Workers on the Board

By instinct and tradition, U.S. labor unions have been content to leave the actual running of companies to management, preferring to stress the bread-and-butter issues of wages, hours and working conditions. But in Europe, worker participation in management decision making is an established idea that keeps spreading continually into more countries and industries. The practice, known in German as Mitbestimmung (literally, having a voice in), took root shortly after World War II in West Germany, where coal miners and steel workers began sitting alongside bosses on industry supervisory boards. In recent years, the notion of giving workers a greater say in the companies that hire them has gained vast new momentum; in one form or another, it is popping up all over the Continent.

Last week in Brussels, the Common Market Commission proposed a statute that could, among other things, result in many firms in the nine-nation Community being governed by supervisory boards representing shareholders, labor and management. In Sweden, worker groups have already won the right to audit company books. In The Netherlands, major employers are required by law to consult a workers' council before closing even an unprofitable plant. In Norway, workers may decide among themselves if they want board representation, then elect up to a third of a company's directors.

Worker participation received a big push in France recently when a national commission recommended 70 changes in law and business practices aimed at increasing worker "co-surveillance," or otherwise making working conditions more humane. The most important proposal calls for one-third worker representation on company boards.

Better Educated. The French report also presented many of the arguments why worker participation should be promoted by the government. Chief among them is the emergence of the "new worker"--better educated, more distrustful of authority, more discriminating toward his working environment than his predecessors of a generation ago. His rise has resulted in absenteeism (425 million work days lost in France alone in 1972) and a growing reluctance on the part of young people to work in factories. Mitbestimmung, or some form of it, is seen as a way of reconciling the new worker and his boss.

There are some indications that Mitbestimmung can indeed work that way. During a decline in the West German coal industry that cost 400,000 miners their jobs between 1957 and 1973, management and workers consulted closely on mine closings and programs for re-employment, retraining and early retirement of employees. Result: the shrinkage was accomplished with no major labor disputes. Mitbestimmung, says Karl-Heinz Briam, labor representative on the board of Krupp's steel operation, "is something like marriage with no divorce possible."

For that very reason, Mitbestimmung is viewed with hostility by Communist-and socialist-dominated unions in France and Italy, who want no marriage between workers and capitalists. In Italy, where unions are among the most radical in Europe, an experiment by the giant automaker Fiat to involve workers in production plans and manpower organization appears to be in deep trouble after only six months. Says Socialist Piero Boni, a leader of Italy's largest trade-union confederation: "Today, this is not the right way for Italy. Here we have to go on strike." In Britain, unions want more than a voice in how companies are run; they want dominance. The journal of the British engineering workers union editorializes: "There is an irreconcilable gulf between the interests of those who seek to maximize profits and those who protect the interests of workers."

But for more and more workers and bosses, Mitbestimmung is the better way. Some illustrations of its progress:

P: In Sweden, Volvo has reorganized its assembly-line system to give workers a greater feeling of accomplishment (TIME, Sept. 16). For almost two years, every company with more than 100 employees has been required to add two workers to its board; the Swedish Confederation of Labor sends new worker representatives to school. Moreover, "safety ombudsmen" are empowered to halt production if they see hazardous conditions in factories.

P: In The Netherlands, every firm with more than 100 employees must form a works council of up to 25 employees elected by their peers. It is not done all the time, but management is theoretically required to consult the councils on practically anything likely to affect the company significantly--expansion plans, merger possibilities, closings, changes in pension plans. In 1974, workers of the Delta-Lloyd insurance group succeeded in overriding management's plan to merge with a Dutch firm and chose instead to make a deal with the British Commercial Union Assurance Co.

P: In France, BSN, a giant glass company, has a committee of 30 workers (representing 14,000) who meet once a month with management to discuss a broad range of subjects: more flexible working hours, altering certain retirement plans. At the Renault auto company, Mitbestimmung translates as "job enrichment": Renault workers select components and assemble them at their own pace, cutting one to two hours off the previous assembly time.

Worker participation is expected to go on rising in Europe even as recession continues. In economically pinched times, workers usually press for non-economic fringe benefits, of which a greater say in their companies is certainly one. Sooner or later, the idea is bound to start sprouting in the U.S. There are no workers on U.S. company boards now, but some union leaders feel that the day is coming. At Chrysler Corp., a move is under way to get employee-elected representation on the company's board, not necessarily a union member but any proven auto executive who could help turn the company around. The wedge would be the estimated 16% of Chrysler's 59 million shares held by union and nonunion workers.

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