MANAGEMENT COUNCILS. - Also called factory councils, they are the technical bodies through which the participation of workers in the direction, administration and profits of productive enterprises in which they work should be brought about.
Participation in the technical-organizational responsibility of the enterprise, with the consequent participation in profits (v. PARTECIPAZIONISMO) is the goal aimed at; workers' management councils are the means to it.
Workers' management councils, understood in this way, give life to a collective enterprise, and therefore stand opposed to the individual enterprise, in which the technical-organizational tasks are entrusted to the entrepreneur, who owns the enterprise, [directs] the administration and moves freely within the administration, being answerable for his acts only to himself, the sole beneficiary of the profits, from which the workers are excluded, governed by a wage system.
The enterprise is a small world, in which the factors of production can be coordinated in various forms. Ordinarily today the factors of production are distributed among different hands, so that there is one who organizes the undertaking (entrepreneur), one who offers his personal services (worker), one who gives the use of his savings (capitalist) and, for agricultural enterprises, also one who has at his disposal the natural agent (landowner).
Moreover, in the modern economic world, a creation of liberalism and capitalism, the enterprise - especially the medium and large one - is marked by a clear distinction between the workforce and the entrepreneurs; between those who work in it in a relationship of dependency and those who direct it, owning its capital or having economic-legal responsibility for it: between them the wage system almost always prevails. Since the end of the last world war, however, once the defensive phase of the workers' movement had run its course with collective trade-union contracts and the various social legislations, the workers, beginning a new defensive phase of their movement, claimed the right to participate in the management of enterprises together with the representatives of capital.
Experiments with factory councils took place in Germany and elsewhere, in addition to the Soviet experiment in Russia and in the Bolshevized countries, where, however, the political factor had a clear predominance over the economic phenomenon, giving rise to a rather negative experience.
Fascism regulated relations between capital and labor in Italy within the corporative regime. The fall of the Fascist dictatorship and the recovery of democratic freedoms has reopened the question, in Italy too, of an integral participation of labor in the life of enterprises, to be brought about by means of workers' management councils. Two "slogans" have become fashionable: "participation in profits" and "workers' management councils."
On a par almost with democracy in political life, workers' control intends to democratize economic life in the sector of production, hitherto governed unilaterally by the owner of the enterprise or by his representatives.
From the private dominion of the present rulers one would pass to the collective dominion of the ruled, through the internal factory organizations or the workers' management councils.
The representatives of labor legitimize their postulates with solid arguments.
I. To give the worker a sense of his real participation in the human community, which works and produces for all its members, it is not enough to improve his working and living conditions, but it is necessary that he cease to consider himself an isolated element and perceive directly, in his own regard, the beneficial reflection of the importance of his contribution.
The human personality of the workers must have the place that belongs to it in the direction of the enterprise, as it has in the productive process. The enterprise is a society of persons, more than of capital. This must not predominate. On the other hand, by uniting all the factors of production in the same hands, the contrast between production and labor is eliminated.
II. Production must be subjected to national control by the workers, who constitute the vast majority of the people.
Industrialists, on the other hand, are clearly opposed to workers' management councils, for other reasons that undeniably carry their weight.
1) The right to management, they say, belongs to the one who assumes responsibility for it and faces the risk, that is, to capital.
2) The very structure of the enterprise requires a unitary government, autonomous, free in its movements.
3) The working class, at least today, lacks directive capacities and moreover has a mentality and interests in conflict with the supreme interests of the enterprise, when it does not have entirely revolutionary intentions.
The delicate moment of the European economy, especially in a phase of readjustment, corroborates these reasons.
Before sitting as arbiters in this clash of arguments, it will be appropriate to consider the different ways in which workers' management councils can enter into the technical organization of the enterprise, and lead to participation in profits.
If the workers' management councils are given only consultative power, it is clear that one cannot speak of true and effective participation in management, the entire and exclusive direction of the enterprise remaining in the hands of the owner. For there to be a minimum of participation, it is necessary that, beyond the disputes settled in the collective contract, at least some of the competences hitherto attributed to capital alone be shared with the category of labor.
On the other hand, if exclusive appropriation of the means of production were granted to the workers' management councils, following any socialization of property whatsoever, it would be inaccurate to speak of participation of labor in the management of the enterprise. It would rather be a matter of exclusive attribution of directive power to the category of workers or to the collectivity, a true economic dictatorship of the proletariat, which would not be long in becoming political, only to transform itself into a dictatorship over the proletariat. The recent history of Russia instructs us on this point. The factory councils at first limited themselves to controlling capitalist production, then became organs of absolute government of the enterprises, and finally were gradually dominated by the central authorities, placed in charge of the national economy, and definitively reduced to the proportions of simple internal commissions (cf.: Soc. ital. per azioni, La socializzazione delle imprese, Rome 1945, p. 42 ff.).
The participation of labor in the direction of the enterprise would preserve its meaning only when the two traditional elements enter into action in the productive process, free labor and free private and social capital, as categories distinct from one another, which associate to govern the enterprise in common, to which both bring their personal or real contributions in a division of directive powers. In this system the workers' management councils would have the function, if one may say so, of a small constitutional parliament, which limits the sovereign power of capital and of those who represent it, since the deliberative power of the workers must be taken into account.
The practical implementation of workers' management councils, understood in this way, in the new step forward that humanity intends to take toward a more perfect social justice, will have to be carried out on a plane of moderation, with one's gaze fixed on the spiritual ends that are aimed at, without losing contact with the bare reality of things and with the norms that preside over economic action.
The participationism of labor in the direction of the enterprise is regarded with full favor by Christian social doctrine (cf. A. Vermeersch, Quaestiones de iustitia, Bruges 1904, p. 627).
Pius XI, considering wages an inadequate form of remuneration for labor, in Quadragesimo anno expresses the hope that "workers become sharers in ownership or in management, participate to a certain extent in the profits earned," and considers it necessary that "in the future capital gains should not accumulate except in fair proportion among the rich, and should be distributed with a certain breadth among the workers." Identical is the concern of Pius XII, who proclaims himself the herald of a social order that "makes possible a secure, even if modest, private property for all classes of the people"; of a "new social order" to be built on democratic foundations also in economic life.
Only that, since it is not within the competence of the spiritual power to determine the juridical-organizational forms of the methods of participation, the Church does not prescribe the technical solutions to such problems, but confines herself to preparing them, promoting them, examining them for their consistency with the principles of justice and equity, and recommending them within the limits and conditions of their applicability.
The Italian Constitution as well, after heated debates caused by the diversity of ideas and parties, contented itself in this matter with a statement of principle, to be implemented in the various reforms, which will have to be conditioned by the moment in which they are carried out.
Art. 46 says: "For the purposes of the economic and social advancement of labor and in harmony with the requirements of production, the Republic recognizes the right of workers to collaborate, in the ways and within the limits established by law, in the management of enterprises."
Where it is evident that the intention is to elevate labor from a tool to a collaborator in production, but the realistic vision of the gradualness through which transformations of this kind must be brought about is also evident.