conditions

Local(relationship)

Elida Gibbs(Unilever)

(no specialterm)

USDAW, MSF New demands aftercompany focusesproduction; TQM agenda

Ad hoc union involvement in jointworking groups on employee attitudesand communication

Continuous yetmarginal role forunions

Local(relationship)

Ford(BridgendandDagenham)

(no specialterm)

TGWU, AEEU,MSF

Need to secure newinvestment forreplacement models

Wider consultation on local decisions;union involvement in businessplanning

Developsrelationship fromFord's EDAPscheme

Local(relationship)

Cadburys(mouldingsfactory)

Partners inChange

TGWU Quality problems, poorhealth and safety

Union involvement in businessplanning and quality improvement

Unions involvedbut questions overincorporation

Local(relationship)

Cadburys(assortmentsfactory)

NewHorizons

TGWU Reduce financial loss Five-year end-game of wish listsincluding ending clocking-in, move tosalaried pay, and teamworking

Sidelined byconflict over payand then jobs.

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National NFAs

The national NFAs signed by Royal Mail and InterCity sought to overcomethe resistance of strong trade unions to management plans. In the case ofRoyal Mail, managers pursued this approach to overcome opposition fromthe Union of Communication Workers (UCW) to plans for flexible work-ing. At InterCity, managers sought to consolidate IR negotiations aroundthe new regional businesses. Although these national agreements were veryimportant and marked a step change, many key issues of detail remainedunresolved, and further investigation revealed important disagreements andsubsequent power struggles to establish new precedents and routines. It isthese struggles, rather than the agreements themselves, that provide an insightinto management values and attitudes. Here we discovered different develop-ments in separate businesses of the same organization. In the case of RoyalMail, one director explained how he was personally committed to the partner-ship approach outlined in the `New Directions' agreement. He described itas `joint consultation for the 1990s'. However, he observed how `the inter-pretation and application varied significantly across the country'. In theSouth East, senior managers described their commitment to involving theUCW in business planning, as the personnel director in the area explained:

My fellow directors have been pretty supportive of the direction of the agreement.

The Processing Director has used the trade unions a great deal in seeking todevelop an automation strategy. They have become very involved strategically inissues such as which offices would close and which [would] survive as part of the

automation strategy, and also the investment patterns. (fieldwork notes)

The union confirmed this picture, with the framework agreement used asa vehicle to pursue a more genuine joint problem-solving approach andinvolve unions in long-term business strategies. Managers had an initialconcern that, after taking the union into confidence, `we run the risk ofbeing embarrassed by seeing our plans up on the union notice board'.However, this eventually gave way to the realization that `the unions haveneeded to act responsibly in order to keep their credibility'. In the Midlands,by contrast, Royal Mail managers described their ìnterpretation' of theagreement as a `green light to exercise unilateral power'. One manager actedout the tough version on one of our visits by arranging a meeting with aUCW representative during which he dismissed complaints about new shiftarrangements. Immediately following this meeting, the manager explainedto us how he had used the new agreement to èstablish a new culture fornegotiations'.Echoing the above divisions among managers at Royal Mail, we found a

similar state of affairs among regional directors at InterCity. Some saw thenew agreements as ènabling tools to develop a partnership with unions'.Others recognized what one manager described as a ùnique opportunity tosideline the unions'. Similarly, in InterCity, although the agreement offereda role for the unions àt every level', the personnel director observed that the



unions had `not been prepared to be involved in strategic business decisions'and warned that, although the agreement ìs a potentially big opportunityfor the unions, if we wanted to, we could be very hard in its use'. Eventually,restructuring as part of privatization overtook the NFA at InterCity as animportant issue. A typical management view of the InterCity NFA was that`we don't really know why it has taken the form it did . . . it was dreamt upwhen we were in conflict and it represents the lowest common denominator'.In both InterCity and Royal Mail, managers were also aware of the internalpolitical difficulties unions encountered in restructuring to match newbargaining arrangements and the concerns of `trade unionists who fear thatthey are becoming part of management'.

A further factor dampened management enthusiasm for NFAs. Such anelaborately codified set of understandings could be, and was, used as a veryeffective weapon by shop stewards when they felt that certain localmanagers were acting outside the spirit of the agreement. An area unionrepresentative from Royal Mail put this point to us rather well, indicatingthe mismatch between partnership agreements and partnership values:

When managers come along with the old attitude and try to be macho I quotefrom the agreement. When they develop policy in isolation and we do not likewhat they produce, then again I quote from the agreement. (fieldwork notes)

Consequently, although these new agreements symbolize a `strategic response'by managers to the trade union question at the level of formal policy, suchagreements fell some way short of a coherent long-term approach formanaging with trade unions.

At National Power, the thinking behind the NFA was rather different andfollowed on from the drive to individualize industrial relations outlinedearlier in this article. Senior managers reported `we came to the conclusionthat jointism cannot work'; and, reflecting on the NFA, a manager recalledthe ambitious nature of the approach when he commented `we only get onechance and we went for the lot'. Another director explained the thinking ofmanagers in National Power further:

We couldn't say to the staff that we believed jointism couldn't work. We had tosay the opposite. So in terms of wording the agreement, we have to make theright noises. There is a role for trade unions but it is a diminishing role and it isdifferent. We will spend more time with them on non-negotiable issues; we'll talk

business plans but not the serious stuff. (fieldwork notes)

Hence the NFA in National Power did not represent a long-term commit-ment to managing with unions and constituted a further erosion of unioninvolvement in management decision-making. This was also the case atworkplace level in the two power stations we studied (Drax and Rugeley).The unitarist values of managers in National Power reported earlier werealso continued in the NFA, and although the NFA combines both unitaristand pluralist perspectives, it constituted a discernible shift towards a moreconsistent ìndividualistic philosophy'.



Local NFAs

Where the local approach to NFAs was adopted, the `preferred' negotiatingpartner for management in all these cases was not the external full-timeofficers, but invariably a body composed of internal representatives whohad been engaged in the task of working out a future for the workplaces inquestion. These new types of agreement marked a departure from thetraditional bargained approach to change on the one hand, and thecomplete bypassing of traditional industrial relations on the other. Adirector responsible for one of these agreements argued that the intentionwas to establish a `common destiny of shared interests'. At Unilever it tookfive years to finalise the `Horizon 2000' agreement. A senior managercontended that ìn a highly unionized environment it is not really feasible todo it incrementally, sooner or later the stewards who are watchful will call ahalt'. However, at the end of the process the same manager somewhatruefully reflected: ìf we had done it sequentially then it would probablyhave taken about the same time anyway'.Overall, many managers felt that single-deal NFAs constituted à compre-

hensive solution' to the union issue. Most matters were covered in the NFAand a majority of managers felt there was `little need for future negotiationswith trade unions', the agreements marking a `permanent dilution' of therole of trade unions. In the words of one senior manager at Unilever wheninvited to reflect on the future after Horizon 2000:

We don't have much more to add in terms of formal agreements, we just have the

bits to pin down. It will be predominantly about getting the right systems andworking together. The unions are weaker and more realistic, but over the next fiveyears, unless they can find a new European direction, it is difficult to see them

playing anything other than a reducing part. (fieldwork notes)

Whereas national NFAs often involved significant differences of interpreta-tion in different businesses within the organization, managers in companieswith single-deal NFAs were more likely to share a common approach. Thiswas due mainly to the greater involvement of plant and middle managers indesigning the agreements and ensuring that they matched local needs.Managers reported that local NFAs with strong trade unions could be

quite successful even though, or because, both sides recognized somepersisting conflicts of interest. This was despite the rather òpen-ended'nature of these agreements and what some managers regarded as `shakyfoundations' upon which to build long-term partnerships. Nevertheless, thelocal-level variants did amount to what Windolf (1989) and Edwards (1995)have termed `productivity coalitions'. It was the potential of these localcoalitions that we found attracted managers towards the reworking ofcollective arrangements although they expressed `frustration' at the pace ofchange. At Ford Motor Company, the unions were involved at plant levelin `significant' consultations over business unit decisions, and managersclaim that these happened on a `full open book basis'. Significantly, a Ford



manager noted: Ì do not distinguish between the concepts of `̀ trade unioninvolvement'' and `̀ employee involvement'' because union involvement atFord is local and close to the employees.' This new relationship can betraced to the early 1990s when a local management and union partnershipsecured investment to build a new car model at Dagenham. Senior managersoffered two reasons why a national agreement featuring a commitment topartnership was not pursued. First, as the company could see no end to jobreductions, it could not offer job security guarantees. Second, even plantmanagers realized that employees did not share a common destiny witha global company threatening the future of plants through constantproductivity comparisons.

At Cadbury±Schweppes, in the chocolate mouldings factory the unionswere `fully involved' in the quality improvement programme to the extentthat the unions àctually run' the Quality Improvement Group responsiblefor safety matters. Whereas in Ford both management and unions cautiouslyfelt that they gained equally from the new arrangements, in the Cadburysfactory management confessed: ìn reality it does undermine the unions andI don't really understand how we got away with it'. One manager gave aspecific example of events when he proposed moving to one shift on aproduction line and the union objected:

We established a Quality Action Team chaired by the [shop] steward whose briefwas to increase throughput by 25%. They were very successful and the result was

one shift working. You could argue the stewards have cut their own throat, but inreality we would have had to close it one month earlier, well that is a half-truthanyway. As long as we are sensible to the people who are displaced it's justified.

(fieldwork notes)

Although this indicates that close co-operation with management canweaken union influence (Kelly 1996), the above manager alongside othersexpressed some unease about union weakness. This suggests that the valuesof at least some managers who were pursuing closer co-operation withunions were far from overtly `hostile' to (moderate) unions.

The one unsuccessful attempt at a relationship NFA in our sampleoccurred at Cadbury's assortments factory. A new plant manager, appointedto turn around a plant that had lost £7 million in the previous three years,outlined his approach:

I asked the convenors to share openly a new approach (we called it `NewHorizons'), to be open, and to share with me a five-year end-game for both

management and employees. We did this and the convenors ran workshops onissues with management. We drew up honesty lists of what managers and unionswanted, no matter how ridiculous they looked on paper. (Cadburys factory

manager, fieldwork notes)

This new relationship failed when the company refused the factory managerpermission to make a generous pre-emptive pay offer in the annual payround and a dispute developed over a four per cent pay rise and shorter



working time. The five-year plan went òn to the back burner' and, althoughthe factory manager maintained Ì do still feel that we have an agreedagenda . . . I want to revert back to New Horizons', he had become painfullyaware that `Cadburys may not want the unions'. As we finished ourfieldwork in this plant, a former operations manager was appointed asthe new personnel manager for the factory. His assessment of the `NewHorizons' agreement was not so favourable, and the views he outlinedindicated that he did not value a more strategic role for the unions in thefactory:

The unions are not changing. We hear the words from their national officer that`we'll come along', but not locally. Their weakness is that they are responsive, not

proactive Ð they can't decide on what the best strategy is. They just make theclimate worse and seek to monopolize issues. It is easy to be reactive, and in realitythe unions will do anything that works. They really don't believe in the need for a

new shift and to be more responsive to the market. At the bottom of it, they arebehind the times. (fieldwork notes)

Where management commitment to partnership was weak, as in this case,then relationship NFAs could fail. However, because such agreements werebuilt upon shared interests between local managers and unions, the failure ofthe new relationship in one part of an organization (Cadburys assortmentsfactory) did not directly weaken the agreement in another part (Cadburysmouldings factory). The manager in the latter was concerned as to whatmight happen to the agreement if he were to leave the factory. He regardedit as dependent on his `personal credibility and trust'; other managers in thecompany accused him of `being in the union's pocket'.

5. Discussion and conclusions

To what extent are significant new pathways being forged in labour±management relations in Britain? The evidence relating to this is somewhatambiguous. On the one hand, each of the major organizations in our studydid (eventually) negotiate some form of new style agreements with one ormore of the recognized unions. However, there was little evidence that theywere achieving stable arrangements that would persist in the long term. Thenew modus vivendi continues to be contested within these managementteams. The present situation, to this extent, remains with the traditionalBritish pragmatism in industrial relations elaborated by Edwards et al.(1998).On the other hand, the overall level of revision to procedural agreements

was surprisingly high. This suggests a break with the continuity in agree-ments previously recorded by Dunn and Wright (1994) as characteristicof the 1980s. Also, it can be observed that the build-up and the realizationof the new agreements was more complex than the ìndustrial partnership'concept that has dominated recent headlines (Coupar and Stevens 1998).



The substantial new industrial relations procedures that we uncovered,including those with partnership features, reveal managers behaving in ashort-term, contradictory and opportunist way.

In all, the complex arrangements that emerged from explicit attempts toshift the balance of emphasis towards more ìndividualized' relations withemployees did not result in either successful union derecognition or securepartnerships. In those organizations that had considered derecognition, theheadlong rush to abandon relationships with unions in favour of individualarrangements with employees was not followed to a conclusion in NationalPower, Cadbury±Schweppes, the NHS trusts or the Co-operative Bank.Many of the managers in these organizations had expressed the desire toshift the balance towards more individualistic approaches to labourmanagement. But, following tentative explorations, the majority remainedpragmatic about whether individualistic approaches could, in the foresee-able future, replace the need for a union presence, even where a longer-termcommitment to joint governance was absent. In several of these organiz-ations initial management optimism had given way to feeling the need to`tread cautiously' in managers' pursuit of an appropriate balance betweendealing with individual employees and maintaining collective relations withtrade unions. As many of these managers had decided it was the relationshipbetween managers and individual employees that made the difference, theyhad become reluctant to sacrifice employee trust. Consequently, signing newframework agreements with unions was a pragmatic decision, even whereunions were aggressively sidelined, as one manager pointed out:

Management control is not about making no role for the unions; if we can exercise

the first, then who cares what role the unions play. We are not here for industrialrelations: it is all about delivery. Our job is not to stuff the unions. The significantfeature is not the role which the unions play but the relationship between manage-

ment and staff. (National Power director)

As we reported, those organizations acting as if they would prefer unionsto `wither on the vine' discovered that the insecurity felt by employees wasa potential future problem. These firms ultimately failed to pursue a con-sistent ìndividualistic philosophy'. We would not interpret the subsequentsigning of agreements by these organizations as evidence of an increasedinterest in joint governance. The firms discussed above all signed agreementsafter unilaterally introducing major change programmes rather than seekinga joint approach to change with unions.

The remaining organizations we studied that sought new agreements toovercome strong union resistance to management plans (e.g. Royal Mailand InterCity) also appeared not to be acting strategically. Although theseagreements involved integrating trade unions into joint problem-solvingactivities, few managers considered these new agreements as establishing along-term basis for union influence or reversing the overall drift away frommanaging through unions. In certain sections of the business, pluralistmanagement values led to effective partnership arrangements with unions,



and these agreements were far from `hollow shells'. However, where strongunion resistance met managers with unitarist values, the result was conflictrather than increased co-operation. For example, in 1995 the Royal Mailsigned a second new agreement after the first had run out of steam, and by1996 industrial relations had slid once more into conflict.Pragmatism notwithstanding, the new agreements did in the main re-

establish a role for trade unions and offered forums to establish joint rulesand procedures, although the agreements were firmly management-driven.However, handling collective bargaining and consultation in this fashion, asmanagers had done with previous attempts to `manage by agreement'(McCarthy and Ellis 1973), appeared paradoxical. Managers made attemptsto restrict the agenda of issues as the new framework agreements excludedbargaining over details and substantive terms and conditions; at the sametime, managers embraced consultation on issues of business policy. In thecase particularly of Ford, there was evidence that company negotiations atplant level had changed form and moved closer towards collaborative plan-ning (Walton 1987), although conflict continued in national negotiations.Underlying these pragmatic arrangements, the evidence we unearthed

from extensive interviews with managers at all levels and across all functionspointed towards an enduring strain of unitarism in management prefer-ences. Whereas Poole and Mansfield (1993: 19), drawing upon large-scalesurvey data, recorded a `high degree' of consistency in management prefer-ences for particular patterns of union activity, our in-depth interviewmethodology revealed that, even in workplaces with collective arrange-ments, large numbers of managers did not accept that unions should beallowed to continue with their traditional activities. Moreover, a significantproportion would clearly have been happier with continued progresstowards union exclusion. Furthermore, in several organizations managersinvited the agreement of unions only after managers had introduced themost substantial changes. Managers requested unions to agree post hocpartnerships to a new status quo in order to legitimize the unilaterally im-posed changes. Union representatives were generally relieved and thankfulthat managers were prepared to reach any agreements at all. For example,shop stewards at Cadburys mouldings factory were well aware of the greatinterest being shown by some of their senior managers in the practices ofnon-union companies in the confectionery industry.The signing of the new-style agreements across these cases can not

therefore be taken as an indicator of change in management preferencestowards union activity and behaviour. Even in Royal Mail, where we founda higher proportion of managers committed to a pluralist perspective thanin anywhere else in our study, pluralist managers recognized they were in aminority, and joint governance constituted a short-term pragmaticcommitment. In the words of one Royal Mail manager,

Our solution is partly strategic involvement, but we need employee involvement

along with that. The unions are after all just one part of employee involvement. It



is employee involvement that is the real aim and the more important of the two.(Royal Mail director).

It is thus important to underline the qualifications in the significanceof this renewed activity in industrial relations. For many managers whofavoured a union-free ènd game', the new agreements, along with thesimultaneous flirtations with individual contracts, were but `the first steps ina longer process'. Furthermore, co-operation with unions had not spread inmany cases because some managers remained unconvinced that this wouldprove beneficial. Consequently, the future of the industrial relations experi-ments described here is at present uncertain and falls short of US-style`mutual gains' partnerships.

The agreements signed primarily to reassure staff where trade unionswere weak (National Power and Unilever) resembled a pluralistic shift inmanagement thinking even less, but constituted a temporary halt in whatmanagers regarded as a longer-term move away from managing with unions.In such instances, the new agreements representing pseudo-partnership didappear to mask employer hostility to collective bargaining and unionrecognition (Kelly 1996). However, hostility was not a feature of manage-ment attitudes towards all agreements; important differences wereuncovered between different businesses and units in the same organization.This suggests that genuine partnership is possible between unions andcertain groups of managers, and in a public policy environment thatpromotes social partnership these isolated agreements may prove effective.Certainly in the current environment some of the managerial comments andbehaviour reported from the mid-1990s may appear dated, for example thebelief that managers can `win by edict' or can refuse recognition to unionswhere membership density is 80 per cent in a workplace. However, whatimpact the Employment Relations Act will have on management thinkingremains to be seen. Although some companies may espouse partnership,there is evidence that the underlying management attitudes towards jointgovernance may be little changed.

Final version accepted 13 January 2000.

Acknowledgement

The authors wish to acknowledge the support of the ESRC in funding theresearch project on which this article draws.

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New Employee Relations Strategies in Britain: Towards Individualism or Partnership?