The Relationship Between Human Resources Management and Trade Unions - Coursework Example

In this era of globalization and liberalization, employees are becoming the competitive advantage for business. A business may manage with mediocre employees but competent employees can propel an average business to greater heights. Likewise, bad employees can cause flourishing business empires to collapse. In a tight labor market, keeping good employees and developing employee loyalty becomes increasingly important and a continuing challenge. With the tight labor market, employers therefore need a strategy to retain their key experts and crucial skilled workers. As prospective employers continuously bid for top performers, management strategies must therefore give due consideration and sufficient resource allocation to keep employees motivated and satisfied. The idea is that the satisfied employee is less likely to pursue greener pastures. Thus, implementing desirable human resource management policies will have a positive effect on employee loyalty. Continuous and systematic approach to training and development, recruitment policies that reduce job-hopping and ensure long-term employment, internal promotion practices with a little recognition given to seniority and the implementation of the productivity-linked wage system would create a more committed employee towards the company. Human resource management (HRM) is the strategic and coherent approach to the management of an organizations most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business (Armstrong, 2006). The terms "human resource management" and "human resources" (HR) have largely replaced the term "personnel management" as a description of the processes involved in managing people in organizations (Armstrong, 2006). Human Resource management is evolving rapidly. Human resource management is both an academic theory and a business practice that addresses the theoretical and practical techniques of managing a workforce. The theoretical discipline is based primarily on the assumption that employees are individuals with varying goals and needs, and as such should not be thought of as basic business resources, such as trucks and filing cabinets. The field takes a positive view of workers, assuming that virtually all wish to contribute to the enterprise productively, and that the main obstacles to their endeavors are lack of knowledge, insufficient training, and failures of process. HRM is seen by practitioners in the field as a more innovative view of workplace management than the traditional approach. Its techniques force the managers of an enterprise to express their goals with specificity so that they can be understood and undertaken by the workforce, and to provide the resources needed for them to successfully accomplish their assignments. As such, HRM techniques, when properly practiced, are expressive of the goals and operating practices of the enterprise overall. HRM is also seen by many to have a key role in risk reduction within organisations (Towers, 2006). The goal of human resource management is to help an organization to meet strategic goals by attracting, and maintaining employees and also to manage them effectively. The key word here perhaps is "fit", i.e. an HRM approach seeks to ensure a fit between the management of an organisations employees, and the overall strategic direction of the company (Miller, 1989). The basic premise of the academic theory of HRM is that humans are not machines, therefore we need to have an interdisciplinary examination of people in the workplace. Fields such as psychology, industrial engineering, industrial and organizational psychology, industrial relations, sociology, and critical theories: postmodernism, post-structuralism play a major role. Many colleges and universities offer bachelor and master degrees in Human Resources Management. One widely used scheme to describe the role of HRM, developed by Dave Ulrich, defines 4 fields for the HRM function (Ulrich, 1996): 1. Strategic business partner 2. Change agent 3. Employee champion 4. Administration However, many HR functions these days struggle to get beyond the roles of administration and employee champion, and are seen rather as reactive than strategically proactive partners for the top management. In addition, HR organizations also have the difficulty in proving how their activities and processes add value to the company. Only in the recent years HR scholars and HR professionals are focusing to develop models that can measure if HR adds value (Smit, 2006). Postmodernism plays an important part in Academic Theory and particularly in Critical Theory. Indeed Karen Legge in Human Resource Management: Rhetorics and Realities posses the debate of whether HRM is a modernist project or a postmodern discourse (Legge, 2004). In many ways, critically or not, many writers contend that HRM itself is a movement away from the modernist traditions of personnel (man as machine) towards a postmodernist view of HRM man as individuals. Critiques include the notion that because Human is the subject we should recognise that people are complex and that it is only through various discourses that we understand the world. Man is not Machine, no matter what attempts are made to change it i.e. Fordism / Taylorism, McDonaldisation (Modernism). Critical Theory also questions whether HRM is the pursuit of "attitudinal shaping" (Wilkinson 1998), particularly when considering empowerment, or perhaps more precisely pseudo-empowerment - as the critical perspective notes. Human resources management comprises several processes. Together they are supposed to achieve the above mentioned goal. These processes can be performed in an HR department, but some tasks can also be outsourced or performed by line-managers or other departments. 1. Workforce planning 2. Recruitment (sometimes separated into attraction and selection) 3. Induction and Orientation 4. Skills management 5. Training and development 6. Personnel administration 7. Compensation in wage or salary 8. Time management 9. Travel management (sometimes assigned to accounting rather than HRM) 10. Payroll (sometimes assigned to accounting rather than HRM) 11. Employee benefits administration 12. Personnel cost planning 13. Performance appraisal One of the most popular hypothesis says that increased human resource management practices coincided with union decline acts as a substitute for unionization. Different analyses show no important differences between union and non-union sectors or between newer workplaces and older ones in the pattern of HRM practices over time; and the study’s longitudinal analysis of Machin and Wood (2005) picks up no evidence of faster union decline in workplaces or industries that adopted HRM practices than in those that did not. Machin and Wood even uncover some evidence of a complementarity between unions and HRM practices. They conclude that increased use of HRM practices is probably not an important factor underpinning union decline in Britain. The decline of trade unionism has been a feature of many countries in recent years (Verma et al. 2002) and the subject of a large body of research. Union decline has been especially strong in Britain over the past 25 years. In the late 1970s over 13 million people—or around 58% of workers—were trade union members, and wages for over 70% of workers were set by collective bargaining. Since reaching its peak in 1979, unionization (however measured) has fallen year after year, so that by 2004 less than 30% of workers were members of a trade union. Coinciding with the decline in trade unionism has been an increase in the use of human relations practices and new forms of work organization. These are often subsumed under labels such as high-involvement, high-commitment, and high-performance management, personnel administration, personnel management or simply human resource management. Such synonyms are often used in a more restricted sense to describe activities that are necessary in the recruiting of a workforce, providing its members with payroll and benefits, and administrating their work-life needs. The initial tendency to associate HRM practices with non-unionism was very strong in the United States; the practices were associated with U.S. multinationals. A lot of the discussion of HRM as an alternative to trade unions remained for a long time as a point of debate and speculation in conferences and seminars. HRM was often assumed to be antithetical to trade unionism, and hence much of the subtext of the debate concerned the future of industrial relations as a field (Godard and Delaney 2000). Keith Sisson, editor of a textbook on personnel management, summed up the published sources well in his introduction to the book’s second edition: “Although there are formulations which givean important place to trade unions …, most are silent on the issues or assume a non-union environment” (Sisson 1994:12). From this, he wrote, we can infer that these writers regard unions as “at best unnecessary and at worst to be avoided.” The implication is that HRM is viewed as a major, if not the only effective, means of remaining non-union. Consistent with that, HRM is inherent to the definition of union substitution in some of the U.S. literature, certainly when distinctions are made between union substitution and union suppression. When Kochan (1980:183) first made the distinction—on the basis that Direct union suppression involved “hard line opposition” through, for example, the use of blacklists, while union substitution was comparatively indirect—he certainly associated substitution with the growth of personnel management. More recently, Fiorito (2001:335) similarly made the distinction on the basis that “union suppression refers to direct attacks on symptoms of ‘unionism’ (pro-union attitudes, intentions or actions) among workers” (italics in original). Since union substitution refers to employer practices designed to offer good pay and conditions or certain kinds of employee involvement, it is often conceived as being aimed at reducing worker dissatisfaction. Given that for Fiorito the adoption of such practices does not have to be consciously motivated by anti-unionism, any increase in their use that acts to enhance job satisfaction and discourage unionism could be taken to be union substitution. Nonetheless, this prejudges too much ahead of empirical research on the purported link between HRM and non-unionism. Fiorito has in fact implicitly recognized the empirical nature of the question by designing and conducting studies to test whether HRM practices do indeed act as substitutes for unions (Fiorito 2001; Fiorito et al. 1987). Conclusion So what is the relationship between HRM and trade unions? Are they mutually exclusive social phenomena, or they can work together, supplementing each other? “An institutional system of negotiation in which the making, interpretation and administration of rules, as well as the application of statutory controls affecting the employment relationship, are decided within union-management negotiating committees” (Bratton and Gold 2003: 411). If do not define the point of discussion, these statement is applicable both to trade-unions and to Human Resourses Management. Obtaining union cooperation would partly depend on management attitudes. If managements believe - as some appear to do - that effective HRM can be popularised by regarding individual enterprise action in isolation from the external labour market, then effective HRM may in the foreseeable future remain isolated islands of excellence, rather than common practice throughout the economy. Perhaps it is this somewhat isolationist attitude which accounts for effective HRM in many countries still remaining the preserve of high technology enterprises, despite its growing popularity. If management strategy is union avoidance, then unionism and HRM will be incompatible. The possibility of two social phenomenas under discussion having a parallel existence is more likely in large enterprises where direct communication with individuals is more difficult. In this connection it may be instructive for managements to consider whether a union-free environment is necessary for effective HRM. Contrary to popular belief, in some countries such as the UK, HRM has been found to be seriously practised in unionised workplaces, rather than in non-unionised ones. Actually the way unions deal with HRM at a local level is varied and depends on the traditions and forms of union organization and practice in different sectors and different ways of management, although common to these packages is the attempt to individualize work relations and weaken the resources of collective worker power. In the context of considerable restructuring and job insecurity in the manufacturing sector, union responses have been largely reactive and muted, occasionally resulting in the emergence of debilitating union forms of “social partnership” (Fairbrother, 1996). In contrast, HRM policies in the public sector and the utilities have been one part of a more profound restructuring in these sectors and unions have been faced with the problem of developing or revitalizing workplace forms of organization. In reality such developments place the question of the way unions organize and operate at a workplace level, in the context of individualized and consensual work relations firmly back on union agenda. It would be unrealistic for unions or anyone else to expect managements to abandon or reduce their resort to effective HRM when the latter is one means of achieving management objectives geared to better enterprise management. The pre-occupation with HRM on the part of employers is not confined to industrialized countries. The Asian emphasis is reflected in the fact that programmes on HRM are far more likely to attract management participation than IR, in the same way that IR programmes would attract trade unions. Effective HRM is not widespread. If more managements succeed in practising effective HRM, on present trends it is not impossible that IR will come to be relegated to a secondary role. This possibility is enhanced by the fact that traditionally IR has never been a part of strategic planning, nor has it been seen as a means of achieving management objectives. On the other hand, HRM is increasingly seen as having a strategic role and as a means of achieving management objectives. The convergence of other factors such as declining union rates (if this trend continues) could also combine to push unions to the fringes. Bibliography 1. Armstrong, Michael. 2006. A Handbook of Human Resource Management Practice, 10th edition, London: Kogan Page. 2. Fairbrother P. Trade unions and human resource management in Britain: case study evidence from the public sector, utilities and manufacturing. Employee Relations, Volume 18, Number 6, 1996 , pp. 10-27(18). Emerald Group Publishing Limited 3. Fiorito, Jack. 2001. Human Resource Management Practices and Worker Desires for Union Representation. Journal of Labor Research, Vol. 22, No. 2 (Spring), pp. 335–54. 4. Godard, John, and John Delaney. 2000. Reflections on the High-Performance Paradigm’s Implications for Industrial Relations as a Field. Industrial and Labor Relations Review, Vol. 53, No. 3 (Apr), pp. 482–502. 5. Kochan, Thomas A., and Paul Osterman. 1994. The Mutual Gains Enterprise. Boston: Harvard Business School Press. 6. Legge, Karen (2004). Human Resource Management: Rhetorics and Realities, Anniversary Edition, Basingstoke: Palgrave Macmillan. 7. Machin, S., Wood, S. 2005. Human Resource Management as a Substitute for Trade Unions in British Workplaces. Industrial & Labor Relations Review. Volume 58, Issue 2. University of Sheffield. 8. Miller, L. E., & Simmons, K. 1989. Management practices of founding and nonfounding CEOs of human service organizations. Proceedings of the Academy of Bristol. 9. Sisson, Keith. 1993. In Search of HRM. British Journal of Industrial Relations, Vol. 31, No. 2 (June), pp. 201–11. 10. Smit, Martin E.J.H. 2006. HR, Show me the money; Presenting an exploratory model that can measure if HR adds value. 11. Towers, David. Human Resource Management essays. Last updated 08/11/2006. Retrieved on 10/01/2008. http://www.towers.fr/essays/hrm.html 12. Ulrich, Dave. 1996. Human Resource Champions. The next agenda for adding value and delivering results. Boston, Mass.: Harvard Business School Press. 13. Verma, Anil, Thomas A. Kochan, and Stephen J. Wood. 2002. Union Decline and Prospects for Revival: Editors’ Introduction. British Journal of Industrial Relations, Vol. 40, No. 3 (September), pp. 373–84 14. Wilkinson, A. 1988. Empowerment: theory and practice. Personnel Review 27 (1): 40-56. Read More