Race to productivity

Posted on 18 Feb 2008 by The Manufacturer

Harmonious workplaces are more profitable, argues John Dwyer

I t’s hard enough for employers to balance the literacy needs of migrant and indigenous workers. Inevitably there’s more to the migration story that makes the balancing act even more knife-edge.
Tensions simmer constantly. Racially-edged banter may be out of fashion, but it’s not that long since Ford president Jac Nasser’s flight to Dagenham in 1999 to take personal control of the factory’s effort to stamp out discrimination and harassment.

There were other, less blatant examples both within Ford, at Southampton, and outside. The participants change as the population does. The report on the May 2001 Oldham riots said: “Discrimination on grounds of religion exists in the workplace, and this should be outlawed.” Now the arrival of east Europeans in the UK workforce prompts some who are familiar with Britain’s factories to warn of a new tide of resentment against the newcomers.

Something is going on, to judge things heard in cafés, bus queues and supermarkets. And, after a fight between the English and Polish patrons of the central London pub where I met a colleague before Christmas, the smart wooden floor in lawyerly Holborn literally had blood on it. Lots. Surely, it’s tempting to conclude, this friction must spill into the workplace.

But the EEF says it hasn’t surfaced as a workplace issue. And the T&G union, which has a long history of trying to stamp out workplace harassment and discrimination, says it hasn’t registered with them either.
But the T&G does report outbreaks of something else. It’s a result of the tendency to supplement workforces with agency labour, now common not just in the food industry but in other sectors, from trailer making to fasteners.

There’s nothing whatever wrong with agency labour, of course. The problem, says the T&G, arises when the agency workers, who tend to be migrants, are paid the national minimum under contract conditions – even illegal working hours – that British workers haven’t seen for years. The result, says the union, is the established workforce’s predictable worry that more and more permanent jobs will make way for the cheaper agency staff. The friction this gives rise to is economic, not racial, but it’s just as pernicious.

The immediate impulse of most industrial managers will be to remind the UK natives that there’s a competitive maelstrom out there. If they aren’t willing to work with Poles or Czechs, the factory may have to be closed and moved to Poland or the Czech Republic in its entirety. Their next, less wise impulse might be to note that, if the trade unions hadn’t been so keen to price UK labour out of global manufacturing markets, our industrial sector could employ twice or three times as many.

This is bunk. Some managers are grateful that they’re at the end rather than the beginning of several generations of trade-union campaigning for better industrial pay and working conditions. That aside, the argument doesn’t sit well in the mouths of manufacturing directors who, let’s say, haven’t shown themselves particularly willing to confine their own pay to east European levels. The competitive argument, however, has value, and the unions know it. True, the T&G, now part of Unite, and others see migrant labour as a new recruitment opportunity. But it’s more than that. The T&G’s ‘equal treatment for all’ campaign to get agency and non-agency workers hired on the same terms is also about keeping UK factories viable, and promoting harmony between the two groups, helps that aim.

The union cites success in Northern Ireland, Scotland, Stoke, Canary Wharf and elsewhere. But the T&G’s handle on the issue isn’t much consolation for employees in companies that won’t let the unions through the door. Should managers care about these black spots? Only if they value the mountain of research that appears to show that harmonious workplaces are more productive than those, like 1990s Ford, which are riven by factionalism.
Jac Nasser took that flight for a reason. Today’s T&G supports his logic. Once the campaign was under way, both management and unions agreed that much of Southampton’s 25 per cent
productivity improvement was due to the diversity programme.