Page 160 - DMGT106_MANAGING_HUMAN_ELEMENTS_AT_WORK

Managing Human Element at Work

Notes Cooperation between management and workers or unions facilitates not only a settlement
of disputes or disagreements but also the avoidance of disputes which may otherwise arise.
At the industry level the relationship between employers’ organizations and representatives
of workers is a precondition to collective bargaining. Where collective bargaining takes
place at the enterprise level, management workers/union relations determine to a great
extent the success or otherwise of collective bargaining. At the national level a good
relationship between representatives of employers and workers enables them to effectively
participate in labour-management relations policy formulation and to arrive at a consensus.
The importance of cooperation in industrial relations and the stability achieved through it
to gain economic competitiveness are well illustrated by Germany and Japan. Writing at the
end of the 1980’s, Wolfang Streek stated: “Despite its relatively small population, West
Germany is still the world’s largest exporter of manufactured goods, ahead of both Japan
and the United States. Among the larger economies, the West German is, more than any
other, exposed to world market pressures. It is only against this background that the high
degree of stability and mutual cooperation in West German industrial relations can be
understood, and it is this stability and cooperation that has in the past accounted for part
of the country’s competitive success in world markets”.
This cooperation is reflected in Germany’s system of collective bargaining (which has often
shown wage restraint), in the system of co-determination, and in the vocational training
system to which employers and unions have made a substantial contribution, thus ensuring
a highly skilled workforce producing goods of the highest quality attractive to the global
marketplace. While this cooperation does not imply an absence of conflict, yet when conflict
occurs it has usually been resolved through compromise solutions. The participative
management system also explains the relatively easy acceptance by German workers of
technological change.

In a broad sense, therefore, Labour Management Relations Policy Formulation (LMRP)
should aim at achieving social justice through a process of consensus by negotiation so as
to avert adverse political, social and economic consequences. Labour relations reflect the
power structure in society, and it emphasizes negotiation and reconciliation by peaceful
means of the interests of government, workers and employers who are the main participants
in the system. Consensus enables the policy formulated to be implemented with the minimum
of conflict as it has the support of all three parties. This is in fact reflected in the ILO’s
principle of tripartism. In the final analysis, labour management relations policy seeks to
achieve development through establishing conditions which are fairer, more stable and
more peaceful than they are at any given moment of time. Labour management relations
policy also seeks to achieve an acceptable balance between labour and management, necessary
for a negotiated development strategy and the establishment or preservation of a society
which is essentially pluralist.

Industrial relations have its roots in the industrial revolution which
created the modern employment relationship by spawning free labour
markets and large-scale industrial organizations with thousands of wage
workers.

7.3 Sound Industrial Relations System at the National
and Industry Level

Labour management relations policy formulation is one of the significant tasks at the
national level, and its successful formulation and implementation can influence the labour
relations climate at the industry and enterprise levels. Such policy formulation, however, can

154 LOVELY PROFESSIONAL UNIVERSITY