Employee Relations Labor Law

A Journey from Industrial Relations to

Employee Relations:
 What is Employee Relations – The term ‘employee relations’
was conceived as a replacement for the term ‘industrial
relations’ but it’s precise meaning in today’s workplace need
clarification. In 2004/5 a lot of research was carried out to
ascertain the changing nature of employee relation work in
modern organizations, to get a snap shot of the current
attitude and practices. The findings have resulted in
formulation of the term ‘employee relations’.
 The decline of ‘industrial relations’ – ‘Industrial Relations’ s
generally understood to refer the relationship between
employers and the employees collectively. The term is no
longer widely used, except in specific sectors and even there
in modified form.
 The decline can be measured in several different
dimensions:-
1. There is a continuous decline in the union membership.
2. The range of issues over which bargaining took place has
reduced massively. It has in fact become less than half of
what it was before.
3. Workplace Employee Relations Survey (WERS) 1998
showed that union officials spend most of their time not to
negotiate pay and work conditions but in supporting
grievances on behalf of individual members.
4. Even where collective bargaining continued, its impact on the
exercise of management discretion was greatly diminished.
5. The shift in the coverage and content of collective bargaining
has been reflected in dramatic reduction in industrial action
since 1980.
6. The number of working days lost per year has also reduced
drastically during the last few years.
 What does employee relations mean to employers
(an important stakeholder) :-
1. Employee relations can be seen primarily as a skill set or a
philosophy, rather than as a management function or well
defined area of activity.
2. Despite well published instances of industrial action, the
emphasis of employee relation continues to shift from
‘collective’ institutions, such as trade unions and collective
bargaining, to relationship with individual employees.
3. The ideas of ‘employee voice’ and the ‘psychological
contract’ have been accepted by the employers and is
reflected in their employee relations.
4. Employee relations skills and competencies are still seen by
employers as critical to achieving performance benefits
through a focus on employee involvement, commitment and
engagement
5. Employee relations is seen as a strategy for managing
business risks.
 What is the state of development of employee
relations in Industry?
1. The findings of WERS 2004 (Workplace Employment Relations
Survey) give a mixed picture of he state of employee
relations. Managers in 30% of the work places report that
the relations have improved a lot since 1998. However,
employees’ views have changed little over the period.
2. A key issue for manager is focus. Are they directing their
attention to the issues that will make a real difference in
business performance? There is a strong evidence that a
positive psychological contract with employees will lead to
superior economic performance.
3. But managing the psychological contract appear to figure
fairly low in the list of management and specifically of the
HR Function’s priorities.
4. Only a few respondents considered employee
engagement as among the top five priorities for HR
functions in their organizations.
 What is Employee engagement?
1. The achievement of business goals and financial returns is
increasingly dependent on delivery by front line employees.
2. ‘Engagement’ has been described as a combination of
commitment and organizational citizenship. Research has shown
that these are both routine outcomes of a positive psychological
contract.
3. Evidences about people management policies and practices that
contribute to building employee engagement are as follows:-
a. Employee Voice – is an on-going, open communications
forum that encourages continual input from staff members. It is
easily added to your existing website or intranet and provides a
non-threatening venue for employees to express their
suggestions, concerns, compliments, and complaints.
b. Team Working - WERS 1998 commented that – training,
team working, supervisors trained in employee relations
matters and problem solving groups are all associated
with one another. The combination of these practices
result in employee participation in ‘decision making’.

c. Work-life balance – Policies of work life balance are

being used by employers to underpin positive work force
behaviors. Various surveys of employee attitudes have
underlined the link between work life balance, commitment
and performance. For example – employee in many
organization can ask for flexible work timings due
changing organizational policies.
 Managing workplace conflict –
a. The ability to manage conflict remains a key issue for
many organizations. Mediation as a method or technique of
resolving work place issues represent an important shift
from the traditional industrial relations frame work, with its
emphasis on formal discipline and grievance procedures,
towards more of a ‘win-win’ approach consistent with the
philosophy of HR management.

b. The decline of industrial relations means that managers

may need to be reminded that employees’ interest are not
necessarily with those of their employer; that despite the
decline in strikes and other forms of industrial action, work
place conflict still needs to be managed.
 What is the Current State of Industrial
Relations?
1. To a considerable extent, it is only the public sector
that trade union retain a measure of their former
strength and influence in work place. This is because
institutions of collective consultation, reinforced by
many cases of industry level bargaining and public
policy emphasis on management – union ‘partnership’,
is still there in public sector.

2. Union influence in the private sector, on the other

hand continues to decline. The main areas of private
sector where industrial disputes are still experienced,
is the transport system, the influence of union is still
there.
 3. ‘Employee Relations’ as a term remain ambiguous, with no clear
boundaries. Most HR functionaries do not use the term on an
everyday basis. It is not calculated to help managers focus on what
they need to know and do to increase performance, as it offers few
insights to contemporary practices.

4. Traditional academic models of industrial relations have only limited

relevance to what managers do today. Employers are in charge and
the role of ‘joint control’ and ‘rule making’ by employers and trade
unions have been replaced by employment regulations and
organizational norms and values.

5. Employee relations can nevertheless point to an underlying

philosophy and attitudes and skills that are still needed by HR
practitioners. Focus on business may result in negligence of softer
skills, which are essential to managing the employment relationship,
and of employee interests and influence.
6. Commitment and engagement are critical to performance but
they are not consistently considered as high in line hierarchy
and even as HR priorities. Presently there is little basis for
expecting this to happen.

7. More effort need to be put into training and supporting the

line managers in, for example – team working and change
management, as the basis for establishing and maintaining
motivation and commitment which is critical for maintaining
sound employee relations.

8. The concept of engagement is helpful in promoting wider

interests in the measurement of HR outputs, including
through the widespread use of employee attitude surveys,
and through performance management/appraisal systems.
 Links between Employee Relations and Share
Holders:
Whenever there is a change required in the
organization or in the situation of merger /
acquisition, the ultimate decision regarding the
change will have to come from the shareholders.
Employees must know what are the ideas of the
shareholders regarding functioning of the
organization. In many companies employees are
asked to attend the shareholders meetings and
exchange ideas and thinking about change,
organizational processes and resource utilization
with them.
 Negotiation Process in Employee Relations:
1. In establishing negotiating aims, points to be
considered by the management are -
a. How the employees might react to management
proposals.
b. The issues that they are prepared to trade in
bargaining.
c. The bargaining style that is to be adopted.
d. The strategy and tactics that they might develop.
2. Process of negotiations –
a. Open discussion
b. Seeking clarifications.
c. Listening to the demands projected.
d. Identify the issues involved.
e. What can be conceded and what can not be
conceded.
f. Getting a general agreement on different
issues.
g. Concluding the agreement with the employee.
h. Getting the agreement in writing from both the
parties.