The issue of private equity has suddenly burst onto the trade union scene, almost out of nowhere. In the last few weeks, the GMB and other unions have picketed, demonstrated, issued press releases and campaigned to raise public awareness of the problem. And media attention has not been lacking either. The prospect of giant companies (and major employers) such as Alliance Boots or Sainsburys being taken over by shadowy private firms with reputations as asset strippers has not gone unnoticed in the mainstream media.

The TUC has backed calls for the forthcoming G8 summit “to set up an international task force to examine whether the growth of hedge funds and private equity threatens the stability of international financial markets, and how to introduce a regulatory and taxation regime that secures a level-playing field between private equity and other forms of investment.” In a statement, the TUC also pointed out that “employees are the normally the main losers, but the wider community loses from a lower tax take and short-termism.”
The problem is not only British – though takeovers of well-known companies like AA have made headlines here. It is a global issue, and is increasingly being addressed at the level of the global union federations. One of those, the global union for food, farm and hotel workers (the IUF), has just launched a major new website focussing on private equity. The website is located at http://www.buyoutwatch.info and is already an indispensable resource.
According to the IUF, the website will “strengthen our collective response” to the threat posed by private equity. The site will include news of private equity developments in the food, farm and hotel sectors, reports on union campaigns, organising and bargaining strategies in response to leveraged buyouts, and updates on key developments in the campaign to contain and roll back private equity through political and regulatory tools.
Recent articles on the BuyOutWatch site have drawn attention to private equity attempts to buy such household names as Cadbury Schweppes, Carrefour, and Gate Gourmet – a company which will be familiar to all British trade unionists due to its “sacking by megaphone” of hundreds of unionised staff at London’s Heathrow Airport and the struggle which ensued.
Another global union federation, UNI, has also devoted a special section of its website to private equity issues, here:

http://www.union-network.org/uniindep.nsf/privateequity?openpage
Last November, another global union federation (the International Metalworkers Federation) joined with the IUF and UNI to hold a conference which noted that “trade unions were increasingly confronted with aggressive anti-union behaviour in the service of reducing wages and benefits.”
Finally, the International Trade Union Confederation (ITUC), which unites national trade union centres (such as the TUC) representing 168 million workers in 153 countries, raised the issue at the world economic forum in Davos this year. In a press release on the ITUC website, the group wrote that “With some US$600 billion in such acquisitions spent in 2006, double the amount of the previous year, questions about transparency, corporate governance and sustainability are critically important, not least for the working women and men whose employment, rights and working conditions are often threatened by the behaviour of these funds.”
At present the ITUC website doesn’t have a dedicated section focussed on private equity, but presumably in the near future, following in the footsteps of UNI and the IUF, it will.