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Page 79
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Wages order or disorder?
by Janus
IN his message to Congress earlier this year President Nixon gave the results of a review of industrial relations in the US. One of the main conclusions was that "the area in which emergency disputes have created the greatest problem is that of transport". In the UK there must be many other industries with a better claim to this distinction. Mrs Barbara Castle may yet come to share President Nixon's viewpoint if the Road Haulage Wages Council today were to accept in full the demand from the trade unions for an increase to £16 lOs in the lowest basic weekly rate.
Too much should not be made of the danger. Although the British road transport unions have considerable power they are nothing like so formidable as their opposite numbers in the US. Whatever may be said to the contrary the likelihood is that in the UK there are far more godds vehicle drivers outside than inside a union.
Certain consequences may follow, although in a confused situation it is unwise to rely too much on one or two simple facts. Whatever the numerical ratio between union and non-union drivers it is safe to say that union strength can be correlated with the size of road transport undertakings.
Over the past few months many large and medium-sized operators have negotiated with the unions agreements which in many cases start where the proposal to the wages council would leave off, in other words with a £16 lOs basic minimum rate. There may also be drivers for non-union firms who are being paid equally well or even better. But it is probably true that drivers on the bare statutory level or only a little above it do not for the most part belong to a union. They are not directly represented on the wages council and the union members must put their case for them.
AS the unions have been able to negotiate for their own members terms much higher than the present statutory minimum they could feel justified in not trying too hard to get the minimum raised. In addition the low statutory level has traditionally provided a good rhetorical opening for an attack on the employers.
The driver of a lorry with a carrying capacity of 5 tons working outside London does not have to be paid more than £13 8s 6d for a week of 40 hours. Even if he works the full week of 60 hours which is all the law now allows the employer is not compelled to pay him more than £20. There may not be a single driver who receives so little; but the road haulage industry as a whole must continue to bear the reproach that it tolerates a situation in which the existence of such a sorry individual is at least theoretically possible.
It is partly to escape from this situation that the employers' representatives on the wages council were themselves prepared to propose a £4 a week increase on the basic rate. It might seem that the unions must welcome this sign of grace. On reflection it is clear that the benefit would mainly be felt by thousands of drivers who had never taken the trouble to join a union and may in some cases be actively opposed to the principle of unions.
THE irony can hardly be lost on the union representatives. They are negotiating on behalf of drivers as a whole but cannot be expected to ignore the special interests of their own members. In the past any possible conflict of aims has not been too difficult to resolve. When the wages council has agreed an increase on the basic rate the union representatives have pressed, usually successfully, for a similar increase on local agreements.
In most cases /this has not seemed unreasonable. It has been possible, for example, to accommodate the increases within the somewhat elastic confines of the present Government's prices and incomes policy. A different problem would be created if the wages council accepted the union proposal of an extra £4 lOs a week, representing an increase of something like 45 per cent. This might be acceptable to the employers and even to the Government only if it were clearly limited to the few—and mostly non-union—drivers who are now receiving no more than the basic minimum wage.
Where agreements are already well above this a further rise of something of the order of 40 per cent would create difficulties not previously encountered. For many of the employers it would be a burden impossible to carry. .
Mrs Castle's reaction can easily be guessed. A massive wage increase would be against the Government's policy and particularly untimely in the running-up period to a general election. Settlements at as much as 10 per cent have been reluctantly accepted and according to a recent Incomes Data survey the general pattern has been one of increases between 5 and 9 per cent.
The same survey speaks of a kind of wages explosion in the public sector. This is a timely reminder that wage scales in the State-owned road transport companies are sensitive to decisions of the wages council although the companies are not represented. The recent change in the structure of the council continues to exclude operators who are engaged in carrying traffic solely on their own account. They also could find themselves affected by a new road haulage wage agreement.
STRICTLY speaking none of these wider considerations can be taken into account by the wages council. The independent members who have the effective casting vote consistently refuse to be diverted from a narrow aim. They are concerned only with fixing minimum rates of pay and are chiefly influenced by factors such as the cost of living and its bearing on the lowest-paid driver. They take no account of what individual operators may pay above the minimum nor even of the problem of productivity.
Left to themselves the independent members might arrive at an increase in the 5 to 9 per cent range. On the other hand, if the employers and unions were able to agree on a different figure this would be the figure in the proposal to be published in due course.
Today's meeting is more than usually difficult to chart in advance. Superficially on the basis of the preceding events one might think that the unions would begin by putting forward their £4 lOs proposal, that the employers would counter this with a proposal for £4 and that agreement would fairly quickly be reached at a figure somewhere between the two. There would hardly be a need for the independent members to intervene.
/N the absence of some reassurance about the effect of a statutory increase on agreements already made at or above the proposed new level, the employers might hesitate to put forward the figure they had in mind. The procedure would then revert to the more familiar pattern in which statistics about the cost of living and about wage levels in other industries would be passed from one side to another in the hope of finding ultimately an increase on which the independent members would be prepared to vote with whichever side put it forward.
The union representatives might register indignation. They had tried valiantly for a massive increase and had failed. They might also feel an unexpressed relief. A reasonable increase on the statutory rates of pay could be used as a lever to obtain a corresponding increase from operators already paying well above the minimum. There could be complications with too large a statutory increase, apart from the reaction of the Department of Employment and Productivity.
Special difficulties must arise in an industry where there is. so great a gap between the lowest-paid and the highest-paid workers who are all doing much the same job. With each successive wave of wage increases the problem increases. Today's wages council meeting is not likely to solve it but it will have to be tackled sooner or later.