HUMAN RESOURCE MANAGEMENT BMG775J1A

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HUMAN RESOURCE MANAGEMENTBMG775J1A

• Norma Heaton
• Week 7 Employee Relations

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Employee relations

• AIM
• To review the changing context of employee
  relations and the key issues facing managers in
  the employee relations field
• OBJECTIVES
• Understand trends in employee relations
• Consider strategic options in employee relations
• Examine forms of employee involvement and
  participation and other developments

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Defining employee relations

• Employee relations consist of all those areas of
  HRM that involve relationships with employees,
  directly or through agreements with trade unions.

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Are employee relations important?

• Employee relations are now placed well down on
  the agenda of HR managers
• Recruitment, selection, development and
  performance management are regarded as more
  important
• Perception that UK employee relations are in a
  healthy state
• A good employee relations climate cannot be taken
  for granted
• A generation of HR managers are unaccustomed to
  dealing with collective disputes

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Trends in employee relations in the UK

• Trade union decline
• Decline in collective bargaining and industrial
  action
• Rise in emphasis on employment rights

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Trade union decline (1)

• Trade union membership fell from a peak of 13
  million in 1979 to 6.4 million in 2005 (26.2 per
  cent of the workforce, 29.0 per cent of
  employees)
• Fall due to
• Hostile employment legislation in the 1980s
• Industrial restructuring with decline in
  established industries and rise in small scale
  office and hi-tech operations

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Trade union decline (2)

• Northern Ireland has the highest trade union
  density compared to other UK regions (40.4 per
  cent of employees)
• Almost three in five public sector employees in
  the UK are trade union members
• Less than one in five private sector employees
  are trade union members

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Decline in collective bargaining and industrial
action

• Decline in the number of employees whose terms
  and conditions are determined through collective
  bargaining ( negotiation with a union or unions)
• National agreements on pay and conditions are now
  rare
• Fall in the number of days lost through strike
  action UK average lower than average for
  European Union

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Rise in emphasis on employment rights

• The law now provides a minimum floor of rights
  for employees in fields such as
• Unfair dismissal
• Anti-discrimination legislation (sex, race,
  disability, religion, sexual orientation)
• National minimum wage
• Family-friendly measures such as the right to
  request part-time working in some circumstances

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The nature of union recognition

• 1970s general assumption - most employers would
  automatically recognise and deal with unions
• 1990s many employers introducing new working
  patterns without consultation
• Present day, increasing distinction between
• Workplaces where unions have maintained a
  presence
• Workplaces where unions are being edged out
• Non-union workplaces
• Source Marchington and Wilkinson (2005)

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Why would employers choose to work with unions?

• Management may regard TU reps as an essential
  part of the communication process
• Employers may aim for long-term stability
• Unionisation may be viewed as inevitable
• Employers may lack the power to reduce the TU role

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Marginalisation edging unions out

• Typically associated with changes such as
• Lower priority accorded to collective bargaining
  and upgrading of consultation
• Greater emphasis on individual and direct
  communication from managers to all employees
• other HR practices stressing the individual such
  as performance related pay

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Managing without unions

• The good, the bad and the lucky
• good large employers offering an attractive
  employment package as an alternative to trade
  union membership
• bad- focus on cost-cutting with only a minimum
  level of workers sights
• lucky no strategy, but innovative practices
  following personnel fashion

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Contemporary study of employee relations

• Torrington, Hall and Taylor (2005) suggest
  employee involvement provides a good reference
  point when thinking about the strategic choices
  faced today by managers in employee relations
• Topics to consider
• Why involve employees?
• History and development of employee involvement
• Forms of involvement and participation

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Why have involvement and participation?

• Few would disagree that employees should have a
  say in workplace affairs. The problem is that
  there is less agreement over the ways in which
  the voices of employees should be expressed
• Hyman and Mason, 1995

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Reasons for introducing employee involvement

• Information and education
• Gaining commitment
• Securing enhanced employee contributions
• Recruitment and retention
• Conflict handling and stability
• External forces

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History of participation and involvement

• Profit sharing, 19th century
• Introduced by some employers as part of a policy
  to extend welfare provisions but dropped because
  of worsening economic conditions
• Whitley Councils 1917
• Whitley Committee proposed setting up joint
  employer-union bodies at national, district and
  workplace level and these have survived in parts
  of the public sector
• Joint Production and Advisory Committees 1940s
• Drive to stimulate productivity and growth
  through factory-level committees where employees
  were involved in discussions over efficiency and
  production

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History ctd

• Bullock Committee of Enquiry 1977
• UK entry into Europe and election of Labour
  government led to Committee established to
  discuss worker directors
• Many employers were hostile to the idea
• Government changed before recommendations
  implemented

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History ctd

• Individualist employee involvement
• 1980s, championed by management, associated with
  interest in HRM
• Directed at securing greater employee commitment
  to the organisation
• Grown largely without legislative support
• Employee empowerment represents the most recent
  manifestation

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Components of employee involvement

• A degree of involvement the extent to which
  employees influence final decisions
• B level at which individuals are involved
• C range of subject matter dealt with
• D form of involvement
• Source Marchington (1992) discussed in
  Beardwell, Holden and Claydon (2004)

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Degree of involvement the escalator

• Control
• Co-Determination
• Consultation
• Communication
• Information

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Level and range of involvement

• Level
• Can be differentiated between task, section,
  department, establishment, division/region,
  corporate and industry
• Range
• At one extreme these can be broad strategic
  decisions
• The other extreme concerns marginal items such as
  the state of the car park

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Forms of involvement and participation

• Downward communications
• Upward problem solving
• Financial employee involvement
• Representative participation

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Forms of participation another division

• Direct ( face to face or written contact between
  managers and subordinates)
• Indirect (employees involved through their
  representatives)
• Financial (profit sharing etc)

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Downward communications

• i) House journals/ company newspapers/e-mails
• ii) Employee reports
• iii) Team briefings
• Regular, structured system to enable top
  management to cascade through the organisation
  news and developments
• Used to encourage commitment and to channel
  conflict
• WERS (Workplace Employee Relations Survey 04
  used by 85 of companies)

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Upward problem solving

• i) Suggestion schemes (WERS 30 usage)
• ii) Quality circles
• Used to develop employees or to improve quality
• Groups meeting regularly and voluntarily to
  identify, analyse and solve problems (WERS - 21
  usage)
• iii) Attitude surveys (WERS 42 usage)
• Systematic means of investigating employees
  views
• Some companies see a benefit in avoiding
  reliance on trade union views
• Helpful in developing policies
• Enhance by establishing project teams

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Financial participation

• Employee share schemes include
• Share Incentive Plans (SIP) where companies can
  give up to 3000 worth of shares to each employee
• Savings Related Share Option Schemes (SAYE) where
  participants can save up to 250 per month to
  acquire shares

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Representative participation Joint Consultative
Committees

• JCCs were popular in the 1940s, declined in the
  1950s and 1960s, and regained some popularity in
  the 1970s
• If they are given only unimportant issues to deal
  with, employees will view them as ineffectual
• Recent legislative changes include the European
  Works Council Directive and the Information and
  Consultation Regulations

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European Works Council Directive

• Applies to companies employing 1,000 or more
  workers and with 150 employees in two or more EU
  member states
• Adopted in 1994, revised 1997
• Implemented in UK 2000
• Provides for establishment of information and
  consultation arrangements at European level

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Information and Consultation Regulations

• Came into effect in Northern Ireland in April
  2005
• Affecting organisations with 150 employees
  initially
• Employees can request information on a companys
  economic situation and employment prospects
• See www.delni.gov.uk

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Summary

• Employee relations practice in the UK was
  dominated by trade unions and collective
  bargaining for most of the twentieth century
• Employment legislation has become more important
  in the employment relationship
• As trade union influence has declined, managers
  have looked to other forms of employee
  involvement

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References

• Beardwell, Holden and Claydon (2004) Human
  Resource Management (chapter 14), FT/Prentice
  Hall
• Hyman,J. and Mason,B. (1995) Managing Employee
  Involvement and Participation, Sage
• Kersley.B. et al (2005) Inside the Workplace
  first findings from the 2004 Workplace Employee
  Relations Survey, ESRC/DTI
• Marchington,M. and Wilkkinson,A. (2005) Human
  Resource Management at Work, CIPD
• Torrington, Hall and Taylor (2005) Human Resource
  Management (chapter 20), FT/Prentice Hall

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Further reading and websites

• Gennard,J and Judge,G (2005) Employee Relations,
  CIPD
• Rose,E. (2004) Employment Relations, FT/Prentice
  Hall
• www.delni.gov.uk (Department for Employment and
  Learning)
• www.dti.gov.uk (Department of Trade and Industry)
• www.lra.org.uk (Labour Relations Agency)