Wednesday, 3 March 2010

Privatisation benefitted Unions - Shocker

Exciting news from the Department of the Bleedin' Obvious at the British Sociological Association.

According to Industry Today:

Rail unions have prospered under privatisation, partly due to the inexperience of managers in the new train operating companies, new research says.

Too many jobs were cut after privatisation and the resulting staff shortages in some areas strengthened the unions' fight for better conditions and pay.

No shit Sherlock!

Eye could have saved the researchers a bob or two by explaining some basics.

The reason Train Operating Companies are called Train Operating Companies is because they operate Trains (the clue is in the name).

To be a Train Operator you need, surprisingly enough, trains.

And drivers.

If in the rush to privatise the industry you consciously destroy national agreements on drivers pay and collective bargaining then train drivers become a commodity - especially as some TOCs prefer to poach staff from other operators rather than grow their own.

To prevent poaching (or to encourage it) you have to improve terms and conditions - see Supply and Demand in the Noddy Book of Economics.

Any negotiations to improve terms and conditions is led, on the staff side, by the Unions.

Able to play one TOC off against another they have managed to leverage terms and conditions for all their members across the industry.

Now that's not just a function of "managerial inexperience" - its a product of converting one company (BR) into an industry and creating a market where previously none existed.

And of course it still goes on -witness the recent problems that both LM and FuCC have had encouraging staff to undertake rest day working (Eye passim).

But it is not just the Unions ability to protect the economic interests of their members that has led to their continued success.

In a safety critical culture like the railways and in an increasingly litigious society the Unions also provide legal support and protection to their members (see Longrider here).

The continued success of the Unions is therefore no surprise. What is though, is that the industry still refuses to address wage-cost-push collectively.