HRM & Industrial Relations

HRM & Industrial Relations
Chris Jarvis 1
Industrial Relations – defining the scope
 male, FT, unionised, manual, “heavy” industries & pu

blic sector , restrictive practices, strikes & collecti
ve bargaining?
 Employee relations - more diverse jobs: non-manual, fem
ale, PT, non-union, services, high tech, “new” busine
ss etc
 Focus = regulation of employment relationship (control,
adaptation, adjustment) - legal, political, econ, socia
l, historical contexts.within
“operating “Collective
& outsideaspects”?
the workplace
concerned with determining & regulating e
mployment relationships.”
Chris Jarvis 2
Unitary Pluralistic Marxist

Authoritarian Cooperation Evolution
Paternalism Conflict Revolution
Approaches to IR
Input Conversion Output
Conflict Institutions Regulation
differences & processes (rules)
Social
Systems
action Control over
HRM labour process
Labour
Comparative
market
Wider approaches
Chris Jarvis 3
Unitary Pluralistic Marxist

Assume
 Capitalist society • Post-capitalist society • Capitalist
 integrated group • Sectional groups - coalesce • Division of labour/capital
 common values, intere•
sts, objectives
different values, interests, objec •
tives
social imbalance + inequalities - p
ower, wealth etc
Nature of conflict
 one authority /loyalty • competitive authority /loyalty ( • inherent in econ. & social systems
 irrational + fractional
•
formal/informal)
inevitable, rational, structural
• disorder - precursor to change
Conflict resolution
 coercion • compromise + agreement • change society
TU Role
 intrusive • legitimate • employee response to capitalism
 anachronistic • internal, integral to workplace • mobilise, express class consciousn
 only accepted if forced• accepted role in econ & manag
erial relations •
ess
develop political awareness & acti
vity
Chris Jarvis 4
Input-output model
 convert potential for conflict into regulation

 reconcile conflicts of interest through legitimate, functional
processes & institutions
 at the heart ....... collective bargaining
 regulatory output
 Rules: unilateral, joint or imposed by government
 substantial & procedural arrangements
 within-the-organisation or external rules (law, national agreem
ents)
 varying degrees of formality
Chris Jarvis 5
Systems approach (Dunlop 1958)
 IR - a social sub-system within the econ. & political systems

 Components
 actors
 contexts (influences & constraints on decisions & action e.g. ma
rket, technologigy, demography, industrial structure)
 ideology - beliefs affecting actor views - shared or in conflict
 rules - regulatory elements i.e. the terms & nature of the empl
oyment relationship developed by IR processes
 Stable & orderly Unstable & disorderly?
Chris Jarvis 6
Social action (Bain & Clegg)
 actor perceptions & definition of “reality” determine behaviour,

actions, relationships
 work orientation is as much a result of extra-organisational exp

erience as experience within the workplace
 structural factors may limit individual choice & action

 bounded rationality - interrelated decisions may fix or significa
ntly shift values, focus, roles or relationships.
 instrumental & value-based considerations

Chris Jarvis 7
Control over labour process
 transformation in inputs by labour using tools & methods. P

roducts, under capitalism, become exchangable, marketable co
mmodities. Relevance to banking, retailing, local gov’t etc ?
 labour-capital relationship - essentially exploitative (ownershi
p, surplus value, logic of efficiency & savings, structures of cont
rol.
 Braverman - to achieve capital’s objectives - specialisation, sta
ndardisation, simplification, substitute technology for labour (Ta
ylor), de-skilling? Critique?
 Core + peripheral employees. Segmented labour markets
 Job enrichment, empowerment & responsible autonomy
 Personal control & bureaucratic control
Chris Jarvis 8
Labour Market - how work is distributed within society
 Issues

increase in women’s activity rates
 level + nature of unemployment, long vs. short-term jobs
 manufacturing  service + globalisation vs. local
 market regulation strategies + dual labour markets
 Economic labour market model
Pay = price mechanism (SS/DD. elasticity & equilibrium)
 One market (same £ for all) or differentiated by skill, job, location
etc.
 assumes Pricing +
 Work - disutility. Wages compensate for less leisure
 Marginal productivity gain from using one extra unit of labo
ur
 “institutionalised” labour market - wage floor, "going rate",
range (quartiles), collective bargaining vs. individual negotiatio
n.
Chris Jarvis 9
Labour Market - social acceptance & hierarchies
 Possible Issues
 Unskilled, semi-skilled & skilled. Blue-collar, white-collar.
 Professionalisation. Other desire the same.
 UK recognition of “engineers”
 UK “class” system & differential access to education (private schools)
& labour divisions.
 Government interest
 Passive & active policies
 Retirement age, unemployment benefit, training, job support
 Who pays - via taxation or direct Er /Ee contributions?
 Interventionist & corporatist approaches (state regulation)
 Deregulation - free, flexible labour market, pay decided by “ability to p
ay”.
Chris Jarvis 10
Economic environment
 UK de-industrialisation + manufacturing decline

 increasing liberalisation, internationalisation & globalisation of trade
 government management of economy e.g. Keynesian vs monetarism.
 increasing inequality in wage distribution
 industrial restructuring & introduction of new technologies
 expansion of service sector
 Participation rates in employment between 1966 & 1981

 77.3 to 75.3% Overall
 97.7 to 87.8% Men
 55.4 to 61.5% Women
Chris Jarvis 11
Employment trends 1981-91
Male Female
FT PT Total FT PT Total All
Manufacturing
1981 4242 69 4311 1342 395 747 6058
1991 3157 55 3212 1080 282 1362 4574

-26% -20% -26% -20% -29% -22% -25%
Services
1981 5460 601 6061 3752 3288 7040 13101
1991 5691 879 6570 4491 4249 8739 15309

+4% +46% +8% +20% +29% +24% +17%
Figures rounded to nearest ‘000

Source: Employment Gazette
Chris Jarvis 12
Social environment
 industrialised, capitalist society

 principles of freedom of thought, expression & association
 Protestant work ethic
 Welfare state vs. independence & expansion of individual o
pportunities
 class & social mobility - manual to middle & professional
 home & share ownership
 unemployment,
ine
“haves & have nots”. NHS vs. private medic
Chris Jarvis 13
Political environment
• internal organisational decision-making. Power-authority structure

s
• external governmental politics
• individual liberalist, laissez faire vs. corporatist, interventionist
• government responsibility for high employment
• privatisation (public vs private)
• TU role/protections & employer role/protections
• law & order
• European Union - national vs supra-national & conflicting politic
al ideologies
Chris Jarvis 14
Development of Industrial Relations - 1
 “in restraint of trade” - Tolpuddle Martyrs

 late 19 c. TUs & collective bargaining confined to skilled
th
trades & piecework. Industrial strength, mutual assurance,

control over entry. Common interest in “local rules”. Empl
oyer interest in controlling wage competition
 WW1 industry level bargaining  uniformity in wage cl
aims. 1916 Whitley Committee  70+ JICs set up 1918-
21
 20s & 30s recession, unemployment  decline in TU m
embership, wage cuts and...!!!...more industrial action. So
me JICs disbanded (industries facing foreign competition)
. Many survive (public utilities, Logov & gov’t.)
Chris Jarvis 15
Development of IR - post 1945
 1950s & 60s

 improvement in economic conditions ----> inc. TU membership & IR activity.
Pressure on industrial bargaining. Productivity problems. PIP. Shift to shop
floor bargaining (stewards vs national officials).
 Donovan Commission (1968) recommends
 reform of voluntary coll. bargaining. Pluralism & company agreements
 1970s “IR tensions & confrontations” (3 day week, miners, Winter of Di
scontent, wage push inflation). Employment legislation to enhance work
er rights & extend coll. bargaining. Voluntary incomes policy.
 From early 80s recession
 Gov’t non-intervention re- industrial restructuring but strengthening of individ
ual over collective rights. TU member decline. Competitiveness, globalisatio
n & and TQM. Managerial (HRM) resurgence.
Chris Jarvis 16
Donovan Commission 1968 (majority & minority report)
 IRctive
improvement by reform & extension of voluntary colle
bargaining
 management initiative & TU agreement
 develop formal company level agreements.
 substantive
 terms & conditions, rights & obligations etc
 procedural
 conduct of relationships, dealing with disputes/conflict;
about power & authority in organisations
 management to embrace pluralism & joint participation
Chris Jarvis 17
Government & Legal intervention
 Managing the economy. Balance of Payments & IMF. Problem of grow

th, industrial change & inflation. Gov’t - TU - Employer triangle.
 Contrary to Donovan voluntarism  Increased legal intervention

 1969 “In Place of Strife” recommended law to deter destructive indu
strial action (“unofficial strikes”) bring orderliness into IR.
 1971 Industrial Relations Act (failed) - more legal control over TU ac
tion & unofficial strikes. Unfair dismissal.
 1974 “Social contract” & support for collective bargaining, stewards’ ri
ghts, disclosure of information, consultation, time off.
 1978-79 Industrial democracy & Winter of Discontent
 1979 steady, greater legal control & restrictions over TU activities
Chris Jarvis 18
Conservative legislation to limit TU activities
 Employment Acts 1980 , 1982, 1988 & 1990

 Trade Union Acts 1984 & Wages Act 1986
 Employment Acts, Trade Union Reform Employment Act 1993
 Employment Rights Act 1996
 no statutory recognition procedure nor closed shop
 no immunity from secondary industrial action
 independently scrutinised ballots for industrial action
 union officers responsible for unlawful actions & must repudiate
 right NOT to be disciplined by union for not taking part in action
 secret ballots for election of NEC officers
 abolished Wages Councils (“price people back into jobs”)
 early 80s confrontations: miners, Wapping P&)/NUS
 extended rights to obtain redress individually
 new realism - single union agreements
Chris Jarvis 19
New Realism?
 management proactivity - neo-HRM, TQM & IIP.

Integration with business competitiveness, excellence, customer care.
 bargaining structures shift from
 management-union (collective) to management-individual relationships (co
mmunication, empowerment, ownership)
 multi- to single-employer. Sole-union recognition for flexible working
 pay & working conditions emphasis
 flexibility & individual.
 more temporary & part-time working
 core/periphery staff with task-function & time flexibility.
 performance-related pay (individual & team)
 share ownership & profit bonuses
 TUs on the defensive. 1979-1993 lose 4.5m members. Cooperative em
ployer partnerships. Member services from credit to training.
Chris Jarvis 20
Concepts & Values in IR
 fairness & equality (but fairness is relative & not constant)

 utilitarian or democratic
 impersonal technical notion
 reciprocity of the exchange, consistent with other exchanges, equality of t
reatment & consideration.
 power to control, influence & modify versus legitimate authority
 French & Raven - 5 sources of power
 reward, coercion, legitimised, referment, expertise
 Morgan (more diffuse, implicit, pervasive)
 control of resources & systems; control of knowledge, information &
decision-making; use of organisational structures, rules & regulations
; control of alliances, networks & counter-organisation
 Magneau & Pruitt - reciprocal perception of power.
Chris Jarvis 21
Individualism & collectivism
 individual negotiation vs combining against Er-Ee imbalance

 Oversimplification to say Mgt-employee relationship = “indivi
dual” & Mgt-TU = “collectivism” .
 Issue = degree to which the individual is or should be
 Feels in control, responsible, allied with or subordinated to, regul
ated by & protected
 Issues of I & C in industrial relations
 Mgt “claim right” to deal with staff without intermediate TU const
raint (represent/regulate on joint basis)
 Individual PRP vs. one package for all
 individual “sees” his/her well-being deriving from own efforts vs.fr
aternalism (improvement through solidarity)
 High trust - Low trust (Alan Fox - Beyond Contract)
Chris Jarvis 22
Trade Union Functions
 Power - protect/support through strength in association - a co

untervailing force, pressure group. Note: bargaining leverage
& member willingness to act together.
 Economic regulation - maximise member returns within wa
ge-work framework. Note: political nature of TU wage policy -
comparability & differentials. Inflation & unemployment (cost-p
ush & demand pull). Win bigger slice of national income.
 Job regulation - establish a joint-rule making system to prot
ect members from arbitary management action . Enable partic
ipation in decisions affecting their employment. Expand job op
portuities?
 Social change - express social cohesion, aspirations, politic
al ideology & develop a society which reflects this? Institution
alise “class” & “conflict”? Dilemma of participating in governm
ent.
 Member services - provide benefits/services to members
 Self-fulfilment - assist individuals to develop outside their job
domain & participate in wider decision-making processes
Chris Jarvis 23
Union character
 expression of sectional/class consciousness ---> “soc

ialist” society
 social
ways
responsibility - exercise role in non-detrimental
 business unionism - maximise benefits from employer

relationships
 welfare unionism - wider social, econ. & political involv
ement for all
 political unionism - through political alliances
Chris Jarvis 24
Why do people join or NOT join trade unions?
 Blue/white collar
 Manual, clerical, technician, technologist, super
visor, manager
 Heavy – light, old – high-tech. industry
 Individualism vs. fraternal/collective
 instrumental
ertainty
reasons for joining. Support in unc
 preference
conflict
for cooperation with Mgt rather than
Chris Jarvis 25
What is Recognition?
 Mgt. formally accepts a TU (or TUs) to represent all/some

employees & enters into joint determination of terms & conditi
ons on a collective basis.
 confers legitimacy & defines scope of union’s role
 movement from unilateral management action to pluralis
m. TU has right to “exist & organise in workplace, support m
embers & have shop stewards, challenge managerial action
& bargain”.
 rights to information disclosure & consultation (redundan
cy, transfer of undertaking, H & S & pensions).
Chris Jarvis 26
TU Recognition Process
Claim for recognition

Management TU & employee’s
policy expectations
Bargaining unit (common interest, internal homogeneity)

•characteristics of work group (skills, pay, jobs, dispersion)
•TU membership %
•collective bargaining arrangements
•management structure & authority
Bargaining agent
Degree of recognition •independent
•representative &procedural only •appropriate for all employees
•negotiating (some/all, joint or sole) •effective/sufficient resources
•union membership agreement •representative
Recognition ballot
What %?
•management rights to manageappropriate

Recognition agreement •scope & instutions of collective bargaining
•role of representatives
Chris Jarvis 27
Recognition
 Implications for Managers

 challenge & appeal against decisions. Slower processes
 representatives as mediator of communications & may block
 work to agreements, procedures with “rights” to be consulted
 persuasion & negotiation to secure “consensus”
 time off & protections for appropriate/legitimate TU activities.
 Grunwick 1977 determined not to grant recognition & dismissed all

employees who took action
 Recognition & non-recognition often exist side by side
 decline in membership & now 1998 Fairness at Work
- Gov’t proposals to enable employees to have a TU recognised by th
eir employer where a majority of relevant workforce wishes it & to int
roduce statutory procedures for both recognition & derecognition
Chris Jarvis 28
Collective Bargaining
an institutionised system of determining terms &

conditions of employment & regulating the empl
oyment relationship between representatives of
Mgt & employees intended to result in an agree
ment which may be applied across a group of e
mployees.
•decline in coverage 1980 - 90
•collective agreements > union membership.
•public sector > private manufacturing > service

•manual > white collar men > women
•53% firms in 1990

•66% of FT workers (direct or indirect)
•Larger firms & public-sector organisations

Chris Jarvis 29
Models of Collective bargaining
 Chamberlain & Kuhn

 conjunctive bargaining
mutual coercion - agreed truce - indispensible to each other - Lose-lose
 cooperative bargaining
both accept neither will gain advantages unless the other gains too. Win-Win -
willingness to concede - to increase size of cake
 Walton & McKersie
 distributive bargaining
basic conflict over slice of the cake. Fixed-sum game - if you win, I lose.
 integrative bargaining (common perception & acceptance of issue)
Mgt accept employee influence. TU accepts business responsibility.
Cooperate to increase cake. Adversarial- cooperative tension remains
 intra-organisational bargaining.
Chris Jarvis 30
Content & Scope of Collective Bargaining
 Substantive rules (economic matters)

 pay (basic, overtime, PBR, guaranteed payments.....bonuses???), hours
(37, 40, shifts, shorter week, flexi-time?) , holidays, fringe benefits (pensi
on, sick pay, company cars?, BUPA?). Annual negotiations.
 Procedural rules
 status quo (no change until disputes procedure exhausted). Shop stewar
ds, grievance, negotitating, disputes, redundancy, consultation, discipline
?
 Work methods/arrangements. The nature of work & how it is =carri
ed out. Flexibility, multi-skilling, productivity, assignments, teams, use
of contractors, operating procedures?
 Bargaining levels
 National/Industry wide (multi-employer & TU Federations?)
 Company-wide
 Plant/shop level
Chris Jarvis 31
What enables bargaining power?
Chris Jarvis 32
Involvement & participation in decision making
 industrial democracy (worker control) - little currency in contempor

ary market-driven economies
 participation
ment
in decisions traditionally the prerogative of manage
 equal power or management style/good-will?

 HRM & reaction against confrontation management
 involvement to mobilise cooperation, talent & creativity
 Task participation: empowerment, cell technology, team working, briefin
g groups & quality circles, delegation, job enrichment & MbO joint proble
m-solving. McGregor Theory Y. Employee reports. 360 degree appraisal
 financial
mes
particpation profit-related bonuses, share ownership sche
 approved deferred share trusts

 SAYE to buy company shares
 employee share ownership plans
Chris Jarvis 33
Employee participation
 Worker directors
 Bullock report
 Works Councils
 European
entatives
pressure for Mgt to consult employee repres
 collective redundancies, transfer of undertakings, health & saf

ety.
 European Works Council Directive (1994)
 EWC for information & consultation to be estabished in any m
ultinational organisation with at least 1000 employees (includin
g 150 in each of at least 2 member states)
Chris Jarvis 34

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