HRM for MBA Students
Lecture 6
Employee relations
Learning outcomes
• Understanding and evaluating the main explanations
given for conflict in organisations
• Understanding the nature of negotiations in the context
of employee relations
• Understanding the purpose and nature of both grievance
and disciplinary procedures
• Familiarity with the process of traditional collective
bargaining and agreements
• Familiarity with the main forms of industrial action
• Understanding the nature of ‘new employee relations’
• Understanding the concepts of employee engagement
and employee voice
Employee relations
• The policies and practices an organisation
uses in dealing with its employees
• Also, the systems of rules and
mechanisms by which organisations and
employees interact with each other
The term covers both collective relations
and policies and procedures which
operate at small-group or individual level –
eg disciplinary or grievance procedures
Grievance and discipline
• Most managers would agree that it is
inevitable that there are issues concerning
grievances and discipline in most, if not all,
organisations
• Employers (managers) and employees
(workforce) both have legal rights and
responsibilities
• They also both have informal expectations
of each other
Employees’ expectations
• That employers will treat them reasonably,
fairly and consistently
• That action will only be taken against them
on the basis of just cause and after proper
and thorough investigation
Employees will feel they have a right to
pursue a grievance if these expectations
are not met
Employers’ expectations
• That employees will perform their duties
and tasks in a satisfactory manner in
accordance with their legal obligations and
the organisational policies and procedures
• That, if the employees’ performance is not
satisfactory, employers have the right to
take appropriate action – which could
include disciplinary action
The employment relations
process
• The employment relationship is usually seen by
both sides as an ongoing relationship which
should survive the resolution of any particular
dispute, whether individual or collective
• If grievance and disciplinary cases are dealt with
properly, we assume that employee
dissatisfaction should be reduced and motivation
increased, with consequent improvements in
individual, team and organisational performance
The employment relations
process (cont.)
• Good grievance and disciplinary
procedures typically are set in stages, and
on the basis that issues should be dealt
with as close to their origin as possible
• The general principle is always to deal
with issues at the lowest level possible
given the nature of the inappropriate
behaviour
Negotiation
• is defined as:
a process for resolving conflict between
two parties whereby both modify their
demands to achieve a mutually
acceptable compromise.
Kennedy et al (1984, p.12)
Conditions needed for collective
bargaining
• Both management and the workforce must be
organised: this implies the existence of trade
unions or some other sort of association
representing the employees
• Formal recognition of the trade unions or other
employee association(s) by management
• Mutual agreement to negotiate in good faith and
to keep the agreements that are reached
Characteristics of the
negotiating process in employee
relations
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•
•
•
•
The parties are not involved in a one-off negotiation
and usually want to continue working together after the
negotiation or bargaining has been completed
The negotiation is usually about more than one issue –
eg basic pay and some aspect of working conditions or
some other benefits
Negotiations are conducted by representatives from
each side and so agreements reached by them will
require endorsement from the wider parties
Each side must establish its priorities, strategies and
tactics before the negotiations start
Once an agreement has been reached, there is joint
responsibility to make it work
Negotiation
MANAGEMENT’S BARGAINING RANGE
Ideal
settlement
point
Target point
Resistance
point
Bargaining parameters
Resistance
point
Target point
EMPLOYEES’ BARGAINING RANGE
(via trade union or staff association)
Ideal
settlement
point
Some types of
collective agreements
• Single-union recognition
• Partnership agreements
• New-style agreements
Dispute resolution: arbitration,
conciliation and mediation
• Arbitration
– a third party, the arbitrator, reviews and discusses the
negotiating stances of the disagreeing parties and
makes a recommendation on the terms of settlement
which is binding on both parties
• Conciliation
– a third party (eg ACAS) attempts to get the two parties
to agree on terms. Conciliators do not make
recommendations
• Mediation
– a third party makes recommendations which the
parties are not bound to accept
Informal employee relations
processes
• Managers should always remember that
within that formal framework of
negotiation, bargaining, etc , informal
employee relations processes are taking
place continuously, whenever a line
manager or team leader is handling an
issue in contact with an employee
representative, an individual employee or
a group of employees
Industrial action
• The sanctions which employees may resort to if
bargaining or negotiation does not produce an
acceptable result
• Informal industrial action is represented mostly
by individual, unorganised forms of action such
as:
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high labour turnover
poor time-keeping
high absenteeism
withholding of effort
inefficient working
time-wasting
sabotage
complaints
Formal industrial action
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Working to rule
Go-slow
Overtime ban
Strike (withdrawal of labour)
Sit-in (occupation of workplace)
Work-in (occupation of workplace and
attempt to keep it operating without
management)
The ‘new employee relations’
In general [the employee relations
agenda] is no longer about trade unions.
There is more emphasis on direct
communication, managing organisational
change and involving and motivating staff.
Issues about work–life balance and the
war for talent reflect a changing workforce
with changing expectations.
The CIPD (2005)
The ‘new employee relations’
(cont.)
... but employee relations skills and
competencies are still critical to achieving
performance benefits. The focus now
needs to be on gaining and retaining
employee commitment and engagement.
The CIPD (2005)
Employee engagement
• [Employee engagement] ‘can be seen as a
combination of commitment to the
organisation and its values plus a
willingness to help out colleagues
(organisational citizenship). It goes beyond
job satisfaction and is not simply motivation.
Engagement is something the employee has
to offer: it cannot be “required” as part of the
employment contract.’
• ‘Employers want engaged employees
because they deliver improved business
performance’
The CIPD (2007)
Drivers of engagement
• Involvement in decision-making – having
opportunities to feed views ‘upwards’
• Freedom to voice ideas, to which
managers listen
• Feeling enabled to perform well
• Having opportunities to develop the job
• Feeling that the organisation is concerned
for employees’ health and well-being
Institute of Employment Studies
Employee voice
• ‘Upward problem-solving’ and
‘representative participation’ to increase
the exchange of information between
managers and employees
• Replacing or supplementing traditional,
indirect means of communication such as
joint consultation
• Seeking to promote engagement and
higher performance at work