EMPLOYEMENT RELATION

1. Background:

Employee relation is defined by Marchington etal (2006) as :

“It can be classified in several ways, ranging from direct EIP requiring the

participation of each individual – e.g. in team briefings or problem-solving groups

– to indirect or representative participation’ (p.11).

Gennard & Judge (2005) explain employee involvement by citing the work of

Marchington (1992) as a range of processes which are inspired by company

management, and then these are implemented with the hope to increase

employee information & knowledge about the organisation, and thereby help to

generate employee commitment to the organisation.

These processes are used to direct people towards an improved company

performance. However, Poole & Mansfield (1992) present their point of view

that managers happen to be supportive of employee involvement practices only

if they do not radically interfere with their control function within the firm.

Employee involvement enables the organisation to concentrate on individual

employees, “and is also designed to produce a committed workforce more likely

to contribute to the efficient operation of an organisation” (Gennard & Judge,

2005 p181).

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2. Employee relations in UK and china- a comparison:

Little is known about the Human Resource Management strategies and

practices adopted by multinational companies (MNCs) from developing countries
operating in developed countries.

MNCs increasingly dominate the world’s markets, and are playing a central role
in the globalisation of economic activity. In turn, the internationalisation of
markets for products and services is requiring multinationals to develop new
forms of trans-national management organisation. Among these, the ways in
which MNCs manage their personnel on an international scale are increasingly
viewed as critical to the success of globalising strategies (Bartlett & Ghoshal,
1989).

Employee relation is seen as strategic in terms of managing business risk.

Employers use the employee relations skills and competencies and feel them as
critical to achieving performance standards through a focus on employee
involvement, commitment and engagement.

According to CIPD (2005) “the emphasis of employee relations continues to shift

from 'collective' institutions, such as trade unions and collective bargaining, to
the relationship with individual employees”

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.

Employee relations is seen as strategic in terms of managing business risk: both

the downside risk of non-compliance with an expanded body of employment law,
and the upside risk of failing to deliver maximum business performance.

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Employee relations are about setting a trust among the employees so that they
feel as a part of the family. Since a Chinese MNC has to operate in UK, the
distinguishing factors need to be kept in consideration which might impact our
employee relations strategy.

3.EMPLOYEE RELATIONS:

As stated by Heathfield(2002) in her article regarding ‘ Employee Involvement’:

“Employee involvement is not the goal nor is it a tool, as practiced in

many organizations. Rather, it is a management and leadership
philosophy about how people are most enabled to contribute to
continuous improvement and the ongoing success of their work
organization”.

Before undergoing the discussion and strategy, it is important to know that how
the both HRM practices in chinese and UK firms are different. The cultural
distance between the HRM in China and the Western oriented societies has
been documented by several studies (Hofstede, 1980). It has been found that
there are significant differences. Management cultural values in the UK have
been described as high on individualism, moderately low on both uncertainty
avoidance and power distance, and moderately high on masculinity (Hofstede,
1997). In contrast, Chinese culture has been described as high on power
distance, low on individualism, moderate on uncertainty avoidance and
masculinity, and high on long-term orientation. Thus, there are major differences
in management culture between the two.

There is evidence, however, of some change in HRM practice following

economic reforms designed to move China from a ‘command economy’ to one
more responsive to the market (Chan 1993). These have led to the introduction
of new employment policies and to the development of new employment
relationships in many firms including state owned enterprises. Employment law

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now sanctions a wide set of practices, previously more commonly found in joint
venture firms, such as fixed-term labour contracts, performance-based rewards
systems, as well as greater individual contributions to social security
arrangements (Warner,1993).

4. Avoid conflicts:

Based on Chapter 23 of Human Resource Management in a Business Context

(2nd Edition) by Alan Price - published by Thomson Learning .Only a portion of
employee relations issues have a disciplinary element. Many cases arise from
some form of conflict between management and employees, or between specific
individuals. Conflict has both positive and negative aspects Where does conflict
come from? A number of basic psychological causes are apparent, regardless of
the overt justification for a dispute:

• Frustration and aggression

• Different objectives
• Different values
• Jealousy
• Culture

Conflict is an inevitable feature of negotiating and bargaining. Trained

negotiators are taught to deal with conflict, expecting both negative and positive
aspects to appear during the process. This will be easier to understand when we
consider specific models of negotiation in the final section of this chapter.

Issues of conflict and discipline may not be resolved at local level. Many
countries have mechanisms by which disputes may be taken to an outside body,
usually in the form of industrial tribunals or arbitration bodies.

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In our case we have to minimize the conflicts that may arise due to the
management practice differences. The conflict might arise due to the reasons
stated above.

5. The employee relation strategy adopted:

Kaufman (004) states in his one of the presentation that EI is not a new idea &

he relates it to early 1919-20s. (Presents finding on the High EI in delta airlines,

at the British academy London, 2004)

He points to the 1920s Shops Councils and Employee World War-I shop

committees, or "works councils," which represented American industry's first

formal experience with joint worker-management problem solving teams.

For the sake of this assignment, I would only discuss few option with examples.

5.1.Consultation and communication channels:

a. Consultation:

Good employee relations s the foremost important condition needed for success.

Employee involvement schemes can help where both management and

employees are willing to be open in their attitude and behaviour. It allows

employee participation and employee support through mutual agreement.

Unless an atmosphere of trust is in the air, the relationship cant be successful.

Gennard & Judge (1997) explain that employee involvement schemes can thrive

where both management and employees are willing to be open in their attitude

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and behaviour, operating in a background with no disputes and confrontation;

allowing employee participation; employee support gained by agreement not by

force.

In Consultation employees exchange views and information. However it is still

upon management to make the final decisions but management takes into

account the views of employees before making the decisions. CIPD (2004)

report on agenda for change mentions ITV’s EI initiatives.ITV’s approach to

employee relations is based on engaging with its employees. It achieved this by

a combination of methods, such as; collective bargaining, consultation with

elected employee representatives and direct engagement with individuals.

At ITV engagement is regarded as being critical to the success of the company,

which is developing a balanced scorecard containing different measures of

engagement. ITV also uses a wide range of direct communication methods to

engage with individuals. ITV’s intranet, known as the ‘Water-cooler’, is a very

useful interacting tool. It provides a daily online update on news affecting ITV

and there’s a weekly Water cooler for employees who are not online.

It is a face-to-face communication that encourages a dialogue between

management and employee representatives. It is believed that employees

become well informed about company operations and therefore choose to

support management initiatives. We can use this option as it will lead to direct

participation from employees.

b. Communications:

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Other types of communications may include the practises like team briefing,

company newsletter and journals and some times more cost effective options

such as staff suggestion schemes, employee attitude surveys and quality circles.

These practices help to collect information from employees in order to assess

employee morale and commitment on some issues like employee perception.

These surveys can be used to measure the reaction of employees and also see

whether they accept the changes. This form of Employee relations is believed to

be cost effective as companies spend less and also motivate employees through

recognition of their ideas and rewards offered for suggested and implemented

ideas.

Inmarsat Plc.,is one example that has shown a good practice of employee

involvement through staff surveys. It was privatised in 1999 from an

intergovernmental organisation to a limited UK company.

For some employees, the privatisation brought uncertainty, as there were some

redundancies. There was a low staff morale and motivation, and the company’s

leadership saw it necessary to promote stability and confidence amongst staff.

With the help of a specialist the company designed a staff opinion survey that

would bring a reality about the employee attitudes and morale. The

questionnaire focused on themes like: our future plans, working relations,

communications and management style.

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Before the survey, there was a communication exercise designed to promote

and encourage a high response rate. The company had a target of 70% but the

response rate was 75%. Other surveys followed in 2000 and 2002 with new

focus areas like resources; efficiency, work-life balance, training and

development, collaboration between departments; and customer focus. The

2002 survey included staff based at the company’s overseas offices. The

response rate improved to 86% for that survey. This was done by and

benchmarked on the specialist company Pilot HR Solutions.

The staff survey is a good example of good practice as it resolved Inmarsat

problems and brought improvement not only on staff morale and motivation but

also on interdepartmental communications; openness, trust and morale; training

and career development; and team leadership at senior levels.(IDS HR Studies

Plus,2004)

It can be a motivating tool for employees when the opinions of employee are

known and employees are motivated when they see their problems addressed.

Employee commitment and trust on management is reflected by improved

participation.

d. Teams Working :

Self-managed team, save money for the company as they eliminate layers of

management. They can eliminate excess personnel as they “can take on tasks

previously done by specialist’s staff” (Marchington & Wilkinson 2005, p84).

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Employees are able to get more skills from others in the team.

Financial Participation

This is where the employees share in the ownership and prosperity of the

business. Profit sharing scheme gives employees an interest in the profit

realised by the organisation. Employees therefore know that for them to gain

they have to work in a productive manner.

It is believed to encourage employees to identify more closely with company

aims and objectives and to promote the idea that common interest lies in

maximising company profits. Examples are profit sharing and share ownership

schemes.

Such schemes normally have different share options and according to

Ramsay(1996) business or financial involvement of employees yields better
productivity and ‘rumour grapevine’ is reduced, and resistance to management
action is also reduced.

CONDITIONS FOR SUCCESS

Good communication with employees is a common characteristic of all such

approaches. A modern forward-looking business does not keep its workers in
the ark about important decisions affecting them. It trusts them and involves
them and thrives for leadership at all levels. “Command and control” is no longer
a sufficient model. A more open and collaborative framework will harness the
talents of all employees.

Employee relations succeeds if supported by the following and to these are

conditions for success as seen by Gennard & Judge (1997):

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  Good employee relations

 Resources

 Top management commitment

 Monitoring

Good Employee Relations:

Gennard & Judge (1997) explain that employee involvement schemes can

prove to be good. The success for the mentioned forms of EI is dependent on

good relationships that exists b/w employer-employees. Where both

management and employees are willing to be open in their attitude and

behaviour, operating in a background with no disputes and confrontation;

allowing employee participation; employee support gained by agreement but not

by force.

Resources:

Resources in the form of time, finance and skills are needed for the success of

EI initiatives. These should be made available for effective operation and

monitoring of the schemes and it include financial resources, time for meetings,

and training for acquiring skills and lost output or service.

Top Management Commitment:

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Schemes are unlikely to be effective unless top management, is committed to

such schemes. If the top management is not involved to make ‘employee

involvement’ as success, the whole idea is useless. Employees should be able

to see its commitment like through the top management involvement into the

scheme. If not supportive of the scheme, management might fail to get

employee commitment, loyalty and support as well.

Monitoring and Reviewing Arrangements:

All the planned programs once started should be monitored as well. This

monitoring and reviewing of the performance is essential to ensure that the

expected desired outputs of the scheme like improved efficiency and quality

are being realised. Gennard & Judge (1997) state that: “Regular monitoring

and reviewing also enables an organisation to assess the cost-effectiveness of

its employee involvement and participation schemes”.

Conclusion:

The message which employee relations seeks to put across is that people are

important, and taken as the asset. All the types seek to enhance employee

commitment through information and involvement and therefore every

organisation must communicate that message.

In the above discussed organisations,it has been seen;that it is vital that

organisation shows that everyone matters and that employee is equally

responsible in contributing to its success.

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The success depend mainly on two factors namely, the top management

commitment to improve, and the availability of financial resources to tackle to EI

programs. From the cases and the outline of the assignment it is clear that

conditions for success should be met and that the appropriate type of EI

initiatives should be implemented. The organisations have also proved that

these conditions once met have improved productivity, uplifted morale and

improved service quality. In the cases we have seen that correct information and

management know how it has enabled the implementation of initiatives that

helped in improving work performances of workers due to continuous feed back

and monitoring .Also the financial participation helped to gain employee

involvement. All such initiatives have resulted in raising the employee morale

and satisfaction.

Involvement, participation and consultation can take many different forms. This
paper looks at current UK experience and identifies examples of best practice,
ranging from team briefings and quality circles, to firms where management and
the workforce have agreed to adopt a “partnership” approach. They show that
best practice takes many different forms, ranging from schemes of direct
manager-to employee communication and involvement, to more formalised,
representative involvement. And they demonstrate that what works best is what
most suits the needs and circumstances of the particular business and its
workforce.
We should try to choose those practices which are suitable in our case and we

need to focus on involving employees more into the organisation. it would help

us in lowering the differences between the two managerial styles. Since the top

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management might be Chinese and UK both, however the staff is UK based,

therefore such schemes are very useful to gain our commitment to work force.

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References:

Adler, N.J. (1992). International dimensions of organisation behaviour, Belmont, Calif:

PWS-Kent.

Bartlett, C., & Ghoshal, S. (1989). Managing across borders. London: Hutchinson.

Chan, A. (1993). Revolution or corporatism? Workers and trade unions in post-Mao

China. Australian Journal of Chinese Affairs, 29, January, 31-61.

Gennard, J. & Judge, G. (1997). Employee Relations. London. CIPD

Gennard, J. & Judge, G. (2005). Employee Relations. London CIPD

IDS HR Studies Plus. (2004). “Employee Attitude Surveys” No 777

IRS Employment Review (2005). “Pay and Benefits” No 831. pp34-35

Marchington, M. & Wilkinson A. (2005). Human Resource Management At Work: People

Management and Development. London. CIPD

Marchington, M ‘employee involvement at work’. Human Resource Management At Work:

People Management and Development. London. CIPD (2001)

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