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This subject is very important and includes a number of intertwined factors that you
should be aware of.

Trade Union Development Up To 1914

This period saw the development of a mass trade union movement with legal rights to take
industrial action in defence of their members’ rights.

1. New Model Unions (Craft Unions)

These were skilled craft unions such as the Amalgamated Society of Engineers. They
provided benefits such as sickness benefit, successfully protected pay and conditions and
held out against the use of unskilled labour. They were moderate in their approach, favouring
negotiation rather than strike activity. In 1868, the Trade Union Congress was formed to get
these craft unions working together.

2. Legal Position of Unions

 The Trade Union Act of 1871 finally gave legal recognition to Trade Unions. Peaceful
picketing was forbidden however, so making strikes ineffective. This was repealed in
1875. The right of unions to picket was limited in the Taff Vale decision 1901. Following
an unofficial strike the management of the Taff Vale railway in South Wales took the
Amalgamated Society of Railway Servants to court and sued them for the losses
sustained by the company through the strike. The case went to the House of Lords,
where judgement was given against the Amalgamated Society of Railway Servants and
damages of £23,000 were awarded to the company. This was a disastrous decision for
the trade unions, for it meant that any unions which might undertake strike action were
liable to pay damages to the employers, and this would soon ruin the unions. The Taff
Vale decision strengthened the Labour Representation Committee, for even those trade
unionists who were not Socialists now saw more clearly the need for independent Labour
members in Parliament to fight for the restoration of trade union rights. The 1906 Trade
Disputes Act (passed by the Liberals) reversed this decision by ruling that a trade union
could not be sued for damages in respect of acts committed by the union or on its behalf.

 Osborne Judgment, 1909. When a railway man called Osborne took legal action to
restrain his trade union (the Amalgamated Society of Railway Servants) from using any
of its funds to support a political party, The House of Lords ruled that it was illegal for a
trade union to spend money either in supporting candidates for elections or on any other
political object. This judgement was a serious setback for the Labour M.P. s, who lost the
salaries which the trade unions had, in many cases, paid them. The payment of M.P.s in
1911 relieved the position for the Labour Party considerably, and in 1913 the Trade Union
Amendment Act legalised the use by trade unions of part of their funds for political
purposes if a majority vote of its members by ballot supported this. The Act also allowed
any trade unionist to ‘contract out’ of payment to the political funds of the union without
any loss of his trade union rights.

3. The New Unionism (Unskilled Unions)

 The cautious phase in trade union history was increasingly challenged from the 1880’s
onwards. The attitude of the younger and more militant trade unionists was expressed
forcibly by Tom Mann in a pamphlet he wrote in 1886. He agreed that the trade unions
had done good work in the past, but were now concerned with little more than keeping
up wage-rates. New unionism was more aggressive and attracted a mass membership
with low membership subscriptions.

 Successes such as the Match Girls’ Strike in 1888 and the London Dock Strike of 1889
encouraged union membership.

 These developments in unionism must be seen in the context of increasing economic

uncertainty in late-Victorian Britain. The latter part of the century saw rather more rapid
swings of slump and recovery in industry, with more frequent periods of unemployment.
Agriculture also declined, and Britain’s trading position became increasingly challenged
by other nations whose industries had now caught up with, and in some cases passed,
those of Britain. Workers needed protection in this environment. The rising cost of living
and unemployment led to increased industrial action from 1910 e.g. 1910-12 saw
nationwide strikes by dockers, miners, railway workers; 1913 saw the Triple alliance’ of
railway workers, transport workers and miners.

Development of the Labour Party to 1918

As you study the development of the Labour Party in this period, you should be trying to
assess the importance of the Trade Union movement.

1. Socialist Organisations

 the Social Democratic Federation, led by Hyndman, a believer in the ideas of Karl Marx.
The SDF believed in class warfare leading to revolution and the reorganisation of society
along socialist lines.
 The Fabians, led by the Webbs, believers in moderate, gradualist socialism. They
believed in working through the existing structure to get reforms and so gradually a
socialist society.
 Not very numerous, influence on the Labour party varied. (SDF left I Fabians heavily

2. Independent Labour Party

 The leading part in the formation of a new Labour Party was undertaken by a Scottish
miner, Keir Hardie. After years as a Liberal member he became convinced that it could
not work consistently in the interests of the wage-earners. In 1888 he founded the
Scottish Labour Party. in 1892 he was elected to parliament as the first independent
Labour M.P. In the same year a new and influential Socialist newspaper was established,
the Clarion, under the editorship of Robert Blatchford.
 At Bradford in 1893 a special conference of working-class delegates met with Keir Hardie
as chairman. the result was the foundation of the Independent Labour Party, whose
policy included the nationalisation of basic industries, the establishment of an eight-hour
day in industry and the creation of a national Unemployment and Sickness Insurance
system. By the end of 1893 there were 300 branches of the I.L.P. However, progress was
slow and in the election of 1895 all twenty five candidates of the I.L.P. were defeated.
Organisation was never strong and the party remained small and was short of funds.

3. Labour Representation Committee

 In 1899 the T.U.C. called a special conference to put forward Labour candidates for
election to Parliament. At this conference there were representatives of the trade unions,
co-operative societies, the Fabian Society, the Independent Labour Party and the Social
Democratic Federation. Out of this combination of forces (with widely differing views of
Socialism) was formed the Labour Representation Committee.

 The L.R.C. had an in built Trade Union majority (they had 7 votes compared to 5 in total
for the various socialist societies and I.L.P.) By 1899 ,the TUG was more inclined towards
the idea of a separate working-class party because of (i) greater representation of
unskilled unions in the TUG. (ii) economic depression. (iii) little progress from
conservatives and Liberals on key problems of eight hour day, unemployment and

 Early problems included; (i) wide ranging ideas within the party from the revolutionary
socialism of the SDF to the moderate reformers in the trade unions. The problems of

reconciling left and right has always been a problem for the Labour Party. (ii) unions were
initially slow to affiliate leaving the new party short of funds to employ officials and fight
elections. To survive, the LRC needed union membership and money. As a result of the
Taft Vale case, however, union affiliation greatly increased (eg. a further 127 affiliated
between 1902-3).

4. Electoral position by 1918

 An electoral pact with the Liberals allowed the LRC a free run in 30 constituencies in
1906. 29 candidates were successful (NB, They decided to become known as the
Labour Party, dropping the title LRC). In January 1910, the Labour had 78 candidates but
only 40 successes. In December 1910 42 Labour members were elected, although by
1914 this was down to 36 due to by-election losses. This was disappointing progress. In
1918, however, they won 63 seats taking 2.25 million out of 11 million votes (without the
help of an election pact with the Liberals).

5. The Labour and Trade Union Movement During The First World War

 The outbreak of war in 1914 found the greater part of the trade union movement and the
Labour Party prepared to support the war effort. However, the Independent Labour Party
members, including MacDonald, the Chairman of the Parliamentary Labour Party,
opposed this policy. MacDonald was removed from his position and succeeded by Arthur
Henderson. The unions accepted the ‘dilution’ of labour, which meant, for instance, the
use of more unskilled workers in the engineering industry. The Government gave a
guarantee, however, that this policy would be abandoned at the end of the war.

 Lloyd George, the new Minister of Munitions, faced with the serious munitions shortage
of 1915, saw the importance of gaining the cooperation of the trade union leaders. He
secured the suspension of many pre-war practices which would hinder production, and
the armaments industry came completely under Government control. All disputes were to
be settled by compulsory arbitration, munitions workers were unable to move into
another industry and (as a concession to trade union and Labour demands) armaments
firms were permitted to make only one fifth more than their pre-war profits.

 When Lloyd George became Prime Minister in 1916 he immediately tried to gain more
cooperation from the Labour Party. He was compelled to concede the Socialist demands
for the state control of the mines, of shipping, of food supplies and for the establishment
of a Ministry of Labour. Three Labour men joined the Coalition Government - Arthur
Henderson became Ministry of Education, John Hedge (a trade union leader from the
steel industry) became Minister of Labour and George Barnes, Minister of Pensions. The
official Labour and trade union movements were drawn fully into the war effort, but were
powerful enough to lay down a number of socialist conditions. The war strengthened the
arguments for nationalisation and state control of the major industries in the post-war
period, for if nationalisation could lead to greater efficiency in war, then why not in

 Not all sections of the trade union movement were prepared to follow the official line.
When the South Wales miners came out on strike in 1915 after refusing arbitration, Lloyd
George was compelled to to give in to their demands. Another centre of unrest was the C
Clyde shipbuilding industry, where the shop stewards were particularly strong.

 Broadly the war was good news forthe Labour movement. Union membership and
participation in decision making increased. Labour Party figures were involved in the
practical running of the country.

6. Historiographical Debate

The Labour Party’s quick rise by 1923 when they formed the government is a focus of
debate. One side of the debate sees the Party in 1914 as weak and therefore argues that
Labour’s rise was due to World War 1 and the split in the Liberal Party (which was far worse
than the early split Labour suffered). The other side of the debate says that Labour’s strength
by 1914 is underestimated. They argue that:

 Disappointing election results can be partly explained by the franchise system. The
complex system of electoral registration meant that parties needed a large number of
full-time officials to make sure that all of their supporter were registered. Labour had few
officials. in addition, there were still at least 4 million men without the vote, most of whom
were working class. (The franchise reform in 1918 can be seen as a factor in Labour’s
growth after World War 1).

 The Labour Party was making great gains in local elections between 1910 and 1913 and
therefore figures from 1910 were no longer an accurate reflection of Labour support.

 The Party was establishing a strong position outside Parliament - local organisation
being developed; further increase in Trade Union affiliation, including the Miners’
Federation, a powerful union which potentially controlled about 90 seats; financial
position also improved by the Trade Union Act of 1913 which allowed unions to raise a
political levy.

7. Ideology

Two documents in 1918 laid down the aims of the Party. As you look at the Labour Party in
office you should assess the extent to which these aims are socialist and the extent to which
they were achieved:

 Labour Party Constitution - this committed the Party to “common ownership of the
means of production” - a socialist commitment.
 Labour and the new Social Order - promised nationalisation, a planned economy, full
employment and the provision of social services.

Labour and the Trade Union movement in the 1920s

The Immediate Postwar Period

 In the election of 1918 the Labour Party won 57 seats. The war was followed by
industrial unrest. The economy went into a slump and the trade unions lost over two
million members during the slump between 1920 and 1922. This led to the smaller
unions amalgamating. One of the most powerful of the new unions that emerged was the
Transport and General Workers Union.

 Several factors combined to ensure the continued growth of the Labour Party. A more
efficient national organisation evolved, local constituency parties were developed, the
continued decline of the Liberal Party. Economic slump and unemployment, further union
affiliation, becoming ‘normal’ for trade unionists to vote Labour in the same way that they
had voted Liberal a generation earlier.

The First Labour Government (1924) And The Unions

Labour gained 142 seats in the 1922 election. In 1924 the Party’s position improved still
further and 191 Labour members were returned. With Liberal support Ramsey MacDonald
(Labour leader) formed the first Labour Government:

 Some reforms were passed like the Wheatley Housing Act which provided money for
Council houses.
 From the trade union point of view the first Labour Government was unsatisfactory. It
was too reliant on Liberal support. Ramsey MacDonald was cautious and relations with
unions were strained due to a threat by the government to use emergency powers
against a proposed strike.