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In any industry, or business organisation employee relations or industrial relations is a critical component of the overall business and human resource strategies. However, it is important to understand that more or less, employee relations or industrial relations as a term are synonymous to each other with relatively similar meaning. In this regard industrial relations can be defined as association between the management of the organisation with its employees. These employees are generally represented in form of a single body known as union led by a union leader. Concept of industrial relations is more prominent in organisations which exist in manufacturing sector.
On other hand, employee relations can be defined as an association between employer and its employee in any other industry other than manufacturing sector. Industrial relations are driven mainly by legal regulatory frameworks laid down by the government such as Employment Relations Act. On other hand, employee relations are often affected by external factors outside the organisational boundary. Hence, employee relations can be impacted by slight slump in economic conditions and vice-versa.
Over a period of time, organisations irrespective of their sector or size have been using these terms interchangeably. Purpose of this essay is to closely analyse the concept of employee relations with respect to various scenarios and derive its importance for an organisation.
Over last few years, there has been major shift in the way organisations are managing their employee relations. Organisations are focused more towards the integration of the overall employee relations framework where, there is equal attention is given to both employee’s interests as well as organisational objectives. In this regard, it is important to highlight two important approaches which are often used by organisations to handle its employee relations. First approach is known as unitarist approach or framework, whereas other approach is known as pluralistic approach. Both of these approaches have their own set of unique features which segregates them from each other.
For example, when we talk about unitarist approach, then in such approach of employee relations, there is only single authority in the organisation which mainly is the management level of the organisation. Hence, in such scenarios, leadership of the organisation is driven by an individual, resulting into making other senior people and their leadership of less significance. Focus of the leadership is towards instilling sense of loyalty, commitment and faithfulness among the employees towards the organisation. In such approach of employee relations, it has been observed that conflicts between employees and leadership of the organisation do not exist; hence employee works in close coordination with their supervisors/managers/leaders so that an organisational objective setup by the management can be achieved successfully. In such approach there hardly in relevance of employee bodies such as trade unions. Hence it can be said that unitarist framework works mainly on the basis of close coordination between employees and their managers on common understanding of commitment and loyalty towards the organisation.
Unlike unitarist approach, pluralistic approach is completely different, this approach considers the organisation or a workplace as an environment where there are several principles, and ethics, behaviours are present. Pluralistic approach is focused towards establishing a balanced environment in an organisation where both employees as well as organisational objectives remain in sync with each other. However, it has been observed that in this approach, focus is more on employee’s rights and their expectations, whereas role of organisation’s management is more like a arbitrator. Trade unions are critical component of such approach as they are considered to be the voice of the employees and reflect a collective opinion.
In this regard, example of Tesco PLC can be considered. Tesco PLC was initially established as an organisation focused on unitarist approach, where the management of Tesco was focused on taking all the major decisions related to the employees. However, when Tesco PLC went public, its approach gradually shifted from unitarist approach towards pluralistic approach, as result of which, today Tesco employees are represented by their trade unions who work closely with employees as well as management of the organisation, so that employee’s interest are fulfilled along with organisational objectives of Tesco.
As mentioned in above sections, there is stark difference in the way trade unions used to function before and in present situation. Unlike past, trade unions and their members are completely aware of their role in the organisation, and various guidelines within which they can raise a demand from the organisation. Today, trade unions are more reasonable in their methods of functioning and do not threaten the organisation with different kinds of threats. Employees who are part of the trade unions are aware of their rights, and various laws, hence influencing them with any false propaganda is not possible either by the management or the trade union leaders. There is no doubt that trade unions have tremendous impact on the employee relations.
For example, changes such as focus on implementation of public laws and regulations to govern the union has made an employee aware about his role in the organisation and various rights he has, due to this employees today are focused towards helping the organisation in achieving its objective. However, from organisational perspective also, leadership of the organisations are well aware of the pitfalls they might face, if they do not maintain a healthy, professional and promising work environment for its employees. That is why, unlike past today there is high level of engagement activities between the leadership of the organisation and the trade unions.
Changes in trade unions have pushed the organisations to think and analyse role of employees in the road to achieve the organisational objectives. Today, employees are no more considered to be just paid professionals. In fact employees are today seen as a critical internal stakeholder of the organisation who helps in achieving the organisational objectives, this has been possible only due to positive changes which has taken place in the way trade unions functions today, and has become more practical and rational in its approach towards handling employee relations.
In employee relations function, there are certain important players who facilitate implementation of employee relations related policies and guidelines. These main players with context to Tesco as an organisation are as follows:
Manager: In employee relations, managers present in an organisation play a critical role. Managers are responsible for managing the human resources working under them. Due to this responsibility, managers become accountable for ensuring that employees interest is taken care of, and a healthy, positive and growth oriented work environment is presented to the organisation. In Tesco PLC there has been specific focus on ensuring that the manager at store level is not focusing organisational polices, but is also responsible for keeping a close track of his employees, along with their issues and concerns. In a way, manager can be defined as a gateway through which employees under him can get an update about the organisational policies. For a good manager, it is not just enough to manage the employees in terms of work allocation to them, a good manager in employee relations function is the one who is capable of handling all the aspects related to an employee along with his interest at the work place.
Trade/employee unions: In Tesco PLC, its employees are associated with each through their respective trade union. Role of trade unions in employee relations is like a catalyst. At times, organisations might get complacent about rights of their employees resulting into unrest and resentment. That is why, trade unions are critical in employee relations, as they help in maintaining a balance between the organisation’s management and the employees. There are various organisations where trade union is seen as a voice of its employees. For organisation also it becomes easier to deal with single trade union leader rather than going to each and every employee to address and understand their concerns.
Government/public agencies: Government is also an important player in maintaining an effective employee relation, for example government setups various regulatory framework in order to manage employee or industrial relations. Hence, government’s role in employee relations is like a watchdog which does not interferes directly in the functioning of an organisation, however it do governs various legal aspects through its policies and laws related to employee/industrial relations.
EU has major influence on the way industrial democracy has taken shape in United Kingdom. Today, due to various EU laws on labours and workers, these people are in a strong position in an organisation. That is why, role of employees in increasingly being seen as a major stakeholder responsible in the process of decision making. It will not be wrong to say, that EU’s influence has resulted into creation of work environment, where management and employees are seen more as a partners working together to achieve the organisational goal.
In this regard, it can be said that participation of employees/workers and process of consultation are two critical attributes which have come due to influence of EU. Because of these attributes, organisations in United Kingdom based organisations are including its employees in the decision making process and further stressing on employee participation in day to day managerial activities of the organisation. In fact employee participation might also exist in different forms. For example one of the most used way of participation is direct participation. In such situation an employee might be consulted by the organisation directly, or face-to-face. Other popular ways are consultation in groups, individual delegation and delegation in groups.
In the process of employee participation and consultation, one important feature is that, it involves the consultative participation of the employees. Hence, in such situation employee is not just seen as a redundant actor in the process of decision making, in fact focus is more towards taking maximum decisions based on the employee consultation.
There are several methods which can be used to gain employee participation and involvement in the decision making process in an organisation like Tesco. For example, Tesco uses quarterly surveys to collect feedback from an employee about his manager. Based on the feedback received, accordingly managers are updated about their performance and corrective decisions are taken.
Another important method is performance assessment of an employee, this particular method might not be positive for all the employees, as performance of one employee might be poor as compared to other. However, to a large extent, performance assessment definitely impacts an employee’s thought process, as it shows the mirror of an employee’s performance based on which he can improve his participation in the decision making process in the organisation. Another important method is of collective bargaining. However this method might not be useful for all situations. For example, an individual can be involved at personal level in the decision making process, which is not possible by involving each and every participants/employees in the decision making process.
Over a period of time employee relations has become an integral part of the Human Resource Management strategy of an organisation. It is important to understand that HRM is focused towards implementation of all the guidelines and regulatory framework in such a way, that it fulfils the interest of employees as well the organisation. HRM decisions might have direct impact on the satisfaction of an employee.
All the mutual agreements or the contracts drafted by HRM have got a direct impact or the influence on employee relations. Today in any organization, there is a diverse range of employees which makes the job for HRM tougher. In a diverse environment, it is a challenge to ensure a happy work environment and healthy employee relations.
Human Resource Management could make use of two frameworks the unitarist and pluralist to maintain the employee relations. The framework needs to be chosen as per the type of the organization. A good combination of both the approaches would be the best option and will have a positive impact an influence eon employee relations.
Based on above analysis, it can be said that, today employee relations as acquired an important status in every organisation’s policy and strategies. No organisation can ignore its employees, hence efforts are being made by organisations across the world to ensure that employee’s expectations are met, and there is no conflict of interest between employee and his employer.
Role of manager, and his way of communication is equally important in the process of conflict resolution. Parties engaged in a conflict situation might use several tried and tested approaches for the conflict management.
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