Influences and Remedies for Union Density in France and Britain;

A brief Comparison

Word Count: 2215

By Charles Audley, s2158468

Critical Essay for 7024EHR, International Human Resource Management

Semester 2 2012

Gold Coast Campus

Historically, trade union density grew steadily across Europe during the post-

WWII era, but experienced a downturn during the 1990’s and 2000’s (Scheuer, 2011).

Several theories have sought to explain this decline, however, structural, institutional,

cyclical/global, and strike-related causes appear consistently throughout the literature

(Bryson, Ebbinhaus & Visser, 2011; Clark, Contrepois & Jefferys, 2012; Sano &

Williamson, 2008; Scheuer, 2011). Two powerful European economies have been

selected for this discussion; France and Britain. Under the Varieties of Capitalism

(VoC) model, both countries, to a degree, represent Liberal Market Economies

(LMEs), although France is occasionally labelled as a state-business-elite LME or

“statist-LME” (Peck & Theodore, 2007), due to the unique low density/high coverage

effect observed. The VoC framework will be utilised to make comparisons between

France and Britain in union density causes and possible remedies, while other factors

such as the Ghent system, political affiliations, structural reforms and the role of co-

ordinated worker mobilisations will be explored. How these two countries, both

members of the European Union (EU), have had their trade union density affected by

the aforementioned forces will be investigated throughout, with an emphasis on not

merely how, but also why these nations may wish to address the situation.

Theoretically, trade unions have the potential to significantly influence

organisational performance (Bryson, Forth & Laroche, 2011). They may do this

negatively by, for example, fighting for above-market wages or bargaining for

expensive improvements in worker conditions. Conversely, trade unions have the

potential to enhance profits, i.e., by raising productivity or assisting effective

organisational change. Empirical evidence suggests that negative effects typically

prevail (Bryson, Ebbinghaus & Visser, 2011; Bryson, Forth & Laroche, 2011; Hirsch,

2008), and this has contributed to increasing tensions and strained relations between

trade unions and employers (Palier & Thelen, 2011). Firstly, labour unions and trade

unions are not synonymous. Labour unions are, generally speaking, only concerned

with the working lives of the individual, whilst trade unions encompass changes at a

broader social and political level. These differences are often obscure or overlapping,

and frequently poorly defined (Meardi, 2010), however for the sake of consistency,

here we shall deal with trade unions, rather than labour unions. Similarly, whilst

viewing trade union decline through the lens of membership provides an interesting

insight (Visser, 2002), the role of unions is central to the argument that without their

existence, capitalism does not have the crucial balance that mitigates worker

exploitation (Bryson, Ebbinghaus & Visser, 2011).

When identifying structural indicators of union density, the most commonly-

cited factors include white-collar status, employment in the private sector, the move

towards part-time and casual employment, and the rise in traditionally non-union

sectors such as the service and retail industries (which are typically dominated by the

female labour force) (Bryson, Ebbinhaus & Visser, 2011; Scheuer, 2011). Britain has

moved away from being an industrially driven economy, becoming increasingly

service-oriented, a sector which traditionally seen low levels of unionisation due to

the prevalence of P/T and casual employees. The French have a particularly strong

industrial economy, with numerous world-leading chemical, pharmaceutical and I.T.

companies (Palier & Thelen, 2011). Furthermore, restructuring of the industrial

sector, outsourcing of positions to the service sector (again, typically P/T and casual

employees), and the progressive privatisation of France’s iconic state owned

enterprises have all contributed to decreasing union density (Palier & Thelen, 2011).

While differing sectors enjoy corresponding traditional benchmarks for union

saturation, age also plays a significant role.

While total union membership has experienced a overall modest decline in

Europe, this effect may be compounded based on the historical “inverted-U” age-

related trend in unionisation, identified by Blanchflower (2007). Interestingly, this

pattern crosses both LMEs and CMEs, and suggests that across most European

countries, the probability of union membership increases steadily, and peaks for

individuals aged in their late 40’s, then steadily declines after that point. Despite this

historical trend, in EU countries for which data is available, retired workers constitute

a considerable (17.2%) proportion of total union membership (Visser, 2006). France

in particular has this free-rider effect, with older workers enjoying all the benefits a

trade union affords, while negating to maintain their union dues (Blanchflower, 2007).

However it is due to the gradual shift of collective bargaining from

government powers, into sector-wide bargaining, and finally down to individual

corporations that may be responsible for the majority of changes in union density

(Blanchflower & Freeman, 1992). This changing pattern dilutes the power to reform

on a broad level and replaces it with limited, narrow-focused collective bargaining

agreements. If trade union density is to be restored to post-WWII levels, it will require

the shift back to collective bargaining at a larger level, perhaps even including trade

blocks such as the EU. This would of course require enormous commitment and

compromise at an unprecedented international level, yet it can begin with a simple

shift away from individual agreements that female-dominated labour markets and

sectors (i.e., retail and service industries) now employ. Historically, dramatic

turnarounds in density have occurred, most notably following the President of the

American Economic Association declaration in that trade unions in the US were dead,

which led to a worker revolt, militant action and unprecedented revival of unionism

during the Roosevelt era (Kaufman, 2001). This brings us to institutional forces

affecting trade union density.

As two advanced industrialised Western European economies, France and

Britain could not be more different in their approach to trade unions. Despite having

very similar populations and economic output and living standards, the two are often

labelled as affiliating with different clusters of industrial relations (Visser, Beentjes,

Gerven & Stasio, 2009). Expanding a level deeper into the VoC approach, which

refers to both France and Britain as existing on the LME continuum, Britain is seen as

a ‘Liberal’ IR state, while France is referred to as a ‘State-centred’ approach (Clark,

Contrepois & Jefferys, 2012). Britain has a much more complex and procedural

approach to IR negotiations, whereas France has more of a broad, all-encompassing

style where unions exercise considerable influence (Bryson, Forth & Laroche, 2011).

A highly influential researcher in institutional economics, John Commons

(1931), was grappling with a definition for ‘institution’ more than eighty years ago,

and little has changed. Whether a reference to laws, law enforcement, or the style of

government in power, institutional forces in France and Britain have had an impact on

union density, by altering the environment in which the ‘game’ is played (Meardi,

2010). Simultaneous to the decrease in union density has been the increase in the

number of countries who are members of trade blocs, such as the EU, NAFTA and

WTO (Blaschke, 2000). As Britain and France are both members of the EU (France

one of six original member states in 1952, with Britain following as a first round

enlargement in 1973), they share a single economic market, which enables most

goods, services, money and people to move about relatively freely (Gabrisch &

Werner, 1998; Wood & Quaisser, 2008).

Private sector union density is roughly three times higher in Britain than in

France (Bryson, Forth & Laroche, 2011). A large part of this difference in France is

due to the free-rider problem (non-unionised employees gaining advantage due to the

efforts of their unionised counterparts, and subsequently taking advantage of anti-

discrimination legislation) is not one that is easily solved, and is seen as almost

inevitable to some extent, even in highly uinionised sectors or workplaces (Scheuer,

2011). If addressing union density had to identify a single possible foothold, in France

it may be ushered in by the recent election of Francois Hollande-led socialist

government, who traditionally have encouraged unionism whilst promoting capitalist

ideals (Gill, 1998). This return to socialism may encourage both younger and older

workers to return to unionism as part of a desire to strengthen the influence of unions

with the newly elected government, in order to pass legislation that benefits both

workers and the economy. Another massive influence on union density is the effect of

cyclical influences, such as the global economy.

Both France and Britain experienced a slump in economic output following

the recent GFC. This can in part be explained by their relatively high exposure to the

international economy via multinational entities, which places both in a position to be

on the receiving end of both boom and bust cycles (Perraton, Goldblatt, Held &

Mcgrew, 1997). Immediately preceding the GFC (between 1998 and 2003), not a

single country in the 34-member Organisation for Economic Co-operation and

Development (OECD) experienced a rise in union density (Blanchflower, 2007). This

trend suggests that some global force is responsible, and indeed, this is often

attributed directly to the GFC (Scheuer, 2011). A simplistic model suggests this is not

a problem during time of low unemployment, however the GFC increased the

exposure to income inequalities, and this, coupled with the unions’ diminished

influence with politicians, has lead to poor outcomes for the individual workers.

Private sector union density is roughly threefold higher in Britain than France.

However, union intervention in France occurs at a much lower level in France than

Britain, that is, a single union representative in France can win agreements which

apply to all workers on-site, irrespective of the union affiliation (Bryson, Forthe &

Laroche, 2011). In Britain however, even if a workforce is heavily unionised, the

extent to which a union has influence is highly dependent upon the employer. The

result is that many French workers have their pay rates established via collective

bargaining agreements, while British workers are typically impeded by union

relations within their organisation.

The presence or absence of the Ghent system (an unemployment scheme

which is administered and distributed by labour unions rather than a state-run body) is

often identified as a key driver of union density. Compounding the effects of the

Ghent system erosion in France, relatively low unemployment levels may be

responsible for the decreasing density of trade unions, as workers gradually evolve

into free-riders (Lind, 2009). This hypothesis suggests, however, that following the

recent Global Financial Crisis (GFC) that a return to unionism is likely. The Ghent

system, adopted by France in 1905, should bolster union density, thus far, the

opposite has occurred. This can be accounted for by the erosion over time of the

Ghent in France, which has slowly shifted unemployment insurance responsibilities to

the state, hence reducing the reliance upon unions (Lind, 2009). The British who have

never adopted the Ghent system, see a shallower decline in union density (Scruggs,

2002).

If a dramatic change in union density is to occur in the near future, it is likely

to be in response to a realisation that unbridled capitalism largely contributed to the

GFC (Sano & Wiliamson, 2008). Without the various collective protections that

unions offer workers, there is no viable alternative to voice the concerns and fight for

the working class. Despite the ramifications of the GFC and implications of the Ghent

system, collective worker mobilisations typify a potentially game-changing TU

density factor: strike-related activity.

As the changes brought about by the GFC/GEC unfold in unpredictable ways,

such as the destabilisation of the EU (Bryson, Forth & Laroche, 2011), in France the

highly co-ordinated and organised collective worker mobilizations, once so prevalent

in the 1970’s, are still being seen (Meardi, 2010). Although levels of collective strike

action have decreased significantly since the 1970’s, strikes are still much more

common in France than Britain (Palier & Thelen, 2011). In a recent comparison of

strike days per 1000 employees in the construction industry, Hale (2008) estimated

that British workers took an average of 13 days, compared with an average of 46 days

in France. This discrepancy can be explained by the differing manner in which unions

engage with employers in France and Britain (Bryson, Forth & Laroche, 2011).

Union density and strike activity are often mentioned as being associated in

the literature (Sano & Williamson, 2008). French workers strike at a ratio of 3:1 in

comparison with British workers, and union density, particularly public sector

density, is often highest during periods of strike activity, although no causal link has

been established (Palier & Thelen, 2011). The underlying feature of the comparison is

that while British unions often threaten to strike, this is often enough to expedite

negotiations, whereas French unions typically bypass advance strike notification and

mobilise popular street protests, which has even been directly linked to the 1997

Socialist Party victory (Jeffreys, 2001).

To summarise, despite both France and Britain being solid European

economies with comparable outputs, the union density disparity is glaring, and until

very recently, saw little on the horizon to indicate imminent change. Policy

implications seem to be a leading contender for stemming the decline in union

density, with a move towards collective bargaining at the national level and away

from institutional level control (Sano & Williamson, 2008). It is unlikely the Ghent

system will play a significant role in stemming TU density in France, and in Britain

the welfare system is already under considerable funding pressure. With the advent of

the highly flexible workforce (P/T and casual employees, very often with a high

proportion of female workers), unionisation has struggled to capture another

proportion of potential members. Collective worker mobilisations may well be the

vehicle to force change via a grass-roots movement, as the highly-interconnected

global market reacts to the volatility that strike-related activity attracts. If unions are

to tackle the problems that unimpeded capitalism has dealt the global economy in

recent years, they must address the problem at the national (governmental) or

international (EU, WTO) level, which will necessitate a coordinated, justified, and

politically persuasive approach. If current events such as the Arab Spring are any

indication, the ability for such responses to gain overwhelming social momentum are

too large for any organisation, sector, government or trade bloc to ignore.

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