Page 26 - DCOM207_LABOUR_LAWS

Unit 2: Labour Laws, Industrial Relations and Human Resource Management

A discernible trend in management is a greater individualisation of the employer-employee Notes
relationship, implying less emphasis on collective, and more emphasis on individual relations.
This is reflected, for instance, in monetary and non-monetary reward systems.

Example: In IR the central monetary reward is wages and salaries, one of its central
themes (given effect to by collective bargaining) being internal equity and distributive justice and,
often, standardisation across industry. HRM increasingly places emphasis on monetary rewards
linked to performance and skills through the development of performance and skills-based pay
systems, some of which seek to individualise monetary rewards (e.g. individual bonuses, stock
options, etc.).
HRM strategies to secure individual commitment through communication, consultation and
participatory schemes underline the individualisation thrust, or at least effect, of HRM strategies.
On the other hand, it is also legitimate to argue that HRM does not focus exclusively on the
individual and, as such, does not promote only individual employment relations.

Notes The potential conflict between emphasizing the importance of the individual
on the one hand, and the desirability of cooperative team work and employee commitment
to the organization, on the other, is glossed over through the general assumption of
unitarist values ..: HRM stresses the development of a strong corporate culture -not only
does it give direction to an organization, but it mediates the tension between individualism
and collectivism, as individuals socialised into a strong culture are subject to unobtrusive
collective controls on attitudes and behaviour.

Some of the tensions between IR and HRM arise from the unitarist outlook of HRM (which sees a
commonality of interests between managements and employees) and the pluralist outlook of IR
(which assumes the potential for conflict in the employment relationship flowing from different
interests). “It is often said that HRM is the visual embodiment of the unitarist frame of reference
both in the sense of the legitimation of managerial authority and in the imagery of the firm as
a team with committed employees working with managers for the benefit of the firm.” How to
balance these conflicting interests and to avoid or to minimize conflicts (e.g. through promotion
of negotiation systems such as collective bargaining, joint consultation, dispute settlement
mechanisms within the enterprise and at national level in the form of conciliation, arbitration
and labour courts) in order to achieve a harmonious IR system is one central task of IR. The
individualization of HRM, reflected in its techniques which focus on direct employer-employee
links rather than with employee representatives, constitutes one important difference between
IR and HRM.

Did u know? The empirical evidence also indicates that the driving force behind the
introduction of HRM appears to have little to do with industrial relations; rather it is the
pursuit of competitive advantage in the market place through provision of high-quality
goods and services, through competitive pricing linked to high productivity and through
the capacity swiftly to innovate and manage change in response to changes in the market
place or to breakthroughs in research and development ... Its underlying values, reflected
in HRM policies and practices, would appear to be essentially unitarist and individualistic
in contrast to the more pluralist and collective values of traditional industrial relation.

Task As a HR Manager, how will you eliminate the tensions between IR and HRM
occur from the unitarist viewpoint of HRM.

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