NatBank is a major UK bank with over 60,000 employees in the UK and over 100,000 employees worldwide.
The partnership agreement at NatBank was born out of a very poor climate of industrial relations in the late 1990s, culminating in industrial action over pay in 1997. Union representatives and managers admitted that there was a need to end the hostile ‘everybody out mentality’ that prevailed within the bank whenever an issue arose, and that the 1990s situation of ‘arm’s length adversarial’ was simply untenable. Improving employment relations was especially important as competition in the financial service sector was intense, and organizational performance had been disappointing.
A formal partnership agreement was signed between NatBank and the recognized trade union in 2000, based upon an adaptation of six principles of partnership espoused by the Trades Union Congress:

The principles of partnership:
1 To secure and promote the long-term success of NatBank.
2 To promote the interests of employees, customers and shareholders.
3 To ensure that NatBank meets customer expectations by having people with the right skills in the right place at the right cost.
4 To facilitate the management of change.
5 To ensure employees are managed fairly and professionally.
6 To promote equality of treatment and opportunity for all, valuing diversity.

Partnership was described by senior managers as a modern and sensible approach to the management of industrial relations centred around a joint commitment to business success. In practice this was said to require greater dialogue and interaction with the trade union, and the ability to consider decisions from both an ‘employee’
as well as ‘business’ point of view. A senior manager contrasted this with a non-partnership approach, where the union may simply want what is best for the union/employees, while the business simply wants what is best for the business. For local managers, partnership concerned a more proactive problem-solving approach, and achieving a clear understanding of the rationale behind decisions. It was made clear by the management team, however, that the union representatives and officials need not necessarily agree with decisions. Rather, the focus was on early consultation regarding developments and the opportunity for representatives to provide feedback and input while decisions are still at ‘the design stage’. When local representatives had strong feelings on an issue and no agreement could be reached locally, there was the option of escalating it to monthly national consultation for further detailed discussion. However, it was clear that under partnership the business retained the right to make the final decisions.
Similarly, for a senior union official, partnership concerned problem-solving, mutual respect, transparency, and greater interaction between the union and the management team. However, he warned that the term ‘partnership’ for such an approach is perhaps inappropriate and potentially misleading. He suggested that the language of partnership often resulted in a debate regarding whether partnership suggests or requires an ‘equal’ relationship between unions and employers. He believed that such debates were actually unproductive, and that it is was better to view partnership in a more pragmatic way, as essentially an opportunity for unions to get ‘inside the tent’. In turn, this was said to offer unions access to key business decision-makers, the provision of better information, and a greater respect for each party’s point of view. He suggested that senior management now had a clearer idea of the operation and purpose of trade unions, and equally full-time officials now had a greater appreciation of business issues and decision making. He contrasted partnership with an ‘institutional conflict approach’, without any real dialogue or regard for the other party’s point of view. It was suggested that partnership provided a framework by clarifying the rights and responsibilities of the employer and the union, and setting out the ‘rules of the game’ Overall, several benefits were identified compared to the adversarial approach of the 1990s. A key benefit concerned the ability of the union to influence decision-making. There was evidence to suggest that the union was involved across areas including pay and conditions, discipline and grievance, and organisational change. An example of this is the joint development of guidelines outlining various commitments regarding off-shoring practices. At the centre of this agreement were commitments to avoid compulsory redundancies and redeploy staff elsewhere in the business where possible, to provide early consultation, and to provide extensive support for employees who were ultimately displaced. With partnership it was suggested that the union now had a wider remit, especially in relation to organisational change issues, whereas prior to partnership much of the attention centred around pay and conditions.
More generally, with partnership management were said to benefit from constructive feedback which assisted their decision-making, meaning that preemptive changes could be made and leading to the greater legitimacy and acceptance of decisions. For the business, it was suggested that the partnership dialogue also encouraged a longer-term perspective than may otherwise have been the case. On the other hand, the union was said to benefit from the opportunity to have a say, often being consulted at a very early stage in the decision-making process. Though the partnership process was not viewed as one of joint decision making per se, union officials and representatives believed that there was evidence of the consultation process having an impact, and this was also recognised by employees.
Another benefit of partnership was said to be more local decision-making and improved employment relations.
The emphasis from the union had been on building a solid cadre of local representatives, and there was evidence to suggest that this had been successful.
Representatives were active and knowledgeable, and appeared to be well respected by management and employees alike. Representatives described their role under partnership as one of questioning, challenging and persuading, as opposed to simply opposing management proposals. In this regard, a key issue was developing a strong basis on which to question proposals which took into account both business rationale as well as the impact on employees. There also appeared to have been an increase in union legitimacy. Prior to partnership, the union was said to have had few resources or facilities provided by the employer. Much of the work of a union representative was undertaken at home, and it was not unusual for vacancies for representative posts to be left unfilled. Since partnership, credible and active representative roles had been created, all union committee positions were filled, and previously weak trade union organisation was believed to have been revived.
Representatives were now able to hold quarterly recruitment events, to distribute promotional materials, and to deliver a presentation at staff inductions for new staff. In addition, representatives were pleased with other arrangements in relation to the provision of sufficient time off for union duties, access to meeting rooms and use of office facilities.......

Question

1 What were the main drivers for partnership at NatBank?
2 What did ‘partnership’ mean to managers and trade union officials/representatives?
3 What were the key benefits for management, the trade union and employees?
4 To what extent had partnership increased union effectiveness?
5 Why might line managers have found partnership particularly challenging?
6 What challenges might threaten the sustainability of partnership at NatBank in the future?