Principles of Employment Relations - Literature review Example

Principles of employment relations xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Name xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Course xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Lecturer xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Date EMPLOYMENT RELATIONS In today’s competitive market, there is increasing need to transform the human resource management docket so as to remain on a competitive edge. Human resources have become an integral part of organizations and as Edwards (2007, 23) maintains, people are the cornerstone to sustainable competitive advantage. Full engagement of the workforce and their integration in the decision making process of the organization is a sure way to maximization of performance. An organization where employees are adequately represented in matters pertaining to the organization can accept tremendous value proposition that exceeds money. Efficiency is an inherent end result in situations where all members of an organization are in good relational terms and their needs are met in a holistic manner. Employment relations is a body that embraces the techniques used by an organization to manage its members as well as the economic and social contexts involved in their operations (Bray et al 2011). Institutions and climates of employment relations vary between counties; being more adversarial in some such as the UK, the US and France while some are cooperative like in Japan and Germany. The purpose of this paper is to gain a conceptual understanding of employment relations. It begins by giving a comprehensive definition of the term employment relations. It will further examine reasons why industrial relations are less relevance to the study of workplace relations in the contemporary society that it was in the 1980’s. Lastly, it will determine the extent to which the term employment relations best describes the changes that have occurred in workplaces since 1980. Interactions between employers and employees may sound deceptively straightforward and simple. A common notion is that it is the way in which employers and employees interact, the way employees get their jobs, execute their respective task, expend efforts and get rewarded for their work. The duty of employers is perceived as the way they pay their workers, ensure that products are processed and sold to earn income and generally facilitate the work done by employees. Even with this simple portrayal, there are many matters that need to be deliberated upon. Such matters include the way in which workers are selected, how jobs are organized within the organization and how workers are motivated to do maximum amount of work. These concerns were traditionally perceived as responsibilities of human resources and personnel management. Indeed, establishing appropriate recruitment and selection procedures, job classification and work organization, managing workers commitment and motivation, development and training as well as payment systems are some of the technical responsibilities of the human resources managers who also evaluate these systems and procedures to ensure that they are effective (Sappey et al 2006, 34). However, with deeper conceptualization of these matters another set of questions arise. For instance, is the payment difference among workers based on their worth towards the organization or is it on the basis of favouritism? These issues in turn raise the issue of benchmarks. In many countries including Australia, benchmarks are not just concerned about individuals but instead they are concerned with clusters of employees and their jobs. In other word, systems and procedures developed to address issues of organization of work, payments, training, motivation and general treatment of workers occur in particular groups. These groups may be formed by employees within the organizations which give non-unionized environment in which a group of employees represent the interests of others to top management. On the other hand, employees may be part of trade unions which present their needs and grievances to their employers. In these kind of settings an employment relationship is established between the employers and the employee. By definition, employment relation is a term that describes the relationship between the employers and the employee and also defines the structure of the labour market (Kuruvilla 2002, 11). Employment relations focus on the employee-employer relationships that result to satisfactory motivation, productivity and morale of both parties. It is also concerned with systems of resolving problems which are actually inevitable in any workplace. According to Cappelli (2008) relationships between workers and employees can be either sophisticated or simple mechanisms such as cooperation and communication, from team briefing to newsletters, joint consultations and quality circles. These methods are initiated and controlled by management. Bargaining between individual employers and employees or more commonly between clusters of employees in groups represented in unions and the employer is also considered as a means of communication. It is an avenue for expressing and resolving grievances and building cooperation. These relationships can be formal or informal. Formal bargaining between union representatives and management is particularly important in large workplaces. This allows negotiations and expression of matters from broad matters of working conditions and pay to individual grievances over dismissal and discipline. Formal bargaining enables workers to have a legitimate right to raise their concerns and bestows upon the management a responsibility to respond to those issues. Formal bargaining in workplace level in Australia is concentrated mainly in large workplaces. Otherwise, much negotiation between employers and employees occurs at the national and industry levels and also within the arbitration framework. In Australia, employment relations encompasses operations of arbitration, employer associations, trade unions and specific policies especially those involving wages. The combination of industrial relations and human resource management gives rise to employment relations. Industrial relations have gone through gradual transformation since 1980. Several analysts and scholars have observed that “industrial relations” is less relevant in the study of work place relations now than it was in 1980. Labour markets were rather free and unregulated at the inception of labour markets. The laissez-faire capitalism that dominated at that time, greatly contributed to inequalities and injustices since labourers did not have the bargaining power with their employers. Moreover, the dominant notion of masters and servants prevented workers from enjoying their rights. IR at this point therefore, came to promote labour market regulations and to correct inequalities that existed in bargaining power. According to the collective IR, problems in employment relations largely emanated from market imperfections which were clearly against employee’s interests thus caused power imbalances in the relationships between employees and employers. Two basic interventions were proposed to achieve equal bargaining power; first, states were required to formulate laws with regard to dispute settlement mechanisms and protective labour laws; and second, employees would be given power to associate in collective bargaining. The idea of trade unions was initially welcomed as many employers viewed it as a strategy to reduced competitive advantage. Besides that, the contentious issue of wage negotiations was transferred from employers to representatives through employer’s organizations and trade unions. During this era, the IR was mainly focused on the external environment more so in trade unionism, labour laws, collective bargaining and dispute settlement. Interests on what exactly occurs in workplace levels have emerged recently. Governments played a major part in strengthening the roles of IR through legal prescriptions. In addition, union power was thriving very fast and depended on implementation of its decisions at the enterprise level similar to the normative effect that occurs during implementation of laws. Consequently, obligations and rules imposed on employers came from outside which limited their flexibility to effect change within their respective organizations. Collective IR was basically operated in three ways. The first way was through the industry or national level agreements between employers’ organizations and unions. The second way was through formal agreements between a union and a single employer. The third way was through general legislative agreements that were applicable to both employers and employees. Regulation of an enterprise’s labour market through external means led to restoration of power balance between workers and management. Establishment of terms and condition of employment reduced conflicts among firms. However, a more enterprise-based approach reveals that employment problems are not only related to conflicts over employment terms and conditions but they also emanate from other sources such as lack of job security, physical working environment, lack of motivation and failure to award workers for their extra efforts. Naturally, these problems can only be addressed at the enterprise level. Hence the view of the IR has gradually changed form since 1980 after the realization that employment problems do not actually arise from the external environment but rather from unsatisfactory human resource management within the organization. Corrective action therefore needs to be taken at the enterprise level so as to ensure a reasonable balance between organizational goals and individual needs of employees. Another factor that challenged predominance of collective IR was what employers claimed as flexibility that is an essential ingredient in competition in the global market place. Additionally, the changing character of the workforce could not allow standardization of policies and practices of employment relations. According to….problems of industrial relations needs to be addressed external as well as internal means. Clearly, some employment conditions cannot be left in the hands of individual employers which then imply that external bargaining forces are still relevant to the organization. The main problem is that external regulations have been over-emphasized such that the main purpose of the IR, which is to produce results at the workplace, has lost meaning; it was judged based on its magnitude. The collective IR also lost sight of the fact that relations that can be considered totally sound are those build from within the organization. In recent times, the IR is greatly influenced by social sciences such as organizational behaviour and psychology. Traditionally, laws and economics were the main influencers of the IR which ultimately led to macro level IR hence to collective, union and government bargaining. Organizational behaviour is now influenced by social psychology which centres on relationships in group behaviour and between people and also by individual psychology. Attention has shifted for industrial relations to employment relations which occur within organizations. There are several factors that have accelerated the need for employment relations within organizations. The first one is the effect of globalization which has drastically changed the way in which organizations are managed and work is performed. Organizations have resorted to strategic measures of increasing competitiveness and efficiency through productivity, skills and innovations as ways of reducing cost and improving quality. Since quality and productivity are key considerations in achieving sustainable competitive advantage, the quality of workforce has become imperative. Shorter product life has prompted the need for easily trainable and multi-skilled employees. Employee’s skills are not only determinants of quality, flexibility and productivity but also investment and ability of the organization to adapt to changes in the market (Lansbury et al 2004). Technology is another key factor which caused a shift to workplace relations. On one hand, effective integration of technology into an organization is only possible through people and on the other hand technology is creating new jobs and displacing the traditional jobs which call for different skills. Besides that, technology is transforming organizational structures leading to flatter structures where command and supervision are less while communication, cooperation and information-sharing are being emphasized. Modern technology has also led to different aspects of work for instance increasing number of people who are working form homes. Part time work is also rapidly taking root in many organizations more so due to influx of women into formal employment. This factor further underscores the need for employment relationships within organizations (Godard 2001). Another factor that has necessitated change of the collective IR is the constantly changing workforce. Ackers (2008, 203) points out that in the recent times, many governments across the globe have witnessed emergence of highly educated and skilled workforce than any other time in history. Therefore, these employees have had to be managed in a different manner contrary to how employees in the past, more so the blue collar employees have been managed. Furthermore, different work arrangements that are constantly emerging may not align to traditional employment relations. There is greater need than before for participative and cooperative form of IR. There are many changes that have been witnessed with the emergence of employment relations. The first one is with regard to flexibility. With increasing production, employers have flexed the working hours such that work is done in shifts and workers can work within certain working hours. Additionally, employees have the option of working on part time basis which gives them time to do other additional jobs. Flexibility in functions is has also been made possible with employment relations. Employees who posses multiple skills do not have to be confined in their respective departments; they can cover up for absentees in other areas. Payments are also more flexible whereby payment is now done depending on performance (Tailby and Winchester 2000). Diffusion of technology into organizations has caused reorganization of methods of work as well as production systems. Clearly, demarcation lines between managers and workers as well as job classifications have been greatly reduced and this has led to enhanced cooperation and motivation. Work involvement in terms of control, conception and execution has also been enhanced. Policies and practices such as information sharing and communication that focus on workplace relations have created environments conducive for increased performance. These features of the contemporary employment relations among others have encouraged workers to invest in training and skills and employers to support them in such initiatives. The employment relations that have continuously evolved since 1980 has also witnessed a contraction in the role of trade unions and an increasing practice in collective bargaining (Bacon and Storey 2000, 67). Government interventions in legal and institutional frameworks for labour relations have introduced regulatory laws to regulate application of collective norms and industrial tribunals to employment relationships. This brings out the concept of non-unionized environments. In these kind of organizations, employees form representative groups in which their grievances are resolved, disciplinary matters processed, procedures operated, established, monitored and implemented. Examples of such bodies are employee councils, joint consultative committees and work councils. One of the principal purposes of adapting individualistic employment relations is the need to eliminate the mediating role of trade unions. Non-unionized employment relations give employers considerable power to alter employment terms and conditions to fit the needs of the organization. In actual fact, evidence from many countries shows that the role of collective bargaining and trade unions is quickly diminishing. In conclusion, employment relations have greatly changed employee-employer relationships in many ways. This approach is clearly converse to what was practiced in 1980 when trade unions took centre stage as the pluralistic era came to an end. Industrial relations was embraced by masses as it was regard as a pathway to freedom and regulation in the labour market. This collective IR emphasized on collective bargaining and trade unions and over looked internal situations that affect organizations. The main issues addressed in collective bargaining were concerned employment terms and conditions which contradict the contemporary employment relations which deduces that problem in labour relations can also emerge from other factors underlying the organization such as working conditions, motivation and job security among others. Noticeably, these problems can only be dealt with at the enterprise levels as external interventions would be irrelevant. With the realization of this fact, many organizations have resorted to individualized employment relations that are in line with their organizational needs. The role of collective bargaining and trade unions is slowly diminishing. References Ackers, P 2008, Reframing employment relations: the case for neo-pluralism, Industrial relations journal, vol. 33, no.1, pp. 1-19. Bacon, N, and Storey, J 2000, New employee relations strategies in Britain: Towards individualism or partnership? British journal of industrial relations, vol. 38, no. 3, p. 407-427. Bray, M, Arnold, P, and Cooper, R 2011, Employment relations: theory and practice, North Ryde, McGraw-Hill Australia. Cappelli, P 2008, Employment relations: new model of white-collar work, Cambridge, Cambridge University press. Edwards, P 2007, Industrial relations theory and practice, Malden, Mass. [u.a.] Blackwell. Godard, J 2001. High Performance and the Transformation of Work? The Implications of Alternative Work Practices for the Experiences and Outcomes of Work. Industrial and Labour Relations Review, Vol. 54, no. 4, pp. 776-805. Kuruvilla, S 2002, Change and transformation in Asian industrial relations, Industrial relations, vol. 41, no. 2, pp. 171-228. Lansbury, R, and Bamber, G. and Wails, N 2004, International and comparative employment relations: globalization and the developed market economies, London, Sage Publications. Sappey, R, Burgess, J, Lyons, M & Buultjens, J 2006, Industrial Relations in Australia, Frenchs Forrest, Pearson Education Australia. Tailby, S, and Winchester, D 2000, Management and trade unions: Towards social partnership, Personnel management, Oxford, Blackwell. Read More