Chapter 8 Managing the Employment Relationship By Monika Huesmann and Moira Calveley Prof Hendy s class 1 Learning Outcomes 1 Discuss the concept of the employment relationship and 3 perspectives of employment relationship 2 Discuss the role of the state i e government in regulating the employment relationship 3 Discuss the role of the employers in the employment relationship 4 Define 4 types of power in the employment relationship 5 Discuss the power of unions vis vis employers in the employment relationship during the pandemic 6 Discuss the extent to which employees are able to have a voice in the workplace 2 What is an employment relationship Defined as the relationship between the buyers of labor the employers and the sellers the employees In simple terms the employees sell their time expertise and skills to the employer in return for a number of benefits including a wage or salary Central to this relationship is the contract of employment although it is also underpinned by a psychological contract Two main groups of actors involved in the employment relationship the individual employees or their union representatives the employer or their agent i e the managers and employers associations The employment relationship is also affected by external factors such as government policies the economy and the media Such factors will also have an effect on the relative power balance of the relationship 3 Different Perspectives The employment relationship can be viewed from a number of different perspectives Fox 1966 The chief ones being Unitarist perspective The company as an integrated unified group of people with a common set of values and interests working towards the same goals Trade Labor unions are viewed as intrusions into management s right to manage Common in managing contemporary workplaces businesses Closely aligned with neo liberalism Pluralist perspective Acknowledge the legitimate role of labor unions and collective bargaining is seen as an appropriate mechanism for wage negotiation Radical or Marxist perspective It is not possible to have a balance of power through labor unions and collective bargaining Workers are and always will be exploited by the business owners 4 The role of the State Neo liberalism Neo corporatism U K and U S A voluntary Mainland Europe approach Government does not intervene in the employment relationship unless it is necessary Based on Adam Smith and Milton Friedman ideas philosophy Strategic HRM is the application of neo liberal values Equitable distribution of wealth Germany France Austria the Netherlands Sweden Interventionist approach Tripartite approach the government employers and labor unions to employment relations Equal distribution of wealth It is not possible for the government to remain neutral 5 Employees and Trade Unions Employees form the second major actors in the employment relationship either as individuals or through various representative bodies such as staff associations and trade unions A trade union is an organization made up of working people The main principles of a trade union are to represent workers and to protect their working conditions they do this through negotiation and collective bargaining with management Major unions in the U S are the American Federation of Labor and Congress of Industrial Organization AFL CIO United Auto Workers the International Brotherhood of Teamsters and Communications Workers of America The National Labor Relations Act NLRA governs the employment relationship in unionized companies The National Labor Relations Board enforces the NLRA 6 Power and the Employment Relationship 1 2 3 Economic power the control of economic resources In the workplace this would usually lie in the hands of the business owner however this is an area that may well be contested as employees look to seek a greater share of these resources Positional power power and authority gained by virtue of holding positions which in the workplace would be that of employer manager supervisor or possibly trade union leader We also see this outside the workplace when governments intervene and introduce employment legislation Depending on the ideological stance of the government such legislation may be beneficial to the business owner management neo liberal or the employee and their representative neo corporatist Symbolic power the ability to impose one s own definitions meanings values and rules on a situation We might see this within the workplace when management promote a particular culture 4 Collective power the mobilization of collective resources the ability to organize groups of people to pursue common goals e g trade unions Adapted from Bradley 1999 34 7 Employee Voice Employee voice can be defined as the ability of employees to make a contribution to the main decisions in the organization Lucas et al 2006 It is the process of the employer communicating to the employee as well as receiving and listening to communication from the employee CIPD 2011 Voice is seen as an important part of organizational commitment where employees have some involvement in decisions Employee voice can take various formats and in organizations which operate from a pluralist perspective it is likely to be collective voice through trade unions and or works councils whereas in organizations which follow the unitarist HRM approach to people management it is more likely to be an individualistic approach through team meetings management communications etc 8 Collective Bargaining Collective bargaining is the term given to the process whereby trade unions representatives consult and negotiate with management with regards to the terms and conditions of employment of their members Good faith bargaining Mandatory bargaining items Items that can be bargained to impasse Example Pay benefits and working conditions Permissible bargaining items Items that cannot be bargained to impasse Example union due checkoff Illegal bargaining items Items that are illegal to discuss in the negotiation Example yellow dog contracts hot cargo items compulsory check off programs 9 Works Councils Throughout much of Western Europe works councils WCs are in operation They are upheld in law in a number of countries WCs are an instrument for giving employees a voice in the workplace helping facilitate employee involvement in employment relations and management decision making at company level Salamon 2000 Generally made up of elected employees works councils have various rights