Chapter 22
Industrial Relations
Recap of Previous Lecture
• Types of separations
• Principles of Transfers
• Principles of Promotions
Separation
•
Leaving of organization by employee is called separation
•
Reasons: Voluntarily or Involuntarily
Reasons of
Separation
Voluntary
• Quits
• Retirement
Involuntary
•
•
•
•
•
Discharges
Layoffs
Retrenchment
VRS
Rightsizing
(restructuring)
Guidelines to Manage Downsizing
• Decision to who stays and who leaves
• Delay and pay hikes
• Freeze hiring
• Restrict overtime
• Retrain or redeploy employees
• Engage part time employees
Adopted from: Aswathappa. Human Resource Management,
• Switch to job sharing
Text and Cases, 2008, Pp. 516-52133
• Across the board pay cuts
• Early retirement schemes
• Keep morale of working employees
Lecture Overview
• Nature of IR
• Need for good relationship between management and workers
• Approaches to Industrial Relations
• Stakes of parties
• Proactive strategy to IR
• Role of HR department
Nature of IR
Industrial Relations: “Concerned with the relationship between
management and workers and role of regulatory mechanism to
resolve disputes between employer and workers”
“IR is concerned with the system, rules and procedures used by
unions and employers to determine the reward for effort and other
conditions of employment to protect the interests of the employed
and their employers, and to regulate ways in which employers
treat their employees”
(p. 534)
Nature of IR
• IR covers
1) Collective bargaining
2) Role of management, unions and government
3) Mechanism of resolving disputes
4) Grievances and disciplinary policy and practices
5) Labour legislation
6) Industrial relation training
Importance of IR
• Moral dimension
• IR protect right of managers
• Handling disciplinary proceedings
• Fairness in practices and working relations
Approaches To IR
Unitary approach
Pluralistic approach
Marxist approach
Industrial Relations
Approaches To IR
Unitary Approach
• Based on mutual cooperation, individual treatment, shared
goals and team work
• Everyone gains when there is common interest and goals and
promotion of harmony
• Conflict is destructive and unnecessary
• Direct negotiations with employees
• No need to involve government, and unions to resolve conflict
Approaches To IR
Pluralistic Approach
• There is competing interests, management’s role is to act as
mediator amongst competing interests groups
• Trade unions are representative of employee interests
• Concessions and compromised between management and
unions
• Conflict between management and union is good for productive
work environment and innovation
• Unions balance interest of employees and employer
• Government interferes in form of regulations to protect the
right of society and employees
• Crux: Conflict is inevitable and needs to be contained with in
the social mechanism of conciliation, collective bargaining, and
arbitration
Approaches To IR
Marxist Approach
• Conflict is inevitable but it is because of capitalist society
• Conflict is not because of competing interests of employees
and management but division with in society between people
who own resources and people who offer labour
• Industrial conflict is because of social and political unrest
• Trade unions are forum to react to capitalism exploitation and
bring social revolution
• Trade unions make employees (labour) position more strong in
capitalistic society
• All strikes are legitimate, fair and political
• Regard state interventions through legislation is to protect the
owners
Parties to IR
Employers
Employees
Employees
Association
Government
Employeremployee relations
Employers
Associations
Courts and
Tribunal
IR Strategy
1) Reactive Strategy
Resolve conflict when it arises and reach to uncontrollable level
2) Proactive Strategy
Follow forward looking and well planned strategy to deal with IR
Four main components of proactive IR strategy
i) Communication
ii) Relationships
iii) Competence
iv) Discipline and Conflict
Factors Affecting Employee Relationship Strategy
Internal Factors
1.
2.
3.
4.
5.
The attitude of management to unions and employees
The attitude of employees and unions to management
The attitude of employees to unions
The strength of unions
The extent to which agreed and effective procedures and rules
exist within company to resolve disputes and handle disciplinary
matters
6. The competence of managers to deal with employees issues
External
1. Strength and effectiveness of employers’ associations
2. The pay and employment situations at local and national level
3. The legal framework in which IR operates
Role of HR Department in IR
• Motivated and competent workforce is responsibility of HR
• Through effective recruitment, work conditions, job designs, safety
and health environment, training and compensation HR department
satisfies employee and organization needs
• Through these efforts it contributes to quality of life of workers
• Workers with better quality of life less likely to resist, involve in
disputes and go on strikes
Summary
• Nature of IR
• Need for good relationship between management and workers
• Approaches to Industrial Relations
•
Role of HR department
• Stakes of parties
• Proactive strategy to IR
• Role of HR department
Chapter 23
Trade Unions
Lecture Overview
• Nature of Trade Unions
• Why employees join unions
• Factors leading to unionization
•
Role of HR department
• Union tactics
• Tactics to remain union free
Trade Unions
“Unions are volunteer organizations of workers or employers
formed to promote and protect the interests through collective
actions”
(p, 549)
Definition of Unions include
1. Combination of workers or employers
2. Could be permanent or temporary
3. Regulate relationships among workers,
employers or among employers
Strategic Choices before managers
1. Allow unions or remain union free
2. If want to remain union free then what to do?
3. If allow unions what type of relationships want?
4. Tactics to negotiate with unions
workers
and
Why Employees Join Unions
1. To protect against exploitation
2. Dissatisfaction (psychological contract)
3. Lack of power
4. Union Instrumentality
Factors Leading to Unionization
Personality, interests, and
preferences
Expectations that work will fulfill
personality, interests, and
preferences i) employment
contract ii) psychological contract
Satisfaction
Work situation
Dissatisfaction with work situations
Influence of
management
Attempt to
resolve situation
independently
Union instrumentality
Unionization
Adopted from: Aswathappa. Human Resource Management, Text and Cases, 2008, p. 552
Strategic Choices for Unions
1.
Bread and Butter vs Political objectives
2.
Adversarial vs Cooperative Role
3.
Traditional issues vs New Services
Union Tactics
1.
Organizing drive
2.
Strike
3.
Political patronage
4.
Blackmail
Tactics to Remain Union Free
Effective first line
supervisors
Effective personnel
planning and selection
Effective training and
development
Open
communication
Effective personnel
research
Union
free
Healthy and safe work
environment
Effective
remuneration
Effective employer and
employee relationship
Adopted from: Aswathappa. Human Resource Management, Text and Cases, 2008, p. 561
HR practices and Unions
HR practices negate the existence of unions because of following
reasons
•
•
•
HR seeks employee relationships on individual basis (Pay and
performance)
HR attempts for socialization of workforce means harmony
amongst workers and between management and workers,
emphasize authority of management
Training programs attempts
management attitude
to
•
Team based work environment
•
Merit based selection and promotion
bring
loyalty
and
pro