1

Employee Relationship
Management
2
LEARNING OBJECTIVES

The objectives of this course are for

students to learn :
 The basic concepts relating to ER/ IR
and HRM
 The role of TUs and collective
bargaining.
 Understand Industrial disputes and its
settlement machinery.
 The role of government and its
functions
 Positive employee relations’ approaches
such as CP, QWL, WPM etc.
3
COURSE CONTENT

The Importance of Studying IR, Human

Resource Management and ER.
 Why is it important to study Industrial
Relations, Human Resource Management
and Employment Relations?
 What relevance does it have on our daily
lives as employees? Issues such as income
of the household, living wage, affects on
family life, education and health, working
conditions, retirement age, etc.
4
COURSE CONTENT

Workers Associations (Trade Unions)

 When and where did they emerge first?
 Why employees form unions
 Types of Unions
 Trade Unions Act
 Union Subscription and various aspects
5
STUDENT PRESENTATIONS

 Each student has to give two presentations.

 One would be group presentation on topics:
 INTUC, AITUC, CITU, BMS & Multiplicity of
unions.
 Second presentation will be individual
presentation on topics relating to the below with
respect to your SIP organizations:
 Career Planning, IR issues such as Trade
unionism, industrial disputes, grievance
handling and discipline issues, quality of W/L
and worker participation issues
6
SIX NEXT PRACTICES IN HR
By C.Mahalingam (Exec-VP and CPO, Symphony Services Corp.)

1. From Employer Branding to employee advocacy

2. From Workforce Management to talent management

3. From Performance management to contribution Management

by maximizing strengths

4. From Individual Competencies to organizational capabilities

for strategic advantage

5. From The Process of employee engagement to the outcome

of employee effectiveness

6. From Leadership Bench to Leadership brand

Source: The Human Factor, July 2009, pg-62-64

7 THE IMPORTANCE OF STUDYING INDUSTRIAL
RELATIONS, HUMAN RESOURCE MANAGEMENT
AND EMPLOYMENT RELATIONS.

 It affects our everyday life.

 It affects the company- whether the company
makes profit or goes bankrupt.
 Workers-
 how much they earn and feed their family, income
of the household, living wage, students education
(how much your parents can pay for your fees) and
health, retirement age, etc.
 what conditions are they working under.
 WHAT IS MEANT BY
8
EMPLOYMENT RELATIONS
(ER)?

 It is combination of Industrial
Relations (IR) and Human
Resource Management (HRM)
 It is a much wider concept to
encompass both IR and HRM
9
STRATEGIC IMPORTANCE OF
EMPLOYEE RELATIONS

• Improve productivity & ensure implementation

of organizational strategies
• Reduce employment costs and help employees
grow and develop
10
FIVE KEY DIMENSIONS OF EMPLOYEE
RELATIONS

Employee
Development

Employee Good Employee Employee

Rights Relations Communication

Employee Employee
Discipline Counseling
11

Open-Door Policy

A policy of encouraging employees to come

to higher management with any concerns.
WHAT IS INDUSTRIAL
RELATIONS?
13
WHAT IS INDUSTRIAL RELATIONS?

 Definition important—setting the scope of study.

 Many attempts at definition:
 from job regulation to social relations at work.
 Challenges to the discipline:
 rise of non-unionism
 growth of human resource management (HRM)
 A broad definition:
‘Industrial relations encompasses a set of phenomena,
both inside and outside the workplace, concern with
determining and regulating employment relationship’
14 WHAT IS INDUSTRIAL
RELATIONS ?

 An act or art of controlling

human resources in employment.
 Also referred as human relations,
labour relations, legal relations
etc.
 Essentially : human relations –
adjustment between humans.
 Two inseparable limbs.
 Interest apparently conflict but
complimentary.
 WHAT IS INDUSTRIAL
15
RELATIONS? (CONT.)

IR Covers:
 Collective Bargaining
 Role of management, Unions and
govt.
 Industrial disputes and resolution
 Grievances and discipline
 Labour legislation
16
HISTORY OF INDUSTRIAL
RELATIONS CONCEPT
 Roots go back to Industrial revolution of late 18th and
early 19th century.
 Before that the greater share of economic activity was
in agricultural sector
 Impact of Industrial revolution:
 Mechanizations
 Mass production at low cost
 Specialization of functions
 Higher capital requirements
 Evolution of entrepreneurial elite
 Unhygienic, harsh working and living conditions
 Increased mobility of workers
17 Human being pivot of this relationship:

1. Broad drives in human nature : dignity, conscious of

rights
2. Complex emotions in success.
3. Instincts of survival, security.
4. Social instincts :
 Wants to join others to secure common interests.
 Team work.
 When these are satisfied, he is happy, Cooperative and
productive.
OTHERWISE :
 Morose,
 Aggrieved,
 Bitter/ Violent
18
DIFFERENCE BETWEEN TRADITIONAL
IR AND EMERGING ER
Dimension Traditional Emerging
Nature of relations Pluralist Unitarist

Contract Emphasis on terms Beyond contract,

of contract, defined innovative ways
rules, contract

Union legitimacy Unions are Not considered

acceptable desirable
Key relation Labour Customer focus
Management
Pay Standardised Performance
related
Job design Division of labour Team work
Conflict handling Reactive Proactive
Key people PM/ IR specialists Line people
 DIFFERENT APPROACHES TO THE
20
STUDY OF IR

 There are three distinct ideological

perspectives to origins and nature of
industrial relations, each leading to a distinct
approach/analytical tool to explain industrial
relations:
1. Unitary Approach
2. Pluralist Approach,
3. Marxist Approach
 APPROACHES TO INDUSTRIAL
21
RELATIONS
Approaches to organizations

Unitary Pluralistic Marxist

Approaches to industrial relations

Input Conversion Output

Institutions
Conflict and Regulation
(differences) processes (rules)

Human Control of
resource the labour
management process
Systems
22
Unitary Approach

 What is the unitary perspective?

– Assumption of a common purpose and
shared goals, with no fundamental conflict
of interest between labour and capital.
– Conflict is an aberration, the result of:
 poor communications
 poor management.
 Unions are seen as an unwelcome intrusion:
 Role for strong management.
23
UNITARISM

 Assumptions about workplace relations

- management and employees share common interest
- one source of legitimate authority (management)
 Assumptions about workplace conflict
- aberration, destructive, to be avoided
- caused by poor management, dissidents, agitators or
poor communication
 Assumptions about trade unions
- a competing with management for employee loyalty.
- an unwarranted intrusion in the workplace
- create conflict where none would otherwise exist
 Assumptions about collective bargaining
- creates and institutionalises unnecessary divisions of
interest
- serves to generate workplace conflict rather than
resolve it
24
Unitary Approach (cont.)

 What are the criticisms of unitarism?

– A narrow approach that neglects causes of
conflict.

– Fails to explain the prevalence of conflict within

organisations.
– Does not account for uneven distribution of power
among employees and employers in the decision-
making process.
25 A unitarist perspective: HRM (cont.)
The analytical tools of HRM

 HRM is the modern form that a unitarist approach

to IR typically takes, that is:
– the management of the employment
relationship primarily from the perspective of
the employer.
 This can be seen in the main focuses of HRM:
– plan human-resource requirements
– recruit and select employees
– train and manage employee performance
– reward employees
– dismiss or retire employees.
26
A unitarist perspective: HRM (cont.)
The analytical tools of HRM (cont.)

 The two main schools within the HRM approach are:

1. ‘soft’ HRM—‘developmental humanism’
2. ‘hard’ HRM—instrumental integration of employees
into firm objectives.
 ‘Best practice’ approach vs ‘contingency’ approach.
27
PLURALISM
 First, what is the pluralist perspective?
– Conflict is inevitable: competing interests
between the parties.
– Power is diffused among the main
bargaining groups within the employment
relationship: no-one dominates.
– Trade unions are viewed as providing a
mechanism that legitimates employees’
rights to bargain within the workplace.
– The state is regarded as an impartial entity,
whose primary function is to protect the
‘public interest’.
28 PLURALIST

 Assumptions about workplace relations

- managers and employees have different objectives
- multiple sources of legitimate authority
 Assumptions about workplace conflict
- inevitable, caused by different opinions and values, benefit to an organisation
- avoid by accepting trade unions, include in decision-making
 Assumptions about the workplace role of trade unions
- not the cause of conflict
- are expression of diverse workplace interests that always exist
- a legitimate part of workplace relations
 Assumptions about the role of collective bargaining
- deals with problems on a collective basis
- most efficient means for institutionalising employment rules
- fairer outcomes by balancing employee and management power
29
PLURALISM (CONT.)

 What are the criticisms of pluralism?

– Theory of pluralism is unclear.
– Power is not evenly diffused:
 it is typically weighted towards
management in the workplace.
 pluralist thinking lends itself to the conclusion
that there is a simple and straightforward set of
processes that resolve conflict, and that conflict
can be readily managed through rules,
regulations and processes.
30
MARXIST APPROACH/ RADICAL
PERSPECTIVE

 What are the common features of Marxist perspectives?

– Fundamental and inherent conflicting interests between

management and workers.

– Uneven distribution of power between bargaining groups,

within the workplace because of division within society.

– Industrial conflict is thus synonymous with political and

social unrest

– The role of trade unions—to challenge managerial control.

– The state protects the interests of capitalists.

31
MARXIST APPROACH/ RADICAL
PERSPECTIVE

– Trade unions are seen both as labour

reaction to exploitation, as well as a weapon
to bring about a revolutionary social change.
– Marxists regard state interventions via
legislation and the creation of Industrial
tribunals as supporting management’s
interest.
– Consequently, employee participation, co-
operative work culture and the like are not
acceptable to the Marxists.
32
A MARXIST PERSPECTIVE:
MARXISTISM (CONT.)

 What are the criticisms of a Marxist

perspective?
 Preoccupied with conflict:
 obscures any cooperation or shared goals
between management and workers.
 Capital is not homogenous:
 competition among capitalists.
 Under-estimates the independence of the state.
33 MARXIST

 Assumptions about workplace relations

 - reflects a wider class conflict between capital and labour
 - reflects coercion of working class into dominant capitalist values
  Assumptions about workplace conflict
 - inevitable: capital seeks to reduce costs, workers seek fairer price for labour
 - will only cease by revolutionary change in distribution of property and wealth
  Assumptions about trade unions
 - should raise revolutionary consciousness of workers
 - should not limit action to improving material lot of workers
- union leaders who accommodate management betray the workers
  Assumptions about collective bargaining
 - merely offers temporary accommodations
 - leaves important managerial powers in tact
 A MARXIST PERSPECTIVE:
34
THE LABOUR PROCESS (CONT.)

CLASS STRUGGLE AND CONTROL IN THE LABOUR

PROCESS
 Marx argued that capital social relations are based on
a fundamental divide between the Haves and the
have nots
 Labour possesses labour power—the potential effort
that each employee offers.
 Potential labour does not always equal actual labour.
 Management’s task is to convert this labour power
into actual work and effort, in order to make a profit.
 A MARXIST PERSPECTIVE:
35
THE LABOUR PROCESS (CONT.)

CLASS STRUGGLE AND CONTROL IN THE LABOUR

PROCESS....

 This gives rise to the central theme within the labour-

process approach: How does management maximise the
conversion of ‘potential’ labour into ‘actual’ labour?
 Labour is not always compliant in this process, resulting
in conflict between management and labour.
 As this relationship is open-ended, management seeks
to establish methods for ensuring control, to maximise
‘actual’ labour effort.
36 THEORIES OF INDUSTRIAL RELATIONS (1)

Human Relations Theory and Neo-Human Relations Theories

 Key proponents: Mayo, Maslow, McGregor, Herzberg
 Frame of reference: Unitarist
  Focus: Workers’ social and psychological needs
  Theory: a system of management, maximise output by meeting
social and psychological needs of employees in the workplace.
(i)   managers identify and satisfy employees’ social and
psychological needs
(ii)  employees seen as different to other production resources
(iii)  employees organised into teams
(iv) employees included in work allocation decision-making
processes
 Result: worker morale maximised, motivated employees productive.
 Neo-Human Relations theories add individual satisfaction and
motivation is through worker ‘self actualisation’ by ‘hierarchy of
needs’
 THEORIES OF INDUSTRIAL RELATIONS (2)
37

Systems Theory
  Key proponent: Dunlop
  Frame of reference: Pluralist
  Focus: a general theory of industrial relations
  Theory: industrial relations is a sub-system of wider society
with four elements:
(i)   actors: employers, employees, their representatives,
government agencies
(ii)  environmental contexts: technology, market, budgets,
distribution of power
(iii)  procedural and substantive rules governing the actors
(iv)  binding ideology, common beliefs encouraging actors
to compromise
38
THEORIES OF INDUSTRIAL RELATIONS (3)

Labour Process Theory

 Key proponent: Braverman
 Frame of reference: Marxist
 Focus: Labour’s relationship with industrial processes
 Theory: improved technology and scientific management
techniques are
 (i) de-skilling work
 (ii) fragmenting tasks
 (iii) centralising knowledge in management
 (iv) diminishing workers control of pace and conduct of work
 Result: labour is increasingly alienated and exploited,
leading to resistance by organised and unorganised
industrial conflict.
39 THEORIES OF INDUSTRIAL RELATIONS (5)

Scientific Management
 Key proponent: Taylor
 Frame of reference: Unitarist
 Focus: Use and control of labour
 Reference to industrial relations: Implicit
 Theory: system of management maximising output by greatest technical
efficiency of work methods, achieved by:
(i) unchallenged management powers to allocate work tasks
(ii) managers relationship with employees is rational and objective
(iii) managers treat workers impersonally and collectively
(iv) work tasks reduced to basics for low-skilled, low-paid
employees in assembly line production
(v) employees are chosen to suits the tasks to be performed
(vi) employees given training in best work methods
(vii) employees motivated by incentive payment schemes
40
THEORIES OF INDUSTRIAL RELATIONS (4)

Trusteeship theory
 Key proponent: Mahatma Gandhi
 Focus: non-violent industrial relations
 Theory: He insisted on recognizing each individual as a
human being. Believed in non-violent means. Laid down
rules for strike:
 The cause of strike must be just, not without grievance
 There should be no violence
 Non-strikers should never be molested.
 According to him, employees should regard themselves as
trustees or co-owners and employees should also regard
themselves as trustees and protect the mill and machinery and
put them to better use.
41
THREE PARTIES OF IR
 ‘Employer’ (Management)
 ‘Workers/Employees’ (Trade Unions)
 The ‘State’ (Government). State plays 2 roles:
 Employer of Civil Servants
 Supposedly a neutral body/third party???
 Does industrial harmony between the three actors can be
easily achieve particularly between employees and
management?.
 To moderate their conflict, the interference of the
government is crucial. Government influence the
relationship by introducing rules and regulations and some
code of industrial harmony.
42
SUMMARY
 The approaches to industrial relations highlights
conflict between trade unions and employers:
– Need to move beyond this limited view.
– Theory provides a guide to understanding the
relationship between the parties in the
employment relationship.
 Three types of theories are introduced in this
chapter:
– pluralist/neo-institutionalist
– unitarist/HRM
– Marxist/labour-process theory.