Trade Unions in the Workplace Can Only Have a Negative Impact on Productivity - Example

Running Head: Trade Unions in the Workplace Can Only Have a Negative Impact on Productivity Trade Unions in the Workplace Can Only Have a Negative Impact on Productivity [Writer’s Name] [Institution’s Name] Trade Unions in the Workplace Can Only Have a Negative Impact on Productivity Introduction Trade union have always been a part of organizations; however they at times tend to out do themselves. A union usually takes part in active negotiation by making agreements with employer on the issue of pay and conditions. It might also offer legal as well as financial advice, reimbursements during illness and education services to their members. Organizations which value the trade unions, will discuss the issue of their member’s pay with those unions The main focus of this essay will be to define what a trade union is, and analyze how trade unions have an effect on productivity. Conflict is an important word when one thinks of Industrial Relations. It can be argued that conflict is everywhere and inevitable in today's society. When one looks at workplace conflict, it can be broken down. On one side there is the employers, and on the other side, the employees. But taking a closer look reveals that there is more than meets the eyes. In today's workplace, conflict consists of employer associations, employers, government, employees and unions. This essay will focus on the employees’ side of conflict and more notably, the trade unions that the employees join. Trade unions groups of employees which improve the working conditions for all the workers (Stewart 2005). This definition, while very basic, is in essence the main function of a trade union. When looking at the history of trade unions &it can be seen to have originated from the economic struggles between workers and employers in the nineteenth century. This means that employees for quite along time have used the many functions that the unions provide (Aldcroft etal 2000 p11). Relationships in the workplace involve conflict because of the temperament of the employer and employee relationship itself. Pinnington and Edwards (2002) point out that managers and workers are "locked into a relationship that is contradictory and antagonistic" (p16). It is contradictory as managers try to achieve control and innovation at the same time, both of which require fairly different management approaches. The relationship is also antagonistic as managers attempt to generate a surplus from the labour of employees. Conflict is unavoidable as employers and employees pursue their own objectives and interests (Analoui & Kakabadse, 1991 p10). Critical factors such as income distribution and job security contribute highly toward industrial conflicts (Hyman, 1989 p23). One of the hardest decisions that people have to make when experiencing dissatisfaction in the workplace is whether or not they should express this discontent (Analoui & Kakabadse, 1991 p15) Consequently, there is a tendency for the relationship between workers and employers to be a bit hostile, guided by a thinking of employers as persons only interested in not giving employees of their due in order to maximize profits. This in turn portrays a monster like image of the employers. The leaders of these kinds of trade unions deliberately induce such thinking in the members so that there can be a negative effect on the productivity. Interestingly however, there is an emerging thinking of the two parties as social partners with a common interest in preserving the organization for their mutual benefits. Thus it can be said that the trade unions are developed to protect and support the interests of their members by making the employers their social partner. By such a partnership the unions find a scape goat in the shape of their employers. The state (all levels of government) plays a crucial role in employment relations, both directly and indirectly. The roles undertaken by governments may be categorised into five components including maintaining protective standards; establishing rules for the interaction between the parties; ensuring that the results of such interaction were consistent with the apparent needs of economy; providing services for labour and management such as advice, conciliation, arbitration and training; and as a major employer. After World War II, it indicates that many governments adopt a more active role in regard to employment relations (Bamber et al. 2004). According to Bamber et al. (2004), there are several reasons why it is important to study analysing different ER systems and how they are managed (adopting an international comparative approach). In this essay an understanding of some of the complexities of employment relations systems will be gained, a part from this essay will give a clear understanding of the negative impact as well a s the positive impact which trade unions have on the productivity of the organization. To serve this purpose a number of theories will be referred to. Each theory or view point will support the notion that if HRM realistic or rhetoric in nature. Analysis Negative impact Where a trade union exists, it influences a number of organisational activities. In organizations where unions play a strong role in the decisions making process the productivity is definitely affected as they cannot make any decision with their consent. This makes the administration feel as if their productivity is being affected as the industrial relationships within their organization is one sided (Waddington & Kelly 1995 p415). This in turn, produces managers who do not give priority to human resources, who are more reliant on the outside bodies; who hand the initiative to unions; and who adopt a reactive and remedial rather than a pro-active preventive approach to industrial relations. A lot of literature proves that the decline in unions is indicative of increasing employee satisfaction and better working conditions (Hyman, 1989; Kornhauser, Dubin, & Ross, 1954; Wooden, 2000). Nevertheless, a lot of studies found results in which employee satisfaction is not related to union membership, thus proving the assumption that all unions do is negatively effect the productivity (Hyman, 1989; Kelloway, Cantano, & Carrol, 2000). A strong factor of negative impact is the noticeable change of attitudes occurring in employers towards the negotiations with unions (Cranston, 2000). Smaller business employers are now replacing full-time jobs with more casual or temporary job positions in an effort to reduce fixed costs. Casual employment has doubled to 20 per cent since 1982 and is still on the increase (George, 1997). Because most union benefits do not extend to casual or temporary employees, non-full-time workers may not find the need to join a union. Changes in the labour law and management practices have led a trend towards individualism and union exclusion (Waring, 1999 p291). Since this change, the number of industrial disputes has dropped to record low levels, and the nature of industrial action has become less dramatic. The growth of individualised employment has left little scope for now organization realize that unions need to be tackled by giving them less collective bargaining as they use It as an excuse to make the employees go against the management thus effecting the productivity (Guest & Hoque, 1996 p 25). Before the rise of individualised contracts, disputes were mostly handled by the unions and the employers. The union would organise activities such as strikes and lockouts in attempt to improve work pay and conditions. These types of extreme industrial actions are costly in both human and economic terms (Hyman, 1989; Leo, 2000). Now employees are cutting out the third party and engaging in non-union agreements directly with the employer. Another reason why unions have a negative impact is that they tend to hold strikes; these strikes are negative ways of expressing their dissatisfaction with the management. They have a negative impact both on the productivity as well as on the economic status. (Kelloway, Cantano, & Carrol, 2000 p165). Strike may be defined as a collective action which employees take against the management. This is an approach which trade unions usually use when they are involved in collective bargaining with an employer. Previously high levels of industrial strike actions have been due to the uncertainty nature of the workplace and high unemployment. These factors provoke employees to "join unions in the hope of greater job security" (Bodman, 1998 p18). Although strike actions have significantly decreased, it does not necessary mean that conflict between employers and employees have also reduced. Unions also tend to as Leo (2000) points out; there are other ways than to strike when reporting bad working conditions and pay. Industrial conflicts are increasingly being displayed in less dramatic individual forms such as absenteeism and sabotage. These more covert actions can also be costly and damaging to a company. Unions may also promote Absenteeism as a way to make the management listen to them can have a significant impact on the costs and the process of labor management. Although involuntary absenteeism is acceptable, high voluntary absenteeism is an indication of job dissatisfaction (Ewing & Sibley 2000 p65) Another way an employee can vent his/her dissatisfaction is through sabotaging the workplace. Sabotage can be in forms of stealing office stationeries to the more extreme of ruining office machineries (Wrigley 1997 p54). The later action cannot only be costly for the organization (in replacing the machinery), but can also harmful to the other employees. Trade union‘s indiscipline is a major cause of work place industrial strife. Bad attitudes such as lateness, failure to observe safety regulations etc will sometimes attract the wrath of Management and if not properly handled tend to distort relationships with the workers and their organization. Thus bad blood which is uncalled-for is exhibited in normal day-to-day consultations or negotiations between the parties (Yates 2009 p47). Also poor understanding of the Company's financial status as well as insensitivity of workers to Management's position leads workers to make unreasonable demands on the Company. Failure to meet such demands engenders unacceptable relations. Another negative behaviour on the part of trade union and their organization is terrorist bargaining (Martin & Ross 1999 p 15). Some workers will resort to unfair labour practices such as threats of strike actions, physical violence, kidnapping etc. These actions are sometimes due to mental laziness or unnecessary militancy of workers. Freeman and Medoff (1980) were the first to introduce the notion of two faces of unionism. The first face known as the Monopoly face (Freeman and Medoff 1980). In this side of trade unions fight against the management to raise the wages, they go to extremes which in turn also affect the productivity of the organization. Thus this also has harmful economic effects. Whilst it is recognised that unions may use their monopoly power to reduce productivity through the restrictive practices, it is argued that this in unlikely to be the case in competitive product markets as high labour cost and low productivity would result in business closure. Freeman and Medoff make the point that the monopoly effect is socially harmful. The second face is the notion of union voice, a good example of this could be strikes which too have a negative impact on the productivity of the organization as no employees in the organization are fulfilling their responsibilities due to the strike. Unions can have a negative impact by using their monopoly position to drive up wages and to introduce restrictive work practices that inhibit management's ability to introduce high performance work practices (Gill & Meyer 2008). Metcalf’s (1989) view that productivity is a result of the interaction between labour, management and government it is difficult to conclude that union presence alone lower productivity. If the industrial relations climate between management and unions is adversarial then it is likely that the output will be less than if it is cooperative. Furthermore, if the input quality of capital and/or labour is low then the output is likely to be low, either in terms of quantity or quality. Low productivity may be the fault of poor management policies and strategies and not the fault of the union. Positive Impacts Unions function to improve the wages, conditions and entitlements of their members (Flanagan etal 1993 p12). Other services that unions offer include; industrial legal assistance, superannuation advice, workers compensation advice, workplace health and safety advice, mortality insurance, personal accident insurance, secondary and tertiary assistance ballots, education courses in such areas; industrial relations courses, workplace health and safety courses, personal development courses and self-defense courses for women . And thus satisfied workers result in increase in productivity. A few major achievements that the unions have accomplished include, broadening the rights of workers to control their working life, having a dynamic role in influencing the stricture of the international market and improving wages along with the working conditions (Aldcroft& Oliver 2000 p23). Being a union member can have many advantages, one of which is the collective bargaining power unions have in the industrial marketplace (Oswald 1992 p 207). Employers have made many improvements in the workplace environment from the result of union pressure. These include improved safety in the workplace, longer annual leave entitlement, sick, maternity and paternity leave, equal pay for all employees, shorter hours in the working week and union representation in workplace issues. The monopoly model of union behavior is not supported in cases where unionization causes an industry to operate off its labor demand function. This outcome is important because, as previously stated, it would suggest that unions have a potentially smaller negative impact on employment and economic welfare (Swanson& Andrew 2007 p781) The evidence of Nickell, Whadwani and Wall (1989) and of Whadwani (1990) is important when considering the impact of unions on productivity. The conclusion that unions do not consistently or necessarily have a negative impact on productivity is indicative of the importance of what management and unions do together, with or without state intervention, rather than what they do as individual elements in the productivity equation. The view that unions have an impact on productivity appears to be established Trade Unions are basically pluralistic nature; it solves not only the problems between the employer and employee but also between the management and the union (Humphreys 2005 p45). Communication between the management and employee would be extremely difficult if there were no unions, unions have also communicate the needs of the workers to the management. This in away makes things easier for the management can then exactly pinpoint the reason as to why their employees are unsatisfied. Thin helps in building a healthy relationship between the two parties. Trade unions have an important role in improving communication between employees and managers so that employees can understand and be committed to the organization's objectives (Addison & Schnabel 2003 p12). They also have a vital role in mediating the required improvements of pay as well as working conditions so that employees don’t feel discontented with their jobs and stay longer in their jobs. Furthermore, Trade unions have an imperative role in encouraging companies to invest in training and development so that employers have the skills necessary for improved products and services and lifelong employment. Employees depend a lot on the third party like unions as they save them from individualised contracts. As they know that the growth of individualised employment will leave little scope for collective arrangements and assuming little need for collective bargaining (Guest & Hoque, 1996). Now when an employee has a complaint, he/she should discusses the issue with the trade union as they find them trust worthy the issue and resolve it rather than turning to managers for guidance. Having this type of employment relationship increases the likelihood of complaints from employees but at the same time, decreases the chances of a major conflict. And increases the chance for productivity Although complaints have increased, it can be generally said that employers are working towards satisfying each employee through the unions and a bottom-up approach (Bacal, 2004; Frenkel, 2002) Voice given to employees due to trade unions is commonly viewed as the key ingredient in the creation of organizational commitment. The notion of 'fair and independent voice’ tend to be associated with the presence of a renowned union and trade union representation on an official joint counselling committee (Dundon etal 2004 p1149). Voice' mechanism in the organization and its workforce has both a positive and negative effects on the productivity. It can be said that the above mentioned , participation may result in a favourable impact on quality as well as productivity while on the other hand it could make matter worse when it is wrongly represented. Trade unions are usually considered as the most appropriate people for providing voice to the employees as they are independent and not loose hope under any circumstances. Trade unions are very beneficial organizations that provide negotiation as well as representation in the workplace. Trade unions major objective is to negotiate with the employer a written agreement covering both employment conditions and the union-management relationship on terms that are acceptable to the union (Callinicos p56). Both employers and union representatives most agree and live up to the terms in the agreement. The agreement is obtained through the means of collective bargaining. Collective bargaining is most commonly an organized procedure in which the problem related to employee, employer, and union problems are discussed rationally and settled on the basis of facts (Wood 1996 p49). The problems are usually discussed by employers and union representatives. Unions use the collective bargaining sessions to establish and maintain wage rates, hours and working conditions. The agreements are used to prevent strikes as well as lockouts, and to ensure settlement of all grievances, disputes, or differences that may arise. Conclusion Trade unions have always been apart of the employee employer relationship. These unions tend to have both negative and positive impact on the productivity of an organization. However it can be noted that the strike they hold to put forward their message has and negative effect on their productivity. Therefore, we must firstly consider what it is that we must evolve with. It is not only the economic climate which the organization must consider, but also societal values. In order for unionism to achieve a set of common goals, there must be some unification as to what these goals are! Secondly, they must endeavour to clearly identify not only obstacles and challenges which the union sets forth, but also the positive points of having a union in their organization. It would be utterly impossible to eliminate trade union’s very existence so long as there are people who support and are willing to join union. It can be concluded that trade unions have devoted resources and energy to reshaping its outlook and structure in many areas to increase membership thus they have a negative as well as positive impact on the productivity of the organization. References Addison T. John and Schnabel Claus (2003); International Handbook of Trade Unions Edward Elgar Publishing Ltd p12 Aldcroft H. Derek and Oliver J. Michael (2000);Trade Unions in the Modern World (Modern Economic & Social History) Ashgate pp 10-23 Analoui, E, Kakabadse, A. (1991). Sabotage. Mercury, London. Bacharach, SB, Bamberger, p 10-15 Bacal, R. (2004). Organizational Conflict- The Good, the Bad and the Ugly. 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