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The Work Foundation

Network Power takes on New Force

Authors: The Work Foundation Stephen Overell

25 January 2011

Writing about the future of the employment relationship can be a bit like nailing jelly to the ceiling. What should be the central subject? The rise and fall of industries? Equality? Families and work life balance? The travails of trade unions? The rising numbers of tribunals? Employee engagement?

new Acas discussion paper on employment relations out today is a useful tour d’horizon of the multiple trends and forces in play. But a notably prominent emphasis is given to the complexities that flow from outsourcing and subcontracting - and the 'network organisations' created when it happens.

The traditions of the literature posit one employment relationship between two parties, employer and employee (master and servant as they were once called). The effect of outsourcing is to instantly complicate this arrangement by suggesting many more people are now juggling one or several employment relationships both with their direct employer and their employers’ clients or customers who may call the strategic and operational shots that affect their work. Meanwhile their 'colleagues' are employees of other organisations doing similar work but on different terms and conditions.

 'Employees are now more likely to have more than one master and to be governed by more than one set of rules,' the paper says. Who is responsible for workers in such situations?

It is uncertain how widespread these arrangements are; the literature on networks is typically case study based. However, it is reasonable to expect outsourcing to rise, not least within the public services.

A paper from the UKCES Praxis series points to three areas where networks affect employment. First, in promoting fairness. Consistency matters to the perception of fairness, yet where there are groups of employees working together on one site, but under different pay, procedures and management regimes, it can be difficult to be fair. In some situations, moreover, outsourcing is sometimes used to distance an employer from the responsibilities of employing people – a bid to keep the power, but transfer the risk.

Second, there are issues around employee voice. Voice arrangements (such as the information and consultation regulations) are invariably single-employer rather than designed to operate across organisational boundaries. Where responsibility is blurred it can be difficult to know to whom 'voice' should be directed. The power of employees to influence their work situations can be correspondingly weakened.

Finally, the authors argue that qualifications need to be transferable between employers rather than merely serving one employer’s needs. The high skill agenda all governments nod at is poorly served without external validation of skills that enable mobility between organisations.

None of this is new. The sociologist Manuel Castells was over-egging the perils of network forms well over a decade ago. 'Never was labour more central to the process of value-making. But never were the workers…more vulnerable to the organisation since they had become lean individuals, farmed out in a flexible network,' he thundered.

But this thinking is becoming more developed in mainstream employment relations debates.

In my view the strongest evidence in its favour comes from asking workers themselves where control over their work derives from. According to the Skills Survey workers declare control over work comes not principally from supervisors cracking the whip nor from technology dictating the routines, but from clients and customers. In effect, power and control over work comes most forcefully from outside the boundaries of the employing organisation, implying the traditions of thinking about rights, power, motivation and conflict may indeed be increasingly in need of updating.