Lecture/seminar outline

114.709: Managing 1. theoretical frames of

Employment Relations (ER) reference
2. advances in theory and
debate
Week Two: ER frames of reference 3. some conclusions

Prof. Jane Parker

Readings
QB Room 3.03 • Rasmussen (2009) Ch. 2
Email: J.Parker@massey.ac.nz
• Donnelly and Proctor-Thomson (2013) Ch 4
(pp58-64) in Parker and Arrowsmith
• de Silva (1997) 114.709

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1 Theoretical frames of reference i) Five major frames of reference

• conflict frames of reference:-

• as touched on in week 1, ER can be interpreted and
explained through the use of frames of reference – pluralism
– unitarism
• frames of references are useful tools to help us
understand what is occurring within the employment – radical pluralism or Marxism
relationship and wider employment relations issues
• systems theory
• there are different ways to view situations and different
frames of reference can be applied • social action approach

• if these are unfamiliar, see Rasmussen (2009) Ch 2

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Theory Manage-
ment
Workers Unions Conflict The state Unitarism
Unitarism Legitimate Resources Outside Unnecessary Should provide a
source of to be intrusion and incompatible minimal
authority applied to into with the aims of framework but
• disregards the different interests amongst individuals - there
production relationship the organisation has no special are no divisions or conflicts of interest between managers and
process between interests in the employees
firm and employment
employee relationship
• views the organisation as a team, unified in a common
purpose (i.e. organisational success)
Pluralism Co- Partners in Legitimate Inevitable - can Acts as the
ordinator production representa- be resolved referee by • single source of authority (management) and all participants
of a tive of positively by an providing share the same goal - harmony and co-operation are the
coalition workers’ institutional institutions to predicted outcomes
of interests framework that resolve conflict;
interests encourages represents “the • conflict is not inevitable but pathological, the outcome of
consensus public good” misunderstanding or mischief.
Radical Exploiter Exploited Only voice Inevitable - will Coercive arm of – management has failed to communicate its goals effectively (causing
Pluralism for exploited only ever end capitalism temporary friction)
with the – trouble-makers deliberately stirring up problems where none would
overthrow of otherwise exist
capitalism

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Unitarism (continued)
• good employment relations = good business so authority
can be left in the hands of management
• employees should not challenge managerial decisions or
their employer's right to manage
• there should no third party intervening in the employer-
employee relationship
• trade unions seen as 'an illegitimate intrusion into the
unified and co-operative organisation', creating
unnecessary conflict in an otherwise harmonious
working environment
Neo-unitarism
• since the 1980s, unitarism has become more refined and is often
referred to as 'neo-unitarism‘
• rise in neo-unitarism was a response to economic recession, with
its weakened union and worker power and the resultant employer
confidence in the workplace
• aims to integrate employees into the company
• managers should create a sense of common purpose and
corporate culture, set targets for their employees, and invest in
training and management development
• techniques to facilitate commitment, quality and flexibility include
performance-related pay, profit sharing and employee
involvement
• arguably, the Employment Contracts Act 1991 (ECA) not only
epitomised the neo-unitarist ideology but accelerated its
acceptance

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Pluralism Pluralism (continued)

• though unions are seen as the legitimate representatives

• views ER as coalitions of individuals and groups of workers with the right to challenge management, there
pursuing their own goals, yet each being dependent is still the notion of managerial prerogative – define
upon the others for mutual survival
• organisations have to accommodate different and
• the collective means by which individuals pursue their divergent groups in order to accommodate change
goals is not only natural but valid
• conflict is managed through rules and laws, enforced by
• conflict is accepted as both inevitable and legitimate and the government agencies/institutions. The laws also
is tempered and controlled through structures and protect the weak and restrain the power of the stronger
procedures. Examples? interest groups
• potential conflict can be eased and stability achieved by
recognising and involving trade unions

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Radical pluralism/Marxism Exercise

Conflict is inherent in ER because:
• defend and criticise:
1. Society is class-based and ownership acts as a source
of power and control, giving employers, (who own the – (neo) unitarism
means of production), the right to employ workers and – pluralism
direct how they shall work. The resulting conflict between
employers and employees is institutionalised. In – radical pluralism/Marxism
response workers form trade unions to represent their
collective interests.
2. Employers and employees will have differing values,
interests and objectives & this will create tension &
ultimately conflict between and within the two camps
(them and us approach)

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 Some criticisms of unitarism
• sees conflict in a narrow and managerialist way
• assumes that everyone shares the same ideologies and
aspirations
• no evidence that weak enforcement and voluntary compliance
works
Some criticisms of pluralism
• tends to concentrate too much on controlling and resolving
conflict, rather than understanding why it is generated in the
first place
• recognises that there is an imbalance of power at the
corporate and workplace level BUT assumes that government
is a neutral/balanced referee
• thus, pluralists have a tendency to focus on how conflict can
be managed while ignoring the nature or basis of conflict
Some criticisms of radical pluralism
• it’s based on ideas developed in the 19th century - little
relevance for the late 20th/21st century. - do you agree?
• growth of middle management and professionals does not fit
the simplistic view that the work is divided into employers vs
employees
• concerned mainly with identifying the source of conflict and
therefore cannot recognise other outcomes of ER
• predicts that changes in the structures and institutions will
create changes in the employment relationships. But this will
not automatically occur and that there can be a succession of
changes before changes in the fundamental aspects of ER
are likely to take place

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Systems theory
• in employment relations,
• adapted to ER by John Dunlop
• world seen as interrelated systems. Based in – Dunlop argues that it is useful to treat ER as a system in order to
in classical theory, particularly Durkheim and analyse and interpret the widest possible range of employment
Talcott Parsons practices

• 4 functions of any system: – ER are seen as a distinctive system, although one that partially
overlaps and interacts with social, economic and political
– maintenance function through shared ideology (for systems.
stability)
– goal attainment (tied to a specific situation ) – this approach emphasises interdependencies and interactions
– adaptation (because of scarce resources there has between organisations and their environment, and how order
to be a prioritising of goals) and stability is established in a changing environment
– integration between maintenance and goal
attainment – to illustrate ...

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Systems theory (ER)

INPUTS PROCESSES OUTCOMES • systems model begins with inputs of groups as well as
What goes into the system These can be formal (i.e. the influences of certain environmental factors
laws) or informal
• 3 key groups - managers, employees and the
ACTORS Bargaining RULES
government or private agencies - have their own
Employees, employers and Can be done at a range of Both formal and informal ideologies
the state different levels
Can be formalised or • creation of stability in ER requires that the ideologies can
informal
be adjusted enough to develop a kind of power balance,
acceptable to each group
CONTEXTS Arbitration, conciliation
Economic, political, social and mediation (State • this adjustment happens when inputs go through a
mechanisms) transformation process by way of bargaining and
conciliation to be converted into the outputs or the rules
IDEOLOGY
of employment relations
Shapes the way people act Feedback

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• essentially, the rules and practices of the
workplace are developed by the
interaction between managers, workers
and their representatives and government
agencies in an environment characterised
by changes in technology, labour and
products markets, and regulations
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Some criticisms of systems theory
• limited in that it provides a description and not an
explanation of employment relations
• it is preoccupied with rules and stability, and it tends to
overlook the dynamic dimension of interest divergence
and conflict
Some strengths
• provides a framework for assessing how well the various
parts of the employment relations systems interact
• useful for classifying elements since it arranges them
into a coherent model or system
• other?
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• Weber: an individual's actions can be categorised into four
types:
– a traditional or habit-bound action
– a spontaneous and emotional action
– a rational action based on one's own behaviour in
response to others' behaviour
– strategically planned action in which decisions have been
made that take into account all consequences of the action
in the short, medium and long term.
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The rules take several forms:
• substantive rules e.g. those contained in an
employment contract or organisational/job manual
• procedural rules: rules that govern how substantive
rules are to be made and interpreted, e.g. the personal
grievance procedures set out in the Employment
Relations Act 2000
• oral rules: part of a verbal agreement or supervision on
the job
• custom and practice rules: habitual acts not written
and sometimes not even spoken of and they may only
be exposed if transgressed
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Social action theory
• Max Weber sets out to classify the meanings people may give
to their behaviour and the behaviour of others
• Weber tried to grasp the basic characteristics of modern
industrial society by looking at the way we interpret the
meanings of others, which in turn influences our actions
• focuses on the subjective and individual social responses of
employers and employees in different situations and attempts
to understand particular actions rather than just observing
behaviour
• we don’t necessarily share the same views and will attach
different meanings to the interactions (e.g. managers and
workers will come together their differing ends may be served
by the same means)
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Recap:
• theoretical frames of reference are used to
understand and interpret the nature and context
of employment relations
• each has its own strengths and weaknesses
• ER theory is still evolving
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ii) Other perspectives Examples of how political ideologies translate in ER terms

Labour (coalition): ER
1999 2013/14 2018/19
• in week 1, we stressed how ER reflects the perspectives Repeal ECA Oppose ER Amendment ER Amendment Act 2018 (revert
or standpoints of different disciplines and disciplinary Good faith Bill Want ‘balanced, fair to 2015 law)
approaches Multi union, multi and encourages good • reinstate breaks
employer quality relationships’ • strengthen collective
• for example, redundancy can be viewed from an bargaining law bargaining and union rights
economic, historical, medical or sociological perspective Can’t replace Oppose ‘trickle down • restore protections for
striking workers economics’, vulnerable workers
No compulsory Full days work should • limiting 90 day trials to
• a perspective based on political ideology (values) is unionism, cover basics smaller workplaces want to
often adopted in relation to ER, e.g. sympathy strikes, e.g. (Extended) re-balance worker-employer
compulsory PPL/$60 a week power relationship
– ‘right wing’ and ‘left wing’
elements of arbitration or child payment ‘humanised’ capitalism? (well-
– conservative, liberal, radical national awards scheme
each? being budget)
– socialism
Equal Pay Amendment Bill
(imminent)
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National: ER ACT: ER
1999 2013/14 2018/19
1999 2013/14 2018/19
Retain ECA 2013 – significant Wants to repeal the ER
changes to the ER Amendment Act 2018 – Strongly supports pro extension of ‘Freedom to earn’
Act 2000 sees it as regressive and the ECA 90 day trial period policy
around collective too union/worker Would allow to all firms Wants a flat rate of
bargaining, union orientated and regulatory employers to dismiss Wants fewer income tax and a
status and protection new workers within 6 ‘higher quality’ company tax rate
Sees a good IR/ER
of new employees month probationary regulations Wants to repeal
framework and flexible period
labour market as critical to
Nb: nothing Labour’s industry-
Post 2008: demise of
Clean up explicit on ER wide centralised
tripartism and a strong and growing occupational on its political bargaining legislation
‘rebalancing’ of ER economy (with neo-liberal health and safety website (Fair Pay Agreements)
(aodn other) policy economic approach) laws Supports right of
towards business employers and
interests employees to
negotiate terms that
are appropriate for
them
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ER and HRM
• disciplinary connections/overlap ... • first, note the key differences in HRM and IR/ER:

• de Silva (1997), section 6 in particular, asks two key 1) IR/ER: collectivist and pluralist; predicates that outcomes
are standardised rules and procedures
questions which encourage us to think about the ER and
HRM nexus or areas of connection (see: • HRM: does not encompass a third party (state) – it’s bipartite
https://www.bartleby.com/essay/Human-Resource- but essentially individual focused (e.g. See HRM functions)
Management-Industrial-Relations-and-Achieving-
• nb: what about team work and corporate culture building?
FK50GJK8KDRVA)
• HRM: pursuit of competitive advantage in the market place,
– how does HRM challenge IR/ER? underlying values are unitarist (but tries to achieve a
commonality of interests)
– how can the conflict, if any, be resolved so that the
two complement each other?

(also Parker (2013) Ch. 1)

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• 2) IR/ER: comprises a large component of rules set by the
state through laws, negotiation parties, courts and tribunals.
HRM deals less with rules than policies and practices. • 5) HRM is the more integrated approach – makes it closer to
corporate planning and strategy than ER, and involves more
• 3) pluralist outlook of IR assumes a potential for conflict involvement of line managers (ER seen as specialist function)
between the two parties or one of them and the state, flowing
• do you agree?
from different interest

– IR/ER seeks to balance interests through means directed at

the ‘collective’
• 6) IMPORTANT: employee loyalty and commitment that HRM
– In ER, grievance handling makes a concession to the seeks to harness – is dual allegiance (employee commitment
individual
to the organisation and to the union) possible?
• 4) HRM: involves individualisation of the employment
• is conflict in values and goals inevitable?
relationship; participation in ER involves unions rather than
individuals directly

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• 7) emergence of new categories of employees has Exercise: HR/ER “Venn Diagram”

heightened distinctions between HRM and ER.

– knowledge workers (e.g. Handy 1990): individualisation • think about how you would position the
thrust of HRM more suited to their aspirations
fields of ER and HRM in relation to one
– other employee groups: another
• part-time
• home workers • justify your view(s)
• contract workers

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[2] Exercise 2. Advances in theory and debate

• social order and social welfare

• Consider:
– conciliation and arbitration system until ECA 1991

1. whether HRM is practised as an anti-union or union • individualism and workplace ER

avoidance strategy
– questions the traditional understanding of collective action
2. the effect of unionisation on HRM
– psychological contracts, emotional and aesthetic labour (SAT) →
3. union views on HRM WLB, careers and generational differences in work expectations
– discrimination and EEO theories and models have prompted
4. NZ employment context – does this make a changes in employment practices (legislation often about
difference? Why/not? individual rights and entitlements)

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• related rise of HRM
• balancing efficiency, equity and labour market flexibility
– HRM approaches, employee engagement
– periods of experimentation: 1890s, 1930s and 1990s
– context of economic decline, legislative framework focus on
economic efficiency in recent decades (ECA 1991, ERA 2000)
• flexible/performance pay
• women
• cross-cultural management
• migration

• ER/HRM training • globalisation, transition economies, MNCs

• others?

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Conclusions
• ER and HRM – can they co-exist harmoniously?
• key ER theoretical perspectives include:
• key advances in theory and debate in ER
– unitarism -- social action theory
– pluralism -- systems theory
– radical pluralism/Marxism

• common political ideologies which permeate ER include:

– ‘right wing’ and ‘left wing’ -- socialism

– conservative, liberal, radical

• ER considers the collective, seeks to reconcile conflict, stresses

communication with employees through unions, traditionally
promoted standardisation

• HRM focuses on the individual, seeks to match goals (unitarist)

goals, is concerned with flexibility

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Next week
• CONTEMPORARY WORKFORCES AND
WORKPLACES

• Recommended readings:
– BUIRA (2009) Ch 5, pp. 4-6
– Department of Labour (2008)
– Parker (2013) Ch. 3 in Parker with Arrowsmith; for Australia, see
Baird et al. (2018) in Parker
– Parker and Arrowsmith (2011)
– Arrowsmith and Sisson (1999)

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