Faculty of Business and Economics

Master of Business Administration (MBA)

“Group Project on Human Resource Management Focused on Employee-

Employer Relations “

GROUP MEMBER ID N0

1. Abigia Getachew………….(GSE /8488/15)

2. Abel Tenaw………………..(GSE /0947/15)
3. Agena Wedaye…………….(GSE/3455/15)
4. Amanuel Kassahun ………(GSE /3788/15)
5. Betelhem Feleke…………..(GSE/1869/15)

Submitted to:

May 2023

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 Addis Ababa

1. INTRODUCTION
1.1. Background of Study

Definition

The goal of employee relationship management (ERM), a component of human resources

management, is to foster solid working relationships between employees and their supervisors.
The following formal policies and processes, which HR professionals, managers, and team
leaders may implement, can help them engage in ERM:

 Team members scheduled social hours

 Systems for receiving team member input and appreciation
 programs for professional growth
 programs for mentoring
 Engagement activities for employees
 initiatives for diversity
 Cycles of review

The contractual arrangement between employers and employees is what constitutes their legal
connection. It is present when someone provides labor or services under predetermined
guidelines in exchange for payment.

Reciprocal rights and obligations are established between the employer and the employee
through the employment relationship, however, that is defined. It has been and still is the primary
means by which employees are able to access the rights and benefits connected to employment in
the domains of labor law and social security. The requirement that establishes whether the labor
and social security legislation provisions addressing employees will be applied is the presence of
an employment relationship. The nature and scope of employers' rights and obligations toward
their employees can be determined using this as the primary point of reference.

Due to the phenomenon of dependent workers without protection due to one or a combination of
the following circumstances, which is becoming more and more common, the issue has become
more and more crucial.

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The law is inadequately or ambiguously formulated, leaving its scope uncertain; the law's scope
is too small, or it is narrowly interpreted.

The employment relationship is concealed; the relationship is objectively ambiguous, raising the
question of whether an employment relationship exists; the employment relationship is present
but unclear as to who the employer is, what rights the employee has, and who is responsible for
upholding those rights; and there is a lack of compliance and enforcement.

To address these concerns, a wide discussion on the nature of the job relationship took held in
2003. The International Labor Conference (ILC) approved Recommendation (No. 198) about the
Employment Relationship in 2006. Under the following headings:

The creation and implementation of a national policy to review and, if necessary, clarify and
adapt the scope of applicable laws and regulations to ensure effective protection for workers who
perform work in the context of an employment relationship; the establishment of such a
relationship by a list of relevant criteria that is based on the facts surrounding the performance of
work and the payment of compensation. The creation of a suitable mechanism—or the use of an
existing one—for keeping track of changes in the labor market and in how work is organized to
offer guidance on the adoption and implementation of policies affecting the employment
relationship.
2. Major Employment Relation Theories in Development
John Dunlop's Industrial Relations System, published in 1958, represented the first serious
attempt to develop a theoretical framework for employment relations. The industrial relations
system, according to Dunlop, is a web of regulations. He basically identified the pillars of an
industrial relations system as three groups of actors (managers, workers, and their organizations,
as well as governmental institutions dealing with industrial relations), operating in a web of three
distinct environmental contexts (primarily technology, markets, and economic and power
distribution), and a central ideology that consists of the shared beliefs of the actors and that binds
the industrial relations. The laws governing industrial relations behavior at various levels
(international, national, sector, etc.) are the dependent variable in Dunlop's model.
Nevertheless, the independent variable is the interaction of the players, settings, and ideologies.
(Gennard and Judge, 2010). However, Alan Fox's theory (Alan Fox, 1974) is more frequently

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acknowledged; his theories of employment relations may be categorized into Unitarism,
Pluralism, and Marxism.
I. Unitarism: - occurs when there is no distinction in the goals of the employee and the
employer due to group homogeneity and objectives, and when there is only one central
super competent driving employer. This can be achieved through fair promotions,
diligent decision-making by a competent, unbiased, and single source of authority,
accurate evaluation of new hires' attitudes, skills, and motivation in a population that is
uniformly politically correct and internally motivated. reducing conflict through optimum
systems and procedures. Conflict in these situations typically results from interpersonal
conflict and a breakdown in communication (Kaufman, 2004).
II. Pluralism: - occurs when there are significant differences between an employer's and
employee's aims because of the presence of numerous heterogeneous interest groups. The
two main categories might be management and employees. Additional groupings, such as
manufacturing workers and corporate employees, may exist and have similar interests
and goals. As a result, there can always be a disagreement about how jobs are assigned,
awards are given, and how groups operate both together and separately. A thorough and
sensitive conflict resolution procedure that encompasses many aspects of decision-
making and grievance management becomes vital because there are numerous
stakeholders engaged, each with a different opinion and aim. Conflict, nonetheless, can
result in progress if it is handled correctly (Kaufman, 2004).
III. Marxism: - looks at the disparity in power as a cause of conflict between employer and
employee groups. Comparing employers and workers reveals a significant gap in supply
and demand. Due to the distribution of money and talent in competitive marketplaces
giving it greater power to dominate in all talks, an employer with the means of production
and the wealth to sustain the same is significantly rarer than the supply of competent
labor. When compared to how dependent labor is on the employer, the dependence of an
employer who possesses wealth and the means of production on labor who owns nothing
but wants to work to meet the most basic needs is relatively minimal. Exploitation results
from this. Wages are directly impacted by the aim to increase profit by lowering labor
costs. The collective body of workers led by an intelligent person is therefore brought
into play to counteract this power of wealth and stuff. This group is known as a trade

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 union. This trade union, which is supported by legislation that grants immunity, enables a
group of workers who are proactive and socialist to negotiate with management to secure
a favorable term for the work that he alone might be unable to complete due to the
severely skewed power equation in the employer's favor. Institutions of collaborative
regulation are therefore more beneficial to management (Hyman, 1975).
2.1. Comparison between Unitarian, Pluralism, Marxism & Subsequent Evolution

Unitarians start with the premise that workplace conflict is not always present and that it is an
anomaly in a relationship that is otherwise essentially cooperative. In general, the organization is
positioned as a single source of authority and is responsible for ensuring fair and equitable hiring
practices as well as effective communication channels. It gave rise to the theories of scientific
management (Taylor, 1974), human relations (Maslow, 1954; Mayo, 1933; Child 1967), and
human resource management (HRM) practices (Stone, 1995; Guest, 1989). In contrast to
Unitarianism, pluralism emphasizes how complex social structures made up of various interest
groups makeup businesses and is predicated on the premise that workplace conflict is inevitable.

The necessity of lowering conflict levels through managerial innovation and paving the way for
group forums to bring up issues and settle them fairly to arrive at a sustainable solution is further
highlighted by the inevitable existence of conflict and acceptance of the same. Systems theory by
Dunlop in 1958 and Strategic choice theory by Kochan in 1986 were further results of this.
Marxism develops from a radical understanding of nature and the belief that class divisions
resulting from wealth inequalities are the root of workplace strife. The Labor Process Theory
(Braverman, 1974) and feminist theories are products of the theory, which focuses on the
unequal distribution of wealth and subsequent exploitation of labor.

3. What is Employee Relation?

The relationship between a company and its employees is known as employee relations, and it is
typically developed by the human resources division. Employee relations encompasses activities
including conducting employee surveys, managing workplace disputes, dealing with employee
complaints, and upholding rules and regulations. A successful and pleasant employee relations
culture is characterized by communication, acknowledgment, feedback, and investment in
employee growth.

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 3.1. The Effects of Common Employee Relations Issues on Your
Organization

As a leader, you cannot avoid conflict because it is an unavoidable component of every

organization. To maintain positive working relationships, it's important to be proactive in
avoiding conflict and to communicate clearly.

Compensation-related challenges will arise in any organization, from disagreements over the
number of hours worked to the method for employee pay increases. If there is a problem, it's
crucial to talk to the staff about it, and you should also encourage them to bring any worries to
your attention. Consider taking preventative measures, such as installing a time clock and
confirming the clarity of your department's policies and procedures or employee manual.

Establish safety policies, pay attention to any concerns your employees may have, and look for
ways to make the workplace a better place to work.

If an employee needs to be disciplined, make sure they have been informed of the procedure in
full. As soon as a problem emerges, make sure to include HR in the discussion.

Your employees' effectiveness can be greatly impacted by the quality of their working
environment, including the locations they are in, and the recognition programs you offer. This is
because they will work more if they feel safe and comfortable.

3.2. How to improve Employee Relations?

Positive employee relations can only develop from having an effective strategy built on
communication, trust, managing perceptions and beliefs, setting clear expectations, and a solid
conflict resolution process.

3.2.1. Ways to Improve Employee Relations

 Have a strategy for employee interactions. Set goals, create a training plan, decide on
disciplinary measures, and establish a framework for resolving conflicts as a team.
Because your business evolves just as frequently, review the plan frequently.
 Make an evaluation of employee interactions. This might assist you in evaluating the
success of your employee relations strategy. Employees can express their opinions and
contribute to the solution by taking an assessment.

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  Don't micromanage; doing so could make your staff feel untrusted. Maintain daily
communication and schedule weekly one-on-one meetings with your reports.
 Recognize effort but refrain from picking favorites. Everyone loves to be praised but
giving too much attention to one person can frequently result in problems with other
employees.
 Transmit information clearly, especially regarding the employee's role and
responsibilities. Each quarter, review these duties.
 Get suggestions from the workforce. Ask only members of the affected workgroup for
their opinions if the decision has an impact on them. Compared to polling your entire
company, this will be quicker and more productive.
 Ensure chances for development. When drafting your employee relations plan, don't
forget to include career development.
 Establish clear and generous boundaries for employees so that they are empowered to
take initiative in problem-solving and make their own decisions.
 Listen attentively. Encourage honest, open communication among your staff members so
that they aren't merely telling you what you want to hear.
 Have faith in your employees. Set boundaries and establish what is acceptable and what
is not, but also be cooperative and willing to forgive mistakes.

Improving employee relations can:

 Foster personal motivation

 Increase productivity
 Grow company loyalty
 Reduce workplace conflict

Employee satisfaction is a key component of an organization's growth and success. When an

employee has a positive relationship with their manager and other company leaders, they
often work more efficiently and produce higher-quality work. Any person who works in a
human resources or leadership role might use employee relationship management tactics to
encourage healthy workplace attitudes and build rapport between employees and
management professionals. 

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 4. Importance of Employee relationship management
 Boosts employee morale: - ERM initiatives and policies can enhance employees' attitudes
toward their jobs and inspire them to achieve. A more confident workforce can
collaborate more successfully. For instance, a sales department with effective employee
relationship management procedures may reward specific sales agents with gifts or
company-wide notices when they accomplish or exceed weekly and monthly goals. The
sales crew may feel appreciated because of this award, which will lift their spirits and
motivate them to break previous records. Increasing sales results in higher revenue for the
whole business.
 Boosts productivity: -Effective employee relationship management can foster a high-
productivity environment that motivates teams to produce more than they ordinarily
would in the same amount of time. People may feel more driven to complete their jobs
when they believe in the importance of their work. Employee skill development may be
aided by specific ERM techniques like mentorship programs and professional
development seminars. For instance, the administrative division of a hospital would
provide weekly seminars for staff members that would cover various administrative
chores. Medical recorders and administrators can do more by learning about new
software and labor-saving techniques.
 Promotes the development of leadership abilities: -Employee confidence and motivation
to take on leadership responsibilities can both be increased through ERM initiatives.
Employees can refine current skills and pick up new ones, like project management and
conflict resolution, through professional development courses, for instance. They might
decide to volunteer to lead committees or take on leadership roles on teams using their
newly acquired talents. Other forms of ERM, such as mentorship programs, can serve as
role models for employees and motivate them to take on more responsibility in their
regular jobs.
 Boosts communication: -Employees may feel more at ease discussing their demands and
preferred methods of working with their bosses and coworkers if they have good working
connections with both groups. Employees can learn about useful tools and resources for
their work with the aid of improved communication. Through the early detection of
possible hazards, it can help avoid worker accidents and consumer complaints. For

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 instance, a manager who uses effective ERM may be a resource for team members who
may seek guidance on how to handle potentially challenging client situations.
 Decreases churn: - An individual who feels valued at work and is motivated to forge a
long-lasting career with the company can benefit from having positive interactions with
peers and bosses. Numerous ERM program components, such as diversity efforts and
professional development workshops, can aid staff members in refining existing abilities
and acquiring new ones. Furthermore, businesses with strict ERM practices may use
internal promotions to advance personnel while they remain with the same company.

4.1. Guidelines for managing employee relationships

 Set objectives and reinforce your ideals.
 Utilize communication tools.
 Honor accomplishments.
 Meet frequently with each team member individually.
 Provide a range of programs.
 Obtain commentary.
 Specify rules for resolving disputes
5. Elements of an Employer-Employee Relationship
 Formalize relationships between employers and employees
 Employee Pace
 Communication Is Key
 Be Reliable
 Provide career guidance and advancement
 Give constructive criticism

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References

International labor organization

Indeed, a career guide

LinkedIn

Knowledge City learning solution

OLYMPIA BENEFITS INC

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