The Role of Trade Unions in Raising Workers Welfare and Industrial Upgrading - Japan and China - Case Study Example

The Role of Trade Unions in Raising Workers Welfare and Industrial Upgrading: Comparing and Contrasting Japan and China Contexts. Name of Student Student Number Institution Course Code Name of Lecturer Submission Date Trade unions all over the world have been credited with the noble task of improving the welfare of workers while at the same time facilitating for industrial upgrading. The upgrading is achieved as workers quest for better working conditions is realised and consequently this trickles towards the upgrading of the industrial environment. The Japanese and Chinese industrial environment and actions are worth noting in the developed and developing world respectively. Japan being among the developed countries and China presenting a fast growing economy with a high workforce presents better contexts for examination of the roles of trade unions in enhancing the welfare of workers and industrial upgrading. This essay compares and contrasts the role played by trade unions in the two countries to enhance working conditions. In context, the main approach in this analysis looks into the extent of success achieved by trade unions in raising workers welfare as well as facilitating industrial upgrading in Japan and China. From the 1950s, trade unions in China were observed to be integrated within the constraints of the centralised planned economy and consequently ensured they enhanced production and became responsible in the distribution of social benefits and services to the workers (Blanchflower and Bryson, 2004). The Japanese trade unions can be praised for their effective bargaining units to achieve better wages with respect to being mostly enterprise unions whose membership consisted of workers of a given company (Giorgio, 1992). Nevertheless, the struggle of the unions in the countries have not been without challenges and at times the wage negotiations appearing obsolete and labour relations being characterised by employment for all state wage determinations. These struggles have not just been documented for historical purposes but clearly show the role played by trade unions in ensuring workers gain better working conditions and get better pay. Consequently, the union activities affect the industrial environment by promoting harmony and understanding as far as relations with employers are concerns while mostly ensuring working facilities are improved (Santoro, 2009). The Japanese trade unions are enterprise based representing firms to which they relate keeping in mind that Japan is an advanced industrialised nation (Tachibanaki and Noda, 2000). On the other hand, the Chinese unions are not really strong and have grown up in the recent years and emerging with being the highest memberships globally (Qiao, 2010). This is favoured by the large work force that characterises China as result of its being the most populated nation in the world. The Japanese union organisation has been termed nearly unique globally. It is characterised as pivotal based on enterprises and not industries or crafts like most other nations (Ohtani, 2000). The unions cater for workers limited to companies at lower levels and on the upper levels the enterprise unions conglomerate joining industrial federations which act as constituents of nation-wide political bodies like the Japanese Trade Union Confederation (RENGO). This gives the Japanese unionism a characteristic three tier system (Kawakami, et al., 2004). The bottom level organised into enterprise unions in charge of negotiating factory issues like wage rates, job promotions, work place safety, redundancies, transfers and retirements issues. This clearly shows the greater role played by enterprise unions to ensure the welfare of workers is improved. However, despite the difference that exists in the various enterprise unions, there are a number of aspects that are similar. These attributes consist of membership restricted only to regular workers, blue and white collar employees enjoying the right to be in same union, the union officers are regular employees for a given company (Kawakami and Kogi, 2001). The set up promoted a sense of belonging for the entire employees’ fraternity with no party feeling out of place or affected negatively by the union conditions. With the presence of federations, they play a key role in the determination agenda and decision making within the industry by making their voices head through the unions (Inoue, 1999). In other words, this means that the negotiations made depends on the federations rather than the company unions and consequently the impact made was effective to the entire nation. The federations thereby present an informal industrial self-regulating body bringing up a similarity of level playing fields by all parties involved (Qiao, 2010). On the other hand, the Chinese trade union environment has been overshadowed by the Japanese one in terms of championing of the workers plight. With ACFTU being the Chinese sole official union, and being the adjunct of the Communist Party and government, while serving as the link of the management and workers within state owned companies (Du and Pan, 2009). The role of the body has greatly been blurred coupled with the economic reforms and development within the private economy in the last two decades. The body has been seeking to unionise the private sector although, there has been no achievement in the encouragement for development of genuine representatives from the grassroots level unions (Chen, 2003). The approach undertaken has been a top-down one where unions and collective contracts are imposed on enterprises having no consultations to the workers. With rapid global industrialisation, securing safety and favourable working conditions among workers has been the plight of trade unions in the Asian region and in specific Japan and China (Filer, Hamermesh, and Rees, 1996). This has grown to be a very important concern with many new production technologies being applied bringing up both positive and negative effects with respect to safety and welfare of the workers. There are traditional and emerging work related risks that have come up with growth and development orchestrated by industrialisation in the era of globalisation (Fischer, 2001). This leads to the fact that trade unions and workers groups have been core in the fight for favourable working conditions, better remunerations and on the same note ensuring safety. A study by Giorgio (1992) clearly examines that mostly the small and medium sized manufacturing firms in Japan but, in turn find the unionised firms tended to achieve much smaller benefits to the companies in respect to the non-unionised firms in the same industrial environment. In context, unionised firms were observed to realise much smaller profits to sales ratios, slightly lesser rates of return on equity, and much fewer value added per worker in respect to the non-unionised ones in similar industries. This presents the case of where the Japanese trade unions championed the rights and benefits of the workers at the expense of the small and medium firms (Filer, Hamermesh, and Rees, 1996). On the same note, it was observed by Japanese labour economists that unionisation in small and medium sized manufacturing companies lead to huge bonuses among and severance pay, high wages for females and elevated levels of employees’ refusal to work on paid holidays (Giorgio, 1992). These two study aspect presents the notion that Japan’s enterprise unions ensured high wages for workers while reducing the profits for the employing firms. There has been the clear strategic move in the Asian region towards promoting industrialisation and has placed Japan among the industrialised nations with China being among the fastest growing and having the largest economy (Traub-Merz, R. (2011). The Chinese labour environment is characterised by large and populace labour force with China being the world most populated nation. The trade unions move in the promotion for industrialisation and better working conditions in both Japan and China has brought up the significant growth of the economy in the region (Tachibanaki and Noda, 2000). The state has been placed forward in the labour relation matters and consequently preventing or reducing conflicts via third party interventions which are external to the enterprise. This is achieved via conciliation, arbitration and labour courts (Santoro, 2009). The benefits that can be pointed out in both nations are the fact that efficiency considerations in the industries became a priority and eventually upgraded the industrial environment. With respect to Japan, the employees’ long-term career is taken directly into account within the remuneration package. Looking at the core enterprises in Japan, workers are not just paid with respect to level of their skills, but also in accordance to criteria like age and years of service (Qiao, 2010). This can be attributed to the concerted efforts by workers unions in ensuring that employee welfare is enhanced and consequently improved. The Japanese labour environment is favoured by various labour laws enacted within the Occupation area and are continue being in effect without great amendments. Unions are legitimate and have both the bargaining power on behalf of the workers to the large companies (Tachibanaki and Noda, 2000). The unions act like political organisations but strikes are prohibited and consequently, there is evidence of independence of unions as they are not monopolised. This ensures that they act for the welfare and benefits of the workers and not being in place to benefit a selected few, like the officials or representatives of the trade unions. Looking at the counterfactual and actual union wage distribution, it is evident that union workers have got higher skill distribution than non-union workers although the gap is not large among the high-skilled employees (Kawakami, et al., 2004). The fact behind the former difference can be traced to the championing by unions for officials to pursue better working conditions and consequently acquire improved and more skills with their specialty or work. This shows that trade unions have impacted positively to the workers by ensuring they get better remunerations and seek skilled labour. Consequently, the enhancement of working skills among the workers is a greater boost to the industrial environment as more employees have acquired increased skills in their works as a result of union championing (Filer, Hamermesh and Rees, 1996). The Japanese trade unions have acquired improvement via collective bargaining on pay, working hours, fringe benefits and in-house welfare programmes. The positive actions undertaken by unions have promoted the welfare workers to a greater extent with respect to their health and safety at work (Fischer, 2001). This has effectively seen the upgrading of industries to ensure safety and meet the health standards stated. In context, the tasks of unions have brought up immense changes upon the workers and their working environment. The role of trade unions in ensuring better working and uplifting the industrial standards can be traced to a number of decades in China with advent of the 21st century. With large numbers of members, the Chinese trade unions maintain over a hundred million members but have been termed less potential in the representation of workers (Traub-Merz, 2011). This can be attributed to their domination and control by the management bodies hence making the unions’ impact not realisable as it may be expected. The Chinese trade unions had been characterised by their domination by the management in the enterprise with higher levels being controlled by the party (Lee and Liu, 2011). This can be termed as a setting that would not favour the enterprise trade unions pushing for improvements in working conditions or higher wages which would mean increased cost to the firms. The interests of the unions are not anchored within the precincts of workforce, but rather are embedded in enterprise management. The Chinese workers have been perceived for long by the West as mere victims of repression having no rights, no trade unions and lacking no hope (Traub-Merz, 2011). Nevertheless, the recent happenings within the labour market and the introduction of labour laws, there seem to be hope of trade unions making greater impacts in the coming years. Consequently, the new trends within the Chinese trade unions in the recent past place the official All-China Federation of Trade Unions (ACFTU) at pace to try and catch up with the new developments in the region and entire world to determine the direction to go (Lee and Liu, 2011). This is in respect to ensuring the workers are championed and industrial environment made appealing to the workers with the extensive growth and development being experienced in the country. The benefit observed today of the trade unions is in the conducting of labour management negotiations bringing up solutions to arising crisis among workers and employers (Lee and Liu, 2011). This in context alleviates the effects of stand offs created by worker-employer crisis whenever lack of consensus arise. But with trade union officials, negotiations are held and concluded on behalf of the workers without their meeting face to face with the employer. Nevertheless, the new era has presented an economic downturn globally that has affected major economies leading to low growth and economic maturity. The results are changes in the needs and challenges by workers changing significantly. This could result into companies being not in a position to meet the demands of workers leading to crisis and resulting to traditional spill-over system of wages hike. However, many industrial corporations in China and Japan have struggled to realise comprehensive improvements within the employment and live of workers via prioritising goals (Santoro, 2009). These has seen the maintenance of wage curve, social security system building to ensure a sense of security for workers, removing unpaid overtime and realisation of equal treatment for part-time worker. In essence, this is a clear evidence of the advantages brought up by corroborative works made by union and employees to ensure the welfare of workers is enhanced. Trade unions have the greater role of ensuring that the workers have good terms with their employers in regards to demands made pursuant to employment agreements or subsequent agreements during employment periods (Ohtani, 2000). The unions evaluate the prevailing circumstances to assess the genuine nature of the employees in regard to any arising decisions touching on the welfare and safety of the employee. In so doing, the unions enter into negotiations with the employers to demand for explanations or else reversal of any actions tantamount to the wellbeing of the workers. In conclusion, it is clear to note that trade unions have played a crucial role in the improvement of workers welfare and upgrading the industrial relations and environment. However, the roles and benefits realised vary with respect to the nature and set-up of the unions in regard to the nation under consideration. The essay clearly illustrates the improvement of wages, working conditions among other benefits which constitute the welfare of the employees. Consequently, through the championing and negotiating for the rights of the workers, unions encourage their members to embrace improving their labour skills resulting to enhanced labour force. This is evident of the greater role played by the unions to promote workers welfare and ensure better working conditions which translates to improved infrastructure and factory facilities to promote safety. In this regard, the resultant observation is the improved industrial system and facilities. It is therefore crucial to note that labour unions in Japan and China have played a greater role in the improvement of the workers’ welfare as well as improving on the industrial relations and environment. 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