The need for dialogue with trade unions is now accepted in principle by the World Bank. But a placement with the Bank’s <¬2lace>Europe and <¬3lace>Central Asia region showed Jane Barrett Why consultation doesn’t always work in practice

“Ownership by stakeholders” is a term used frequently within the World Bank, but it seemed to me during my placement at the Bank that generally this applied only to the process of a national government making a formal decision.

In relation to the content of trade union engagement, there are Bank documents that refer to the need to consult trade unions on the “mode of restructuring”. Lucy Fye, senior private sector development specialist for the Africa Region of the Bank spoke recently of the need for “communication at all points of restructuring”.

The Bank’s Port reform toolkit also puts up a strong case for early involvement of organised labour in any port restructuring project. The toolkit argues:

Governments….have much to gain from involving labour early and effectively in the port reform process. Labor’s contribution stems from its important role as:

- one of the port’s most valuable assets, trained personnel

- a source of practical knowledge of an experience in port operations

- problem solvers

- and a source of ideas to add value to the goods and services of customers.

Similar points are made in the Bank’s Toolkit on labour issues and infrastructure reform.

Consultation can also help improve the process and outcomes of workforce restructuring….As a two-way process, consultation

- offers a way to tap into the experience and knowledge of stakeholders in the design and implementation of labour restructuring proposals

- Provides a source of information to tailor labour strategies more closely to prevailing circumstances

- Provides ideas about how to design the communications strategy, prepare for negotiations, and develop any cooperation projects that might be possible

- Adds legitimacy through involvement of stakeholders in decisions affecting their future.

Consultation should be undertaken with all key stakeholders. Consulting with trade unions has a particular facet, however: union opposition to PPI (“Private Participation in Intrastructure”) often has its basis in a belief that the unions are insufficiently consulted about PPI, or consulted too late when there are problems in the process.

Obstacles to engagement

These general statements are however not necessarily helpful in providing guidelines in practice. The absence of clear guidelines creates an excuse for Bank staff and consultants to argue that the level of engagement (consultation, negotiation and/or cooperation) is a government prerogative. In other words, governments are the Bank’s clients and their decisions on levels of engagement are to be respected.

While of course this is formally speaking true, in their advisory role Bank staff and consultants have a huge amount of influence. My observation is that the hindrance to early consultation on the mode of restructuring is more a question of the mindset of Bank staff and consultants.

Workers and their representative trade unions are not seen as a resource, but as a hindrance to decision making. At best trade unions are to be consulted on the consequences of reform/restructuring, in particular on the final implementation of decisions to retrench workers. And even here, there is no uniformity on what aspects of a retrenchment process should be consulted.

My observation is that the absence of engagement in the early stages of the project is reinforced by the way in which project teams are constructed and the brief that each team member has. The teams are constructed on a multi-disciplinary basis. In railway reform projects this means that the team comprises financial experts, railway technical experts, and human development/environment experts. The job of meeting with trade unions is delegated to the human development specialists or social scientists, usually with the brief of dealing with the consequences of restructuring.

The consequence is that workers, through their trade unions, are denied the opportunity to share their rich experience and perceptions of operations with those leading the project. The project design and implementation is likely to suffer through the absence of worker input into the technical discussions.

To give a practical example, the railway consultant to the Bank’s railway reform work in Romania for the past 15 or so years, has never met the trade unions, or directly with workers. In my view this has resulted in a direct threat to the sustainability of the project. Information technology that the Bank funded is currently not being utilised, despite all the hardware being in place. The “human element” is clearly to blame, but at the time of writing there was no intention of talking to anyone about the obstacles to implementation except management (especially middle management).

There is sufficient evidence to show that sustainability and effectiveness of infrastructure reform is maximised where consultation itself is maximised. The Ghana ports example is cited in the Toolkit on labour Issues and Infrastructure Reform, as is the South African railway example, the Sri Lanka telecoms example, and the USA Indianapolis city services example. While it is accepted that such processes are not possible in all political contexts this should not stop the Bank and the ITF and/or the ICFTU from developing a set of guidelines for Best Practice for Engagement to aspire to.

In the process of infrastructure reform, trade unions are not exempt from criticisms. They are at times rather meek, ambivalent and/or late in their demand to be consulted on the form of enterprise reform. And where they have demanded to be consulted on the form of enterprise reform, they do not always have an independent vision that they can bring to the table. And they are often not practised in analysing such data as traffic density, staff projections, operating costs, investment requirements and so on. This weakens their capacity to engage in the rationale put forward by the Bank when it puts forward a case for enterprise reform/restructuring.

Need for follow-up

The lack of clarity on engagement also extends to how engagements are conducted. The early processes, where they do take place, are primarily processes of providing information in the form of presentations and not of approaching the issues facing the enterprise from a mutual problem-solving point of view. Where questions are raised in response to a presentation, there is a tendency simply to note the questions rather than consult to a conclusion. Agreements and/or disagreements are not reduced in writing to form a record.

Where formal negotiations related to the reform process do take place between management of an enterprise and trade unions, the Bank staff attached to a particular project do not request detailed reports of the outcomes of these negotiations. Not only does this mean that records of any one project that involve management-trade union negotiations are therefore incomplete, but it also means that monitoring and follow-up of trade union engagement by project team leaders is inadequate.

Transparency of information is inadequate. For example, reports by Bank staff or consultants are not always shared with the trade unions. There is no rule or protocol on responding to trade union approaches/correspondence. It is not unusual to find trade union correspondence to the Bank being ignored, both at the level of headquarters and at country level.

Trade unions are often confused about where the locus of decision making lies between government, management and the Bank. Bank and government personnel laughingly make reference to the fact that in this state of confusion both institutions conveniently hide behind the other. The consequence for consultations is not so funny however. Trade unions flounder in their attempts at locating the right person or institution to talk to and become increasingly frustrated.

In multi-union situations, rival unions usually don’t work together, thus weakening the trade union position and also creating difficulties for the Bank and other stakeholders in the consultation process.

Jane Barrett, policy research officer for SATAWU in South Africa, was seconded to the World Bank on behalf of the ITF under the Bank’s exchange programme.

Next issue Jane Barrett looks at trade union engagement with the World Bank on the issue of retrenchments.

Towards real consultation - Bank should include consultation with stakeholders on agendas, as well as recording of agreed conclusions of meeting. - Records of key negotiations between trade unions and management should be kept, monitored and followed up. - Better sharing of information with unions. - Bank must reply to all stakeholder correspondence. - Trade unions should be briefed on areas of responsibility and decision making. This should preferably be in a four-way meeting of Bank, government, management and trade union. - In multi-union situations unions should co-operate in developing joint positions.