Managing Trade Unions at the Firm Level & the Dynamics of Collective Bargaining

By Rai, Himanshu | Indian Journal of Industrial Relations, July 2008 | Go to article overview

Managing Trade Unions at the Firm Level & the Dynamics of Collective Bargaining


Rai, Himanshu, Indian Journal of Industrial Relations


Trade Unions

Employees represent the human side of an organisation and trade unions serve to give them a collective voice to protect and further their interests. Of late, there has been a decline in the proportion of unionised workplaces and in the collective representation of employees on many issues predominantly due to a reassertion of managerial power in the workplace and government support to management in the face of globalisation (Sen 1997). The decline could also be attributed to the shift of jobs from the manufacturing to the service industries, and unaggressive union leadership (St. Antoine 2001). At the firm level, it is the interaction between the attitudes of management to employees and unions, the attitudes of employees to management, and the attitudes of employees to unions that determines the quality of industrial relations (Aswathappa 2001).

A variety of reasons, such as, unemployment, public goods, destructive competition, and the greater ease that firms have in replacing employees than employees have in replacing jobs, are responsible for market biases against employees (Voos 2001). In view of these markets, the collective bargaining that trade unions facilitate becomes relevant and perhaps a necessary means to achieve the societal objectives of redistributing income, rights, political voice, and power to employees.

At the firm level, trade unions exercise joint control with the management over certain aspects of work and the related terms and conditions of employment, and thus, redress the bargaining advantage of the individual employee with respect to the employer by providing collective action instead of individual action (Aswathappa 2001). The predominant union tactics to achieve this are organising, collaboration, political pressures, strikes, and blackmail.

In a study of 80 managers working in a variety of industries, Das and Dr. Himanshu Rai is Asst. Professor, Indian Institute of Management, Lucknow-226013 Manimala (1997) found that a large proportion of managers felt that unions interfere with an employer's ability to run business efficiently, and the feeling was stronger as one went up the managerial hierarchy. They also found that the prevailing climate of trust and cooperation between management and union in a firm affected the managerial attitudes toward worker autonomy and security. The managers were more likely to be flexible in accommodating union and the employees and providing autonomy and a sense of security to workers in firms, which had a cooperative work atmosphere between management and the union. Sometimes, employers dislike unionism because of an expected increase in costs due to higher remunerations and benefits, fear of loss of control over operations and freedom to reward performance, and an anticipated lack of ability to adapt quickly to changing demands (Aswathappa 2001). To obviate the need for unionisation of their organisations, managers, therefore, employ effective supervision, open communication, effective personnel research, healthy and safe working environment, effective employer-employee relations, effective remuneration, effective training and development programmes, effective personnel planning, recruitment and selection (Aswathappa 2001); strategic human resource management system (Das & Manimala 1997); and strategies leading to reduction of support for unions (Wright 1996), contracting of work (Kumar & Murray 2002).

In a study carried out in five large manufacturing establishments, Ganj (1996) found that workers joined unions because they thought unions could protect them against victimization, secure the wage increases, and ensure job security and improved conditions of work. On the other hand, those who did not join unions cited dissatisfaction with the general functioning of unions, pursuance of personal goals by union leaders, fear of victimization, fear of being branded disloyal to the organisation, and fear of reprisals by the management as the underlying reasons. …

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