Hospital consultants are the latest group of workers to ballot for strike action. In the past year, the UK has lost 3.7m working days to strikes; largely public sector workers such as nurses, junior doctors and railway workers but private sector workers at the likes of Amazon and Heathrow too.
The Office for National Statistic reckons that strikes have depressed growth in the economy. People may have changed their spending behaviour or those with children may have been unable to work if teachers were on strike, for example.
Perhaps this level of industrial strife is to be expected when inflation remains worryingly high – with the Bank of England raising interest rates for the thirteenth time in a row to 5% on Thursday – amid wages that have been flatlining since 2008.
There are strong echoes of the 1970s when oil price shocks led to sky-high inflation. I grew up in the 1970s and 1980s and remember well the three-day week, electricity blackouts and teachers’ strikes. The last of these left me and my schoolmates learning at home for weeks at a time.
Is there an alternative to industrial action? If workers felt they had more of a stake – or greater sense of ownership – in the business or the public service they were providing, there could be fewer disputes and more limited industrial action.
Friday is employee ownership day, a chance to mark and celebrate businesses owned by their members, such as the John Lewis Partnership.
Employee ownership has more than doubled in the past three years. By the end of last year, there were 1,300 employee-owned businesses in the UK. They range from Arup, the design and engineering firm, to Zetter, the recruitment agency.
The top-50 of them generated revenue of £21.7bn last year. Nine in 10 employee-owned businesses reported that employees have some or a lot of say in decisions on working conditions; 85% have some or a lot of say in new working methods.
Different employee-owned organisations have different ways of giving their members a stake; for the John Lewis Partnership, employees’ (or partners’) share in any profits that are made by the business. And as an industrial democracy, partners influence how the business is run through their elected representatives in local forums or partnership-wide council. Interestingly, there is no constitutional ban on trade unions, although – to date – none has been organised.
Another way partners can express their views is through the Gazette – an in-house weekly newspaper that began in 1918. The Gazette has editorial independence and any partner can write in with whatever is on their mind. It does not always make for easy reading but it is an important channel for partners to share what’s on their minds.
Membership organisations are clearly not immune from the inflationary pressures affecting all businesses. And the partnership has its own challenging debates about how much more we can do on pay while maintaining a healthy business. A business based on membership does instil a greater sense of ownership in the future. It also operates channels through which employees can voice their concerns.
There is more robust debate in the partnership during the tougher times than in the good, as befits a business run on democratic lines.
Employee-owned businesses also have the advantage of being able to think longer term, not being driven by short-term shareholder interests, benefiting customers and partners.
Not having outside shareholders also means we have to fund our growth in more imaginative ways, especially a business of the scale of the partnership.
For many years we have relied on the cash we generate, proceeds from asset sales and borrowing. We have also had access to outside capital through joint ventures, such as the one with Ocado that powered Waitrose home deliveries or our new venture with Abrdn supporting our new “build-to-rent” property business. We could look at further opportunities for external investment in the partnership’s transformation, provided these do not fundamentally alter our employee ownership.
Could a partnership model apply to the public sector as well as to the private sector? I think it can. There was famously much debate during the coalition government of David Cameron and Nick Clegg of applying the “John Lewis model” to the NHS. While it hasn’t been introduced wholesale, there are pockets where a mutual model has been established.
The Minehead medical centre, a general practice based in Somerset, last year rejected a hospital merger, instead becoming an employee-owned trust. It said the decision was in the best interests of patients and the medical staff; a move it believes will “protect the ongoing stability and sustainability of the practice”.
So while employee ownership may not be a panacea, giving workers more of a stake could greatly improve industrial relations and benefit the whole country.
Dame Sharon White is chair of the John Lewis Partnership
