June 2008 – White collared philanthropists

It is some time since I last read Robert Noonan’s classic story of working life, The Ragged Trousered Philanthropists, so I made sure I caught the first episode in a new dramatisation of the book on BBC Radio Four at the weekend.

The story relates the experiences of a group of craftsmen and labourers in the fictional town of Mugsborough as they work on the renovation of a house, employed by its new owners, a firm of builders and decorators called Rushton & Co.

The book is credited as a seminal influence in British left wing politics. Tony Benn, the former Labour minister and MP described it as “a torch to pass from generation to generation.” But I had thought it dated until I picked it up again after listening to the radio version.

Now, re-reading the book, I’m thinking it still has something fresh to say to the thousands of people who choose to work in companies without any trade union representation.

Noonan, writing as Robert Tressell, noted how the real obstacles to fair pay and working conditions are not the managers and owners but the workers themselves who are willing to take pay cuts in order to preserve their jobs rather than stand together against iniquity.

Instead of engaging in political debate they prefer to squabble amongst each other, arguing about who does the most work; or they complain about competition for jobs from foreigners. “We’re over-run with 'em. Nearly all the waiters and the cooks where we was working last month is foreigners,” says Sawkins, the workshop sneak.

Today, as so many UK restaurant and hotel jobs are occupied by central Europeans, such sentiments are not unknown among British-born job seekers. They are as misplaced now as they were then.

Another similarity with today’s office-bound “sharp-suited philanthropists” occupying the modern workplace is the fear of losing one’s job or of speaking out against cheese-pairing employers. Too many people are working longer than they should for fear of demonstrating a lack of commitment if they leave the office promptly at a reasonable hour.

Indeed, a survey of 1,000 UK office workers carried out on behalf of Microsoft Windows Mobile, the operating system for mobile devices, found signs that the trend towards working away from the office, either at home or elsewhere, may be declining as more people opt to be seen at their desks for fear of losing their jobs.

The research found that the number of companies claiming to offer some form of mobile working had dropped 10 per cent year on year to about half in the survey. Yet no more than one in 10 employees questioned in the study thought they had the freedom to work remotely as part of their job.

The most senior managers were three times more likely to have the right to work away from their offices than middle managers, suggesting that such work is still regarded as something of a perk no matter how it might promote efficient working practices.

The report said that a fear of recession was influencing employees to seek refuge in their desks, rather than work out better ways of doing their jobs. The study makes for depressing reading but it’s understandable that people may be worried about their jobs in the wake of last week’s announcement that Aviva, the UK’s biggest insurer would be cutting 1,800 jobs from its general insurance business over the next two years.

It’s inevitable, when facing a downturn, that companies will review their staffing arrangements but this time some may come unstuck if budget-cutting drives away good employees.

In Noonan’s book a labourer is asked to work for less than the rate he has charged previously. “I have never worked under price before,” he says. “Either you do the work or you don’t,” he is told.

Since some workers such as Sawkins – a semi skilled workman – have shown themselves willing to work for less than their skilled colleagues, the hourly rates paid to all the workmen are kept lower than would otherwise be the case.

Inevitably this means that in the long run the quality of the workmanship suffers but the building firm is resigned to such compromise in a world where every competitor is undercutting the rest.

Does this sound familiar? The problem with undercutting - and it goes on enough today – is that ultimately we all suffer. There is nothing pleasant about stinking public toilets in airports and petrol stations yet I’m noticing that in today’s harsher business climate cleaning is often neglected by hard-pressed managers who must concentrate their efforts on sales.

One problem is that managers get rewarded for keeping their budgets tight, not for spending on excellence where they see it. While there may be some discretion, no-manager in their right mind is going to use it if it means that they might lose out to a more economical colleague.

It’s difficult, therefore, to focus on quality when the finance chief is constantly trying to pair down costs. Facing such pressures, trade unionism, it should be recognised, has played a significant role in maintaining standards and wages across all industries, not just those that recognise unions.

As Incomes Data Services, the pay information specialist, pointed out in a recent report: “The fact is that many large and influential private sector companies recognise trade unions and conduct usually amicable annual pay reviews with them.

“Because they are both large and influential, the rates of pay they set for particular occupational groups often set the salary benchmarks for the non-unionised sectors as well. This is particularly true in manufacturing where skilled salary levels for craft technicians in the unionised sector in cars, aerospace and defence industries set benchmarks for many other firms.”

There is a myth, in other words, that trade unions are working against the interests of employers. Increasingly as a shareholder in a number of public companies, my worry is not so much with rank and file employees, or with trade unions, but with those managers who are motivated less by the pursuit of excellence and more by personal ambition.

I would remind such managers of the five questions that Tony Benn said should be asked of anyone with power: “What power have you got? Where did you get it from? In whose interests do you use it? To whom are you accountable? How do we get rid of you?”

The return of job insecurity makes a mockery of the so-called “war for talent.” Yet talent will remain in short supply in future as demographic trends begin to bite. Those who ignore such trends will leave their companies the worse for their short-term responses. But will they be made accountable in the long run? I doubt it.

Sound management is more than squeezing wages while tolerating the erosion of employee goodwill. It shouldn’t take an almost century old socialist text to tell us this.

See also: Trust in the workplace