2.

6 Employer and Employee Relations (HL only)

 Employer and employee relations

 Good relationships are necessary as poor working relationships lead to low

morale, conflict, and perhaps even strike action/rioting
 Negotiations and collective bargaining
 Negotiations
 Bargaining process wherein two parties try to get a mutually acceptable
agreement
 Collective Bargaining
 Negotiations between managers and employee representatives (usually
union representatives)
 Not an industrial action, but failure here could cause more problems
 Compromise is necessary on both sides
 Employees are usually represented by labor unions
 Organization of worker members
 Increases bargaining power of employees
 Makes it easy for employer to communicate to a collective
 Provides legal and financial support
 Goal is better employee conditions, legislation, pay, etc.
 Three levels of negotiations:
 Management negotiations (regarding internal business functions)
 Commercial negotiations (w/ different organizations)
 International negotiations
 Six stages of negotiations:
 Preparation, proposal, debate, bargaining, closing, review
 Different views/approaches on negotiations:
 Avoidance – avoid problems, might mean issues aren’t solved
 Level playing ground – parties must be equal to have negotiations
 Winner takes all – one wins, one loses
 Win-win
 Success of negotiation depends on:
 Experience, power of union, state of economy, demand for labor, media
opinion, government involvement and degree of substitution (ability to replace labor
with capital intensive production)
 Methods by employees to achieve objectives
 Goal is to reduce a business’ productivity to increase union’s bargaining power
 Negotiations/collective bargaining (as seen above)
 Go-slow/slowdowns
 Work at the minimum required amount by contract
 Effective when in high seasonal demand
 Work-to-rule
 Work at the minimum required amount by rules
 All rules and regulations are strictly followed
 e.g. not taking calls during lunch breaks
  Overtime ban
 Strike action
 Refusal to work
 Illegal without prior notice
 May coincide with a walk-out
 Methods by employers to achieve objectives
 Objectives include reducing costs, increasing productivity, and staff morale
 Negotiations/collective bargaining (as seen above)
 Public relations
 Deals with media to make the business look good
 Build goodwill
 Lockout
 Employer version of strike action
 Divides unions by pitting workers who want to work vs. those who don’t
 Threat of redundancy
 Still considers employment rights
 Change of contract
 Closure
 Conflict
 Hinders productivity, reduces morale, causes internal politics, etc. etc.
 May be good since it helps address problems
 Conflict isn’t bad, depends on how it is managed
 Sources:
 Needs and wants – when they are not met
 Perceptions – when communication is inadequate
 Incompatible values, abuses of power, feelings
 Approach depends on concern for personal outcomes and other’s outcomes
 High concern for personal outcome causes win-lose
 High concern for others causes surrender
 Low concern for either causes avoidance
 High concern for both    causes collaboration
 Moderate concern for both causes compromise
 Conflict resolution
 Resolving conflicts successfully (if everyone is satisfied)
 Approaches:
 Conciliation
 Use an independent arbitrator
 “Caucusing” – separate meetings with arbitrator
 Conciliators encourage compromise and make legally binding
agreements
 Arbitration
 Like above, except arbitrator makes the decision, like a judge
 Industrial democracy/employee participation
 Involve employees in decision making
 Uses motivation theories
 Makes for cooperative employees less likely to strike (win-win)
  No strike agreements
 Single-union agreements
 Employer agrees to only bargain with one union
 More convenient
 Consultation (w/ employees)
 Litigation (lawsuits)
 Likely to cause win-lose
 Realistic expectations
 Avoidance
 Likely to cause lose-lose
 Change management
 Processes and techniques used to plan, implement, and evaluate change
 Change includes: new products, restructuring, new policies, mergers, etc.
 Forcing change might cause problems, while no change means no progress
 Factors/sources of change
 Customers – changing tastes, expectations, demand for better products
 Competition – need to stay competitive and evolve
 Management – stay on top of market trends, employee motivation, etc.
 Exogenous Factors – change in fashion, state of economy, etc.
 Technology
 Government
 Resistance to change
 According to John Kotter, there are 4 main reasons:
 Self-interest > Corporate Objectives
 Misunderstandings (uncertainties and “if it isn’t broke…”)
 Different assessments of situation
 Low tolerance for change
 Ambivalence may also be an issue
 Reducing impact of change
 Change Approaches Model by Kotter
 Deals with resistance to change
 Six approaches:
 Education and communication
 Establishes trust, eliminates misunderstanding, etc.
 Participation and involvement
 Link to Mayo and Herzberg theories of motivation
 May be time consuming
 Facilitation and support
 Retraining, counseling, etc.
 Negotiation and agreement
 Compromise, incentives, amendments in contract, etc.
 Manipulation and co-option
 Convert thinking to be pro-change
 May backfire
 Explicit and implicit coercion
 John Storey
  4 different approaches to managing change:
 Total imposed package – changes are just implemented
 Imposed piecemeal initiative – change done gradually
 Negotiated total packages – negotiate with employees before
implementing
 Negotiation piecemeal packages – negotiate with employees then
slowly implement
 Iceberg Model
 Two levels of change:
 Top level: cost, quality, and time
 Bottom level: People/stakeholders
 4 groups in the bottom level:
 Opponents (- behavior, – attitude)
 Promoters (+ behavior, + attitude)
 Hidden opponents (+ behavior, – attitude)
 Potential promoters (- behavior, + attitude)
 Attitudes are shaped by management of perceptions; behavior is affected
by management of power and politics
 Change Phases Model by Kotter
 8 reasons why change management fails:
 Too much complexity
 No support from staff
 No clear vision
 No communication w/ stakeholders
 Obstructions to vision
 Does not focus on small continuous changes
 Declare success too soon
 Ignore corporate culture