Part one
The nature and context of
industrial relations
CHAPTER ONE
THE STUDY OF
INDUSTRIAL RELATIONS
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Overview
 What is industrial relations?
 Distinguishing different approaches to the study of the
employment relationship
 A pluralist perspective: Neo-institutionalism
 A unitarist perspective: HRM
 A radical perspective: The labour process
 Final observations
 Summary
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What is industrial relations?
 Definition important—setting the scope of study.
 Many attempts at definition:
– from job regulation to social relations at work.
 Challenges to the discipline:
– rise of non-unionism
– growth of human resource management (HRM)
– revival of labour economics.
 A broad definition:
‘industrial relations is about the behaviours and interaction of
people at work’.
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What is industrial relations?
(cont.)
 Industrial relations (IR) assumes the employment relationship
is conflictual:
– power relations at work.
 Traditionally, it focused on ‘collective’ aspects of
employment.
 It has expanded to incorporate ‘individual’ aspects.
 IR is interdisciplinary by nature.
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Distinguishing different
approaches to the study of
employment relations

There are three distinct ideological perspectives to origins
and nature of industrial relations, each leading to a distinct
approach/analytical tool to explain industrial relations:
1. a pluralist perspective, leading to ‘neo-institutional’
approaches
2. a unitarist perspective, which informs human resource
management (HRM)
3. a radical perspective, which enables a ‘labour process’
approach.
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A pluralist perspective: neoinstitutionalism
Pluralism
 First, what is the pluralist perspective?
– Conflict is inevitable: competing interests between the
parties.
– Power is diffused among the main bargaining groups
within the employment relationship: no-one dominates.
– Trade unions are viewed as providing a mechanism that
legitimates employees’ rights to bargain within the
workplace.
– The state is regarded as an impartial entity, whose
primary function is to protect the ‘public interest’.
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A pluralist perspective: neoinstitutionalism (cont.)
Pluralism (cont.)
 What are the criticisms of pluralism?
– Theory of pluralism is unclear.
– Power is not evenly diffused:
 it is is typically weighted towards management in the
workplace.
– Emphasis upon rational approach to conflict
management:
 a form of managerialist thinking that obscures.
– The emphasis on rules and regulations neglects process.
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A pluralist perspective: neoinstitutionalism (cont.)
Neo-institutionalism


Neo-institutionalism is an extension of pluralist thinking
about the role of ‘rule-making’ in the employment
relationship.
It sees that the employment relationship is governed by two
types of rules:
1. formal/informal rules
2. substantive/procedural rules.
These rules are made in a broader context: as a result of the
forces and imperatives of capitalist social relations, in society
and in the workplace.
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A pluralist perspective: neoinstitutionalism (cont.)
Neo-institutionalism (cont.)

Other features of the neo-institutionalist approach:
–
–
–
–
the open-endedness of the employment relationship
understands the present in terms of the past
seeks to describe and understand the ‘real’ world
is not concerned with developing grand theory—develops
theory through induction.
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A unitarist perspective: HRM
Unitarism

What is the unitarist perspective?
– Assumption of a common purpose and shared goals, with no
fundamental conflict of interest between labour and capital.
– Conflict is an aberration, the result of:


poor communications
poor management.
– Unions are seen as an unwelcome intrusion:

complete loyalty of employees.
– Role for strong management.
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A unitarist perspective: HRM
(cont.)
Unitarism (cont.)

Approaches within unitarism:
– scientific management (Taylorism/scientific management):
 work study/‘one best way’
 establishment of work rules.
– human relations (Mayo/the Hawthorne experiments):
 emphasis on work groups and social relations at work
 less importance given to economic incentives.
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A unitarist perspective: HRM
(cont.)
Unitarism (cont.)

Approaches within unitarism (cont.):
– neo-human relations (McGregor/Likert/Herzberg):
 importance of individual needs of workers
 creating satisfaction from the nature of job.
– human resource management:
 emphasis on the management of commitment
 integration of employees into organisational strategy.
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A unitarist perspective: HRM
(cont.)
Unitarism (cont.)
 What are the criticisms of unitarism?
– A narrow approach that neglects causes of conflict.
– Fails to explain the prevalence of conflict within
organisations.
– Does not account for uneven distribution of power among
employees and employers in the decision-making
process.
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM
 HRM is the modern form that a unitarist approach to IR
typically takes, that is:
– the management of the employment relationship primarily
from the perspective of the employer.
 This can be seen in the main focuses of HRM:
– plan human-resource requirements
– recruit and select employees
– train and manage employee performance
– reward employees
– dismiss or retire employees.
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM (cont.)
 HRM as a scholarly concept is relatively imprecise.
 What is its scope?
– Is it a study of employer labour-management practices, or
– is it concerned with the optimal allocation of labour to
achieve management’s goals?
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM (cont.)


The two main schools within the HRM approach are:
1. ‘soft’ HRM—‘developmental humanism’
2. ‘hard’ HRM—instrumental integration of employees into
firm objectives.
‘Best practice’ approach vs ‘contingency’ approach.
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM (cont.)
 ‘Soft’ HRM:
– focuses on individual employees and the management
strategies needed to increase employee satisfaction,
organisational commitment, motivation and work
performance
– employees have universal needs, best identified and met
using techniques drawn from psychology and
organisational behaviour
– the techniques of management, aimed at achieving these
goals, are considered to be ‘best practice’, the ‘best’ ways
to develop employees towards organisational goals.
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM (cont.)
 ‘Hard’ HRM:
– focuses on the better integration of HR strategies into
business strategy
– employees are seen as a commodity to be better
allocated, in order to assist the achievement of business
strategies
– decisions about the adoption of specific HRM policy
becomes increasingly about cost–benefit analysis.
 Management’s aims are to achieve ‘best fit’ between HR
strategy and business strategy.
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A unitarist perspective: HRM
(cont.)
The analytical tools of HRM (cont.)
 Criticisms of HRM approaches:
– both ‘hard’ and ‘soft’ HRM lack empirical evidence
confirming prescriptions.
– ‘soft’ HRM has fundamental contradictions:
 individual performance and development, and teambased cooperation
 implementing organisational flexibility can undermine
the stability, trust and long-term development needed
to achieve organisational goals
 HR’s championing of organisational culture can
conflict with the desire for flexibility.
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A radical perspective:
The labour process
Radicalism
 What are the common features of radical perspectives?
– Fundamental and inherent conflicting interests between
management and workers.
– Uneven distribution of power between bargaining
groups, within the workplace and society.
– The role of trade unions—to challenge managerial
control.
– The state protects the interests of capitalists.
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A radical perspective:
The labour process (cont.)
Radicalism (cont.)
 What are the criticisms of a radical perspective?
– Preoccupied with conflict:
 obscures any cooperation or shared goals between
management and workers.
– Class struggle not part of modern capitalism.
– Capital is not homogenous:
 competition among capitalists.
– Under-estimates the independence of the state.
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A radical perspective:
The labour process (cont.)
Class struggle and control in the
labour process
 Marx argued that capital social relations are based on a
fundamental divide between the bourgeoisie and the
proletariat.
 Labour possesses labour power—the potential effort that
each employee offers.
 Potential labour does not always equal actual labour.
 Management’s task is to convert this labour power into actual
work and effort, in order to make a profit.
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A radical perspective:
The labour process (cont.)
Class struggle and control in the
labour process (cont.)
 This gives rise to the central theme within the labour-process
approach: How does management maximise the conversion
of ‘potential’ labour into ‘actual’ labour?
– Labour is not always compliant in this process, resulting
in conflict between management and labour.
– As this relationship is open-ended, management seeks to
establish methods for ensuring control, to maximise
‘actual’ labour effort.
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A radical perspective:
The labour process (cont.)
Class struggle and control in the
labour process (cont.)
 The labour-process argument: How does management
maximise the conversion of labour power into actual labour?
– Braverman (1974) argued that management seeks
control and improved performance through deskilling
labour.
– Friedman (1977) argued that management could use
either:
 direct control or
 ‘responsible autonomy’ based approaches.
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Final observations
 Chapter has highlighted three perspectives to the
employment relationship:
– unitarist
– pluralist
– Marxist.
 Each of these approaches are competitors in seeking to
explain the nature of the employment relationship:
– each approach is based on different value judgments.
– each approach emphasises different aspects of the
employment relationship.
 This text adopts a pluralism/neo-institutionalist approach.
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Summary
 The ‘commonsense’ approach to industrial relations
highlights conflict between trade unions and employers:
– Need to move beyond this limited view.
– Theory provides a guide to understanding the relationship
between the parties in the employment relationship.
 Three types of theories are introduced in this chapter:
– pluralist/neo-institutionalist
– unitarist/HRM
– radical/labour-process theory.
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