The Unions Scuttle the Social Contract

Scarcely able to be heard above the relentless heckling in the audience, Britain's veteran trade union leader Jack Jones shouted a warning: "If you support this motion, you will not assist the government. You will paralyze it and indeed stand in danger of destroying it."

Ignoring the plea of their chief, delegates to the convention of the Transport and General Workers' Union last week voted for a motion that effectively scuttled the landmark agreement on wage restraint between Britain's unions and the Labor government of Prime Minister James Callaghan. The vote to demand substantial wage increases was a deep personal humiliation for Jones, who in 1973 had helped draw up the agreement. In a weary voice, he declared that the TGWU action would lead to "a wage scramble, renewed inflation, increased unemployment and new trouble for the pound."

No-Confidence Vote. It could also lead to the fall of the Labor government. The agreement on voluntary wage restraints, grandly dubbed the "social contract," had constituted the Callaghan government's most compelling argument for remaining in office. If the Labor Party is unable to control or moderate the unions' wage demands, thus further aggravating inflation (now running at 17% annually), Callaghan could face a no-confidence vote in the House of Commons that he would probably lose. The resulting election might be a Tory landslide. Already David Steel has threatened to withdraw his pledge to support the Callaghan government with the 13 crucial Commons votes of his Liberal Party if no effective new agreement on wage restraints is forthcoming.

The prognosis is grim for new talks on restraints. Until now the TGWU's adherence to the contract had discouraged other unions from breaking the wage-restraint agreement. With 1.9 million members, the TGWU is the largest single union within the umbrella-like Trades Union Congress, which ostensibly represents organized labor in Britain. Now other major unions are demanding release from the agreement. At the mine workers' union convention in Tynemouth last week, delegates representing 262,000 members voted to demand raises by Nov. 1. The 1.3 million-member engineers' union has also voted against further wage restraints, and a host of smaller unions are expected to follow suit, creating a sudden and inflationary wage explosion at the end of this month. This week Chancellor of the Exchequer Denis Healey meets with TUC leaders. He hopes to persuade the trade union body to join the government in an appeal to hold down wage demands. In exchange for this support, the government is expected to promise some form of price controls.

Meanwhile, a 46-week-old strike in London has become a riveting symbol of the Labor government's failure to keep labor peace. Charter Road in northwest London has become the scene of ugly battles between police and protesters as a result of a walkout at the Grunwick Film Processing Laboratories.

Just Nonunion. The strike, which has been dubbed "the Grunwick siege" by pro-Tory London papers, began as a relatively simple labor problem. Last August Mrs. Jayaben Desai, a tiny Indian immigrant from Tanzania, walked off her job as a film processor in protest against the low wages ($42.50 a week), poor working conditions and compulsory overtime imposed on the predominantly Asian work force by Grunwick's Anglo-Indian managing director George Ward. With six other employees, Mrs. Desai joined the Association of Professional, Executive, Clerical and Computer Staff (APEX), a moderate, nonmilitant, white-collar trade union. In the next few days, more than 100 Grunwick employees joined APEX. Ward, who describes himself as "not antiunion, just nonunion," fired all the workers affiliated with APEX and refused to meet with the union's organizers.

In retaliation, APEX organized a picket outside the plant. For months Mrs. Desai and a handful of other dismissed employees patrolled in saris outside the gates of Grunwick as policemen eyed them warily. Unable to meet with Ward, APEX enlisted the aid of the Advisory, Conciliation and Arbitration Service (ACAS), an agency set up by the government's 1975 Employment Protection Act.

Ward, advised by the National Association for Freedom, a right-wing organization made up mostly of businessmen, refused to cooperate with ACAS. He rejected its proposal to poll his employees on whether or not they wanted union representation. When ACAS polled the striking workers anyway, they opted for the union. ACAS then recommended that the company recognize APEX. But Ward went to court to contend that the ballot had been improperly conducted.

Last week the High Court began hearing arguments on the case. To union officials, it is a crucial test of the government's support for the trade unions. In a characteristic British compromise, Parliament did not empower ACAS to compel employers to recognize unions; ACAS can merely recommend compliance. If the court accepts Ward's basic contention that he cannot be forced to accept APEX, union officials fear there will be a host of legal challenges to ACAS recommendations. Says APEX Official John Wall: "If the court rules that ACAS has no teeth, there will be hell raised within the Trades Union Congress."

Mass March. Union leaders concede that mass picketing is difficult to control and may lead to trouble. But they argue that Ward's defiance has left them with no alternative other than to call for support of the Grunwick strikers. A mass march of union members and strike sympathizers is scheduled for this week. Arthur Scargill, arrested by police last month when he appeared at Grunwick, promises that 3,000 members of his Yorkshire miners' union will participate in the demonstration.

The Grunwick siege painfully dramatizes the Labor government's precarious dependence on the trade unions, whose unpopularity among nonunionists is rapidly rising. Against the backdrop of the large-scale workers' revolt against wage freezes, the Grunwick strike reinforces the public impression that trade unions are uncontrollable.

This perception was strengthened by the refusal of postal workers to process mail from Grunwick to its film-service customers. After ignoring pleas from postal union officials to stop their illegal blockade, 100 workers were suspended without pay. They showed up at the local sorting office anyway, delivering mail to private homes in the area before postal officials closed the office.

Lacking the legal authority to impose a solution, the Labor government and the courts appear to be powerless. Indeed, the Grunwick siege has raised some fundamental questions about the ability of Britain's democratic institutions to resolve labor disputes.

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