The recent change of government brings to an end a sustained attempt to transform British industrial relations by legislative action. This article explores the consequences. It explains the cumulative effect of the legal changes since 1979, including the growing influence of the European Community, and examines the economic and social results. While legal intervention has had an impact on the institutions of industrial relations, most notably in reducing the power of organised labour, this cannot be isolated from wider structural changes in labour and product markets. A review of research on economic outcomes suggests an uneven and tenuous link between institutional change and economic performance. Walsh, 1994). As with the substantial decentralisation of the public sector after 1980, this fragmentation greatly reduced the industrial basis of trade union power, tying the interests of union organisations increasingly to those of individual employers. These changed economic and institutional circumstances had consequences for trade unions which were in many ways similar to those intended by the legislation, creating a further difficulty for its evaluation.The experience of other industrialised countries, in most of which there were comparable changes in economic conditions, is of relevance and will be drawn upon later. Most of these countries adapted to a changing economic environment without undertaking similar adjustments to their systems of industrial relations to Britain