The four pillars of collective bargaining

Notes

1. See the ‘Collective bargaining and economic policy’ section.

2. E Dabla-Norris, K Kochhar, N Suphaphiphat, F Ricka and E Tsounta, Causes and Consequences of Income Inequality: A Global Perspective (IMF Staff Discussion Note, June 2015); F Jaumotte and C Osorio Buitron, Inequality and Labor Market Institutions (IMF Staff Discussion Note, July 2015). The latter (at p 27) ‘found strong evidence that the erosion of labor market institutions in the advanced economies examined is associated with an increase of income inequality’. See also F Jaumotte and C Osorio Buitron, Revisting the Drivers of Inequality: The Role of Labour Market Institutions (VOX, CEPR's Policy Portal, 2015).

3. A good example of this thinking is in the paper which served as the principal blueprint for the Trade Union Act 2016: E Holmes, A Lilico and T Flanagan, Modernising Industrial Relations (Policy Exchange Research Note, September 2010), which identified (at pp 17–18) only three situations in which it might be desirable to permit (by law) an individual worker to take strike action: where there are significant costs to employer or employee in absorbing a new worker into the employee's position, where employees have limited choice of employer and where the law offers limited employment rights. In a free and efficiently functioning labour market by contrast, it seems there is no tenable basis to permit workers to strike!

4. A Bogg and T Novitz (eds), Voices at Work: Continuity and Change in the Common Law World (2014). The foundational analysis is A O Hirschman, Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations and States (1970); (for earlier sources see B E Kaufman, ‘Employee Voice before Hirschman: Its Early History, Conceptualization, and Practice’ in A Wilkinson, J Donaghey, A Dundon and R B. Freeman, A Handbook of Research on Employee Voice (2014); more recently: P J Gollan and G Patmore, ‘Perspectives of Legal Regulation and Employment Relations at the Workplace: Limits and Challenges for Employee Voice’ (2013) 55 Journal of Industrial Relations 488; E McGaughey, ‘Behavioural Economics and Labour Law’, LSE Legal Studies Working Paper No 20/2014.

5. R Freeman and J Medoff, What Do Unions Do? (1984); S Deakin and F Wilkinson, ‘Labour Law and Economic Theory: A Reappraisal’ in H Collins, P Davies and R Rideout (eds), The Legal Regulation of the Employment Relation (2000); ACAS, Information and Consultation at Work: From Challenges to Good Practice , ACAS Research Paper 03/03; G Davidov, ‘Collective Bargaining Laws: Purpose and Scope’ (2004) 20 International Journal of Comparative Labour Law and Industrial Relations 81; S Deakin and F Wilkinson, The Law of the Labour Market: Industrialization, Employment, and Legal Evolution (2005); Department for Business, Innovation and Skills, Engaging for Success: Enhancing Performance through Employee Engagement (2009, URN 09/175) (‘Macleod Report’); P Davies, ‘Efficiency Arguments for the Collective Representation of Workers’, in A Bogg, C Costello, A C L Davies and J Prassl (eds), The Autonomy of Labour Law (2015); K Hoque and N Bacon, Workplace Representation in the British Public Sector: Evidence from the 2011 Workplace Employment Relations Survey (Warwick Papers in Industrial Relations No 101, 2015); J Dromey (ed), Involvement and Productivity – The Missing Piece of the Puzzle? , above.

6. Such as the opening or closing of workplaces or the expansion or contraction of production or services. Still less do they have a say on the terms and conditions of others, for example, the remuneration packages of senior managers. And few firms harness or encourage through adequate reward or encouragement the ingenuity or knowledge of their workers to solve production problems or to improve efficiency.

7. Nor do workers have any say over the minimal hourly rates fixed in the National Minimum Wage or the Living Wage.

8. D Smith and P Chamberlain, Blacklisted; The Secret War Between Big Business and Union Activists (2015).

9. For example, the time limits for consultation on measures to avoid collective redundancy have been reduced and the CJEU has restricted the application of the obligation: USDAW v WW Realisation 1 Ltd (C-80/14) [2015] ICR 675.

10. It is appreciated that sectoral bargaining poses problems for unions in that the site of negotiations is removed from the workplace of the worker and his or her influence (not merely on the negotiations but on the negotiators on his or her behalf) is diminished in proportion to the greater size of the bargaining unit. There are dangers of bureaucracy replacing direct participation. Yet without sectoral bargaining, as we have seen in the United Kingdom and in Europe, establishment-level bargaining also declines. The need for sectoral collective bargaining is becoming appreciated in the USA too: see D Rolf, ‘Toward a 21st-Century Labor Movement’, The American Prospect , 18 April 2016, http://prospect.org/article/toward-21st-century-labor-movement.

11. Allonby v Accrington and Rossendale College (Case C-256/01) [2004] ICR 1328, para 68; reiterated, in different contexts, in Danosa (C-232/09) [2010] ECR I-11405, para 39 and in Holterman Ferho Exploitatie BV v Spies Von Büllesheim (C-47/14) [2016] IRLR 140, para 41.

12. Work is usually a collective endeavour. Even those who work in splendid isolation usually require others to fulfil their endeavours (the freelance, the composer, the playwright, etc.). In the usual scenario, the employer requires the workforce to operate as a well-oiled team with each member exercising his or her individual judgment, skill and autonomy to that collective end. In contrast, in extracting the greatest surplus value from the collective operation, subject to the avoidance of disproportionate transaction costs in wage setting, the employer prefers to deal with each worker separately so as to maximise the former's power over the latter. The worker, however, can maximise his or her power by acting collectively to capture as much surplus value as they are able from the work they perform. Where such solidarity is achieved the resultant process is collective bargaining.

13. Saskatchewan v Attorney-General of Canada 2015 SCC 4, [2015] 1 SCR 245. A fuller quotation reads, [3] The conclusion that the right to strike is an essential part of a meaningful collective bargaining process in our system of labour relations is supported by history, by jurisprudence, and by Canada's international obligations. As Otto Kahn-Freund and Bob Hepple recognized: ‘The power to withdraw their labour is for the workers what for management is its power to shut down production, to switch it to different purposes, to transfer it to different places. A legal system which suppresses that freedom to strike puts the workers at the mercy of their employers. This – in all its simplicity – is the essence of the matter’ (Laws Against Strikes (1972), at p 8). The right to strike is not merely derivative of collective bargaining, it is an indispensable component of that right. It seems to me to be the time to give this conclusion constitutional benediction…. [53] In [an earlier Supreme Court decision], this Court recognized that the Charter [part of the Canadian Constitution] values of ‘[h]uman dignity, equality, liberty, respect for the autonomy of the person and the enhancement of democracy’ supported protecting the right to a meaningful process of collective bargaining within the scope of s. 2(d) [of the Charter]. And, most recently, drawing on these same values, in [another Supreme Court case] it confirmed that protection for a meaningful process of collective bargaining requires that employees have the ability to pursue their goals and that, at its core, s. 2(d) aims to protect the individual from ‘state enforced isolation in the pursuit of his or her ends’…. The guarantee functions to protect individuals against more powerful entities. By banding together in the pursuit of common goals, individuals are able to prevent more powerful entities from thwarting their legitimate goals and desires. In this way, the guarantee of freedom of association empowers vulnerable groups and helps them work to right imbalances in society. It protects marginalized groups and makes possible a more equal society. [54] The right to strike is essential to realizing these values and objectives through a collective bargaining process because it permits workers to withdraw their labour in concert when collective bargaining reaches an impasse. Through a strike, workers come together to participate directly in the process of determining their wages, working conditions and the rules that will govern their working lives. The ability to strike thereby allows workers, through collective action, to refuse to work under imposed terms and conditions. This collective action at the moment of impasse is an affirmation of the dignity and autonomy of employees in their working lives. [55] Striking – the ‘powerhouse’ of collective bargaining – also promotes equality in the bargaining process: England, at p 188. This Court has long recognized the deep inequalities that structure the relationship between employers and employees, and the vulnerability of employees in this context. In the Alberta Reference [case], Dickson C.J. observed that: ‘[t]he role of association has always been vital as a means of protecting the essential needs and interests of working people. Throughout history, workers have associated to overcome their vulnerability as individuals to the strength of their employers’. And this Court affirmed in the Mounted Police [case] that: ‘S 2(d) functions to prevent individuals, who alone may be powerless, from being overwhelmed by more powerful entities, while also enhancing their strength through the exercise of collective power. Nowhere are these dual functions of s 2(d) more pertinent than in labour relations. Individual employees typically lack the power to bargain and pursue workplace goals with their more powerful employers. Only by banding together in collective bargaining associations, thus strengthening their bargaining power with their employer, can they meaningfully pursue their workplace goals’. The right to a meaningful process of collective bargaining is therefore a necessary element of the right to collectively pursue workplace goals in a meaningful way … [the] process of collective bargaining will not be meaningful if it denies employees the power to pursue their goals.

14. S Lansley, The Cost of Inequality: Why Economic Equality is Essential for Recovery (CLASS, 2011); L Mishel, The Decline of Collective Bargaining and the Erosion of Middle Class Incomes in Michigan (Economic Policy Institute, Briefing Paper No 347, 24 September 2012); S Lansley, Rising Inequality and Financial Crisis: Why Greater Equality is Essential for Recovery (CLASS, 2012), at pp 4–5 points out the link between growth in inequality and economic crisis: ‘… historical evidence provides strong evidence of a link from equality to instability. The two most damaging recessions of the last century – the Great Depression of the 1930s and the Great Crash of 2008 – were both preceded by sharp rises in inequality’. See also J E Stiglitz, The Price of Inequality (2013); L Mishel, J Schmitt and H Shierholz, ‘Wage Inequality: A Story of Policy Choices’ (2014) 23(3) New Labor Forum 26; F Bourguignon, The Globalization of Inequality (2015); A B Atkinson, Inequality: What Can be Done? (2015).

15. ILO, Global Wage Report 2014/15: Wages and Income Inequality (2015), at p 19, citing J D Ostry, A Berg and C Tsangarides, ‘Redistribution, Inequality and Growth’, IMF Discussion Note SDN/14/02 (2014); OECD, In it Together: Why Less Inequality Benefits All (2015); ILO, IMF, OECD, World Bank, Income Inequality and Labour Income Share in G20 Countries: Trends, Impacts and Causes (2015), at p 4. J Ostry, P Loungani and D Furceri, ‘Neoliberalism: Oversold?’ (2016) 53(2) Finance and Development 38–41.

16. R Wilkinson, Unhealthy Societies: The Afflictions of Inequality (1996), R Wilkinson, The Impact of Inequality: How to Make Sick Societies Healthier (2005), R Wilkinson and K Pickett, The Spirit Level: Why Greater Equality Makes Societies Stronger (2010); and S Lansley, Rising Inequality and Financial Crises: Why Greater Equality is Essential for Recovery , above; Oxfam, The Cost of Inequality: How Wealth and Income Extremes Hurt Us All (Oxfam Media Briefing, 2013); Oxfam, Working for the Few; Political Capture and Economic Inequality (2014).

17. See the depressing: C Belfield, J Cribb, A Hood and R Joyce, Living Standards, Poverty and Inequality in the UK: 2015 (Institute for Fiscal Studies, Joseph Rowntree Foundation, July 2015).

18. A Reeves et al., ‘Austere or Not? UK Coalition Government Budgets and Health Inequalities’ (2013) 106 Journal of the Royal Society of Medicine 432.

19. Office for National Statistics, Life Expectancy at Birth and at Age 65 by Local Areas in the United Kingdom, 2004–6 to 2008–10 (2011) shows that life expectancy was no less than 13 1/2 years greater for men born in Kensington and Chelsea compared to those born in Glasgow. The gap between the highest and lowest life expectancy grew by 1 year for men and 1.7 years for women in the four-year gap studied. The latest figures confirm that life expectancy has increased between 2007–2011 but that the life expectancy gap between social classes of men has persisted (82.5 years for social class 1 and 76.6 years for social class 7) and that there has been a slight widening of the gap for women: ONS, Trend in Life Expectancy at Birth and at Age 65 by Socio-Economic Position Based on National Statistics Socio-Economic Classification, England and Wales, 1982–1986 to 2007–2011 , 21 October 2015. Infant deaths are more than twice as common amongst those from ‘routine and manual occupations’ than those from ‘higher managerial, administrative and professional occupations’ (5.3 per thousand compared to 2.1 per thousand: Office for National Statistics, Statistical Bulletin: Childhood Mortality in England and Wales: 2014 , 19 April 2016, https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/childhoodinfantandperinatalmortalityinenglandandwales/2014, table 1). A long-term decline in mortality was reversed by the adoption of the policies of austerity for men since 2010 and for women since 2011: R Loopstra, M McKee, S V Katireddi, D Taylor-Robinson, B Barr and D Stuckler, ‘Austerity and Old-Age Mortality in England: A Longitudinal Cross-Local Area Analysis, 2007–2013’ (2016) 109(3) Journal of the Royal Society of Medicine 109.

20. www.economist.com/node/21564417.

21. S Machin, ‘The Decline of Labour Market Institutions and the Rise in Wage Inequality in Britain’ (1997) 41 European Economic Review 647; A Blackett and C Sheppard, ‘Collective Bargaining and Equality: Making Connections’ (2003) 142 International Labour Review 419; D Card, T Lemieux and W Craig Riddell, ‘Unions and Wage Inequality’ (2004) 25 Journal of Labor Research 519; D Checchi, J Visser and H van de Werfhorst, ‘Inequality and Union Membership: The Influence of Relative Earnings and Inequality Attitudes’ (2010) 48 British Journal of Industrial Relations 84; B Western and J Rosenfeld, ‘Unions, Norms and the Rise in US Wage Inequality’ (2011) 76 American Sociological Review 513; S Hayter and B Weinberg, ‘Mind the Gap: Collective Bargaining and Wage Inequality’ in S Hayter (ed.), The Role of Collective Bargaining in the Global Economy (2011); see generally J Berg (ed.), Labour Markets, Institutions and Inequality (2015); and in particular, in that volume S Hayter, ‘Unions and Collective Bargaining’.

22. ILO, Global Wage Report 2014/15: Wages and Income Inequality (2015), pp 59–60, citing J Visser and D Checchi, ‘Inequality and the Labor Market: Unions’ in W Salverda, B Nolan and T M Smeeding (eds), The Oxford Handbook of Economic Inequality , above, p 230.

23. ILO, Global Wage Report 2014/15: Wages and Income Inequality (2015), p 60. ‘There Is Consistent Evidence…That Overall Earnings Dispersion Is Lower Where Union Membership Is Higher and Collective Bargaining More Encompassing and/or More Centralised/Co-Ordinated’: OECD ‘Wage-Setting Institutions and Outcomes’, in OECD, Employment Outlook (2014), p 160 (and see 166).

24. Sector-wide collective bargaining blossomed in the 1930s (though as far back as 1919, the Weimar Constitution, Article 165 had made provision for workers and employees to regulate wages and working conditions at enterprise, district and national levels). It was seen, in Europe, North America and Australia, as a central component of the strategy of economic recovery from the Great Crash of 1929 and the Depression which followed in the 1930s. In the UK the government's decision to implement the Whitley Reports of 1917–18 had a remarkable immediate impact, with some 5 million workers being brought into some kind of joint wage regulation (either JICs or trade boards) between 1917 and 1921. But in the period of austerity from 1921 until the aftermath of the Great Depression, the system was allowed to decay and of the original 73 JICs, only 47 remained in existence by 1926 (A figure which slipped to 20 by 1939, even though the latter were said to be ‘by far the largest and most important’: A Fox, History and Heritage: The Social Origins of the British Industrial Relations System (1985), p 297). But from 1934 the Ministry of Labour assumed a proactive role proclaiming that: ‘It has been the policy of the Department to take every opportunity of stimulating the establishment of joint voluntary machinery or of strengthening that already in existence’ (Ministry of Labour, Annual Report 1934 , Cmd 4861 (1935), p 74). In 1937 the Ministry reported that ‘In some industries the scope of existing machinery was extended, while in others, where no constitutional machinery existed, discussions took place under the auspices of the Department for the purpose of formulating proposals for the joint regulation of wages and working conditions’ (Ministry of Labour, Annual Report 1937 , Cmd 5717 (1938), p 63). During the Second World War, the collective bargaining system was heavily relied upon to enhance Britain's war effort with a legal mechanism (compulsory binding arbitration) to enforce collective agreements in an industry or locality against non-parties, so preventing undercutting (the Conditions of Employment and National Arbitration Order 1305 of 1940 which imposed the duty ‘upon all employers … to observe recognised terms and conditions of employment’ (or terms and conditions not less favourable)). In the United States the National Industrial Recovery Act of 1933 made provision for a form of sector-wide regulation of the US economy through ‘industry codes’ in which it was anticipated labour unions would play a part in negotiating. Although there were 546 such codes (which dealt with prices as well as wages), the NIRA was declared unconstitutional in 1934 – see A J Badger, FDR: The First Hundred Days (2008); K D Ewing, ‘The European Union and Collective Bargaining’ (2016) 117 Theory and Struggle 16. The 1933 Act was replaced by the much less effective National Labor Relations Act of 1935. In 1936 France's Popular Front government established the right to bargain collectively in the Matignon Accords which settled the general strike of that year. In Ireland the Conditions of Employment Act 1936, provided by s 50, (in relation to wages payable for particular forms of ‘industrial work’) for the registration of collective agreements on wages made between employers and unions, for the universal application of such registered agreements and for their enforcement in the particular industry once the terms of the agreement had been registered and published in the Official Journal, Iris Oifigiúil. In Sweden the Saltsjöben Agreement, signed in 1938, cemented the consensus approach to collective bargaining and industrial dispute resolution which remains the bedrock of the Nordic model and has preserved Sweden from the worst of the economic crisis of the last few years.

25. E Stockhammer, Why Have Wage Shares Fallen? (ILO, 2012), p 43.

26. C Belfield, J Cribb, A Hood and R Joyce, Living Standards, Poverty and Inequality in the UK: 2015 (Institute of Fiscal Studies (supported by Joseph Rowntree Foundation), July 2015, http://www.ifs.org.uk/uploads/publications/comms/R107.pdf, p 32, figure 3.4).

27. E McGaughey, Do Corporations Increase Inequality? (30 November 2015), http://piketty.pse.ens.fr/files/McGaughey2015.pdf, at p 21. As he puts it: ‘… inequality grew most clearly where people were deprived of a meaningful voice at work. In the UK and US where collective bargaining remained the “single channel” for workplace voice, the effects were more pronounced than Germany, where workers had binding votes for workers on boards and works councils’ (ibid., p 48).

28. Ibid., pp 20–21. We are grateful for permission to reproduce this. McGaughey's UK graph closely resembles a graph showing unions and (un)shared prosperity in the USA (1918–2008) produced by R Eisenbrey and C Gordon, As Unions Decline, Inequality Rises (Economic Policy Institute, 2012), http://www.epi.org/publication/unions-declineinequality-rises/, reproduced in R Wilkinson and K Pickett, The Importance of the Labour Movement in Reducing Inequality (CLASS Thinkpiece, July 2014), p 6. These are consistent with a graph in a different format showing that, in an international comparison, countries with stronger trade unions are less unequal (data for 16 OECD countries 1966–1994) by B Gustafsson and M Johansson, ‘In Search of Smoking Guns: What Makes Income Inequality Vary Over Time in Different Countries?’ (1999) 64 American Sociological Review 585, also reproduced in R Wilkinson and K Pickett, ibid., p 6. Graphs to similar effect but different format show the strong link between union density and top earners' income shares: F Jaumotte and C Osorio Buitron, Revisiting the Drivers of Inequality: The Role of Labour Market Institutions (VOX, CEPR's Policy Portal, 2015).

29. See the ‘The four pillars of collective bargaining’ section.

30. In the United Kingdom and in the world at large, the labour share has diminished significantly over the last 30 years: OECD: OECD Employment Outlook 2012 (2012), Chapter 3. According to research by the New Economic Foundation, Working for the Economy. The Economic Case for Trade Unions (2015), p 5, wage share in the UK reached its peak in 1975 at 76.2% and had decreased by 8.9% in 2014, to 67.3%: http://b.3cdn.net/nefoundation/dc86334962e1f9a027_gfm6bex7d.pdf.

31. Ö Onaran, A Guschanski, J Meadway and A Martin, Working for the Economy: The Economic Case for Trade Unions (University of Greenwich, New Economics Foundation, 2015), p 33.

32. Primarily by distributing more of the surplus value of work as wages rather than profit.

33. S Deakin, J Michie and F Wilkinson, Inflation, Employment, Wage-Bargaining and the Law (Institute of Employment Rights, 1992); F Wilkinson, ‘Equality, Efficiency and Economic Progress: The Case for Universally Applied Equitable Standards for Wages and Conditions of Work’, in W Sengenberger and D Campbell (eds), Creating Economic Opportunities: The Role of Labour Standards in Industrial Restructuring (International Institute for Labour Studies, 1994); S Deakin and F Wilkinson, ‘Rights vs Efficiency? The Economic Case for Transnational Labour Standards’ (1994) 23 Industrial Law Journal 289; S Deakin and F Wilkinson, Labour Standards – Essential to Economic and Social Progress (Institute of Employment Rights, 1996); S Sachdev and F Wilkinson, Low Pay, The Working of the Labour Market and the Role of the Minimum Wage (Institute of Employment Rights, 1998); S Deakin and F Wilkinson, ‘Labour Law and Economic Theory: A Reappraisal’, in H Collins, P Davies and R Rideout, The Legal Regulation of the Employment Relation . T Aidt and Z Tzannatos, Unions and Collective Bargaining: Economic Effects in a Global Environment (World Bank, 2002), wrote that ‘high rates of unionization lead to greater income equality, lower unemployment and inflation, higher productivity and speedier adjustments to economic shocks’. B E Kaufman, ‘What Unions Do: Insights from Economic Theory’ (2004) 25(3) Journal of Labor Research 351; note the review of literature in T Aidt and Z Tzannatos, ‘Trade Unions, Collective Bargaining and Macroeconomic Performance: A Review’ (2008) 39 Industrial Relations Journal 258; S McGuinness, E Kelly and P O'Connell, The Impact of Wage Bargaining Regime on Firm-Level Competitiveness and Wage Inequality: The Case of Ireland (ESRI, Working Paper No 266, 2008); F Traxler and B Brandl, The Economic Effects of Collective Bargaining Coverage: A Cross-National Analysis (ILO, 2009); F Traxler and B Brandl, ‘The Economic Impact of Collective Bargaining Coverage’ in S Hayter (ed.), The Role of Collective Bargaining in the Global Economy (ILO, 2011); D Cunniah et al., ‘Towards a Sustainable Recovery: The Case for Age-Led Policies’ (2011) 3 International Journal of Labour Research 159; F Traxler and B Brandl, ‘Collective Bargaining, Inter-Sectoral Heterogeneity and Competitiveness: A Cross-National Comparison of Macroeconomic Performance’ (2012) 50 British Journal of Industrial Relations 73. A strengthening of collective bargaining together with other labour market institutions is advocated by D Coats, From the Poor Law to Welfare to Work, What Have We Learned From a Century of Anti-Poverty Policies? (The Smith Institute, 2012); and by S Lansley and H Reed, How to Boost the Wage Share (Touchstone Pamphlet No 13, 2012). To state the converse: ‘In heavily monopolised economies, demand will not automatically keep pace with production. This will particularly be so if the bargaining power of labour decreases, and this is precisely what happened in the decade after 2000’: J Foster (2012) 64(2) Communist Review 5; or‘… higher pay is also needed in sectors of the UK economy that can afford it. As we have seen, this is a particular problem in the UK, where given the scale of the decline in private sector collective bargaining coverage, there is now relatively little upward pressure on many firms in the large service sectors that account for the bulk of low pay’: C Cowdery et al., Gaining from Growth, the Final Report of the Commission on Living Standards (Resolution Foundation, 2012), at p 95. See also: Ö Onaran and G Galanis, Is Aggregate Demand Wage-Led or Profit-Led? (ILO, 2012); G Vernon and M Rogers, ‘Where Do Unions add Value? Predominant Organizing Principle, Union Strength and Manufacturing Productivity Growth in the OECD’ (2013) 51 British Journal of Industrial Relations 1; S Deakin, C Fenwick and P Sarkar, ‘Labour Law and Inclusive Development: The Economic Effects of Industrial Relations Laws in Middle-Income Countries’ in M Schmiegelow (ed.), Institutional Competition between Common Law and Civil Law: Theory and Policy (2014); S Deakin, J Malmberg and P Sarkar, ‘How Do Labour Laws Affect Unemployment and the Labour Share of National Income? The Experience of Six OECD Countries, 1970–2010 (2014) 153 International Labour Review 1; D Cooper and L Mishel, The Erosion of Collective Bargaining Has Widened the Gap Between Productivity and Pay (Economics Policy Institute Paper No 143, 2015), http://portside.org/2015–01–10/erosion-collectivebargaining-has-wid-ened-gap-betweenproductivity-and-pay; Ö Onaran, A Guschanski, J Meadway and A Martin, Working for the Economy: The Economic Case for Trade Unions (University of Greenwich, New Economics Foundation, London, 2015); S Deakin, ‘The Contribution of Labour Law to Economic Development and Growth’ (Presentation to 21st Congress of the International Society for Labour and Social Security Law, Cape Town, 21 September 2015).

34. G Davidov, ‘Collective Bargaining Laws: Purpose and Scope’ (2004) 20 International Journal of Comparative Labour Law and Industrial Relations 81; F Fakhfakh, V Pérotin and A Robinson, ‘Workplace Change and Productivity: Does Employee Voice Make a Difference?’ in S Hayter (ed.), The Role of Collective Bargaining in the Global Economy (above); M Lawrence and C McNeill, Fair Shares: Shifting the Balance of Power in the Workplace to Boost Productivity and Pay (IPPR, 2014). As Janet Wilkinson points out: ‘boosting trade union recognition and collective bargaining coverage would make an important contribution to tackling the UK's poor record on productivity’ (‘Trade Unions and Productivity’ in Dromey (ed.), above, p 29).

35. The Public Contracts Directive 2014, Article 18(2) includes a general obligation on member states to ensure the enforcement of social and environmental obligations through public procurement. It states: ‘Member States shall take appropriate measures to ensure that in the performance of public contracts economic operators comply with applicable obligations in the fields of environmental, social and labour law established by the Union law, national law, collective agreements or by the international environmental social and labour provisions listed in Annex X’. Annex X refers to a number of international conventions including several ILO Conventions. There is also a specific obligation in Article 69(3) to reject tenders which on examination are found to be abnormally low because of non-compliance with such obligations. Article 71 includes provisions designed to deal with sub-contractors' non-compliance with their social and environmental obligations (although limited and largely dependent on member states establishing national rules). See RegioPost GmbH & Co v Stadt Landau in der Pfalz (C-115/14), 17 November 2015.

36. IMF, World Economic Outlook: Spillovers and Cycles in the Global Economy (2007); ILO, Global Wage Report 2008/9 – Minimum Wages and Collective Bargaining: Towards Policy Coherence (2008).

37. ILO Convention 98 (1949), European Convention on Human Rights (1950), Article 11 European Social Charter (1961), Article 6, and Charter of Fundamental Rights of the European Union (2000), Article 27. It is implicit in Article 8 of the International Covenant on Economic, Social and Cultural Rights, and Article 23 of the International Covenant on Civil and Political Rights (both 1966).

38. This is almost identical to wording in the Korea-EU free trade agreement (effective by way of an EU Council Decision of 14 May 2011) at Chapter 13, Article 13.4, para 3. Both agreements also contain near identical versions of the following: ‘Each Party shall ensure that its labour law and practices embody and provide protection for the fundamental principles and rights at work, and reaffirm its commitment to respecting, promoting and realising such principles and rights in accordance with its obligations as member of the ILO and its commitments under the ILO Declaration on Fundamental Principles and Rights at work and its Follow-up, adopted by the International Labour Conference at its 86th session in 1998: (a) freedom of association and the effective recognition of the right to collective bargaining … 2. Each Party shall ensure that its labour law and practices promote the following objectives included in the Decent Work Agenda, and in accordance with the 2008 ILO Declaration on Social Justice for a Fair Globalisation, and other international commitments’ (CETA Chapter 24, Article 3; the Korea agreement equivalent is at Article 13.4, paras 2 and 3). The very recently published draft of the EU-Vietnam free trade agreement is virtually the same. These Free Trade Agreements (FTAs) are objectionable in almost every respect except their recitation of ILO principles; unenforceable though these latter are under FTAs, in particular the Investor-to-State Dispute Settlement schemes (and the newer Investor Court Scheme) which give no standing to trade unions, citizens or even States to sue the corporations which are the beneficiaries of the SDAs.

39. Lord Bingham, ‘The Rule of Law’ (2007) 66 The Cambridge Law Journal 67. See also T Bingham, The Rule of Law (2011). The Council of Europe, Report on the Rule of Law – Adopted by the Venice Commission at its 86th plenary session (25–26 March 2011) at para 36 came to a similar conclusion that the proposition that the ‘law must be followed’, and ‘applies not only to individuals, but also to authorities, public and private’. For a discussion of the Rule of Law in European labour law see K D Ewing and J Hendy, ‘The Eclipse of the Rule of Law: Trade Union Rights and the EU’ (2015) 4 Revista Derecho Social y Empresa 80.

40. The ILO's Collective Bargaining Convention 154 (1981) also contains the duty to promote collective bargaining, though the United Kingdom has not ratified it. The European Court of Human Rights (ECtHR) regards the right to collective bargaining as an ‘essential element’ though Article 11 does not require States to promote collective bargaining: Unite v UK , application No. 65397/13, 26 May 2016.

41. (2009) 48 EHRR 54.

42. Ibid., para 157.

43. Conditions of Employment Act 1936, Section 50.

44. ILO Convention 94 (Labour Clauses (Public Contracts) Convention, 1949) expressly permits public contracts to specify that the workers concerned shall enjoy hours, and other conditions not less favourable than those established for work of the same character in the trade or industry in the district where the work is carried on. Directive 96/71 on the posting of workers in the EU (defective as it is in the light of the CJEU judgments in Laval un Partneri Ltd v Svenska Byggnadsarbetareforbundet (C-341/05) [2008] IRLR 160 and Ruffert v Land Niedersachsen (C-346/06) [2008] ECR I-1289) applies to erga omnes collective agreements, so long as they are universally applicable to the industry in question in the member's State: Article 3(8).