Back to the Waterfront

'Back to the Waterfront'

Nicholas Finney, OBE

It is a great pleasure and privilege to be addressing the H R Nicholls Society tonight. I have already learned a great deal about your waterfront problems both from reading the Inter State Commission's reports and from reading various submissions and subsequent comment and from talking to many people associated with the Waterfront since I arrived on September 9th.

My background is the reason I am your guest tonight. I was the director of Britain's National Association of Port Employers until it was disbanded in December 1989 having successfully removed National Bargaining from the UK's port industry. I am accused or applauded for having led the campaign to end the National Dock Labour Scheme which for forty-two years put a stranglehold round Britain's ports.

That's the tale I am going to tell you tonight but first of all I would like to pay a tribute to somebody who I met for the first time this afternoon and he is sitting next to me tonight---Wayne Dyer. His tale of the Hunter Valley 25 for me said it all about what it is really like to have to face up to the problems at the coal face. Although, we had a pretty tough campaign in the UK, I don't think I was ever faced with the kind of problems he had in having to carry forward the fight against intimidation by the FEDFA. I congratulate you Wayne; it is perhaps no small coincidence that my Mother's maiden name was Dyer.

I have to admit to a sense of déjà vü when I read the Interstate Commission's Report which was published in March '89. To show you that we did have exactly the same problem in the UK I want to tell you the story of a shop steward who was introducing a new young trainee, (that was long ago, when we had young trainees) to work on the docks.

The shop steward went and saw him after about a fortnight and said, 'Now, how are you son, how is it going, they looking after your wages alright?' The trainee says, 'Yes all's fine'. 'Have they trained you and are you getting proper training?' 'Oh yes' he says. The shop steward says, 'Well have you got any other questions?' The young chap says, 'Well actually I have one question could you tell me what a square foot is?' The shop steward thought for a moment and said 'Well I'm sorry I really don't know, but walk with a limp and I'll get you compensation'.

It is difficult to discuss Australia's waterfront industry without mentioning the power granted to the Waterside Workers Federation. Clearly the power and control of the waterside unions is making it more difficult for the reforms to take place and your current labour legislation doesn't appear to back up employers sufficiently to control industrial disruption and the endless additional cost of consultation and negotiation. I know that you feel very strongly that the stevedoring employers are not doing enough but I do think that they haven't got much incentive to fight the current legislation. It's a pretty demoralising problem when a new guy wants to go in and set up in an industry and finds that through the Industrial Relations Commission, union membership and national awards can be imposed on him. That's a situation I wouldn't have liked to have faced in the UK.

In the sixty UK ports governed by a national dock labour scheme it was a criminal offence to employ anyone other than a registered dock worker on work which was legally defined as dock work. The obscurity of the dock work definition gave the legal profession a wonderful living for over forty years. In fact, it was nothing short of a national tragedy to the legal profession to learn the historic announcement by the UK government on the 6th April 1989---it's all over.

The National Dock Labour Board consisting of 50% union and 50% employer reps, was supplemented by a further twenty boards across the country. This system gave the unions an absolute veto over dismissal and total control over recruitment and discipline. In 1982 [I just quote this as an example] a Southampton dockworker was dismissed for a serious criminal offence involving theft over quite a long period of time. He served the prison sentence, was returned to the labour pool and within six months on full back pay, was put back to employment in the same area from which he had come. Restrictive practices, all thoroughly familiar to you, developed a folk lore of their own. Ghosting was popular; allocating and paying dockers to do a job which couldn't be done by dockers and ensuring they never appeared to do the job. The trouble is they had real pay packets and the shippers, importers and exporters had to pay. Other practices such as welting and bobbing were endemic. I also heard the mention of 'spelling'. All these practices involved establishing an inflated gang size and letting half of them 'bob off' home for the day. Disappointment money, embarrassment money; all sorts of money for fictional hardships. Above all morale was always poor because everybody knew that management could not manage in this straightjacket. There was a terrible sense of demoralisation and morbid unreality about everything. It reminded me in a strange way of a little text found on a gravestone deep in the heart of the English countryside:

Here lies all that remains of Charlotte,
born a virgin, died a harlot
for sixteen years she kept her virginity
a marvellous thing for this vicinity.

It was the depth of plundering by the docker; the abuse of monopoly power which eventually sowed the seeds of their own destruction.

When the confrontation came, a number of important factors made a difference to the outcome. The pattern of employment in Britain's ports was uniquely focused on the dock labour scheme. The Transport and General Workers' Union completely dominated control, having 95% of the 10,000 men on the register. In Australia of course you have about thirty waterside unions, although the WWF does appear the most powerful and your 1988 IR Act seems to be giving the WWF even greater monopoly powers over the waterfront. Because of the dreadful inefficiencies of the dock labour scheme, three other major features characterised employment patterns in UK Ports. First, no other unionised port worker (even workers in the same union) could carry out dock work, and so they resented and disliked the dockers' privileges. These were now a majority of the Ports workforce, about 20,000 other workers. Secondly because no docker could be sacked, most private stevedores had collapsed and turned their dockers over to the Port Authorities in the 1970s and 80s. Just before repeal last year 73% of the dockers in the UK were employed by the Port Authorities and over the past twenty years the number of docker employers had fallen from 2,000 to just 142. Even that statistic is interesting because 142 is certainly a great deal more than the five or six employers that appear to dominate the Australian stevedoring industry. Needless to say, the only reason that the port authorities became the 'employer of last resort' was because of the infamous 'jobs for life' agreement which prevented a docker from being dismissed even for redundancy.

Secondly, because of the dock labour scheme, ports outside the scheme, Felixstowe and Dover, grew from virtually nothing to become very substantial ports in value and tonnage terms. About thirty non scheme ports in 1989 handled about 30% of Britain's trade by tonnage and about 55% by value.

Finally, Britain's close proximity to Europe meant that roll-on/roll-off ferry services simplified cargo handling and could keep exports moving even if the dockers and the dock labour scheme were forced on strike. They couldn't forever but they could for say a month or two. These three crucial features had a considerable bearing on the tactics and outcome of what should have been an even more significant industrial dispute than the confrontation of the miners in 1984.

I want to take you back in time a bit to 1984. On July 10th, I received a telephone call at 10am in the morning from John Connolly who is the National Secretary of the Transport and General Workers Union telling me that a national dock strike was to start from midnight. I was told the dispute concerned the use of non registered staff at a port called Immingham on the east coast. No attempt was made by the Union to call for mediation. The UK was in the middle of a miners' dispute and within three days every UK docker stopped work including non registered dockers because they were all members of the Transport and General Workers' Union. The government was privately in a state of considerable panic because they believed a central front had been opened up by the unions and they were already grappling with the miners' dispute.

Ten days later we were at ACAS, the government's conciliation service. This is a voluntary body because there is no compulsory arbitration and there are no legally binding awards in the UK. Nevertheless, we thought that we had better be there. The strike was actually broken when the lorry drivers who were queuing at Dover and had been doing so for a couple of days decided they had had enough and threatened to burn the shop steward's hut down. It is important to realise the strength of the transport drivers.

We learned a lot from this national dispute---the reaction of government, industry and other workers. We now began the long drawn out process of planning the downfall of the dock labour scheme and the power of the waterfront unions. We knew the government wouldn't act before a general election (which we were two years away from) so we commissioned eight middle managers from the industry to carry out a study and report on repealing the scheme to see if it could be done in a politically and industrially acceptable way. During the next year, this group of eight middle managers became very committed. They used to meet on the waterfront in their own time. They produced some very major and important reform proposals which we drew on for source material for our entire campaign. They reported that there were no means by which a solution could be found without confrontation. They concluded that it was not possible to legislate on the issue of repealing the dock labour scheme. They also said that if the employers started negotiations it would destroy the benefits of repeal and it would lengthen the inevitable dispute. The employers had to think in terms of confrontation and had to plan to overcome that confrontation and mitigate the results.

What the study realised was that there was nothing that the employers could give by way of negotiation to replace the power and privileges that the trade unions would be losing by the repeal of the dock labour scheme, nothing at all. That was a very important conclusion for the national executive of the port employers to endorse and there were many hours of debate about whether it was the right thing to do. However, they decided that this was the correct advice and from that point on they planned a major political campaign. It is important for me to explain that the UK Government, although sympathetic to the employers, was actually very unhappy about taking the dockers on. We knew the Prime Minister was unhappy. She was a very cautious woman when it came to taking on labour issues and having had quite a tough time with the miners, she wasn't about to set into yet another industrial dispute unless she was certain it would be beneficial and would be worthwhile doing, and that the employers would see it through.

There were however some pieces of legislation that were helpful. For example in 1982 the Conservative Government introduced legislation which gave employers rights to take legal action to secure damages against trade unions where those trade unions were taking secondary action.

This was achieved by applying a narrower definition of a trade dispute and by extending the powers available to the courts to apply financial penalties against Trade Unions for continued unlawful action.

Secondly, they required secret ballots to be carried out on the workforce before you could legally achieve a protected strike. Without these two pieces of legislation, it would have been more difficult for us to pursue implementation of our strategy.

There were four main plans to our strategic plans.

• First, we had to pursue a campaign to persuade government to act to repeal the dock labour scheme.
• Secondly, we needed to prepare our legal case and court action in the event of a national strike and we needed to make sure all our 132 members were well equipped with legal advice to enable them to resist whatever action might be threatened or delivered by the trade union.
• Next we had to prepare an industrial relations strategy. First we needed to gather comprehensive information intelligence on what the likely impact of a strike was going to be. How long it would be in each case. What support would be given to the dockers by other groups of workers in that port or perhaps by transport drivers or other groups of workers. We had to analyse the trades that we thought would be most politically sensitive, things like newsprint and food; trades most industrially sensitive like iron ore into blast furnaces where stocks were low.
• Finally, we needed to ensure that our own members were ready to maximise the opportunities which would be available once we got rid of the Dock Labour Scheme. We urged them to have a plan of action to know what they would do once they were freed. Otherwise a lot of effort would be wasted. We held two major conferences before we were sure the government was actually ready and these conferences were to try to persuade employers to plan in advance how they would go about setting new working patterns, how they would set about breaking down the demarcation lines, how they would go about setting new pay agreements, new manning levels etc. Fundamentally and long before the government repealed the scheme, we took the decision that the employers were going to abandon all national and port pay bargaining.

The campaign was conducted through parliament by using every possible parliamentary device. Early day motions, adjournment debates etc. We had three MPs who really acted as our voice in Parliament. They did all the hard work, they talked to the other MPs, they introduced briefing materials into the House of Commons, and we made sure that they were always well supplied with appropriate material.

We talked to influential political bodies [like your own] such as the Institute of Economic Affairs, the Centre for Policy Studies, the No 10 Policy Unit, the Aims of Industry. We made sure that those people who really had influence in government were fully committed and would themselves talk to a wide range of people. It was too serious an issue to just leave to transport or employment ministers. We know that it would be a Cabinet decision; we knew we had to get people like the Chancellor of the Exchequer and the Foreign Secretary on our side. So we used every political body which had influence. We also used the press and media. We constantly searched out and supplied the media with anti-docker stories, headlines such as 'welcome return even if the man's a thief' or 'ghosts who keep vanishing'; 'twenty things you never knew about fiddling dockers', 'they can't be fired'. These headlines were all designed to make it easier for the dockers to be isolated. By the time government acted every national newspaper at one time or another had published an editorial calling for the government to end the dock labour scheme.

We had a Times columnist write headlines like 'dark ages on the docks', 'queer seaside customs', 'legalised extortion racked', 'time to end it', 'block those dock rip offs'. We also encouraged radio and television to do documentary programmes on the docks scandal.

We commissioned economic studies. One particularly important economic study [and perhaps it is worth thinking of using in the Australian scenario] was to try and prove that by getting rid of the dock labour scheme, you actually create many more jobs than you lose. Getting rid of the restrictions on the waterfront meant a whole new world in 'investment opportunity'. We sought two benefits from this approach. One, to make it much more difficult for the Labour Party and for the unions to argue against repeal, and secondly to make sure we could drive a wedge home to isolate dockers and describe them as a selfish, small group of workers who were actually stopping people from gaining jobs in unemployment black spots which frequently were in under developed city dock areas which had been derelict for many years.

We received widespread media coverage and at the end of the campaign it was beginning to become an overwhelming pressure group influence on the government. We didn't forget the port users. We made sure that industry were properly consulted and we approached the key user groups. Suffice to say they all actually gave us their support, particularly the shippers. The ship owners, however, weren't much help, in fact they were pretty discouraging. They told anyone that would listen that we were irresponsible, that we were unnecessarily confrontational and we should get into negotiation with Trade Unions. We didn't take any notice of them and the reason we didn't take any notice of them was because they didn't own stevedoring companies any longer. That was the price they paid in 1970 for opting out of stevedoring. So they were no longer members of the National Association of Port Employers.

This is the same across the world. The ship owners have always been weak. The shipowner is urging appeasement, constantly saying 'let my ship out, I'll pay whatever you like don't cause any trouble'. I can understand that and I can understand that they own a multi million dollar business. They have ships that are earning hundreds of thousands of dollars in their sea voyage and maybe a few more dollars on the port costs doesn't matter to them but it damned well matters to the country that they are trading in and out of. I think it's something that one should work at embarrassing the shipowners over, getting them out into the open to say why it is that they will not stand up and be counted in terms of supporting waterfront reform.

We knew that confrontation would be inevitable and when at last the government announced on the 5th April 1989 that they were going to repeal the dock labour scheme we knew we had won a famous victory. What we then had to do was put our plan of action into operation. We set out to achieve reform as fast as possible using a £35,000 redundancy payment provided by the government in its repeal bill, to break the strike and to shed labour. Under UK labour law you can actually dismiss workers lawfully providing you are not selective. If all workers are on strike you can say 'either you come back to work or you are sacked'. We were accused of 'gangster tactics'. Nevertheless, that was the threat and it certainly had a major effect on breaking the strike, because of the potential loss to the dockers of their £35,000 sterling redundancy payment.

Before finishing, it is important to describe the impact one year later of the reforms. We had 9221 dockers on April 5th 1989. In October 1990, there are less than 4,000 dockers left and many ports where there are no ex registered dockers at all. The restructuring of the labour force has been complete. Since the date of 3rd July 1989 when the repeal became law, our achievements [depending on which side of the fence you are standing] are as follows:

• We removed all national agreements.
• We removed all port agreements, seventy in all.
• We removed all industry Conciliation and Arbitration procedures.
• We disbanded all national and local employers associations.
• We introduced new industrial contracts based entirely on the relationship with each employers own workforce.
• We abandoned all artificial demarcation lines, introducing retaining programmes without government money.
• We developed entirely new work patterns, totally flexible shift patterns.
• We eliminated labour pooling.
• We introduced part time working/contracting out.
• Dockers in five ports have established major stevedoring companies with their own redundancy money.
• We have achieved productivity improvements of between 25% and 400% in all operations, particularly in bulk operations.
• We have opened docks and container berths which have been closed for the last sixteen years.
• We have improved ship turn-around times by up to 100%.
• We have won back new and innovative inward investment to the ports in the form of warehousing, cold storage, packaging, food preparation, and processing plants.

But I think the greatest of our achievements [and this is an achievement for the company as a whole] is that we destroyed for the foreseeable future the power of trade unions to hold the country to ransom by calling a national dock strike, which is so wrong for any democratically elected government. I think these achievements are worth learning from. They don't seem to me to square entirely with Paddy McGuinness' comment at your conference last year when he said 'we have nothing to learn from Mrs Thatcher because we don't have the same class or union or industrial structure, we don't have the same kind of incompetent wet English gentlemen in government whichever power happens to be nominally in charge, we are lucky', he said.

Well, I don't think I would agree with you Paddy. If you were here, it would be an interesting debate, because I think what has happened in Britain is resoundingly good news for the country and couldn't have been achieved without the Thatcher government's determination to remove Trade Union Monopoly power.