Would you agree with compulsory union membership?

After being touted in his Budget speech by the Prime Minister, should membership in trade unions for workers and for businesses in business chambers should be compulsory?

November 2008: a demonstration against higher utility bills led by all Malta's unions
November 2008: a demonstration against higher utility bills led by all Malta's unions

In his Budget speech last week Prime Minister Joseph Muscat urged a discussion on the possibility of introducing mandatory membership in both trade unions and employers’ associations.

The proposal originally made by the General Workers Union was aimed at addressing “precarious work, abuse and exploitation of employees.”

The proposal has already been shot down by the Malta Employers’ Association, the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association stressed that the decision to join a union or organisation should be left entirely up to the individual employee or company.

The business bodies insisted that freedom of association implies also the freedom “to disassociate oneself from either a trade union or employer organisation”.

Union membership not a real choice for many

But compulsory trade union membership may well address the plight of the most vulnerable categories of workers who fear leaving a bad impression with their boss upon joining a trade union.

“The argument that being a member of a union should be up to the individual employee who can decide freely whether or not to become a member, is in theory reasonable, but it does not hold for many workers in lower income brackets who do not really enjoy such freedom,” social justice activist Michael Grech told MaltaToday.

According to Grech many of these are not unionised not because they don’t want to join forces collectively, but because of their precarious employment conditions and the “implicit or not so implicit perils” unionisation might imply regarding their employment. In short these workers do not join a union simply because they are afraid of losing their job.

Grech compares the need for compulsory union membership to other legislation like the one stipulating a minimum wage. “Why does the law stipulate a minimum wage, and hence imply that such freedom does not extend to asking/receiving a pay lower than is stipulated by this?”

The answer to this is that the legislator has rightly assumed that “such unbridled freedom will in many cases imply abuse and employers taking advantage of employees in precarious situation, with the latter ‘freely’ agreeing for any starvation wages they cannot refuse”. Grech describes this scenario as ‘Dickensian’ .

Free riding on the union?

Industrial relations expert Godfrey Baldacchino gives another reason why all employees should pay the equivalent of a union membership fee – the fact that both members and non-members benefit from the negotiations carried out by a trade union or business chamber.

“Why shouldn’t workers be obliged to pay the equivalent of a trade union membership fee when they do not wish to join a union?” he asks.

For Baldacchino the straw that breaks the camel’s back is that while trade unions negotiate with employers on behalf of their members, the outcome of their negotiations, as manifest in collective agreements, are enjoyed by the whole workforce, irrespective of whether they are union members or not.

“Hence the temptation for non-union members to ‘piggy back’ or ‘free ride’ on their union member colleagues. Only the latter pay their union dues; the rest don’t, but they still enjoy negotiated wage increases, bonuses, etc., anyway.”

But while some workers take a free ride on negotiations by trade unions at their workplace, Malta also has an increased number of workers who are not covered by collective bargaining.

The decline in collective bargaining

Baldacchino notes that labour relations for the past thirty years  have been marked by two contradictory trends: increased social dialogue at a national level and decreased collective bargaining at work place level.

According to Baldacchino the principle of social dialogue crafted in the 1990s remains “very much alive” in the practice of consultation, involving trade unions, employer associations and government, typically within the ambit of the Malta Council for Economic and Social Development.

On the other hand at enterprise level the picture is so different. “Malta has some 8,000 employers – but only around 200 have negotiated and concluded collective agreements”.

Meanwhile trade union membership is probably stable or even rising marginally: with trade unions soon expected to declare that the number of trade union members over 100,000 members.

However, the proportion of the labour force that is unionised is in decline, “especially now with thousands of foreign workers in Malta, most (but not all) of whom are not unionised”.

For Baldacchino it is now “an especially good time” for trade unions to wield the added clout offered by a labour deficient economy, and argue for better and fairer means of representing workers at enterprise level.

And while freedom of association is respected at law it remains unclear whether in practice this possibility actually exists for all workers.

“Such an option remains practically unthinkable in specific economic sectors as well as in micro and small enterprises.”

All small business owners should join a union – GRTU

GRTU president Paul Abela who represents small business owners also makes the argument against free-riders in his advocacy of compulsory membership in employers’ organisations but is cautious when it comes to compulsory membership for employees.

In fact, it was the GRTU which originally proposed a system of compulsory membership for all self-employed persons and legal entities entitled to run businesses in Malta in 2017. This would involve a nominal, regular and mandatory financial contribution to one of the cross-sectoral employer organisations that is represented on the Malta Council for Economic and Social Development.

“At that time we were told by Minister Helena Dalli that this would be unconstitutional. We can’t understand what has changed,” Abela told MaltaToday.

Abela pointed at Austria as a model to emulate. The Federal Economic Chamber (WKO), an employer organisation in Austria has a mandatory membership.

He pointed out that while business organisations lobby for all businesses and spend money on reports and sectoral studies, a significant number of businesses who benefit from these negotiations do not contribute through membership fees.

But Abela is not sure whether the same model should be applied to workers. “Most of our members employ a few employees. Their relationship with the employer is different from that of someone working in a very large enterprise. They tend to have a very personal relationship with an employer who often works side by side with them… in many cases they may not even need to join the union to make their voice heard.”

More in Budget 2019

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