Employee Relations with Regard to Local, National, and International Contexts - Essay Example

Employee Relations Introduction: The concept to employment is inevitable for human condition and ascertains the manner in which individuals lead their lives. The various types of professions and employment in turn provide an insight into the manner in which societies perceive and derive their sense of identity. The allocation and utilization of human resources, the organizational structures as well as that of management, the system of rewards or payments etc ascertain the relevance and role of gainful employment and indicate the level and extent of tolerance the society displays towards the concept of employment. It also helps in identifying and assessing the various levels of employment and help define the nature and scope of relationship between the employees and employers; the social and moral values upheld by the societies; and provide guidance with regard to approaching and addressing employee disputes and grievances within and across industries. The fact that laws and regulations governing employment are implemented as a reaction to the existing social and moral values as well as the existing social, cultural, political, economic, and technological circumstances existing within a given community, state or nation. The study of employee relations hence helps in understanding and exploring the concept in a comprehensive manner and provides an insight into the factors that shape our views towards employment, employee relations, and work in general. This essay aims to explore the concept of employee relations with regard to local, national and international contexts; and the factors that influence the existing norms and in the process provide a meaningful discussion regarding the historical origins, definitions, and theoretical perspectives aided by relevant case studies to help support and substantiate the claims made. Employee Relations: Definitions The concept of employee relations was introduced as a replacement to the term industrial relations (CIPD, 2013). Industrial relations refer to the relationship between employers and employees within an industry. Employee relations on the other hand cover a broader spectrum of this relationship and include the relationship between employers and trade unions, other representatives of the employees, as well as officials (Armstrong, 2010). The term employee relations have been defined differently by different authors over the years. Some of the most common and prominent definitions are discussed below: Rose (2008) defines employment relations as: "The study of the regulation of the employment relationship between employer and employee, both collectively and individually, and the determination of both substantive and procedural issues at industrial, organisational and workplace levels". According to Edwards (2009) "The employment relationship is about organizing human resources in the light of the productive aims of the firm but also aims of employees. It is necessarily open-ended, uncertain, and … a blend of inherently contradictory principles concerning control and consent" (p. 4). Significant differences with regard to the definitions of employment relations have been observed between the American and British use of the term. Employment relations in the U.S. for instance lays special emphasis on the functional activities concerning HRM while describing the term and the resultant interactions which arise between the employer and the employees at various levels across the workplace (Beardwell and Holden, 1994). The UK definitions on the other hand encompass a wider scope which transcends the workplace and includes interactions not only between the employer and the employees but also those between the state, the employer associations as well as organized labour (Gennard and Judge, 2002). ER Perspectives: The employment relationship can be categorized into three distinct perspectives i.e. unitarism, pluralism, and radical perspective. Unitarism: According to this model / perspective the relationship between the employer and employee is defined by a shared / common goal or interest. The unitarist perspective presumes the existence of commonality of interests between the management and labour. It acknowledges the inherent conflict between the two parties and at the same time posits that such conflicts although inevitable, are highly unnecessary and undesirable and can and must be avoided due to their shared goals and objectives (Kaufman and Taras, 2000: p. 178). Pluralism: This perspective assumes and acknowledges the existence of conflict between the employee and the employer and attributes it to the diverse groups existing within an organization thus entailing that conflicting opinions and perspectives are inevitable. The diversity in social groups is highly inevitable in contemporary workplaces and is often conflicting in nature since the interests and views of people differ greatly leading to industrial conflicts within organizations (Gardner and Palmer, 1997). Radical perspective: The radical perspective includes a broader and more comprehensive view of the relationship between employer and employee, as compared to the unitarist or pluralist persepective. This approach studies the concept of employment as a part of a larger economic framework thus entailing that there are bound to be cycles of accumulation and crises in a capitalist economy whereby various issues are encountred by an organization with regard to the demand and supply for capital as well as labour which eventually leads to conflicts within an organization. Such conflicts in turn disrupt the power relations between the employer and the employee causing an imbalance in the process (Gilmore and Williams, 2012). Historical overview: Evolution of the concept of Employee Relations: The concept of industrial relation, which was eventually replaced by employee relation, was originally introduced by Britain which was the first country ever to establish formal rules and regulations to govern the relationship between employer and employees. Prior to the 1990s the concept of industrial relations was used to control and govern the conflicts encountered by the management with regard to issues such as wage disputes faced by the employers and for addressing the concerns and grievances of the workers / employees. It was used to regulate the industry in the face of growing competition which escalated due to drastic changes in the social, economic, political, cultural and technological fields. Furthermore there was a pressing need to govern the industry in the war ravaged economy which suffered greatly during the World Wars and the significant shift in the methods of production from labour intensive techniques of production to capital intensive ones (Gennard and Judge, 2005; Lind, Knudsen, and Jorgensen, 2004; Lewin, 2006). According to Etzioni (1995) employees in the past were engaged with or employed in organizations in drastically different ways as compared to that in present times, with varying degrees of intensity and approaches to the concept of employment. Employment in the past was highly concerned with compliance and authority whereby the employees were used to complying with the rules and regulations laid down by their respective organizations and the organizations in turn were perceived by them as some type of power-wielding authority figures which controlled the people employed by them as well as guided the type and nature of their involvement in the organization (p. 12). The concept of power or the sources of power used by employers in the past could be categorized into three different forms such as coercive, remunerative, and normative while the forms of involvement were categorized into three distinct categories i.e. alienative, calculative, and moral. According to Leat (2012) the concept of compliance has been redefined as a consequence of the various social, political, economic, and technological changes which took place in the external environment with the result that it is now perceived as a comparative descriptor of a type of attachment which is relatively less positive and intense as compared to the concept of commitment as used historically (p. 12). Patterns and processes of change in ER: Various legislations and regulations have been introduced over the years to safeguard the health and well being of the employees and in the process improve employment relations between the employer and employees and the management and labour. These include the Treaty of Paris which was introduced in the year 1952 and led to the creation of the European Coal and Steel Community helped immensely in improving the employment relations. The treaty promoted and emphasized on the need for improving the living as well as working conditions of coal and steel workers, an initiative which was revolutionary and highlighted the significance and relevance of a better work environment for the employees. This treaty was then followed by the introduction of the Treaty of Rome introduced in the year 1957 which led to the creation of the European Economic Community (EEC). This treaty played a key role in eliminating the barriers to the free movement of labour, capital, goods and services and encouraged and promoted the Free Movement of Workers Chapter thus abolishing the restrictive work practice trends dominant during that period. It granted the workers the right to choose their place of work and afforded them the right to engage in employment of their choice. Similar to the Treaty of Paris, this treaty too promoted better living conditions for the workers and the right to equal pay regardless of gender, thus eliminating gender discrimination at workplace (Marchington, Wilkinson, and Sargeant, 2002: p. 54). Human resources management (HRM) and the new industrial relations: The term Human Resource Management is now widely used by academicians and researchers to refer to a wide array of issues associated with policies and practices applied by modern corporate organizations for managing their employees (Kuper, 2003). The transformations taking place in the socio-economic sphere triggered off various critical changes in the employee relations. One of the major developments ever since the 1980s as a consequence of such changes in the external environment was the change in strategic and integrated approaches to managing employee relations. These changes were essentially based on the foundation of two pillars of employment relations i.e. employee commitment and shared interests within the workplace as opposed to the dominant ideology which existed prior to this period which entailed increased emphasis on managerial control and the consequent conflicting relationship between the employers and the employees (Farnham, 2000). Models of HRM: The concept of employee, personnel or human resource management has been described as different variants of people management. Different countries have adopted different approaches or models of managing their human resources as a means of enhancing their employee relations. Countries such as UK, Ireland, New Zealand and Australia for instance are known to lay greater emphasis on the soft models of HRM which predominantly include the matching model and the Harvard model (Price, 2011). The matching model of HRM This model was introduced by Fombrun et al., (1984) to refer to the organizational approach whereby the employees are included as a part of its larger corporate strategy and scheme (Kuper, 2003). This model stresses on the significance and relevance of effective utilization of human resources as a means of successfully accomplishing the objectives of the organization. Effective utilization of human resources entails acquiring it at lower costs and exploiting it fully to obtain best possible bargain. The model was influenced by the argument put forward by Chandler (1962) which states that the structure of an organization reflects its corporate strategy. Fombrun (1984) on the other hand emphasises on the significance of achieving a best fit between the organizational objective and the human resources hired to achieve those objectives. The Harvard model The Harvard model addresses four key strategic aspects of the corporate organization which includes human resource flow structure, the corporate work systems, the employee reward systems as well as employee influence. This strategic model of HRM emphasizes the manner in which the top management aims at utilizing / exploiting the available human resources with a view to enhance their performance and productivity. This model was first introduced by Beer et al., (1984) and differs significantly from the matching model of HRM in the sense that as compared to that model, the Harvard model stresses on the human aspect of HRM and is more concerned with assessing, exploring, and improving the relationship between the employee and the employer by introducing various strategies and policies within the workplace (Storey, 1992; Truss et al., 1997; Legge, 1995). The shift of power and authority as a consequence of shift in the external environment eventually resulted in transformation in the workplace which redefined the power relations between the employer and the employee. Research suggests that post the 1980s the change in employee relations emphasized the shift in management approaches towards their employees whereby the concept of control to commitment was replaced by commitment to employees which in turn was aimed at achieving corporate success (Walton, 1985). It has been observed that the transformations within the field of employment and the corresponding initiatives in the field of human resource management in the UK originated in larger organizations and particularly so within the corporate sector where the market segmentation and competition was relatively fierce due to changes in technology and the corresponding changes in the market structure (Storey, 1989; Storey, 1992; Sissons, 1998). The nature of HRM and the corresponding changes applied within the field of employment relations were far more evident during the 1990s in the UK in large corporate organizations. According to studies almost 63 per cent of organizations surveyed in the UK reported to have special departments dedicated to look after and supervise the well being and ensure smooth functioning of their personnel. Special departments headed by HR directors were created with the sole objective of managing and assisting the employees and resolving their grievances (Price Waterhouse Cranfield, 1990). Theoretical frameworks: ER perspectives and job regulation: This section includes a detailed discussion of the various theories of employee relations such as the mobilization theory, Employee Engagement thoeries, Social exchange theory etc. Mobilisation Theory: This theory was introduced by John Kelly (1998) to explore the relationship between union action and the member participation and is one of the most dominant theories in the field of labour relations. It is regarded as highly influential (Heery, 2005) since it offers a fair account of the manner in which individuals unite together willingly to contribute towards the collective goals and objectives of the organization and at times against the employers (Kelly, 1998). This theory argues that the very concept of collective organization and collective activity of employees is a consequence of actions initiated by the employers which in turn leads to the development of a sense of injustice and / or illegitimacy among the employees causing them to unite and revolt against the employers (Kelly, 1998: p. 44). The theory emphasizes on the concerns and grievances of employees with regard to issues such as low wages, long work hours, or issues related to workplace environment due to organizational change. In a recent case, hundreds of American employees employed in a fast food organization planned a strike against low wages. This planned strike was estimated to be the largest ever action initiated by employees against a corporation to revolt against an industry which is notorious for its low-wage policy. The workers from at least 70 restaurant chains in and around New York including those from McDonalds, Wendys and Burger King gathered together to press for higher wages and the right to organize without the threat of retaliation or facing serious consequences (The Guardian, 2013). Social exchange theory: The social exchange theory posits that employee share various social exchange relations with their immediate superiors as well as colleagues within the organization and these relations help in forming bonds of justice and trust among the employees. The theory further states that the feelings of justice and trust among employees is paramount for organizational success since the lack of interactional justice is highly likely to influence the supervisory trust and hence negatively affect the relationship between the employees and the employer (Arnold, 2009). Increased employee trust in the organization or in the managers / supervisors, on the other hand, significantly benefit the organizations since employees feel highly motivated to achieve the corporate goals and enhance their performance in the process to achieve the desired targets. It leads to creation of a healthy workplace environment and improves the relationship between employee and employer. Hence organizations today emphasize on building positive relationships by way of introducing novel strategies to ensure and enhance employee trust in the management. Various social policy directives such as Pregnant Workers Directive (1992), Working Time Directive (1993); Directive on Parental Leave (1996) or the Directive on Burden of Proof in Cases of Sexual Discrimination (1997) etc introduced and implemented in organizations across UK have played a significant role in improving employee trust in the management and build positive corporate relationships in the process. Implications of globalisations for ER processes and outcomes Current scenario: Contemporary globalization is one of the most defining periods of our time marked by dramatic economic, technological, and political changes and significantly impacting the field of Human Resource Management and employee relations in the process. Corporate activities have assumed giant proportions and are becoming more and more global in their approach. The management today is faced with challenging issues such as dealing with employment laws and regulations in not only their own countries but in countries across the globe. In such an economic sphere the issues related to employee relations and management are bound to occur in magnified proportions. The ability of organizations to spread across diverse geographical locations and its propensity to relocate has resulted in the simultaneous weakening of its collective capacity. The decentralization and localization of collective bargaining arrangement has become the dominant and a highly powerful feature of present times. Such changes have resulted in the use of downward pressure by employers to negotiate wages in local markets i.e. set up branches and factories in low-cost countries and exploit the benefits of cheap labour resulting in uneven development of employment opportunities and the emergence of a whole new working class. The workers in contemporary economic and political environment have sought to rebuild their organizational bases by forming of trade unions in a bid to use politics of scale and resist dominance and control by employers (Ackers and Wilkinson, 2003: p. 185). Future implications: The changing global climate which has brought about significant changes in the field of ER has far reaching consequences on the relationship between the employer and the employee as well as on the society as whole. There is a clear shift in the social values which in turn has impacted the manner in which employment relations are defined and interpreted. The wide cultural diversity at workplace has enabled employees to seek equality and safeguard themselves against discrimination. Various laws have been put into place to ensure and minimize employee discrimination on various grounds including age, gender, sexual orientation, disability, or race. Such changes are likely to improve the content of work, labour practices, as well performance of employees leading to revolutionary changes in the industrial relations in the years to come. Conclusion: A critical discussion of the concept of employee relations as well as human resource management highlights the existence of a paradox of consequences arising out of the rapidly changing and evolving organizational structures in the post globalized world. The power relations and dynamics between employee, employers, trade unions, and other officials have undergone significant changes over the years accelerated by globalization and the resulting changes in the economic, political, social, and technological spheres. The Western economies are being constantly transformed due to the combined forces of various drivers of change resulting in creation of a highly dynamic and decentralized society structure which holds more power over the contemporary organizations than ever before. Managers today are observed to be struggling against such forces to regain control of the employment relations by adopting and implementing a diverse range of approaches and leadership styles thus resulting in an increased emphasis on the singificance of organizational life. References: Ackers, P., Wilkinson, A., (2003). Understanding work and employment: Industrial reltions in transition. London, UK: Oxford University Press. Armstrong, M., (2010). 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