Employee Relations AC219

1
Employee Relations AC219

• Lecture 4 Actors in Employee Relations
• Management and Managing Employee Relations

2
The Journey So Far?

• Employment relationship
• Perspectives on this Unitarist, Pluralist,
  Radical
• Changing Contexts how these impact on
  employment relationship
• How these are seen through the lens of frames of
  reference
• Implications for Management, Employees and Trade
  Unions, the State

3
Management

• What are management concerns in employee
  relations?
• Output
• Productivity
• Labour costs
• Quality and continuous improvement
• Continuity of production/service
• And how to secure these?

4
Management

• Some options
• Management unilateral decision-making
• Joint decision-making (with trade unions)
• Joint decision-making (with employee reps)
• Consultation with trade unions/employees

5
Managerial Prerogative

• Managerial prerogative
• The employers right to direct and allocate work
  central to discussion of limits to managerial
  control and authority
• Much interest in the limits placed on the scope
  and exercise of this formally and informally
• - By the State through legislation
• - By employees and trade unions through
  challenges to managerial authority and through
  CP
• - By management in opening up specific areas to
  joint decision-making (e.g pay, hours)

6
Managerial Prerogative

• Scope and exercise of managerial prerogative
  varies greatly across countries
• Managements right to manage
• More established in Britain and America than
  elsewhere ideology very strong (Poole and
  Mansfield 1993, 2001)
• Explains continuing significance of union
  recognition of management acceding to union
  involvement as an issue in Anglo-American
  employee relations

7
Managerial Prerogative

• In contrast
• Concept of partnership and joint decision-making
  more embedded in large areas of mainland Europe
• In Europe, limited support for idea that
  management can manage the employment relationship
  without sharing decision-making in some areas

8
Managerial Prerogative

• Important ideological differences about role of
  management in employee relations
• Links to broader socio-legal and institutional
  contexts - systems of corporate governance how
  organisations are owned and controlled
• These reflect and feed into differences in
  management cultures
• BUT
• Management not homogeneous considerable
  diversity within management in the same
  organisation, same industry and same country

9
Management and Employee Rels

• Management in British employee relations
• Unscientific management (Hyman 2003)
  pragmatic management and a lack of professional
  management of personnel/IR until 1970s and beyond
• Historic role of employers associations and
  industry-wide collective bargaining (as in much
  of Europe) and State sponsorship of this
• Pivotal role of collective bargaining until 1980s
  still in public sector

10
Management Approaches

• In past large firms normally unionised, often
  multi-union with recognition by extension to
  new factories
• Best practice firms unionised Shell, ICI
• Even at peak of union activity (1960s/70s) most
  establishments non-union
• Small firms mainly non-union product markets
  limiting scope in employee relations
• Larger firms more scope for strategy in employee
  relations

11
Management Approaches

• Change in contexts in 1980s and 1990s
• Model employers now non-union, IBM, HP, Kodak,
  Motorola, Delta, MS, Virgin
• Climate and context favoured a non-union
  solution or single union as with Japanese
  transplant companies
• Late 1980s see new factories and offices normally
  not unionised. High profile employers Honda
  and Ford attempting the non-union option
• Employment Relations Act (1999) and legal right
  to recognition

12
Management Approaches

• New economy firms emphasis on flexibility,
  modern HR, individualism and resistance to
  union recognition
• Amazon, DHL, Microsoft, Ryanair (?)
• Changing contexts re-evaluation by management -
  in 1980s management de-unionised their thinking
  (Dunn 1989)

13
Management Approaches

• Differences between British and overseas
  companies operating in the UK.
• WERS evidence most innovation in employee
  relations in foreign-owned companies
• Foreign companies global strategies
• Transfer ER approaches from home country en
  masse or selectively (BMW, Honda, Sanyo, Toshiba)
• Operations part of global supply chain

14
Management Enduring Issues

• Concerns of management in employee relations with
  employee performance and engagement as a means to
  improve organisational performance?
• Question remains of whether to try and do this
  with or without unions?
• Recognition therefore remains a critical
  strategic employment relations decision issues
  of managerial prerogative and power sharing?

15
Management Enduring Issues

• Why might an employer wish to recognise in the
  current climate?
• What might be critical factors in influencing a
  decision about the bargaining agent and
  bargaining unit?
• What are the alternatives to recognition?

16
Case The Global Airline Industry

• Airline industry highly unionised (multi-union)
• Industry highly regulated routes, hours of work
  
• De-regulation in US in 1980s, in Europe in 1990s
  and again 2007/08
• Until 1990s most of industry State and ex-State
  owned flag carriers
• In Europe Iberia, Alitalia, TAP, Lufthansa,
  KLM, Air France all once state owned
• Competitive but mainly unprofitable most
  airlines losing money

17
Global Airline Industry

• Global airline industry huge cumulative losses
• Many airlines bankrupt or have collapsed
  (Sabena, Swissair, Alitalia, Delta, United)
• Re-structuring of airlines feature of last 15
  years
• De-regulation growth of low cost airlines in
  US, Europe and now India, SE Asia
• Business strategies in industry now divided
  between those airlines pursuing low cost and
  those airlines focused on corporate segment
  providing a quality enhancement strategy for
  business/first customers
• Implications for people management and employee
  relations