Performance-related pay fails to sideline unions

Despite the hopes of some "union-busting" human resources gurus, performance- related pay has failed to marginalise unions in British industry.

In a study of 128 organisations to be published next week, Industrial Relations Services found unions and collective bargaining were continuing to play a key role in businesses which had abandoned across-the-board wage increases as a means of rewarding their employees.

The research group foundunions were "derecognised" in only four of the 244 employee groups covered. The findings undermine claims made by the Institute of Personnel Development which has questioned the need for collective bargaining where profit-related pay has been introduced.

Union leaders were taking comfort from the study yesterday as they gathered in Brighton for this week's annual TUC Congress.

Nearly two-thirds of the organisations covered - in public and private sectors - said the use of individualised or team-based pay had changed but not reduced the role of unions.

A further 23 per cent of employers said the role of unions had only been partially reduced, while just 14 per cent considered the union role had been significantly reduced.

In the great majority of cases unions still influenced such matters as the top and bottom of salary scales, minimum annual increases, the level of the overall pay budget and the market-related element of pay rewards.

In many cases union negotiators were also involved in the "nitty gritty" of pay reviews, helping to determine such factors as the distribution of pay awards to different categories of employee.

In a separate survey of 536 organisations from a range of sectors, the charitably funded Industrial Society found that 77 per of companies now had some form of appraisal system for their employees.

Around 24 per cent managed pay schemes where there was a direct link between remuneration and performance. A further 27 per cent took some account of performance appraisals, but included other factors. Nearly half the employers surveyed, however, said there was no direct link between performance appraisals and wages.

Tony Bolton, a senior consultant at the society, said a lot of mistakes could be made by managers carrying out appraisals: "No wonder people call it the `annual reprisal interview'."

Separately, it emerged that Barclays Bank is facing a fresh threat of strikes in a long-running dispute over pay after unions decided to hold new ballots. Members of the Banking Insurance and Finance Union and UNiFI will vote on whether to walk out in protest at a new performance-related pay system which the unions claim will freeze the pay of 25,000 workers. A result is expected by the end of the month.

`IRS employment trends 640',from Industrial Relations Services, 18- 20 Highbury Place, London, N5 1QP.

`Managing Best Practice 37', by the Industrial Society, Robert Hyde House, 48 Bryanstone Square, London W1H 7LN.