WORKPLACE DEMOCRACY AND THE GLOBAL FINANCIAL CRISIS

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WORKPLACE DEMOCRACYAND THE GLOBAL FINANCIAL
CRISIS
Russell Lansbury Professor of Work
Organisational Studies, Faculty of Economics and
Business, University of Sydney
The Kingsley Laffer Memorial Lecture, University
of Sydney, 16th March 2009
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Workplace Democracy

• A democratic workplace is one in which workers
  have the opportunity to genuinely participate in
  and influence decisions concerning their lives at
  work.

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Key Questions

• Is workplace democracy relevant to the current
  economic crisis?
• What can be learnt from previous experience to
  foster workplace democracy?
• How will globalisation influence future prospects
  for workplace democracy?

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The Case for Workplace Democracy

• Efficiency enhances decision-making by taking a
  wider range of views into account.
• Equity provides for greater power-sharing at the
  enterprise level.
• Humanistic fulfils human needs for greater
  personal involvement and self-worth.

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Approaches to Workplace Democracy

• Collective bargaining through membership of
  unions.
• Indirect or representative participation through
  joint consultative bodies and works councils.
• Direct participation in semi-autonomous
  workgroups, TQM and QC circles and work redesign.
  

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Workplace Democracy and the Global Financial
Crisis
Social democratic governments around the world
must devise a new regulatory framework which
combines productivity growth with social equity.
Kevin Rudd, P.M. (2008) The Global Financial
Crisis.
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Previous Laffer Lecturers
We are now witnessing one of the most dramatic
changes in history but further changes are
required in the relationship between management
and workers. Bob Hawke, P.M. Laffer Lecture
1993.
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Previous Laffer Lecturers
I want equity back on the agenda of labour
market and industrial relations reform.
Quentin Bryce, Governor General, Laffer
Lecture 1999.
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Previous Laffer Lecturers
Australia must not only strengthen the rights of
individuals at work in Australia but it should be
a force in the world to assist other nations to
achieve fundamental workers rights. Justice
Michael Kirby, Laffer Lecture 2002.
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Previous Laffer Lecturers
It has always seemed incongruous to me that
while Australian citizens are able to elect their
governments, when they enter their workplace to
become industrial citizens they have no legal
right to elect a consultative body to participate
in workplace governance. Prof. Ron McCallum,
Laffer Lecture 2005.
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Kingsley Laffer 1911-1993
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Kingsley Laffer 1911-1993

• Established industrial relations as a field of
  study at the University of Sydney.
• Founding editor of the Journal of Industrial
  Relations.
• Founding member of the Industrial Relations
  Society.
• Interdisciplinary approach and focus on global
  aspects.

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Democracy at Work Emery Thorsrud
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Australian Pioneers of Workplace Democracy

• Fred Emery (Tavistock Institute) semi-autonomous
  work groups.
• Kenneth Walker (ILO) the participatory
  enterprise.
• Bill Ford (UNSW) policy advisor, action
  researcher and enterprise development agreements.
• Dexter Dunphy (UTS) the sustainable corporation.
  

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Workplace Democracy in Australia

• Joint committee introduced during WW2 and in the
  1950s to improve efficiency and reduce
  absenteeism.
• Dunstan Labor government in South Australia in
  the 1970s.
• Hawke Labor governments Accord in 1980s and 90s.
• Recent research reported around 50 per cent of
  Australian workplaces had some form of joint
  consultation.

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Workplace Democracy in an International Context

• Sustained initiatives within the European Union
  on representative participation eg. European
  Works Councils.
• Employers seek greater direct employee
  involvement in order to gain greater productivity
  and flexibility.
• Coordinated market economies (Continental Europe)
  have sustained greater levels of workplace
  democracy than liberal market economies
  (Anglo-Saxon countries).

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Globalisation and Workplace Democracy

• Concerns that globalisation has resulted in the
  transfer of power from the nation state to
  multinational corporations (MNCs).
• Global Unions and NGOs have achieved
  international framework agreements with some
  MNCs.
• The ILO has a mandate to establish and promote
  core labour standards but lacks powers of
  enforcement.

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After Lean Production The Global Auto Industry
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International Research on the Global Automotive
Industry

• After Lean Production studied auto companies in
  the mid 1990s. Repeated in 2000s.
• The Japanese and German auto companies benefited
  from direct involvement of employees in decision
  making and innovation.
• Toyota and VW are more likely to survive than the
  'big three' US auto companies.

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ABB and Globalisation
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ABB in Europe and Australia

• Three plants in Australia, Finland and
  Switzerland were similar in size and products but
  varied in levels of performance.
• A key difference between the plants was that both
  the Finnish and Swiss plants excelled either in
  product or process innovation and involved their
  employees in decision-making.
• By contrast, the Australian plant failed to
  innovate or engage its employees and was forced
  to close operations.

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Future Challenges for Workplace Democracy

• Globalisation presents both a threat and an
  opportunity for workplace democracy.
• The ILO, Global Union Federations and NGOs are
  having increased success in persuading MNCs to
  adhere to core labour standards.
• A more integrated and comprehensive approach is
  needed at the global level.

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Implications for Australia

• A new social contract is needed between key
  parties to provide stronger legal rights for
  workers and sustain more democratic workplaces.
• A more ambitious vision is required by
  government, employers and unions to achieve
  decent work and democratic workplaces.
• Australia must not only strengthen the rights of
  individuals at work but we should be a force in
  the world for fundamental workers rights
  (Michael Kirby).

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Future Directions

• The spread of this revolution has of necessity
  been slow Nevertheless, it is no passing fad
  There has been the realisation that the
  traditional authoritarian patterns of working are
  grossly inefficient In their place we need new
  and genuinely democratic forms of work
  organisation.
• Fred Emery.

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