Labour party look at proposal to encourage workers to participate directly in management

The Government is considering a fundamental review of company law to allow workers to sit on boards. Mrs Barbara Castle, Secretary for Employment and Productivity (DEP), has written to employers and the Trades Union Congress (TUC) telling them of her interest in plans to encourage workers to participate directly in management. A confidential document from the DEP on industrial democracy admits that very large issues are involved, adding that they “could involve a fundamental review of company law and of the accountability of management to employees.”

The TUC yesterday set up a special working party to clarify union attitudes. Sir Sidney Greene, TUC president, is to take the chair and among other members will be Mr Jack Jones of the Transport and General Workers’ Union. The Government paper poses a series of questions about the appointment and authority of workers as directors. The TUC will give Mrs Castle a general reply before embarking on a detailed study.

TUC leaders are expected to tell the DEP that worker directors must be appointed only by the unions and not by shareholders nor by direct election from the shop floor. They believe there need be no conflict of interest between such directors and their union colleagues during plant-level wage bargaining. TUC staff point out that ordinary directors have to juggle their institutional interests and those of shareholders.

Mrs Castle draws attention to West Germany where companies have two boards – one composed of working managers and the other taking a supervisory role. The TUC has not decided whether it wants a similar set-up here and, until it does, it will find difficulty in saying whether it wants full-time voting positions on boards, union officials sitting on a part-time basis, or rank and file workers attending board meetings as advisers.

In the public sector at least, the TUC wants a much more radical approach to the whole question of worker representation. It will tell the Government that union nominees should come from the industry and the region in which they serve as part-time members, and that they should be allowed to continue to hold rank and file union positions during their terms of office.