The Birmingham bin strike has been rolling on for 18 months, and the workers - organised by Unite - have long suspected that the council's refusal to negotiate and willingness to throw money at breaking the strike, more than it would have cost to have settled the dispute, suggests the local authority wants to break the union. And yesterday, ITV West Midlands regional news confirmed it. They reported on a leaked council document from March that set out a plan to sack the bin workers while bypassing councillors, a move the document recognises would fall foul of the new unfair dismissal legislation and cost the council about £23m. People familiar with local authorities often complain about officer-led councils, but this is something else entirely. Unelected senior officers and Whitehall commissioners appear to be in cahoots when this scheme was hatched, and all of them deserve firm and tough action taken against them.
The bulletin on these revelations covers 15 minutes of the report.
7 comments:
Well! Turns out that the "deep state" brigade had something real to complain about; or at least, they have been handed a big old grain of truth to point at triumphantly.
But who was pulling the strings of these officers and commissioners? Did they decide to do this all by themselves?
All this stems from the legal fiction that as long as you work for the same employer, pay rates should not be based on market value (as established by how much you actually need to pay someone to do that job in the real world), but should be based on whether a lawyer believes that empirically not equal work should be treated as equal based on the legal fiction. Unions have aggressively pursued this, and I don't blame them, it is in the interests of some of their members, but it it clearly has negative outcomes, and is not in the interests of other members or of external parties who feel the fallout.
Employers who have employees doing work of materially unequal value in the real world, should probably outsource some or all of it. Paying the market rate for jobs that are empirically unequal is fine when it's different employers. And to be clear if you're a canteen supervisor who wants the pay of a refuse collector, or a checkout operator who wants the pay of a warehouse operative, you could apply for those roles in full acceptance of the different, unequal, demands they entail.
Can anyone translate this gibberish from Kamo?
I can make out that he thinks refuse collectors should be paid more than canteen supervisors and warehouse workers should be paid more then checkout operators; taken in isolation, that much would be relatively sensical and uncontroversial (compared to his usual offerings), but doesn't have any clear relevance to the story.
For the benefit of Anonymous, I will explain it as clearly as I can.
The story linked relates to a long-running dispute between Birminham City Council and its refuse collection staff (and their union representation).
The dispute stems from an interpretation of the Equality Act stipulation "work of equal value should have equal pay". Seems straightforward enough, except what constitutes equal value is not determined through objective means like what an employer actually has to pay to get a particular job done. Instead it is subjectively decided by a lawyer who can ignore empirical evidence. As a real world example, employers have to pay more to get people to collect bins than dish up school meals because the former is more physically demanding, involves unsocial hours and is generally much more unpleasant. But lawyers decided if the bin collectors and the canteen staff have the SAME EMPLOYER, then they should be paid the same, because they think it is work of equal value, even if empirical evidence refutes this.
If these workers doing these very different jobs, with different demands, worked for different employers, there would be no issue paying the actual market rates. That is perfectly legal. Hence, if an employer finds themselves in this situation, which can happen in many different scenarios, they may benefit splitting off those functions rather than risk contrarian lawyers.
From this irrational situation, many employers, supported by their unions, quite rationally decided to pursue pay discrimination claims. Even though many people doing the lesser paid jobs don't want to do the better paid jobs, for the very reasons why they are better paid. This situation drove Birmingham City Council into effective bankruptcy. One of its responses was to try and cut the pay of the bin workers, rather than paying the other jobs above their market rate (which they claimed they couldn't afford to do). This brought it into dispute with the bin workers and their union (a union which was involved in the process that led to this situation, albeit representing other members). This is the context to the story.
Obviously, whether you think the context to a story, is at all relevant to a story, is a personal opinion.
I find this particularly interesting:
"many employees," (I assume Kamo meant to write employees here) "supported by their unions, quite rationally decided to pursue pay discrimination claims."
The interesting bit to me is the idea that this was a rational thing to do. Of course, Kamo's use of that word may have simply been throwaway. But if it's true that this situation is the main cause of their employer's bankruptcy, it's a very myopic and short-termist idea of rationality; hyperbolic discounting at its very worst, threatening to drain the word "rationality" of any useful meaning. Behaviour more crudely evokable in the phrase "shitting where you eat" - and behaviour which most animals don't engage in unless they are trapped in an environment which drastically constrains their options.
This is (one reason) why the concept of homo economicus is now as anachronistic as eugenics and phrenology. Rationality is no more than an aspiration for humans, and barely even that for most of them, given the hopeless - and self-reinforcing - mismatch between the complexity of their environment, and the information processing power available to them. We should probably assume that the canteen workers of Kamo's story pursued their pay discrimination claims for reasons which had less to do with rational self-interest, and more to do with their lack of access to the information which they would have required in order to make rational decisions.
Economics is the study of how resources ARE allocated, not how individual people feel they SHOULD be allocated (and I know some people really want it to be the latter). Economics can be used predictively, how X may change Y, but what X and Y should be are not its scope (try politics or moral philosophy). There are many different models and theories of economics, some are far more rigorous than others. Some of what passes as economic analysis or commentary isn't really economics at all, it's just 'feels' or apophenia. Some core of aspects economics are fairly fundamental and uncontroversial; supply, demand, incentives etc if people ignore these, they're really not doing economics. Homo Economicus is a useful basic model for understanding some of these core concepts, anyone who has ever studied economics formally or just has a genuine interest in the subject knows it's not intended as some kind of inviolable law. People are not perfectly rational, but that doesn't mean they cannot and do not behave rationally within their own references much of the time, everything is trade-offs and we have our own preferences. Just because Homo Economicus is a popular strawman for some, doesn't mean it isn't useful to those who use it as intended (there are plenty of other useful economic ideas that get parodied into strawmen by people who don't like what they infer from them).
The Birmingham City Council case is one of a number where tribunals, led by lawyers, have determined very different kinds of work have the same value where the empirical evidence says different. These tribunals gathered evidence from real people, which was publicly reported. People really did say they didn't want to be a refuse collector or a warehouse labourer or something else far more demanding that paid more than their actual job, and insufficient pay premium was a common reason. I don't think you really need Homo Economicus to accept this, nor to understand why these people would willingly run with it when their union reps told them they could essentially get a pay-out for little to no effort. As for Birmingham City Council could they have reasonably or rationally predicted massive financial penalties for paying market rates for certain jobs, where paying the market rate is fine as long as it's not the same employer doing it?
Anon 20:07 here, Kamo. I can see why you might be defensive in these parts, but my comment was not intended as a rebuttal of yours, merely as an observation of something that I found interesting within it. I didn't notice you directly invoking homo economicus anywhere, I only noticed a somewhat casual use of the word "rational".
W.r.t the Birmingham bins saga, your account is an appealing one - although I'm not going to make any claim of having checked the historical facts which you appear to be asserting.
W.r.t economics, it's really rather naive to treat it as the study of "is" rather than "ought", because to do so ignores (ironically) a quite enormous and obvious "is": the feedback loop between the pronouncements of economists, and the policy of how resources ARE allocated by existing power structures. And hence the staggering perverse incentives which the field cannot help but be forever entangled in. Economists who take their craft seriously might aspire to aloofness, commendably, but because they have to exist inside the systems which they are trying to study, economists who say things which are considered useful to vested interests (and/or well-resourced would-be disruptors) will always be selectively favoured over those who are not. In short, economics and politics are fundamentally not separable - otherwise economics would be physics.
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