Impact of Institutional Factors on Employment Relations - Coursework Example

Topic: Lecturer: Presentation: Introduction Employment relations are the organizational policies and actions that entail the association between management, individual employees as well as among groups of employees in the workplace. The practices are significant in the enhancement of employee satisfaction. There are many factors that may affect might affect employment relations, such as political influences, changing technology, cultural issues, social and economic factors, business cycle as well as psychological factors. This paper presents a critique of the factors that influence employment relations, with special focus on political, technological and cultural factors and their implications for international Human Resource managers. Impact of Institutional Factors on Employment Relations The government plays a significant role in employment relations and is recognized by many employers in many states including the UK, US and Australia among other thriving economies. Each state has its own regulations regarding collective bargaining, which are influenced by policies. The labour law has a strong influence on employment contracts and the behaviour of employers in regards to their relationship with employees. The government, being the sole institution mandated to develop new laws and to discard the ones that seem inappropriate, has the capacity to determine how the employer-employee relationship should be. The changes in regimes governing the state greatly influence the manner in which organizations operate. Trade unions are applied as the tools for strengthening the employees’ collective bargaining Hollinshead et al (2003). However, they are met with resistance from different circles especially when the government promotes non-collective mechanisms in industrial relations. The unions are sometimes viewed as the major drawbacks in the efforts to encourage investors to create employment opportunities. They are viewed as hindrances towards the maintenance of a free labour market. For example as Dundon & Rollinson (2004) observe, the unions were considered to be the cause of rampant unemployment in Britain since 1979. This made the government to make efforts that are geared towards increasing the freedom of managers, reduction of government influence on formal structures of organizations and increasing the management’s capacity to control the human resources. Government policy usually has a significant influence on the outlook and the anticipation of employers. In essence, even if the policies have no express effects on the employment relations, the managers tend to develop a perspective that is shaped by them in regard to the relationship and the expectations of the employees. The indirect impact of the policies is known to have a significant effect in employment relations. With unions being rendered powerless, employers find no reason to seek legal action for sanctions against unions. Political influence leaves the control or freedom of employees at the discretion of the managers. In essence, economic growth depends on the capacity of the government to encourage investors in the economy and hence political influence in employment relations is focused on maintaining a favourable environment for investment (Rose, 2008). This means that as much as the government protects the welfare of employees, the interests of the investors are of paramount importance and hence significant freedom is accorded to them. Trade unions on the other hand emphasize on employee welfare and less on the interests of the employers. Political power is therefore applied by the government to limit the powers of the unions and collective bargaining in general to enhance the investment climate for the employers’ to remain in business (Scullion, & Starkey, 2000). Apart from political factors, employment relations are also affected by technological advancement. In the contemporary workplace, employees are exposed to hi-tech equipment that work at higher speed than humans. The setup of the workplace is usually based on the design of the machines and computers and how they are required to function. The machines are usually arranged in a manner such that the employees are only required to introduce in put and perform minimal specific tasks to enable the process to be completed (Shen, 2005). In essence, they are subsidiary in comparison to the workplace system which performs most of the tasks. The modern technological systems have largely affected the conventional workplace operations whereby employment relations were enhanced by interpersonal associations and interactions among the employees. In the highly automated workplace, workers interact with machines and computers and rarely among themselves and hence technology has an influence in the development of casual work groups and the level of teamwork or inconsistency in the workforce. In essence, such workplaces that have not been humanized have a great impact on the success of employment relations (Daniels, 2006). Technology is often viewed as a de-skilling aspect of the workplace due to its replacement of the conventional skills. Automation of business processes generates fear among employees regarding their job security as new technology replaces their roles in the workplace, which affects employment relations. However, there are emergent technologies that improve the working conditions of employees. These improve employment relations especially since they present the workers with new learning opportunities (Scullion & Starkey, 2000). Workers in highly automated workplaces are likely to be stressed particularly when they have to perform the same tasks throughout their stay in organizations without an opportunity of engaging in consultations with others who on the other hand have similar tasks in their area of specialization. However, some of the new technologies may help in reducing this monotony and hence improved satisfaction and employee relations. On the other hand, individual privacy has also been affected by technological advancements that have enhanced workplace monitoring. In the process of maintaining the organization’s integrity through employee monitoring, employers interfere with workers’ privacy rights thereby lowering their morale for work (Davison & Ward, 2000). It is therefore clear that even though technology has many positive impacts on employee performance, there are various aspects that may hamper the accomplishment of effective workplace relations. Hofsted defines culture as a tool that the mind applies to guide a person’s day to day activities and interactions with others. He believes that culture is a collective aspect of a population that has occupied a particular social environment where individuals learn unique norms and also develop standards that guide their behaviour. These behaviors make a distinction between cultures since all individuals in a particular culture share norms and customs (Hostede, 1991). Some cultures are individualistic such as the British, US and Australia among others while the Japanese and the Chinese cultures tend towards collective action and teamwork. Adler (2002) argues that cultural differences affect the manner in which people relate with each other and it is not different for employment relations. For example, working strategies that affect the employees’ religiosity may degrade the relationship between the managers and workers. On the other hand, cultural diversity is a critical issue that may affect employment relations as the different cultures make efforts to establish self identity. When one culture is esteemed than others in the workplace, employment relations deteriorate. However, strong relations may be appreciated when both the mainstream and minority cultures are appreciated (Rollinson & Dundon, 2007). The three institutional factors have various implications on employment relations for international Human Resource managers. For instance, the political factors require the managers to adhere to the policies of the host government. However, the differences in the employment laws between different countries present difficulties especially in the harmonization of human resource practices for multinational companies. Some trade unions are stronger in some states than others and therefore the employment relations have to be unique to each country that the business operates. The managers should be informed regarding the employment policies in the various countries where they operate and also be capable of matching the organizational strategies without infringing the rights of employees (Lewis et al. 2003). On the other hand, difficulties are encountered in international HRM and employment relations due to technological differences in different countries. For example, the level of automation of business processes is varied, which is the same case with knowledge transfer regarding the application of new technology. The technical knowhow is minimal and automation of business processes may be stressful for the employees. Application of new technology for workplace monitoring is also a critical issue especially since the rights to individual privacy vary from state to state. The international HRM have a responsibility of satisfying the training needs and the reduction of the possibilities of de-skilling by upgrading the skills of the conventional workforce to utilize the emerging technologies (Blyton et al. 2004). In the international perspective, human resource managers are required to understand the desires of the diverse cultures in the workplace. The managers have a difficult and essential task of managing diverse characteristics such as gender and racial differences. Religious beliefs are also diverse and work may be affected by dogmatic religious holidays internationally. Managers therefore have to be highly capable and informed individuals to cope with the demands of the workforce thereby maintaining effective employment relations (Leat, 2007). Conclusion Political influence on employee relations is usually as a result of governments’ efforts to enhance the investment climate while maintaining the welfare of citizens. Trade unions on the other hand are usually less considerate in regards to an organization’s profitability than the welfare of employees. Technological advancement has both negative and positive impact on employment relations. Employees’ morale may be reduced as a result of de-skilling, while on the other hand technology generates new opening for employees to acquire skills. Cultural differences on the other hand may limit the effectiveness of employee relations. However, appreciating cultural diversity in the workplace can be a significant step towards the accomplishment of strong relations among employees and the management. International human resource managers are compelled to adhere to the policies of the state in which they operate. They also need to identify the training needs of staff to avoid low morale in the workplace. It is important for them to understand the diverse needs of employees in the workplace. References Adler, N. 2002. International dimensions of organizational behavior. Cincinnati, OH: South Western. Blyton, P. & Turnbull, P. 2004. The Dynamics of Employee Relations, 3rd Ed.Houndmills: Palgrave Daniels, K. 2006. Employee Relations in an Organizational Context. London: Chartered Institute of Personnel and Development. Davison C. S. and Ward K. (2000). Leading International Teams. Berkshire, UK: McGraw-Hill. Dundon, T. & Rollinson, D. (2004). Employment Relations in Non-Union Firms, Routledge Hollinshead, G., Nicholls, P. and Tailby, S. 2003. Employee Relations 2nd Ed., Financial Times, Pitman Publishing Hostede, G. (1991) Cultures and Organizations: Software of the Mind. New York, NY: McGraw-Hill. Leat, M. 2007. Exploring Employee Relations. 2nd Ed. Oxford: Butterworth Heinemann. Lewis, P., Thornhill, A., & Saunders, M. 2003. Employee Relations, London, Prentice-Hall Rollinson, D. & Dundon, T. 2007. Understanding Employment Relations. Maidenhead: McGraw Hill. Rose, E. 2008. Employment Relations, London, Prentice Hall, Financial Times Scullion, H. & Starkey, K. 2000. “In Search of the Changing Role of the Corporate Human Resource Function in the International Firm”. International Journal of HRM, Vol. 11, 6 pp 1061-1081. Shen, J., 2005. “Towards a Generic International Human Resource Management IHRM Model”. Journal of Organizational Transformation and Social Change, Vol. 2, 2 pp 83-102. Read More