APPENDIX 17
Memorandum by the Trades Union Congress
I. INTRODUCTION
1. On 7 May the Trade and Industry Committee
announced its intention to conduct an inquiry into UK Employment
Regulation that would cover the contribution labour market flexibility
makes to the UK economy and consider whether the current degree
of flexibility is appropriate or desirable, and, if not, what
measures the Government should take.
2. This memorandum presents the TUC submission
to that inquiry, and argues:
— The debate about employment regulation
should take into account the positive advantages of employment
rights.
— Different forms of labour market
flexibility interact: any evaluation of measures to promote numerical
or wage flexibility must take into account their impact on functional
flexibility.
— British debates about employment
regulation over-state the importance of labour market flexibility,
and this is linked to a "low road" business approach,
in which success is built on the foundation of low prices and
low input costs—including pay, training and capital investment.
— In an era of technological change
and intense competition UK companies are less likely to succeed
using this approach. Instead a "high road" approach
is advocated, based on innovation, investment and high-trust relationships.
Unions have a great deal to offer in an economy that is taking
the high road.
— The best business environment for
this approach is the European Social and Economic Model, providing
social security through generous benefits, a firm foundation of
fair employment laws, and social partner involvement at every
stage, from the firm, through the regions, to the national level.
— Specific reforms proposed in the
submission include increases in the national minimum wage, an
end to the opt-out from the Working Time Directive, the introduction
of the Temporary Agency Worker Directive and reform of the law
on employment status, with the presumption that all workers are
covered by employment rights and any exclusions must be justified.
3. The TUC believes that the debate about
employment regulation should take into account the positive advantages
of employment rights. Employment rights help labour markets to
operate more effectively by creating security, reducing poverty,
inequality and social exclusion, and promoting the long-term trust
relationships that are essential if the UK is to succeed in internationally
competitive markets.
4. Different forms of labour market flexibility
interact: any evaluation of measures to promote numerical or wage
flexibility must take into account their impact on functional
flexibility1 and vice versa. Some forms of flexibility beloved
of classical economists—such as external numerical flexibility2—are
much less attractive when this feedback is taken into account.
5. Employment regulation is a matter of
more than just laws. The institutional framework—benefits,
active labour market policies, collective bargaining—is
essential. The TUC has been arguing for some time that the UK's
institutions and laws create a "low road" equilibrium,
which constrains firms to adopt business strategies that are unsuited
for a future of heightened competition. The public policy dimension
of that equilibrium is the characteristic British habit of viewing
employment rights only as a constraint on employers. Industrial
and social relations are seen as a zero-sum game, in which any
advance for those at the bottom must mean losses for those at
the top. Sheltered markets have allowed firms constrained by these
attitudes to muddle through, but this option is disappearing.
6. This submission argues that the creation
of a modern "flexicurity" labour market is the counterpart
of the "high road" business environment we seek to create.
This is not a Utopia—other low-unemployment European economies
have achieved this, using generous but conditional labour market
benefits; active labour market policies; social partner regulation
of, and participation in, the labour market and devolved institutions
and resources.
7. We conclude by arguing for a number of
concrete reforms including further increases in the national minimum
wage; further tax-benefit reforms to "make work pay";
increased education and training opportunities, especially for
people from poorer families; an increase in the real value of
out-of-work benefits; increased spending on active labour market
policies and (especially) childcare; further measures to improve
work-life balance (including an end to the UK opt-out from the
Working Time Directive); continued strong support for regional
development based on the RDAs; encouragement for the building
of High Performance Workplaces; and the reform of the law on employment
status. The keynote reform would be for the Government to promote
collective bargaining as a key element of flexicurity, using it
to address issues of low workplace productivity, training and
inequality.
II. EMPLOYMENT
PROTECTION IS
A GOOD
THING
8. It is notable that the title of this
inquiry is "employment regulation" but the terms of
reference only mention "labour market flexibility".
This reflects a tendency among some economists only to see employment
regulation as a problem.
9. But, of course, the laws, institutions
and practices that make up employment regulation do more than
simply affect the degree of labour market flexibility in the economy.
They were introduced to achieve positive social and economic objectives,
which are valuable in themselves, and the extent to which these
objectives are achieved should be included in any assessment.
As Robert Solow commented in his Keynes lecture:
"Every one of these regulations or restrictions
was intended to promote a desirable social purpose. Some may do
so ineffectively or inefficiently. That is worth knowing; but
the fact remains that wholesale elimination of these `rigidities'
is neither desirable nor feasible."3
10. Since 1997 the Government has re-regulated
the labour market. Some politicians and economists bitterly opposed
the national minimum wage, because it would reduce wage flexibility;
it would, we were told, increase unemployment and inflation. In
fact, price rises in 1999 (the year the minimum wage was introduced)
were lower than in the previous year. Employment rose by 250,000
in that year, and it has continued to rise alongside the minimum
wage, so that there are now a million more jobs than there were
five years ago. 18% of firms affected by the 2001 increase responded
by increasing their use of new technology, and the minimum wage
has also been responsible for modest increases in training and
improvements in retention and motivation in the low-paying sectors.4
11. The national minimum wage has made life
better for many low paid workers. 1.2 million received a pay increase,
with black and minority ethnic workers and disabled people gaining
disproportionately;5 and over a million people have gained from
each subsequent increase.6 The national minimum wage has reduced
the gender pay gap by about 1.5%.
12. It is just as misleading to consider
the rights introduced by the Working Time Directive only in terms
of reduced flexibility. These rights enhance the efficiency of
firms and the country as a whole, through improved health and
safety—excessive hours are linked to the likelihood of having
a road or industrial accident or of over-exposure to dangerous
chemicals and to such conditions as cardiovascular disease, diabetes,
stress and depression.7 There is also evidence that the long hours
culture restricts women's progress in the labour market, harms
parenting and undermines family life and is linked to low productivity,
high labour turnover and failure to innovate.8 We know that, despite
the severe limitations resulting from the opt-out, the Working
Time Regulations 1998 led to 6 million people getting an increase
in their holiday entitlement, including 2 million who had previously
had no holidays at all. This is a large increase in the total
of human happiness, and it is shocking that many politicians and
commentators pay it no attention at all.
13. We need these rights to have the force
of law because there are far too many employers who will do nothing,
even when better conditions would be in their interests, helping
them to maximise the contribution their workforce can make to
the organisation. The Working in Britain Survey found that "managers
are pragmatic enough to adapt to change in the way they treat
their employees when it is required of them but few seem willing
to take any positive initiative to introduce workplace reform
to meet worker demands or aspirations."9 The survey was carried
out when the Government was considering the right to work family
friendly hours, a debate that took place after several years of
exhortation and advice; the survey found "precious few signs
that most employers in Britain are planning in the near future
to improve benefits for employees with specific family responsibilities
beyond the bare legal requirement." 10
14. Getting rid of employment legislation
would not make the problems it addresses go away. Remove rights
and workers will try to defend themselves through their unions,
weaken the unions and they will turn to the courts. Businesses
hate the "compensation culture" that has long been a
feature of US employment, where unions have been weak and regulation
set at a low level for many years. Its rise in this country has
precisely mapped the move to deregulation and attacks on unions.
III. COMPLEXITIES
OF FLEXIBILITY
15. The Committee's inquiry focuses on labour
market flexibility, and this memorandum therefore does not discuss
product or capital markets in detail. But it does refer to them
in places, because labour market flexibility is undoubtedly influenced
by changes in the product and capital markets. As the Treasury
has argued:
"The overall flexibility of the economy
depends on the interaction of flexibility in the labour, product
and capital markets . . . the overall flexibility of the economy
depends on each market working as effectively as possible."
11
16. Equally importantly, just as the labour,
capital and product markets influence each other, so to do the
different institutions of labour market flexibility. One of the
key contentions of this submission is that measures designed to
promote numerical or wage flexibility will affect functional flexibility,
and vice versa.
17. The emergence of labour market flexibility
as a common field of study is a comparatively recent development,
and the term has been defined in many different ways in the past
three decades. As Robert Reich commented when he was the US Secretary
of Labor, it went "directly from obscurity to meaninglessness
without any intervening period of coherence." 12 In this
memorandum we will use the Treasury's categories: 13
— Geographical flexibility or the ease
with which workers can move across the country to another job.
— Employment and numerical flexibility—flexible
forms of employment that offer variations in hours and tenure,
and the regulation of hiring and firing.
— Functional flexibility—the
ability of the workers to perform a range of tasks, and thereby
allowing them to adapt to different skill requirements or work
practices.
— Wage flexibility, real and money
wages and relative wages.
IV. NON-WAGE
FLEXIBILITY AND
THE UK ECONOMY
Geographical flexibility
18. The Treasury's 2003 assessment of
EMU and labour market flexibility noted that, job mobility is
low in the EU generally, 14 but "need not necessarily undermine
the flexibility of the labour market as a whole. However, this
requires that other characteristics can compensate. That said,
more geographic mobility would help adjustment where other labour
market adjustment mechanisms are slow." 15 The follow-up
report published this Spring added that, with the exception of
London, "the net flow between most regions is generally very
small over the year," though net flows disguised the ease
with which people can move—2% of the population moved from
one region to another in 2002. 16 The Treasury believes that geographical
mobility is, nonetheless, lower than in the USA, requiring special
attention from the Government. 17 The Government is piloting reforms
of Housing Benefit to make it easier for unemployed people to
move to find work, and commissioned the Barker report on housing.
18
Employment flexibility
19. The Treasury has argued that a wide
variety of employment forms means more people are able to enter
and leave the labour market, and for hours to vary in response
to changes in demand. There is a great deal of hype about new
flexible working practices. There are changes, but they are long-term
trends, such as the growing proportion of women in the labour
force. Sorting out the real changes from pundits' inventions,
we can say:
— Temporary work surged in the mid
1990s, but has been shrinking as a share of employment ever since.
Today about 1.5 million employees work in temporary jobs, just
over 5% of the all employees. The big change in the recent years
has been within the temporary labour market, with fixed term jobs
falling and the number and proportion of agency temps increasing.
In 2002 the LFS showed 290,000 people, or one temporary worker
in 6, saying that they were temping for an agency, and the DTI
has said that this is probably an under-estimate, estimating the
true number as probably nearer 700,000.
— Second jobs/portfolio working has
been portrayed as the future of work, with descriptions concentrating
on IT literate graduates with a "portfolio" of jobs,
not just one. Second jobs are actually more common at the other
end of the labour market, where low paid workers need to supplement
inadequate earnings in their first job. Although second job holding
is more common in the UK than the rest of Europe the number of
people affected is falling at the moment. Today, just over 1 million
workers have second jobs.
— Homeworking is not going to be the
typical pattern of the future. There has been no overall rise
in the total number of people working at home rather than in an
office or factory, though occasional working at home—a day
or two a week—is much more common nowadays if we include
unpaid overtime by managers and professionals such as teachers.
— Teleworking is replacing more traditional
forms of homeworking—so although the overall number of people
working at home is static the share who say they telework is growing
rapidly. But what they often mean is that they are doing some
of their work on their own computer—often after the children
have gone to bed. People for whom teleworking is their modus operandi
are still rare—fewer than 1% of all in work, and most people
statistically classified as "teleworkers" are self-employed
or home-based workers such as salespeople or consultants.
— Specialisation and sub-contracting
is becoming more widespread, and has helped drive a big expansion
in areas such as business services. Between 2000 and 2003 recruitment
services, computer services and marketing and consultancy services
have recorded a 20% rise in employment. We expect this trend to
continue, with strong demand from both the public and private
sectors for bought-in services.
— Self-employment is increasingly dominated
by white-collar professional jobs in areas such as business services.
There are about 3.5 million self-employed people in the workforce
today, or just over 12%.
— Part time work has grown by 2-3 percentage
points in every decade since the start of the 1970s, and we expect
this to continue. In recent years the rise in part time work has
been related to the increasing number of students, who more frequently
combine work and study than in the past. There are several major
employers who now depend on student labour.
20. The 2003 Treasury study gives the UK
generally high marks for labour market flexibility, second only
to the USA. Actually, if the task is to Britain's employment picture
more like America's we will need a less diverse labour market.
Part-time work, temporary work and self-employment are more common
in Europe than the US, and the picture for the UK is very similar
to that for Europe generally: the UK has higher levels of part-time
work but less temporary work. 19
21. In fact, British usage of alternative,
`atypical' forms of employment probably reflects weaknesses as
much as strengths. As in Europe, about one worker in three on
a fixed term contract would prefer a permanent job but was unable
to get one. 20 The UK has very high levels of `occasional' working
at home, but this is likely to be the long hours culture in another
guise, rather than evidence of genuine flexibility. Similarly,
the large number (by EU standards) of low-hours part-time jobs
reflects factors which are unrelated to the flexibility story—lack
of childcare, a penal tax-benefit system and the rising number
of students taking on jobs to finance their educations.
22. The Treasury assumes that the Working
Time Directive's lack of bite in the UK is a good thing, but the
two most common reasons for long hours have little to do with
increased efficiency:
— low basic hourly rates for manual
workers, who have to rely on overtime; and
— unpaid overtime by white collar workers—which
grew rapidly in the 1990s, powered by the intensification of work.
Numerical flexibility
23. Numerical flexibility is usually taken
to have two aspects: internal and external. Internal numerical
flexibility is actually much more easily regulated by collective
bargaining than by legislation. Unions have long experience of
negotiating on overtime, shift premia and annual hours contracts.
Business people who resent the intervention of outside regulators
in these matters might care to consider the advantages of working
with a union to agree mutual gains solutions.
24. External numerical flexibility—the
extent to which employers are able to hire and fire workers without
reference to standards of fairness imposed by the state—has
become something of a totem for the free-market right. Regulation
in this area, they believe, hampers productivity, because firms
are unable to respond to changes signalled by the market. Lower
productivity eventually feeds through to lower total employment,
which also results from employers' reluctance to take on extra
workers for fear that they will be unable to dismiss them, should
the need arise. Unemployment will therefore, it is argued, be
higher in economies with tougher employment protection standards.
25. After the 1997 election Patrick Minford
predicted that, together with the minimum wage, the new Government's
(very moderate) plans for strengthened employment would cost more
than half a million jobs in the first year, and a million by the
end of the second. Recalling this prediction highlights the fact
that this is not the best time to argue that labour market efficiency
depends on less secure employment.
26. Far from being a threat to jobs, re-regulation
has been accompanied by a significant increase in employment.
Total employment has increased by about 1.5 million since 1997:
as the Chancellor boasted in his Budget speech, we have the highest
employment levels and lowest unemployment for a generation, with
new records being set every month, and most of this growth has
come from permanent employee jobs, not temporary work and self-employment.
27. Most anti-regulation arguments from
international evidence rely on comparisons between the USA and
the EU. This is interesting—between 1979 and 1997 the UK
went as far down the de-regulationist route as the US, but is
much less frequently quoted. There is a good reason for this:
Table 1
JOB CREATION RATES 1971-200421
| Annual average employment change
| UK | Eurozone
|
| 1971-80 | +0.3% | +0.3%
|
| 1981-90 | +0.5% | +0.5%
|
| 1991-2000 | +0.2% | +0.5%
|
| 1991-95 | -1.0% | -0.2%
|
| 1996-2000 | +1.4% | +1.4%
|
| 2001-04 (part forecast) | +0.7%
| +0.8% |
| | |
Jobs growth in the UK has consistently been at around the
same level as the rest of Western Europe or slightly worse. Our
foray into de-regulation has had no effect on this pattern.
28. It is a similar story when it comes to unemployment.
In the 1960s and 1970s UK unemployment was lower than in the economies
than went on to form the current Eurozone, but between 1980 and
1995 the average annual unemployment rate was higher in the UK
than in the Eurozone. Only in the second half of the 1990s has
the gap widened significantly between UK and average Eurozone
unemployment rates, a period when labour market regulation in
the UK was increasing.
Table 2
UNEMPLOYMENT PERFORMANCE 1971-200422
| Annual averages | UK
| Eurozone |
| 1971-80 | 3.8% | 4.2%
|
| 1981-90 | 9.6% | 8.9%
|
| 1991-95 | 9.3% | 9.4%
|
| 1996-2000 | 6.5% | 9.9%
|
| 2001-04 (forecast) | 4.9% |
8.1% |
| | |
29. And there is no clear relationship between a country's
productivity record and their level of labour market regulation.
In the chart below, EU member states' levels of regulation and
productivity are compared. The unbroken horizontal line divides
the seven countries with the highest level of regulation with
the seven with the lowest levels. Similarly, the unbroken vertical
line divides the higher productivity countries from those with
lower productivity. The chart below shows that there is no clear
relationship between regulation and productivity: EU member states
are scattered equally across all four quarters. The UK is outstanding
for low regulation and productivity.
30. All this is hard to explain if flexibility is the
only route to labour market success. It probably isn't:
— A British review of OECD research into the links
between employment regulation and labour market performance summarised
the results as showing that "employment protection legislation
has no significant associations with overall unemployment once
other factors are taken into account" and that "it appears
more important that the range and type of legislation adopted
in a particular country is appropriate and works well with the
other labour market institutions and culture in that country".23
— A study for the OECD in 1996 by Jackman, Layard
and Nickell concluded: "Lower employment protection. . .increases
hiring and thus reduces long-term unemployment. But it also increases
firing and thus increases short-term unemployment. The first good
effect is almost offset by the second bad one. The gains from
flexibility are small."
— A similar study by Nickell published in 1997 looked
at the underlying causes of differences in unemployment rates
across Europe and concluded: "Labour market rigidities which
do not appear to have serious implications for average levels
of unemployment include. . .strict employment protection and general
legislation on labour market standards."
— A recent study by Nickell concluded: "There
is no evidence that employment protection slows productivity growth.
Indeed, the reverse is more likely." 24
Functional flexibility
31. Workers' ability to take on different tasks quickly
and respond to changes has always been valuable, but this is more
true than ever in an era characterised by intense international
competition and the use of information technology. Intense competition
ensures the existence of a premium for firms that can quickly
change their products and the way they create them, and information
technology speeds up the response, cutting the time lapse between
strategic and operational decisions. But the ability to do this
depends upon having workers who can rapidly change what they do
and the way they do it, and on an organisation of work that allows,
encourages and enables them to do this.
32. In the past, UK policy has concentrated on skills
shortages (lack of people with the right skills in the labour
market generally) and skills gaps (lack of people with the right
skills within firms). Skills shortages have meant that the recovery
phase of the economic cycle has always seen an increase in inflationary
wage pressure, and the Treasury's 2003 EMU assessment pays close
attention to this issue. The paper notes that the Employer Skills
Survey and the BCC and CBI surveys show that that shortages have
at least stabilised since 1997; but skill gaps are more widespread.
25 Where skills shortages can mean higher wage pressure, skills
gaps are more likely to show up in poor productivity—and
it is certainly true that the UK has made very little progress
in closing the skills gap with the Eurozone economies:
Table 3
PRODUCTIVITY IN 1997 AND 200226
| EU = 100 | GDP per hour worked
| GDP per person employed |
| 1997 | 2002
| 1997 | 2002 |
| France | 110.8 | 113.7
| 107.5 | 108.8 |
| Germany | 107.3 | 106.2
| 99.7 | 97.4 |
| Italy | 111.9 | 113.8
| 112.6 | 113.1 |
| UK | 88.2 | 88.1
| 94.0 | 96.1 |
| | |
| |
This is not a new story. UK Governments have been trying
to improve productivity for a long time, but with very poor results:
Table 4
AVERAGE ANNUAL GROWTH IN GDP PER HOUR WORKED, CYCLICALLY
ADJUSTED27
| 1980-90 | 1990-2000
| 1996-2000 |
| France | 3.2% | 2.0%
| 1.8% |
| Germany | 2.5% | 1.9%
| 1.6% |
| Italy | 2.4% | 2.0%
| 1.6% |
| EU average | 2.7% | 1.9%
| 1.6% |
| UK | 2.3% | 1.4%
| 1.5% |
| | |
|
33. Skills gaps create a severe limitation in functional
flexibility that is experienced at the level of the individual
firm, but which is the expression of a systems problem: the UK's
low skills equilibrium. Skills gaps are as much a problem of demand
as of supply, indeed, the two are roughly in balance. Employers
do not recognise the need to increase skills, because the UK's
characteristic business strategy is to compete more on the basis
of low prices than of added value, and high level skills and empowered
workers are more likely to be a problem than an asset for a firm
adopting this strategy. As long as firms can survive on this basis
there will be little incentive to change voluntarily. This problem,
which is essential to understanding labour market flexibility
in the UK is expanded on below.
34. In our view, the fundamental barriers to workforce
reform include:
— a lack of the resources and/or money needed to
implement change;
— excessive workloads, leading to insufficient time
for training and the absence of working time flexibility;
— reform being focused on restructuring;
— targets and priorities making it difficult for
managers to focus on the `soft' issues of work-life balance, skills
training Employment Tax Credit; and
— the fact that a disproportionately large amount
of the training budget—even in the public sector—goes
to managers (80% of skills spending in local government, for instance,
is devoted to 20% of the workforce).
35. None of these problems are functions of excessive
employment regulation. Indeed, new regulations could help overcome
them:
— A right to paid time off for training.
— Extension of the employer training pilots.
— Exploration of the possibility of a skills levy
in certain sectors.
V. WAGE FLEXIBILITY
36. There are three broad categories of wage flexibility:
— Relative wage flexibility: the ability of wages
to adjust across different jobs or regions as demand and supply
change (for example, wages in occupations or regions in decline
will fall relative to wages in expanding occupations and regions).
— Real wage flexibility: the ability of wages in
real terms (after adjusting for inflation) to respond to changes
in unemployment and labour demand.
— Nominal wage flexibility: the ability of wages
in cash terms to respond, including overtime, and bonus payments).
37. The Treasury's 2003 EMU assessment concluded that
regional wages had become more responsive to unemployment rates
between the mid 1970s and the mid 1990s—in other words,
wages grew more slowly in high unemployment regions, making them
more competitive in labour cost terms and helping reduce regional
unemployment rate differentials. 28 Our conclusion is that there
is no convincing evidence that relative wage flexibility has significantly
reduced differences in regional labour market performance:
— Regional labour markets are an artificial concept—with
the partial exception of London and the South East, pay in the
UK is set at the national and local level.
— The real economic differences within the UK are
not between regions but at the sub-regional level. The UK has
relatively small differences in economic prosperity measured at
the regional level but huge differences when measured at the sub-regional
level.
— The Treasury's own regional productivity report
concluded that: "relative labour market performance has been
remarkably stable since the interwar period".
Wage flexibility across jobs
38. According to the Treasury study, in flexible labour
markets wages will fall in jobs for which demand is falling, when
compared with the wages of workers in jobs in demand. Earnings
inequality is therefore a sign of increased flexibility, which
we should welcome, not worry about. 29
39. It is no surprise that over the past twenty years
the wages of, for example, a hotel porter have grown less strongly
than a City analyst; this reflects their respective bargaining
strengths. But no one could seriously think that the former could
move jobs in response to the higher wages offered by the latter.
The labour markets at the top and bottom occupy such different
worlds that changes in the wage gap between the two tell us nothing
about relative wage flexibility.
40. The growth of wage inequality is far more likely
to be the old story playing out of labour market privilege for
those at the top and labour market exploitation at the bottom.
The UK has experienced one of the biggest increases in labour
market inequality over the past twenty years, behind only the
USA and New Zealand. Institutional factors such as the decline
of collective bargaining, weaker employment protection laws, and
cut backs in the social welfare safety net have all had a major
role to play in explaining the rise in wage inequality in the
UK.
41. Another argument says that demand for better qualified
labour in the UK and other OECD economies has meant that the wages
of those with education has gone up relative to those without
education. The growth in wage inequality is therefore primarily
caused by "the returns to education" having risen.
42. Widening inequality in education opportunities—with
chronic under-investment in state education and a failure to develop
a vocational system for those unable to access higher education—must
have had an important role to play in wage inequality. In addition,
the explosive growth in child poverty in the 1980s and totally
inadequate nursery school provision reinforced social divides
in educational opportunities especially in the early years. In
1979 only 13% of children lived in poverty, but by 1996 this had
increased to 33%.
43. A recent study concluded that people born into a
poor household in 1970 and therefore entering the labour market
from the mid 1980s onwards stood less chance of moving into higher
income brackets in later life than someone born into a poor household
in 1958 and entering the labour market from the mid 1970s onwards.
The study concluded that this fall in social mobility was partly
because "a greater share of the rapid educational upgrading
of the British population has been focussed on people with richer
parents".30
44. Higher returns to education can only be part of the
explanation. Many graduates are undertaking work for which a degree
is not necessary, suggesting that employers are using university
education as a filter for other desirable characteristics.
Real wage flexibility
45. In principle, labour markets can respond to a sudden
economic shock—a sharp and sustained rise in the oil price
for example—by slower growth in real wages (wages after
allowing for inflation) rather than higher unemployment. This
is the logic behind many national agreements, social contracts
and the like between governments, unions and employers across
Europe and (historically) in the UK.
46. The Treasury summarises the results of 23 studies
over the past 40 years looking at how real wages respond to changes
in unemployment in the UK against other OECD economies. But as
they all use different methodologies, different comparators, look
at different periods and generate different results it is hard
to draw any firm conclusions. The Treasury has developed a statistical
measure for the UK that shows real wages have become more responsive
to unemployment, but admit that "the change is not statistically
significant".31
Nominal (money) wage flexibility
47. Real wages could come under pressure because inflation
increases sharply or because of cuts in money wages. In practice
workers have resisted cuts in money wages and some employers may
be reluctant to impose them. So wage flexibility is more likely
to occur through changes in real wages rather than money wages.
48. However, resistance is likely to be weaker when inflation
is very low, so money wages can fall without people experiencing
real terms loss of income. This may simply reflect the ability
of some employers to exploit workers in weak bargaining positions
rather than as an example of genuine negotiated wage flexibility.
As recent examples with migrant workers show, those in very weak
bargaining positions may have little choice but to accept wage
cuts.
49. The Treasury argue that the UK has money wage flexibility
through the annual bargaining round, allowing pay to respond to
changing labour market circumstances. Pay can also be adjusted
on an annual, monthly or weekly basis through changes in overtime
or bonus payments.
50. The Treasury offers no international comparisons
to suggest whether nominal wage flexibility is greater in the
UK than elsewhere. However, the evidence shows that wage flexibility
appears to be as great in Europe as in the UK or in the US.
— A recent report by the European Commission undermined
claims for the significance of wage flexibility, finding that
wage responses to inflationary shocks were "surprisingly
similar" in the Eurozone and the USA, that "nominal
factors probably do not play a major role in changes in unemployment"
and that "the finding of broadly similar degrees of nominal
inertia makes it difficult to identify institutional labour market
characteristics as the major determinants of nominal rigidities."
32
— A recent study found that both France and the
UK had annual contract durations, most other European economies
between two to three years, but the economy with the longest contracts
was the US with deals of between three to five years.
VI. IS THE
CURRENT DEGREE
OF FLEXIBILITY
APPROPRIATE OR
DESIRABLE?
51. To some business representatives the obvious answer
to this question is no, the UK is losing its competitive edge
as increased regulation creates a `red tape burden.' This view
has been repeatedly articulated by Digby Jones, Director General
of the CBI:
"Our flexibility has been steadily eroded by ever increasing
regulation and there is still more to come onto the statute book.
We now face a real danger of our advantage being destroyed and
there are clear signals that firms will go elsewhere if they are
burdened with more legislation".
"There is absolutely no room for complacency on this
issue. The threat is not so much that jobs will go to France and
Germany but to India, China and Brazil. The government must resist
pressures to regulate further, much of which is coming from Europe
and from trade unions." 33
52. Mr Jones' argument assumes that countries have no
alternative to social dumping, to cutting taxes and reducing the
level of regulation if they want to keep jobs. Indeed, his argument
suggests that we must bring our standards down till we can compete
with India, China and Brazil; that is, that British prosperity
depends on lower wages and less secure jobs. This is nonsense;
UK businesses will never be able to compete on labour costs with
nations in the developing world, or with the EU accession countries.
Nor should they: our continued prosperity depends not on low labour
costs and deregulation but on innovation and adding value to products
and services. The recipe for this future is improved management,
sustained investment in people and capital, a focus on best practice
and a business environment that sustains long-term efforts to
move up the value chain. The UK's still modest level of regulation
and low wages are not the obstacles to this.
53. Last year the Department of Trade and Industry published
UK Competitiveness: Moving to the Next Stage, a study commissioned
from Prof Michael Porter. Prof Porter concluded that British businesses
are not being held back by a `red tape burden,' high taxes or
too many holidays and rights to time off. In fact:
— "The UK has the lowest level of product and
labour market regulations in the OECD." 34
— There is a "generally competitive system
of business taxation with incentives for R&D investments and
investments in economically distressed areas. The overall level
of taxation is slightly lower than in many other advanced economies;
this relative advantage of the UK has, however, decreased in recent
years."
— "The UK currently has one of the highest
levels of labour force utilisation in the OECD," (that is
hours worked per employee, employment rate and labour force participation
rate) "behind only Japan and the United States."
54. Any impartial observer will find the facts persuasive:
— An OECD survey35 of business regulation in 1998
ranked the UK 21st out of 21 countries.
— And 20th on measures of the severity and costs
of employment protection laws.
— An independent study36 found that corporate tax
rates in the UK were lower than in the US, Japan, Germany, France,
Italy and Spain.
— A US Bureau of Labor Statistics comparison of
labour taxes37 found the UK ranked 20th out of 25 industrialised
countries, well below the US.
— Comparisons by ONS38 showed average profitability
in Britain in 1998-99 was 12% compared with 9% in the US and Spain,
8% in Canada, 5% in Japan and 4% in Germany and the Netherlands.
55. But the evidence that convinced a former adviser
to Ronald Reagan has not yet persuaded everyone in Government.
The DTI's Regulatory Impact Assessments for employment legislation
regularly overstate the costs of such measures whilst making no
estimation of the likely benefits. When dealing with the Working
Time Directive, for instance, the DTI's methodology has been to
estimate the total hours that are currently worked above the 48-hour
limit and then suppose that new employees will have to be recruited
to work all of them. Their Assessment does refer to the personnel
and health and safety benefits, but these are given no money value
and they are not offset against the costs.
56. The Treasury appears to be an even bigger sceptic.
Its 2003 assessment includes a new index of labour market flexibility,
39 which claims to measure how responsive to an economic shock
a labour market would be. This index awards the best scores to
countries with low benefits, less employment protection legislation,
low/no minimum wages, low labour taxes and weak unions.
57. This index prompts a question: if the Treasury really
believes that the route to flexibility is via wage inequality,
weak unions, low labour taxes and ineffectual employment regulation,
what should we make of a Government that has introduced the national
minimum wage, reduced the qualifying period for employment protection
to one year and increased National Insurance Contributions? The
Treasury's approach should lead them to expect a less efficient
labour market, yet their assessment is that flexibility has improved
since 1997.
58. It is notable how little relationship there is between
this supposed determinant of flexibility and the countries' actual
labour market performance. 40 What this suggests is that, far
from there being a simple blueprint for labour market success,
countries have a choice, 41 and it makes sense to aim for an approach
that combines high functional flexibility with high productivity
and good social and employment outcomes.
59. Interestingly, this point is particularly well made
by Jonathan Michie and Maura Sheehan, who are quoted in the Treasury's
2004 assessment as supporters of flexibility. 42 Their survey
of hundreds of British firms actually led to a much more nuanced
conclusion that is worth quoting at length:
"Any simple-minded view of deregulated labour markets
creating a flexible labour market and hence an innovative and
dynamic economy is thus found to be dangerously simplistic. Creating
the right sort of flexibility can indeed pay dividends. Allow
the wrong sort of flexibility and firms may be tempted down a
cul-de-sac which allows some short-term pay off by shifting the
bargaining power in their favour vis-a"-vis a more insecure
workforce. But this is the wrong route to go down for improved
productivity and competitiveness based on quality and high value
added. In short, the sort of labour flexibility that Government
should be encouraging requires investment in people. The real
danger that simple minded policies for labour market deregulation
pose is undermining the confidence of firms to invest in their
own workforce, for fear that increased labour turnover may lead
to the returns on such investment being lost. Labour deregulation
may thus inadvertently lead to a lower level of the sort of flexibility
that is associated with innovation and good corporate performance.
A regulated labour market on the other hand can actually underpin
the sort of investment by firms in their own workforce that creates
the `win win' outcome of positive human resource management practices
such as high levels of training and involvement, along with improved
corporate outcomes in terms of motivation, productivity and profitability."
VII. THE WAY
AHEAD
60. The TUC believes that a key strategic economic task
facing the UK is how to achieve a systemic change, moving out
of the "low road" rut—competing on price not innovation,
with low investment in physical and human capital. As Michael
Porter said, this means a transition from being:
"a location competing on relatively low costs of doing
business to a location competing on unique value and innovation.
This transition requires investments in different elements of
the business environment, upgrading of company strategies, and
the creation or strengthening of new types of institutions."
43
61. Crucially, this transition will depend upon creating
high performance workplaces. In recent years commentators, academics
and personnel professionals have come to recognise the importance
of the way in which an enterprise organises the work it does.
In the UK, a CIPD study of manufacturing companies44 has been
influential: in the firms studied, HRM practices relating to employee
skills and job design accounted for:
— 19% of the variation between companies in change
in profitability, and
— 18% of the variation in change in productivity.
62. In other words, how a company manages its staff directly
affects both firms' profitability objectives and the Government's
productivity agenda. The import-ant reforms have been those designed
to get the most out of the organisation's employees—by enhancing
their capacities, removing barriers to utilising these enhanced
capacities and increasing employees' motivation to do apply them.
63. Firms that succeed in doing this will become substantially
more functionally flexible. A key high performance reform is to
enhance employee participation, bringing decision-making closer
to the operational level. More decision-making by front-line workers
increases the pace of innovation, freeing managers to take a more
strategic view and to plan further ahead. Even where decision-making
has not been delegated, an organisation that offers more information
to employees and is more willing to listen to them will still
achieve worthwhile results. Firstly, this is an excellent way
to tap into the company's best source of market intelligence—front-line
staff are often the first to become aware of problems or opportunities.
Secondly, a commitment to employee involvement is the first step
on a ladder of business gains:
— Involving employees in decision-making and giving
them a real influence over decisions leads to higher morale and
to staff being more likely to support workplace change.
— This in turn means that supervision can be less
intensive.
— So managers spend less time fire-fighting minor
or day-to-day problems.
— Freeing them to deal more expertly with serious
and strategic issues.
64. Obviously, a high level of trust is the essential
basis. Decision-making cannot be delegated to people who think
they are being exploited, and people who are scared to tell their
managers the truth cannot be relied upon. Trust cannot be assumed
or coerced, and workers will only trust employers who recognise
their right to disagree. Organisations that trust their employees
and hope to be trusted in return will accept this, and welcome
a genuinely independent voice for their workers:
— The more important a decision is, the greater
the risk posed by issues where there are real conflicts of interest
between employees and their employers.
— Representative participation can reassure workers
that their interests have been fairly taken into account—but
only if they trust their representatives.
— Workers are more likely to give that trust to
their representatives if they believe they are independent.
— TUC research45 suggests that, when employees are
confident about their representatives' independence, they will
then be happy to see them working in partnership with the employer.
65. But the high road's clear business advantage has
a price: it reduces the profitability at the level of the firm
of crude exploitations of wage and numerical flexibility. Morale
and the quality of relationships make more difference to whether
an organisation can achieve the high performance model than any
set of techniques or policies that can be ticked off a list.
66. This conundrum may help to explain why the high performance
model is (all commentators agree) comparatively rare. The Workplace
Employee Relations Survey suggests that the proportion of companies
that have adopted it is no higher than one in seven. 46 The attitudes
and assumptions that lead to workers being treated as mere factors
of production may also hinder the adoption of the high performance
model. This approach requires investment in training, and respect
for the workforce.
67. The "low road" business model, by contrast,
does not require managers to have any respect for their staff—indeed,
it is a disadvantage. A study of firms in the pharmaceuticals
and aerospace industries described managers failing to consult
(or even inform) their staff about major work organisation changes,
but still complaining that workers and the union would not get
involved. 47 The author of another case study report remarked
on how frequently the managers refused to accept the legitimacy
of workers' responses to changes, and on how "employees were
often seen as the problem rather than as the means through which
solutions to problems could be found." 48
68. This is why the TUC has strongly welcomed the Information
and Consultation Directive and Regulations. One of the advantages
of the Directive may well be that when companies have to inform
and consult their workers it will encourage them to adopt reforms
that will be in their own long-term interests. This enhancement
of employees' ability to articulate their interests will encourage
the development of high performance workplaces and help achieve
a greater degree of fairness at work.
69. We want, however, to be clear in this submission
that our aim is not to damn the managers of `low road' companies.
Like many British business people they are caught in what Finegold
and Soskice in an influential 1988 article described as a "low-skills
equilibrium, in which the majority of enterprises staffed by poorly
trained managers and workers produce low-quality goods and services."
49 Firms caught in this equilibrium would rarely have room to
invest in work organisation or upskilling, and indeed such an
investment might not be worthwhile for them. Firms producing low-quality
goods usually have to compete on the basis of cost, and "Fordist"
production remains ideally suited to them: minimally skilled workers,
performing standardised tasks can produce cheap goods and services.
70. The TUC has elsewhere50 looked at the factors that
produce this equilibrium, including the skills and qualifications
of managers, the viability of alternative business strategies,
the rules relating to ownership and corporate governance, union
weakness, the attitudes of stakeholders and the legal environment.
What is worth noting here is the connections between, on the one
hand, the low road and the worship of labour market flexibility,
and on the other hand, between the high performance model and
a decided emphasis on functional flexibility.
71. The labour market model favoured by the TUC builds
on high performance workplaces and the European model of a generous
welfare state and investment in active labour market policies.
The high road to success is built upon secure jobs with secure
wages, and the new rights introduced over the past six years must
be the start of reform, not the terminus.
72. In today's terms security doesn't just mean freedom
from unfair discrimination or dismissal, it also means that every
worker must be able to combine their job with their family life.
This is not just a matter of "balancing work and family responsibilities"—family
life is a right, guaranteed by the European Convention on Human
Rights, and that right should be as secure from infringement at
the workplace as it is from state restrictions. All this suggests
an agenda for strengthening our employment rights:
— An adequate minimum wage, providing a foundation
for greater equality in original incomes.
— A serious attack on the long hours culture.
— Substantial public investment in childcare, making
it free or at least a great deal cheaper for many more parents.
— Basic employment rights for all workers, whatever
their status.
73. We argued above for the success of the national minimum
wage and the Working Time Directive. The minimum wage has already
been raised without an adverse impact on unemployment or inflation,
and it can be raised again. The long hours culture is not conducive
to the causes of health, higher productivity or attracting women
into the workforce; the opt-out from the Working Time Directive
should be ended as quickly as possible.
74. The TUC has welcomed the European Commission's proposals
for a Temporary Agency Worker Directive that would give agency
temps equal treatment with other workers in such areas as pay,
working time and holidays. While significant numbers of people
in all forms of temporary job move into permanent work, agency
temping can still be a very insecure form of employment. As the
OECD warned in a recent survey: 51 "persons spending an extended
period of time in temporary jobs may be compromising their long
run career prospects, in addition to being subject to considerable
employment insecurity". Agencies are expanding and doing
well in other European labour markets where regulation is far
more extensive and agency workers are often automatically covered
by collective agreements. There are no convincing reason why UK
agencies and UK employers cannot operate just as effectively with
the Directive as European agencies and European employers.
75. Finally, it is becoming a matter of urgency that
the Government should reform the law on employment status. DTI
research says that the status of 30% of the workforce is unclear;
they may qualify for employment rights, or they may not—only
an Employment Tribunal can determine the issue. The OECD has commented
on the blurring of boundaries between different categories, and
it is clear that the use of casualised labour is increasing:
— In the distribution, hotels and restaurant sector
there have been large increases in agency and casual workers.
By 2002, 61% of staff working in hotels and restaurants were in
"casual" work.
— In the banking, finance and insurance sector the
use of casual workers has more than doubled since 1992, while
the number of agency workers has increased by 150%.
— In transport and communications, the numbers of
agency workers in this sector have tripled since 1992.
76. The Government's intention when introducing the Working
Time Regulations was to ensure that all but the genuinely self-employed
should benefit. However, union lawyers have reported a series
of cases where individuals, mainly freelancers, who are economically
dependent on one or a limited number of employers, have been treated
as self-employed as opposed to "workers" under these
regulations. A piecemeal approach, treating different groups of
workers differently, would only add to existing complexity and
exacerbate the already unequal treatment of different groups.
The TUC believes that employment rights should be extended to
a broad category of workers: the presumption should be that all
workers are covered by employment rights and any exclusions from
the definition must be justified, and the burden of proof should
rest on the employer. All employment rights should be extended
in this way, including health and safety protections, trade union
rights, the right to a written statement of terms and conditions
of employment, the full panoply of family friendly rights and
unfair dismissal and redundancy protections.
77. Above all, we need a new approach to labour market
flexibility in the UK that recognises the central importance of
collective bargaining and the development of labour market institutions
that promote social dialogue between employers and trade unions.
High collective bargaining coverage and a strong and systematic
role for social partners in labour market institutions give other
European economies an in-built advantage. When regulation is needed
it can be introduced flexibly and quickly, but often it is the
collective bargaining and institutional framework that effectively
regulates the majority of the labour market. Moreover, such an
approach means that the focus is firmly on how to improve functional
flexibility and create high performance workplaces. This is a
key reason why in terms of workplace productivity nine out of
the world's top 10 economies are European.
NOTES
1. The ability of workers to undertake new tasks and of organisations
to organise themselves in new ways.
2. Numerical flexibility is usually taken to mean the organisation
of the workforce in a way that makes it possible for an organisation
to cope with changes in demand. Internal numerical flexibility
typically means the use of shift-working, overtime etc, whilst
external numerical flexibility often means recruitment and dismissal.
3. "What is Labour-Market Flexibility? What is it Good
For?", Robert M Solow, Proceedings of the British Academy,
Dec 1998, pp 189-211.
4. The National Minimum Wage, Low Pay Commission,
4th report, 2003, pp 61, 231 & 236.
5. Ibid, para 2.16.
6. Ibid, para 2.20.
7. The Use and Abuse of the "Opt-Out" in the
UK, TUC, 2003, quoting: The use and necessity of Article
18.1(b)(i) of the Working Time Directive in the United Kingdom,
Barnard et al, EC, 2003; Working Long Hours, HSE, 2002;
"Married to the Job", Occupational Health and Safety,
July 2001; Working Long Hours: A review of the evidence,
Kodz et al, DTI Employment Relations Research Series 16, 2003;
Living to Work Survey, CIPD, 2003; Reducing at-work
road traffic incidents, Work-Related Road Safety Task Group,
HSE /DTLGR, 2001; "Working Long Hours and Health", J
M Harrington, BMJ Supplement, Vol 308, 1994. TUC analysis
of the 2002 Labour Force Survey looking at hours of work and rate
of industrial injuries, found a consistent gradient, with people
working under 16 hours a week having an accident rate per hundred
workers of 1.5, while those who worked more than 60 had a rate
of 4.9.
8. Ibid, quoting: Barnard et al; Parenting in the 1990s,
Ferri and Smith, JRF, 1996; Step-parenting in the 1990s,
Ferri and Smith, JRF, 1998; How do they find the time?;
Dex et al, JRF, 2003; The Business Context of Long hours Working,
Hogarth et al, DTI Employment Relations Series 23, 2003.
9. Taylor, Managing Workplace Change, ESRC, 2002.
10. Op cit.
11. Flexibility in the UK Economy, HMT, March 2004,
para 3.1.
12. Quoted in "Unemployment and External and Internal
Labor Market Flexibility", David Kucera, Center for Economic
Policy Analysis, CEPA Working Paper 11, 1993, p 4.
13. EMU and Labour Market Flexibility, HMT, 2003,
para 2.59.
14. Ibid, para 2.69.
15. Ibid, para 2.84.
16. Flexibility in the UK Economy, HMT, March 2004,
para 4.15.
17. Ibid, para 4.16.
18. Ibid, paras 4.17-4.18.
19. Why the French are Right: answering the flexibility
myth, TUC, 1999, quoting data from European Commission, European
Employment Observatory, US Bureau of Labor Statistics and UK Labour
Force Survey.
20. EMU and Labour Market Flexibility, HMT, 2003,
para 2.96.
21. European Economy 4, annex table 2 and 5, annex
table 27, European Commission, 2002.
22. European Economy 4, annex table 3 and 5, annex
table 28, European Commission, 2002.
23. "Some Labour Market Implications of Employment Legislation",
Labour Market Trends, September 2001.
24. Job Tenure and Labour Reallocation, CEP, 1998.
25. Ibid, para 2.104.
26. Productivity, Partnership and Institution Building,
TUC, 2003.
27. Ibid.
28. Ibid, paras 2.15—16.
29. Ibid, chart 2.2.
30. Changes in Intergenerational Mobility in Britain,
J Blunden, A Goodman, P Gregg and S Machin, IPPR, 2002, p 18.
31. Op cit, para 2.31.
32. "Wage flexibility and wage interdependence in EMU:
some lessons from the early years", European Economy,
European Commission, June 2003.
33. CBI Press Notice 24/10/02. We should be careful about
claims from business organisations, which may over-state or distort
employer concerns. In 1999 the Small Firms Research Trust surveyed
firms to find out which regulations took up the most time: 72%
said VAT, 57% PAYE, 48% self-assessment, 25% said health and safety
and just 5% said the working time directive, 3% the minimum wage
and 123% all other employment related legislation. (Quarterly
Survey of Small Business in Britain, SBRT, Dec 2000.) Research
for the DTI by the Small Business Research Centre at Kingston
University (Small Firms' Awareness and Knowledge of Individual
Employment Rights, 2002) asked people running small businesses
to identify the most important factors affecting performance.
The authors concluded that "the impacts of individual employment
rights on small firms are not widespread." Just one respondent
in six cited any government legislation or regulations (ie not
only employment regulation), more popular contenders were competition
and financial considerations such as cash flow, debt, rents, interest
rates. A substantial minority (about a third) said that employment
rights had a positive impact—providing guidelines and clarification
in setting terms and conditions for their employees and around
10 per cent said they "raised staff morale and engendered
a feeling of security". In other words, more employers saw
regulation as good for business than believed that regulation
hampered entrepreneurship and business growth.
34. Op cit, p 25.
35. Economics Working Paper 226, OECD, April 2000.
36. "The Case for International Tax Co-ordination Reconsidered,"
Peter Sorenson, Economic Policy, CEPR October 2000. Tax
rates on retained corporate income in 1999 were 30% in the UK,
35% in Spain, 37% in Italy, 38% in the US, 40% in France, 48%
in Japan and 52% in Germany.
37. Social insurance and other labour taxes as a percentage
of hourly labour costs for production workers in manufacturing,
BoL, September 2000. In 1999 these were 13% in the UK, 21%
in the US, 24% average across the EU.
38. Economic Trends, December 2000.
39. EMU and Labour Market Flexibility, paras 4.73-4.78,
created by pooling replacement ratios, unemployment benefit duration,
spending on active labour market policies, employment protection
legislation tax wedge and union density, coverage and co-ordination.
Actually, the index measures labour market rigidity: the lower
a country's score the more flexible it is meant to be.
The index shows the UK having the best score in Europe—only
the USA does better among advanced industrial nations—but
it produces some idiosyncratic results: Italy and Spain, apparently,
have more flexible labour markets than the Netherlands, Sweden
or Denmark (not a consensus view.)
40. Op cit, chart 4.12. If we rank the countries by their
unemployment level, giving their flexibility ranking in the second
column, we can see how little relationship there is between the
two:
Countries and their flexibility rankings, ranked by unemployment
| Country | Flexibility ranking
|
| Switzerland | 3 |
| Ireland | 6 |
| Austria | 7 |
| Netherlands | 14 |
| Norway | 15 |
| Denmark | 19 |
| USA | 1 |
| UK | 2 |
| Japan | 4 |
| New Zealand | 9 |
| Australia | 10 |
| Sweden | 13 |
| Canada | 5 |
| Germany | 8 |
| Italy | 11 |
| Spain | 12 |
| Portugal | 16 |
| Finland | 17 |
| France | 18 |
| Belgium | 20 |
| |
41. As Richard Freeman has observed: "Once a country
has a strong tradition of basic market freedoms it has considerable
leeway in the precise way it structures its institutions. Advanced
capitalism is a sturdy economic system that allows for a diversity
in institutional arrangements." (Institutional Differences
and Economic Performance Among OECD Countries, Richard B.
Freeman, CEP discussion paper 557, 2002.)
42. Op cit, box 3.2.
43. UK Competitiveness: Moving to the Next Stage,
M Porter, DTI, 2003, p 5.
44. Impact of People Management Practices on Business
Performance, Patterson et al, IPD, 2002.
45. What Workers Want from Workplace Organisations,
Diamond & Freeman, TUC, 2001.
46. Britain at Work, Cully et al, HMSO, 1999, p 295.
47. High Involvement Work Systems: The Only Option for
UK High Skill Sectors?, C Lloyd, SKOPE research paper 11,
2001, pp 15-16.
48. People Management in UK Aerospace: Case Studies,
M Thompson, Templeton College for SBAC, 1999, p 67.
49. "The Failure of Training in Britain: Analysis and
Prescription", D Finegold & D Soskice, Oxford Review
of Economic Policy, vol 4, no 3, p 22.
50. The Low Road, TUC, 2002.
51. Quoted in Agency Work in Britain Today, TUC, 2003.
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