Labour policy—false and true

by Lynden Livingston Macassey

There are in practice two objects to achieve. First, to ensure that each grade of worker gets a fair wage which corresponds to the “ability wage,” and secondly, to try and keep the wages of workers in one industry in proper wage-relationship with the wages of comparable workers in other industries. If the existing wages are less than the “ability wages,” and the latter are either equal to, or less than, the comparable wages, there ought to be an advance of the existing wages up to the ability level, and, in my view, a further advance beyond ability level towards, but not exceeding, the comparable wages-level, if the circumstances of the industry are such, as for example, in respect of foreign competition, that the market price of the product can be increased by the necessary amount. It is so essential for the harmony of industry that the wages of comparable workers should be generally on the same level. There is no difficulty in practice in saying who are comparable workers. Industrial experience and tradition have firmly settled that. In the case, comparatively rare in practice, where the level of ability wages is higher than the level of comparable wages, other considerations arise. Some employers contend that to pay in one industry that can afford it a higher rate of wages than in comparable industries that cannot afford it is to upset the equilibrium of wages in those latter industries, and incite the workers in them to ask for the same wages rates, thus involving a charge upon the whole or a section of the public forming the consumers of the product of those industries with the usual results. Other employers assert that comparable wages are the criterion of fair wages, and as employers have to stand the risk of paying Trade Union wages when profits are not adequate, so, therefore, employers, when profits are exceptional, should be entitled to retain what remains after comparable wages are paid. I do not see why the employer should be entitled to appropriate in such a case the difference between the ability wages and the comparable wages. In my view, if an industry is shown by a joint cost investigation to be able to pay wages which are higher than comparable wages, the amount of the proceeds of the industry beyond the sum necessary to pay wages at comparable rates should be divided equally between employers and workers and consumers—in the case of the latter by a reduction in price. The workers thus secure a share in the prosperity of the industry.

Some wage complexities due to the war urgently need adjustment. Flat additions as war bonuses on piece-work or tonnage-rates are unsettling anomalies; they should be incorporated in new piece—or tonnage—rates. Their existence hinders output. War advances and war bonuses; which, though originally different, are now in practice indistinguishable, should, so far as not withdrawn, be merged into the permanent rate or price—in one-half of industry they have already been merged—difference of treatment only causes unrest. It cannot be too strongly emphasized that high rates of wages do not necessarily mean high earnings—they frequently mean no earnings and no work. Increasing the productive efficiency of labour does increase the ability of industry to pay. Such alone is the one sure road to higher earnings.

Other Essentials to Industrial Contentment

There should be open to the workers in this country an opportunity of rising, that is, of transfer from the wages side to the salaried side of the staff as is afforded by American employers. Why there should be such reluctance among so many English employers to promote men from the wages side I have never appreciated. During the war I had a large number of workmen under me at the Admiralty, who, after the war, were appointed to responsible positions on the administrative side of industry in the establishments of some broad-minded employers, and have abundantly justified their selection.

CHAPTER XXVII
THE RIGHT RELATIONSHIP BETWEEN EMPLOYERS AND EMPLOYED
2. CO-OPERATION IN INDUSTRY

The Workers’ Own Resort to Co-operation—The Marxian Argument against Co-operation—Some Workshop Applications—The Marxian Fallacy of the Origin of Capital—The Marxian Fallacy of Value—The Need of Sympathy in Workshop Life—The Need of Strict Justice—The Money Value of Sympathy in Industry—The Sympathetic Handling of Labour a Special Art—An Illustration of its Successful Application.

The establishment of co-operation in industry between employers and employed is a matter almost entirely of the mind and spirit; it depends upon the elimination of the mutual suspicion that at present exists; it involves the creation of confidence; it entails the dissipation of certain economic fallacies that obsess the workers and also unprogressive employers.

The Workers’ Own Resort to Co-operation

Labour thoroughly well recognizes the productive power of the spirit of co-operation. In certain trades men work in squads, and the members of the squad share in agreed proportions the total price for the squad’s collective work. Many shops are paid on the output bonus system or on a “fellowship” basis. Under such conditions the earnings of the squad or shop, within the limits fixed for normal output, depend on the full co-operation of each member of the squad or shop. Co-operation is then recognized as a moral duty. It is almost invariably afforded without stint, if not it is sternly exacted. Many skilled men also paid on output are assisted by semi-skilled or unskilled “helpers” paid a fixed time wage, irrespective of output. Although the increased efforts of the “helpers” result in increased earnings only for the skilled men, in general co-operation is usually forthcoming from the “helpers,” and if not it is unconditionally demanded. There is no difficulty in identifying the doctrines to which the workers appeal in justification of their present attitude of non-co-operation with employers—they all come from Marxian Socialism. They are encountered everywhere in workshop, Trade Union branch and district committee, and form the foundations of belief amongst industrial democracy.