Industrial Relations - Manage IR for Higher Productivity

Empowering People to Drive Productivity

Industrial relations is not exactly the same as employee relations. However, some organizations consider that they are somehow the same.

They are the same yet different.

The latter focuses on employer-employee relationship. The former is concerned with organization-union relationship and the rules governing such relationship.

Both have the same purpose of creating a working environment with no or reduced conflicts.

By implementing an effective employee grievance procedure, you reduce further the possibility of conflicts.

Such conflicts, if they happen, will have a negative impact on productivity.

See to it that your organization complies with Labor Laws, the law of natural justice, and other relevant laws such as the common law and approved policies.

Even difficult employees are protected under the law. Matters like this can lead to conflicts between employer, unions and or employees.

Effects of Globalization on Employer-Employee Relationship

Sooner or later the impact of increased competition will affect your organization. This scenario makes employment-related costs and issues too important for you to ignore.

If your workforce is unionized, and with the internationalization of your business, unions must "add value" to the organization and make their members change to avoid the closure of their organization.

How Will You Handle Your Unions?

What type of union leadership are you dealing with?
Handle with care all matters raised by unions.

Both your organization and the union have only one main objective - the continued survival of your organization in an increasingly competitive business environment.

You can choose between several approaches to industrial relations (IR). Events in the last decade or so demonstrated that there was a movement away from the third option.

Under the unitarist approach both organization and union cooperate to ensure that employees perform well. The focus is on the parties' common interests in addition to promoting a harmonious working environment.

One of the criticism of this approach is that it does not favor unionism. In essence, it legitimizes management authority and ignores the diverse interests in employment.

The pluralist approach sees the organization and union at opposite ends. Under this approach, you recognize that the union is the legitimate representative of your employees. Compromises are common under this approach.

There is another approach, namely the marxist approach which treats trade union as "both a logical employee reaction to capitalist exploitation and part of the overall political process for achieving fundamental changes in society." This is a reference to class struggle.

An adversarial approach to industrial relations is very destructive. It may even lead to great financial loss or even closure of the business if the conflicts are not resolved quickly enough.

If negotiations fail, you can refer the dispute to an industrial tribunal for resolutions. Try to avoid this. This invites bad publicity.

At the end of the day, employees are more interested in earning their living than anything else.

All the same, there are calls for trade unions to truly represent the workers' interests at work.

Effects of HR Management on Industrial Relations

It had been alleged that Human Resource management (HRM) has adverse implication on the traditional adversarial employee relations.

Human resource management focuses on employees as important assets, emphasizes the importance of teamwork, and employee involvement in decision making, among many.

In contrast, IR consider employees as a cost, seeing the organization and employees as opposed to each other, with minimal employee involvement in decision working.

IR practitioners and other proponents of IR argue on the danger posed by Human Resource Management to unionism.

However, this should not deter you from implementing HRM.

The Parties Involved in IR

There are normally three parties, namely, the government, employer associations, and trade unions.

A trade union represents employees from one particular organization or a group of organizations involved in the same industry.

You may have a system of compulsory arbitration provided under federal laws, state laws or subsidiary legislation such as statutory instruments. These laws also prescribe other requirements on IR.

Familiarize yourself with these.

Industrial Relations Process

You can handle industrial dispute through a number of methods.

  • Collective bargaining where your organization negotiates with the union
  • Conciliation where a third party assists your management and union to reach an agreed settlement
  • Arbitration where a third party makes a judgment on the dispute between your organization and union
  • Consent awards where your organization and union ask for ratification by a third party of the negotiated agreement

The third party is usually an industrial tribunal.

Collective Bargaining Must End in a Positive Note, Resulting Better Industrial Relations

Legislation Regulating Industrial Relations

These include IR acts, trade unions acts and workplace relations acts, and include amendments to these laws from time to time.

There are other relevant laws including law court decisions.

Click here for a pdf article on the "Collective Bargaining Process"

Pay Attention to Workplace Safety, Difficult Employees, and Female Employees

Unions usually raise matters relating to wages and benefits. But they also consider workplace safety as being very important. This is an important provision in collective agreements.

Your organization cannot afford to ignore this matter which employees consider as one of the duties of employers. There is usually a series of government legislation on health, safety and environmental matters in the workplace.

Other matters that require careful handling are female employees as well as difficult employees.

Females employees are protected by anti-discriminatory laws. Recruitment policies and practices are subjected to these laws.

Terminating difficult employees is already hard without representation from unions.

But it is not impossible. Just make sure that your organization adheres to the existing rules and regulations, and the policies referred to in the collective agreement.

Do not consider every employee who complaints is a difficult employee in the strict sense. Such an employee may have a genuine grievance.

Try to resolve the matter raised as soon as practicable. However, you may find that facing an employee who has a grievance is not easy. The issue is not always the same.

You need training to effectively handle such matters. But training will not always provide the answer.

You need something that you can refer from time to time. You can teach yourself in handling employee complaints. This book, available from, explains how.

Re-Examine Your Industrial Relations Position

Your organization cannot just wish that the unions will go away. They won't. But do not consider them as antagonists against whom you must win at any cost.

This is a negative and a damaging approach to employer-unions relations. Everyone, including your organization, will suffer if a harmonious working condition does not exist.

Review your approach to IR. Changing economic conditions, the need to become more customer-oriented, globalization, and other market forces require that your organization do this.

Awareness of every new development in IR will go a long way in helping you make effective pro-active plans. Make adjustments as and when necessary.

Effective handling of industrial relations can contribute to your organization's productivity. On the other hand, any serious shortcoming will undo much of the good that is already there.

If your organization has the intention to go global, ensure everyone understand what are involved, including the importance of employee relations.

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