The relationship between the State and Industrial Relations

1. State and
Industrial Relations

2. The modern state and its
origins
 It will almost be impossible to understand
in any meaningful sense the nature of
industrial relations and trade unionism in
any country without first looking at the
role played by the state or government.

3. The modern state and its
origins
 The reason for this seems simple
enough: society has to be governed or
managed by a group of people for the
citizens to go about their own businesses
and activities safely and systematically.

4. The modern state and its
origins
 The problem of maintaining any social
order is constant, and unavoidable, and
remains intertwined with the rise and
development of the modern state.

5. The modern state and its
origins
 It is not merely by accident that a few
persons or a relatively large number of
persons find themselves in positions of
authority and exercise power over others.

6. The modern state and its
origins
 Under feudalism, those in position of power
claimed that God more or less made life that
way.
 In that period, it was not very difficult to identify
the ‘State’ and its origins for, as King Louis XIV
of France was reported to have said in French,
“I am the State”: those who owned everything,
including the power of life and death over
peasants, slaves, serfs, etc., literally embodied
the State in their person and activities.

7. The modern state and its
origins
 Specific territories and persons and property
therein were expressly owned by specific
individuals (king, emperor, prince, etc.) or
groups of individuals and as such the fortunes
and governance of these rose and fell
according to the plight or circumstances of
those who owned them.
 The right to life and other rights and liberties
were granted as a favour.

8. The modern state and its
origins - Hegel
 Hegel, in his discussion of the philosophy
of the State, conceived public
administration as a BRIDGE between the
STATE and the CIVIL SOCIETY.

9. The modern state and its
origins - Hegel
 The CIVIL SOCIETY comprised the
professions, the corporations which
represented the various PARTICULAR
INTERESTS, with the State representing
the GENERAL INTEREST.

10. The modern state and its
origins - Hegel
 Between the two, the BUREAUCRACY
was the medium through which this
passage from the PARTICULAR to the
GENERAL INTEREST became possible.

11. The modern state and its
origins - Hegel
 Hegel, in effect, expected there to be
‘opposition’ between the PARTICULAR
interests of the corporations (that
represented the interests of organised
capital, their owners and the professions)
and the COMMON interest represented
by the state.

12. The modern state and its
origins - Hegel
 In this social order, political franchise
was very limited, extended only to the
aristocracy, the emergent wealthy groups
(landed or rentier, mercantile and
industrial capitalists), their corporations
and organised professional associations.

13. The modern state and its
origins - Hegel
 In the struggle for domination of society,
Hegel imagined that through the
bureaucracy and other sets of activities,
the State would somehow stand for the
protection of general interests.

14. The modern state and its
origins - Karl Marx
 Karl Marx accepted Hegel’s tripartite
structure of society made up of the state,
bureaucracy (in terms of state
administration) and civil society, but
disagreed with Hegel over their
composition and the role each one of
them plays in a capitalist society.

15. The modern state and its
origins - Karl Marx
 According to Marx, this “opposition”
offered by the
administration/bureaucracy to the State
as envisaged by Hegel does not exist
because the State does not represent the
general or common interest but the
particular interests of the dominant social
class, a social class that itself is a part of
the civil society.

16. The modern state and its
origins - Karl Marx
 Indeed, ‘the executive of the modern
state is but a committee for managing the
common affairs of the whole
bourgeoisie,’ Marx and Engels had
maintained instead.

17. The modern state and its
origins - Karl Marx
 Marx’s central argument is that all human
society through history is class-dominated, the
nature and character of the dominant social
class depending on the epoch. And, as such,
the state (however composed) has historically
always served class (particular and privileged)
interests and not general interests.

18. The modern state and its
origins - Karl Marx
 Thus, ‘the elaboration of state institutions has
been closely associated with the development
of antagonistic class interests, and their
functions have always included the
reinforcement of the system of class rule
enshrined in the existing social order by
suppressing acts of resistance and revolt by
subordinate classes.’

19. The modern state and its
origins - Karl Marx
 From this viewpoint,
 a) bureaucracy constitutes a very specific and
particular social group,
 b) that the state administration/bureaucracy is
not a social class, and along with the State
itself, is an instrument by which the dominant
class exercises its domination over society.

20. The modern state and its
origins - Karl Marx
 In this way, to a certain degree, the future and
the interests of bureaucracy are closely linked
to those of the dominant class and the State.
Its justification and existence depends on
them.
 In capitalist society, the real task of
bureaucracy is to impose on the whole of
society an order of things which consolidates
and perpetuates class division and domination.

21. The modern state and its
origins - Karl Marx
 At the same time, its other task is to
mask this domination by interposing itself
as the general interest smoke screen
between exploiters and exploited.

22. The modern state and its
origins - Karl Marx
 But, on the other hand, as bureaucracy is
not an integral part of the capitalist class,
it has a certain autonomy which makes
conflict with its masters possible. This
conflict cannot go beyond certain limits,
which are always determined by the
existing forces and relations of
production.

23. The modern state and its
origins - Karl Marx
 Briefly, from the above, it follows that
bureaucracy does not occupy an organic
position in the social structure, as it is not
directly linked with the process of production.
Its existence and development has a transient
and parasitic character. Its main task is to
maintain the status quo and the privileges of its
masters.

24. The modern state and its
origins - Karl Marx
 From this point of view bureaucracy and further
bureaucratisation become unavoidable and
indispensable in a society divided into social
classes.
 Indeed the political system of such a society
increasingly requires further and stricter control
for the maintenance of the divisions and
inequalities among its various groups.

25. Current arguments
 The debate, since Marx, over the nature of the state
and thus of modern capitalist society has not subsided,
a great many attempts directed more at confusing the
issues rather shedding more light. Certainly, most of
the attempts have been driven by the desire to
‘disprove’ Marx over
 a) the existence of two social classes in society (by the
same token, the degree of exploitation in society);
 b) the partisan role of the state; and
 c) the conception of a communist or classless society.

26. Current arguments - nature of
the state
 On the composition of the state and its
apparatuses, the generalised picture of non-
Marxian position is as follows. The modern
state has as its core the ‘government’, its other
arms being the main civil service, legislature
(where they exist), local government, judiciary,
public utilities and parastatals, law enforcement
and intelligence agencies, and the armed
forces.

27. Current arguments - Nature of
the State
 The group of people who make up
the government carry out the
functions we call ‘governance’, and
the government consequently has
the constitutional responsibility to
pass laws to regulate the conduct of
citizens and institutions in the
country.

28. Current arguments - Nature of
the State
 It is because this general role is so
important to the survival of a country
and of the dominant classes that
how a government comes into being
is not left to chance and the
processes and procedures for
composing it are usually spelt out.

29. Current arguments - Nature of
the State
 The existence of a government means
that the citizens temporarily give up
some of their own power or sovereignty,
through their elected representatives, as
it is not possible for everyone to
physically and directly participate in
decision-making.

30. Current arguments - Nature of
the State
 And it is through representatives
and by periodically changing them
that citizens can indirectly contribute
to decisions affecting their lives. This
process is both delegation of power
and political democracy.

31. Current arguments
- Nature of the state
 This is also why it is not possible to
justify an authoritarian regime or a
dictatorship in the name of the
people or citizens: dictatorships
seize the power or sovereignty of the
people and which may or may not be
used (overwhelmingly, the latter) to
further the general interest or good.

32. Current arguments - Nature
of the State
 For modern liberal governments to function effectively
and legitimately, they have to be first elected according
to laid down rules and procedures (usually contained in
a constitution), and when elected make rules or laws.
For these rules or laws to be implemented and to
regulate the conduct of all, institutions are established,
and this is what accounts for the existence of the civil
service, local government, the judiciary, police,
customs, immigration, armed forces, and other public
utilities.

33. Current arguments - Nature of
the State
 Even unelected governments, such as military
regimes and territories ruled by absolute
monarchs/kings, also make laws and develop
the above-mentioned institutions to implement
them. Where such citizens accept and believe
such rulers have a right to make laws without
consulting or involving them, then such rulers
may not feel the need to justify or explain their
laws and actions.

34. Current arguments - Nature of
the State
 Nowadays, however, even authoritarian and
military regimes find that they have to explain
and defend some of the laws they decree into
existence and many of their decisions and
actions are contested by their own citizens and
the international community in a new age of
individual and fundamental human rights after
the collapse of the Soviet Union and so-called
East European countries.

35. Current arguments - Nature of
the State
 Anyway, once a government is in place, it
claims the role of regulating the conduct of
everyone inside the country, and since all
interests groups in society have some sectional
or private interests to protect, the dislike and
contestation of some government policies are
bound to occur any time a specific law or policy
negatively affects such sectional interests.

36. Current arguments - Nature of
the State
 It should also be borne in mind that although a
government may have the power to make laws, those
laws that do not conform to laid down procedures in
their enactment or violate those rights and privileges
protected by the constitution and are universally
recognised and embodied in the various conventions
and declarations of international institutions (e.g. the
United Nations Organisation - UNO) can be declared
unlawful by the courts. It is to avoid this that some
military dictatorships introduce so-called ‘ouster
clauses’ that prevent the law courts from even
examining such laws.

37. Current arguments - Nature of
the State
 Wherever there are private and public employers and
individuals are physically and legally free to secure
paid employment, workers exist. So also would a
private employment contract be created, whether
verbal or written. Those relations arising from the
employment situation, including attempts by the private
employer, public employer and workers to sort out
differences over terms of employment and other issues
that may arise from time to time often involve the state.

38. Current arguments - Nature of
the State
 The state itself is both an employer and
the institution that makes laws to regulate
the activities of everyone else, including
those of private employers and workers
and their organisations.

39. Current arguments - Nature of
the State
 These two interests, that of employer and
ostensible regulator, can and do conflict
and sometimes influence the kind of laws
passed to regulate the three parties in
industrial relations.

40. Current arguments - Nature of
the State
 So, the right of the state to regulate or
intervene seems to be widely accepted in
principle by all parties in industry, but
how far, where and how frequently are
often the problem. How far, where and
how frequently the state intervenes can
hardly be separated from the nature of
the state itself.

41. Role of the State
 The logic underlying orthodox explanations
dictates that the state has to be an arbiter.
 Not particularly concerned with the historical
evolution of state’s regulatory capacity, the
focus and emphasis in such explanations is on
the integrative function of regulation - a
snapshot of the present or status quo.
 Clearly then, the state operates at three levels:
the international, the national level and then at
the micro-level (organisations).

42. Role of the State
 At the international level, the state
disappears from the analysis, to be
replaced by such doctrines as
‘comparative advantage’ in international
trade and ‘market forces’. Transnational
companies have global operations and
make profits by being ‘more competitive’
and ‘beating the opposition’.

43. Role of the State
 Here the state is supposed to protect
‘national interests’ through a judicious
mix of policies: import-export controls,
tax regime, investments in ‘sensitive
sectors of the economy’, diplomatic
pressures on foreign governments to
‘open up trade’, and so forth.

44. Role of the State
 For the national and micro levels,
because of the regulatory and sometimes
mediatory roles of the government, some
have strenuously argued and struggled
to give the impression that the state is in
principle ‘neutral’: that it is merely a
question of taking case by case and
examining state’s role.

45. Role of the State
 That, sometimes, government’s decision
might favour the employer, and at other
times the worker and his/her
organisation. The examples of Factories
Act and similar legislation that seek to
establish minimum health and other
standards at the work place may be seen
as favouring workers.

46. Role of the State
 On the question of the state attempting to
establish health and safety standards at
the work-place representing an even-
handed approach, such a position
assumes the meeting of such standards
(physical work space, lighting, noise
levels, dust levels, protective clothing
against chemicals, gas, etc.) to be added
cost that employers can do without.

47. Bias of the system
 In addition to the above, private industry
requires investments to make profits, and
ensuing profits are supposedly ploughed
back as further investments for more
profits. In this process, more jobs might
be created and government can derive
some revenue from taxes and as duties.

48. Bias of the system
 Many government’s attempt to create ‘a
favourable climate for investments’ by lowering
corporate and production taxes, engaging in
periodic downward review of import tariffs,
keeping a lid on wages and salaries, etc., aside
from the fact that most laws are geared to the
protection of private property can only but
favour managements and investors.

49. Bias of the system
 A government that is dedicated to the
protection of private property and minimising
disruptions to production and seeking the
elimination of ‘threats’ to investments and
investors, and ‘ensure a buoyant economy’,
CANNOT BE NEUTRAL in industrial relations.
 Quite simply, there is no ‘economic growth’ and
‘buoyant economy’ without profit-making
private companies in this context.

50. Bias of the system
 Trade unions, striking workers,
protesting students, all those seeking
improvements in their terms of
employment commonly tend to constitute
a ‘threat’ of a sort before the eyes of
most state functionaries - much more so
under military regimes that cannot
stomach any opposition or protests.

51. Bias of the system
 In addition, where many members of the ruling
group and elite of the state system (civil
service, parastatal, local governments,
judiciary, police, armed forces, intelligence
agencies, etc.) are investors and own
companies (results of privatisation, etc.),
hostile labour legislation is to be expected, and
harassment of workers and other vocal groups
in society by the whole range of law
enforcement agencies routine.

52. Bias of the system
 It is not convincing to portray the
mediating role of the state in conflict
situations as neutral. The institutions and
processes of mediation, conciliation and
arbitration are in reality manipulable and
contestable, especially as the state often
sets the limits within which they operate.

53. Bias of the system
 For example, decision-making processes in
business organisations are autocratically
arrived at, yet a group of workers reacting to
some of such decisions that affect them
adversely may be required by law to meet
several conditions, including balloting before
going on strike, to determine whether decision
to strike was democratically arrived at!

54. Bias of the system
 A minister or employer might take his
time about taking a dispute to arbitration,
and eventually when done the pace at
which proceedings progress is
subjectively determined by the
arbitrators), and so on.

55. Bias of the system
 Or, when a government passes
legislation to block the bank accounts of
a trade union whose members are on
strike, or a court orders same, or
legislation or court order prevents trade
unions from using their funds ‘for political
purposes’.

56. Bias of the system
 There is usually no commensurate
legislation nor court order preventing
employers and businesses from doing
same: indeed, most political parties
(where they exist) compete for their
support and patronage!
 The areas most frequently subject to
state regulation are usually

57. Main areas of State’s direct
involvement
 employment and manpower
development;
 wages and salaries,
 union government and administration;
 collective bargaining; and
 industrial conflict.

58. Context of state involvement
 According to the pluralist model, all
groups in society, whether economic,
socio-cultural, or political, organise to
meet and protect the interests of their
members.

59. Context of state involvement
 In respect of industrial relations, for example, most
private employers and investors, even when they
recognise the notion of social responsibility, hardly see
their operations in terms of ‘national interest’. They see
instead opportunities, markets, sources of finance and
raw materials, and other resources and constraints that
can facilitate or hinder their operations within the given
environment, while their activities at the same time
serving to shape the environment itself.

60. Context of state involvement
 Thus, by definition, their interests are
partisan or sectional and private
employers largely concern themselves
with complying with relevant laws and
agreements reached with workers and
their trades unions - that is where unions
exist.

61. Context of state involvement
 The wages, fringe benefits, and other welfare
schemes constitute a cost to them, and official
policies and trades union activities directed at
increasing these would habitually be resisted.
But such resistance, under certain
circumstances, might in fact be in everyone’s
interest if the passing on of such costs to the
consumer would sharply increase the rate of
inflation and reduce general purchasing power.

62. Context of state involvement
 The same goes for governments and
politicians. What this suggests, among
other possibilities, is that government’s
economic and social policies may not
necessarily be in the “national interest” or
affect a larger number of citizens
positively all of the time.

63. Context of state involvement
 Those who control any government (or
political parties that form such
governments) have their own agendas
which they try to achieve within the law
and constitution, if they have any respect
left at all for both.

64. Context of state involvement
 Where governments, like military regimes
everywhere, have ouster clauses that prevent
organisations, citizens and the law courts
themselves from challenging their own laws
and decisions, any talk of some decision being
in the national interest must be closely
examined and questioned, especially where
the government says there is no alternative to
its policies and affected parties or the public
have no way of changing such a policy.

65. Context of state involvement
 This alone, if nothing else, is why
democratically elected governments are far
superior to the most benevolent of military
regimes: namely, that policies are debated and
majority vote settles the choice of policy, and
when such a policy has far too many negative
consequences, protests and more debates
arise and the policy is modified in due course.

66. Context of state involvement
 So, what constitutes normal policy
making process under democratic
government is often presented by
spokesmen of military regimes as
‘opposing the government’, ‘subversive
of the government’s plan’, ‘sabotage’ and
similar labels.

67. Context of state involvement
 The phrase ‘national interest’ has
become an indispensable legitimising
slogan in government’s propaganda
machinery everywhere, even in places
where those in government make it clear
that they wish to hang on to power
against the wishes or preferences of the
public or electorate.

68. Union government and
administration
 Many governments target the capacity of
unions to organize by trying to influence
who can be members, who can stand for
elections and how often union elections
can be held, and so forth.

69. Union government and
administration
 These are complemented by verbal and
media attacks on union officials, freezing
some bank accounts, and undermining
the legitimacy of union executives
especially in periods of conflict.

70. Union government and
administration
 While in some countries the Registrar of
Trade Unions (or equivalent) contributes
his own part by withdrawing official
recognition by de-registration,
 recognising an unpopular faction of a
union,

71. Union government and
administration
 denying some unions permission to
amalgamate or federate, extending recognition
to only one central labour organisation,
 insisting on voluntary check-off system,
 balloting before strikes are embarked upon;
and
 refusing to accept some union accounts when
submitted.

72. Union government and
administration
 In any case, all governments attempt to
influence organised labour everywhere,
and for a variety of reasons may choose
to give grants or subventions to trades
unions or the central labour organisation.

73. Union government and
administration
 Where a section of the labour movement is itself
involved in the government of the day (as happens in
Europe and Britain where some political parties and
many trade unions have joint committees and are
inextricably institutionally intertwined), in such a plural
situation of political parties and trades unions
subscribing to various and differing ideological
positions and thus different social agendas, it all then
boils down to rivalry and competition for the minds of
the electorate.

74. Union government and
administration
 Official policies perceived to be inimical to the interests
of wage earners or to those of a section of the labour
movement are then opposed by those affected.

75. Union government and
administration
 However, the situation is contrastingly different
in Africa, Asia and South America where most
governments, civilian and military, appear to be
routinely anti-unions and, aside from direct
physical attack on union leaders and some
workers, legislation and decrees which
severely restrict the capacity of unions to
function effectively are put in place.

76. Union government and
administration
 The notion of plurality of interests and the
democratic right of persons to organise
and protect such interests do not seem to
enjoy wide acceptance among those who
control the levers of power in these
places.

77. Collective bargaining and
wage bargain
 The state is also heavily involved in
regulating collective bargaining. The
state as an employer attempts to
determine public sector terms through
various mechanisms, depending on
whether such public sector employees
enjoy the legal right to organise or not.

78. Collective bargaining and
wage bargain
 Where they do not (e.g., Essential
Services in several countries), quite often
terms of employment may be determined
through the establishment and
functioning of wages and salaries
commissions, or committee or wages
board, or some such ad hoc or
permanent institution.

79. Collective bargaining and
wage bargain
 There is usually a ministry or official body
concerned with industrial relations and
labour matters and some main legislation
or code which provides a legal
framework for collective bargaining.

80. Collective bargaining and
wage bargain
 Of course, developments in the domestic
and international economy that serve to
constrain the state and impact on
collective bargaining processes cannot
be overlooked.

81. Collective bargaining and
wage bargain
 Since the mid-1980s the dramatically
deteriorating standard of living in the face
of stagflation and decreasing capacity
utilisation in many industries has
presented problems of sorts for all
parties in industry.

82. Collective bargaining and
wage bargain
 Not all the problems in the economy and
industry have been caused by world-wide
economic depression.
 The rate of inflation,
 monetary and fiscal policy,
 autonomy and effectiveness of monetary
institutions and authorities,

83. Collective bargaining and
wage bargain
 extra-budgetary expenditures and budget deficits,
 official housing, health and educational policies,
 elite-generated political crises and tensions,
 sourcing of raw materials,
 pricing policies of trading and manufacturing
industries,
 activities of middlemen and of market-women and
men, just to mention a few, all impact upon the
situation.

84. Wage bargain institutions
 Wage bargain institutions in the public
sector have tended to take
institutionalised forms as wages
commissions/committees, wages boards
or councils.

85. Wage bargain institutions
 Where workers therein are not organised
into trades unions, such bodies are
legally empowered to negotiate salaries,
fringe benefits and general conditions of
service for the employees so affected.

86. Wage bargain institutions

 In the so-called non-unionised private
sector, special tribunals or commissions
might be established to investigate
conditions in some of the establishments
or industries.

87. Wage bargain institutions
 What is left of the private sector is
presumed to be subject to collective
attempts by management and
workers at continuously modifying
terms of employment.

88. Wage bargain institutions
 But, over and above all, many
governments adopt some variant of
incomes and policy guidelines, in spite of
periodic calls for completely deregulated
economies or dominance of ‘market
forces’, to put an upper ceiling on
percentage increases in wages and
salaries.

89. Wage bargain institutions
 Wage bargaining processes are thus
restricted to the range provided
under such economic policies,
percentages that often are below the
rate of inflation.

90. Wage bargain institutions
 Wage settlements under such
incomes policy guidelines remain
unsatisfactory even before they are
reached, leaving a residue of
bitterness and discontentment.

91. Wage bargain institutions
 In many countries, especially in Africa,
Asia and South America, such wage
bargain institutions in the public sector
are rendered moribund and ineffectual,
the government preferring the method of
administrative fiat.

92. Industrial conflict
 Either through pre-emptive moves or in
reaction to generalised disquiet and pockets of
protests alongside adverse press coverage,
the government would appoint ad hoc inter-
ministerial, bilateral and tripartite committees
largely to defuse the situation by addressing
themselves with much fanfare to particular
issues.

93. Industrial conflict
 Many governments routinely claim the
maintenance of ‘peace and order’ as one
of their main functions, and are
particularly upset over industrial conflicts
that disrupt production and services.

94. Industrial conflict
 Quite often, they use intelligence
organisations, police and soldiers to
break strikes, either physically or by
detaining union officials and some
strikers, physical harassment and
intimidation, or sending some strikers to
tribunals/courts for trial.

95. Industrial conflict
 The government also regulates industrial
conflict through some decrees or laws
and institutions. Mediation, conciliation
and arbitration services are offered by
some organs of the state, quite often a
ministry of employment or labour or
some bodies enjoying a measure of
institutional autonomy.

96. Industrial conflict
 Despite the tripartite composition of
these bodies, in many countries the
government usually has greater influence
over them and can and does ignore
some of their rulings or decisions.

97. Concluding observations
-Importance of the State
 The first is the determination of the conditions
on which labour power may be sold: the state
intervenes to affect the reproduction of labour
power, for example through social security
legislation that guarantees minimum living
standards, the result being that the supply of
labour power no longer depends solely on the
market.

98. Concluding observations
-Importance of the State
 Second, there is the regulation of how
that labour power is used – e.g.
Compulsory union recognition and
collective bargaining as means of
constraining management’s freedom to
discipline workers.

99. Concluding observations
-Importance of the State
 Other examples are legislation restricting
the hours of labour and establishing
standards of health and safety: the
employer’s freedom to use the labour
power that he has bought is restrained
not only by workers’ own actions but also
by state regulation.

100. Concluding observations
-Importance of the State
 Regulations on the price of labour power
may set limits to what can go on inside
the labour process, but they do not
directly shape the pattern of relations.

101. Concluding observations
-Importance of the State
 Regulations on the use of labour power
directly constrain employers’ power over
labour and affect how the labour process
is organised.

102. Concluding observations
-Importance of the State
 But, at the end of the day, private
employers have enough free hand to
deal with workers as they deem fit.