Essay on "HRM Paradigm and Trade Unions"

Essay 6 pages (1680 words) Sources: 3 Style: APA

[EXCERPT] . . . .

HRM Paradigm and Trade Unions new trend in business over the preceding twenty years, or so is Human Resource Management, an internal tool that has been developed to help businesses streamline labor issues and potentially increase rather than decrease the flexibility of the labor aspect of business. According to Donald Wells, despite the consistent denials of wrong doing, by businesses and trade unions the new trend in HRM is to develop better communication and flexibility between corporations and trade unions, hence decreasing the bargaining power of the strict contract decisions that unions have advocated for in the past. This direct communication is not in and of itself a challenge to unionism but has become the source of a loss of rights for employees, as unions have begun to see the issue from the perspective of business, rather than staunchly advocating for employee rights with limited concern for business concerns. (Wells, 1993, pp. 56-57) Unions have served the historical role of creating a voice for employees, in so doing they have had both positive and negative effects on business, providing collective cost reduction of programs through large group systems, helping train and educate employees collectively and therefore at reduced costs to employers but they have, as some would argue often lost sight of the actual market in which they are negotiating and overburdened the employer with demands that the current market cannot meet. (Flanagan & Deshpande, 1996, p. 23)

Though HRM is clearly much more than a greater developed communication standard between management and unions, this aspect of HRM is clearly incompatible with unionization and the traditional standard of advocating for employee concerns against business demands. The unions have been in a postion to research, independently, and with the assistance of businesses trade and market issues that helped them develop greater knowledge of the ability of a market to absorb greater pay and/or social services for employees, without the intrusion of business on the findings. Now, the persuasive power of business representatives can have a greater influence on the outcomes of union demands and gains.

In North America, corporate responses to increasing international competitiveness appear to center less on wage concessions and technological change than on organizational change involving greater cooperation between workers and managers. Human Resource Management (HRM) reforms are intended to enhance managerial initiative by replacing rigidities in contractual relations between unions and management with more flexible and cooperative arrangements entailing greater commitment by employees to management goals. These reforms are often referred to as Team Concept, Employee Involvement, and most frequently, Quality of Working Life or QWL....HRM changes include job expansion (job rotation, enlargement, and enrichment), skill enhancement (multi-skilling), worker participation in workplace decision-making, production based on self-organized, self-supervised work teams, rigorous screening of new hires, group problem solving, gain-sharing and profit-sharing, improved communications between workers and managers...These reforms entail a loosening of previous limits on the prerogatives of management, whether such rights are codified [as they would be in union contracts] in collective agreements or established on the basis of an informal 'common law' of workplace practices. (Wells, 1993, pp. 56-57)

Wells' basic argument is then that HRM may serve important functions, some of which improve employee productivity, engagement and empowerment but also open the employee to the development of systems that are again more in favor of management and more flexible for the management to again reassert the right to alter employee rights based not on employee needs but on business needs. This to Wells is proof that, trade unions and the new HRM paradigm are clearly incompatible, simply because in both the positive and the negative sense they reduce or even eliminate the rights of employees to bargain for change that is conducive to their needs, rather than the needs of the employer and give the employer more rights to alter the work conditions. They also reduce the bargaining power of unions by creating a system that is much more aware of the persuasive needs of business as apposed to the persuasive needs of the employee. There are like any other situation bit positive and negative aspects of both trade unions and HRM practices and like anything else a balance needs to be made in an ethical format.

The development of trade unions has occurred over time to help ensure that individual workers are not treated unfairly in the work place. The reason for this is simple, labor is an area of investment, within business that can and often is seen as an area where cuts can be made to increase profitability. Labor is one of the most flexible aspects of business as the number of hours one works and the wage one earns, not to mention benefits offered are directly associated with management decisions and managers under pressure, which most are, can manipulate such to reduce overhead and potentially create higher profits, within the limits required production. Trade unions appeared early in the industrial revolution as a result of the fact that labor principles were often cloudy and left employees directly at the mercy of management with little or no reasonable protection or vote for changes that did not allow individual employees the right to voice concern or elicit changes that might help improve rather than undermine employee standards of living. (Lee, 1998, p. 313)

As business has become increasingly competitive in a global market the labor subsection of business has come increasingly under fire, again as a flexible aspect of business that can be trimmed and developed to better meet profitability goals, which are expected to be in exponential growth at all times for a business to be successful. (Lee, 1998, p. 313)

Management of human resources has been acknowledged as an important factor in developing sustainable competitive advantage (Pfeffer 1995; Lado and Wilson 1994; Kydd and Oppenheim 1990). Unlike other resources (plant and equipment or product design, for example), superior human resources tend to be very difficult for competitors to duplicate. (Flanagan & Deshpande, 1996, p. 23)

The fact that human resources are one of the most flexible aspects of the business experience has both positive and negative consequences. Employers can seek to improve employees with investment in training, further education and incentive-based programs or they can choose to exploit employees by paying them less than what they are worth or offering them less than equitable social services to decrease the overall labor budget. According to Wells, HRM gives back to mangers what unions chose to take away with collective bargaining and contract employment agreements. Unions provide for employees not only bargaining but the ability of employees to seek improvement of skills inside the trade they work in, usually for the cost of dues paid by employees and minimal investment by the employer, and in unskilled trades they can help employees seek alternative employment where standards and conditions might be better. Like HRM the arguments associated with unions are also split, as some recount dissatisfaction as the essential product of unionization while others stress that productivity is increased as a result of the demands of unions on managers to improve employee compensation and standards.

Labor unions can have a major impact on a firm's HRM practices. It has been argued that unions not only limit an organization's discretionary authority to change workplace practices, but also have a negative effect on productivity (Holly and Jennings 1994). Also, union workers generally report lower job satisfaction and higher conflict with management than do non-union workers (Freeman 1994). Unions can also affect the median wage of the workforce. The unionized blue collar worker's median wage is about 70 per cent higher than that of his/her non-unionized counterpart (Bureau of Labor Statistics 1993).It is important to note, however, that many observers argue that unions can be and often are a positive influence on firms and productivity. Bluestone… READ MORE

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