The Irrelevance of Trade union Recognition? A Comparison of Two Matched Companies

Two UK business services companies are compared both to each other and to their common state-owned industry background in order to assess the implications of trade union recognition and changes in bargaining structure. Union recognition was abandoned by one company under the agenda of ‘individualisation’ and ‘personal contracts’ but retained by the other under that of ‘partnership’. The regulation of employment relations became decentralized at both companies relative to their ancestral public enterprises. The similarity of the companies in terms of products, technologies and institutional history means for the union recognition effect an approximation to a natural experiment. The evidence suggests secondary, and to some extent employer-friendly, effects for union presence upon operational attributes and economic performance, but major effects for the mix of decentralisation and the wider changes in markets, ownership and law that both accompanied and fostered decentralisation.