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Industrial democracy is an arrangement which involves workers making decisions, sharing responsibility andauthority in the workplace. While inparticipative managementorganizational designs workers are listened to and take part in thedecision-making process, in organizations employing industrial democracy they also have the final decisive power, including in matters of organizational design andhierarchy.[1]
In company law, the term generally used isco-determination, following the German wordMitbestimmung. In Germany, companies with more than 2000 employees (or more than 1000 employees in the coal and steel industries) have half of their supervisory boards of directors (which elect management) elected by the shareholders and half by the workers.
Although industrial democracy generally refers to the organization model in which workplaces are run directly by the people who work in them in place ofprivate orstate ownership of themeans of production, there are also representative forms of industrial democracy. Representative industrial democracy includes decision-making structures such as the formation ofcommittees and consultative bodies to facilitate communication betweenmanagement,unions, andstaff.
Advocates often point out that industrial democracy increasesproductivity and service delivery from a more fully engaged andhappierworkforce[citation needed]. Other benefits include less industrial dispute resulting from better communication in the workplace; improved and inclusive decision-making processes resulting in qualitatively better workplace decisions, decreased stress and increased well-being, an increase injob satisfaction, a reduction inabsenteeism and an improved sense of fulfillment[citation needed]. Other authors regard industrial democracy as a consequence of citizenship rights[citation needed].
At the point of production, the introduction of mandatory works councils and voluntary schemes of workers' participation (e.g. semi-autonomous groups) have a long tradition in European countries.[2]
In a number of European countries, employees of a business take part in election of company directors. In Germany, the law is known as theMitbestimmungsgesetz of 1976. In Britain a 1977 proposal for a similar system was named theBullock Report.
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Theanarchist thinkerPierre-Joseph Proudhon used the term "industrial democracy" in the 1850s to describe the vision of workplace democracy he had first raised in the 1840s withWhat is Property? Or, an Inquiry into the Principle of Right and of Government, (management "must be chosen from the workers by the workers themselves, and must fulfil the conditions of eligibility.") He repeated this call in later works likeGeneral Idea of the Revolution.[3]
In late nineteenth century, and at the beginning of the twentieth century, industrial democracy, along withanarcho-syndicalism andnew unionism, represented one of the dominant themes inrevolutionary socialism and played a prominent role in internationallabour movements. The term industrial democracy was also used by British socialist reformersSidney andBeatrice Webb in their 1897 bookIndustrial Democracy. The Webbs used the term to refer to trade unions and the process ofcollective bargaining.[4]
While the influence of the movements promoting industrial democracy declined after the defeat of the anarchists in theSpanish Revolution in 1939, several unions and organizations advocating the arrangement continue to exist and are again on the rise internationally.[citation needed]
TheIndustrial Workers of the World advance anindustrial unionism which would organize all the workers, regardless of skill, gender or race, intoone big union divided into a series of departments corresponding to different industries. The industrial unions would be the embryonic form of futurepost-capitalist production. Once sufficiently organized, the industrial unions would overthrow capitalism by means of ageneral strike, and carry on production through worker run enterprises without bosses or the wage system.Anarcho-syndicalist unions, like theConfederación Nacional del Trabajo, are similar in their means and ends but organize workers into geographically based and federated syndicates rather than industrial unions.
The New Unionism Network also promotesworkplace democracy as a means to linking production andeconomic democracy.
Modern industrial economies have adopted several aspects of industrial democracy to improve productivity and as reformist measures against industrial disputes. Often referred to as "teamworking", this form of industrial democracy has been practiced in Scandinavia, Germany, the Netherlands and the UK as well as in several Japanese companies such asToyota, as an effective alternative toTaylorism[citation needed].
The term is often used synonymously withworkplace democracy, in which the traditional master-servant model ofemployment gives way to a participative, power-sharing model.
