CHAPTER X
INDUSTRIAL COUNCILS
To secure industrial peace on terms just and honourable to both sides would be to double the national strength whether in industry or citizenship.—MEMORANDUM OF THE GARTON FOUNDATION.
Under this head it will be convenient to treat not only of the steps to be taken to prevent disputes or secure their settlement by peaceful means, and to promote a more hearty co-operation of employer and employed, but also of various other questions affecting industry, such, for example, as increased production and increased saving. Without industrial peace there will be no industrial or commercial prosperity, and without a fair amount of prosperity it will be very difficult if not impossible to preserve industrial peace. As the War proceeds these questions become more and more urgent; after it, they will be more serious and more pressing than ever. Already the need for taking certain steps at once and for preparing a future policy is recognised. Anyone who wishes to have before him a clear statement of the industrial situation and of the effects of the War upon it, cannot do better than read, and read with care, the revised memorandum prepared under the auspices of the Garton Foundation and published in October, 1916. Singularly impartial and judicious, it does not gloss over the difficulties and perils which must be faced, but throughout there is a note of hopefulness—an anticipation of a better state of things—if while "the forces of change are visibly at work we do not allow
them to hurry us blindly with them," but "direct them along the path of ordered progress." Some of the specific remedies suggested, of the proposals adumbrated, may be open to criticism—criticism is, indeed, invited—but it is evident that nothing is suggested that has not been the subject of careful consideration of the facts. Some of the proposals have already been put into fairly definite form in the Whitley Report, and have received the approval of the Government. Industrial Councils are to be established. The object of them will be to consider "constructive measures for the improvement of industrial conditions and the increase of efficiency." They will not be confined to specific points of dispute. They are to be established in industries which are "highly organised," where the employer and employed already possess some definite association or union which represents them respectively. There are to be national, district, and workshop councils set up. Their object differs from that of the Conciliation Boards for Arbitration or the Trade Boards established to settle some specific question such as a minimum wage to be paid, or some question that has given rise to a dispute between employers and employed. Such a mode of settlement is a great advance on leaving differences to be settled by an industrial war—a strike or lock-out. The Boards will still be needed, just as arbitration tribunals will be required to settle specific disputes between nations. The aim in both cases is to substitute arbitration for war (or its equivalent) or threats of war. Something more is aimed at in the establishment of Industrial Councils. They contemplate a "continuous and constructive co-operation of Capital and Management on the one hand and Labour on the other." They are not tribunals for the settlement of disputes which have arisen, but joint committees which can discuss and propose methods of dealing with any question affecting working-conditions generally, e.g., the introduction of new machinery and its effect on employment and the status as well as the wages of the workpeople, and even its
economic effect generally. Suggestions can be made as to changes which may "increase output or economise effort" and eliminate waste. The effect of any alterations on the health of those engaged in any industry would be within their purview. The idea is to promote co-operation, to make all recognise certain common interests, not merely to adjust competing claims. In international affairs the nearest analogy would be a League of Nations for promoting the common interest of all. While, of course, the main object of such a league is common action to prevent breaches of the international peace by restraining wrong-doers, it should not be the sole object. In the case of Industrial Councils the object is to promote the general welfare of all engaged in the trade and to increase productive efficiency, as well as to secure fair terms between the parties and prevent disputes. If such a Council has been established for any industry Government Departments will consult it, and not the Trade Board, on any questions affecting that industry; but the constitution of the Council should make provision by which Trade Boards can be consulted. Roughly speaking, "the functions of the Trade Board will be called into operation mainly in the case of the less organised trades, and the highly organised trades will be the sphere of the Industrial Councils." These, in their most developed form, will be national, district, and local.
A memorandum which has official sanction states that the chief duty of the Trade Boards, on the other hand, is to fix minimum rates of wages which can be imposed by law. They are needed primarily to insure that in trades where the workers have no official organisation to guard their interest a living wage shall be secured for all. They are statutory bodies set up under an Act of Parliament just passed, and will be connected with the Ministry of Labour, by which their members are largely nominated. The work of such Boards is being extended.
Detailed discussion of the character of the work
which may be expected to be done by the councils and of its probable effects would be beyond the scope of this volume, and would require special knowledge of the industries concerned. It will vary in different industries and in different places. In some, success may be confidently expected, in others there will probably be failures. The aim of the proposal is certainly one to be desired, and the method for attaining it promises many beneficial results. There appear to be some dangers involved which it may be well to consider. Useful work may be hindered owing to, first, the time and attention required for the meetings and discussions of the various councils, and the risk that clever and fluent talkers may prolong debate and generate friction and may perhaps exercise an undue influence. Probably this will not be found a serious danger. Experience over a considerable district shows that those who are chosen by the Trade Unions to represent them are usually clear-headed and businesslike men, who grasp a point quickly and, while carefully guarding the interests of those whom they represent, are fair-minded and ready to do all they can to promote the national interest also. Secondly, there may be a tendency to interfere too much in questions of management, even where full and detailed knowledge of trade conditions of the moment and of possible appliances that may be used is required, and prompt action may be necessary. A man steering a boat in a storm would hardly succeed if he had to consult a committee before moving the helm. The object of the councils would not be to undertake the general management of the business, but should be directed to the relation of workers and management, to secure efficiency and greater production, a fair participation in and distribution of the benefits derived from success, and wholesome conditions for those engaged in the work, and to avoid dispute by agreeing action beforehand wherever possible. Thirdly, in this as in most other cases where power is given to representatives of organised bodies, there
is a risk of undue interference with the liberty of those who do not belong to them or who are in a minority. A dead level of uniformity may be secured, experiments and new lines of action by enterprising and original minds may be interfered with. The old problem of reconciling high organisation and corporate action with individual liberty may present itself in an acute form.