Lecture 8

Human Resources Lecture 8 Employment relations and collective bargaining Managing employee relations

No single event seems to have had more impact on HR management in New Zealand in recent times than the Employment Contracts Act 1991. The Employment Relations Act 2000 also sparked off debate and controversy. These acts were predetermined by the pressure of economic change, globalisation and a more competitive marketplace.

Employment Contracts Act 1991 The aim – ‘to promote an efficient labour market’, allow employees to decide who would represent them in employment matters, and to enable employees to choose whether to negotiate an individual employment contract or be bound by a collective employment contract.

The research showed that employees in 41% of the cases approved the Act and it helped them -In the ability to negotiate with employers on a one-to one basis; -Lower production costs; -A more competitive economy; -Flexible hours; -No discrimination; -Stopped strikes and unions under control; -Better wages and benefits for workers; -Reward for effort; -Safeguards for both employers and employees.

Employment Relations Act 2000 To build productive employment relationships through the promotion of mutual trust and confidence in all aspects of the employment environment and of the employment relationship -By recognising that employment relationships must be built on good-faith behaviour; and -By acknowledging and addressing the inherent inequality of bargaining power in employment relationships; and -By promoting collective bargaining; and -By protecting the integrity of individual choice; and -By promoting mediation as the primary problem-solving mechanism and -By reducing the need for judicial intervention.

Institutions and actors Institutions The Employment Relations Act maintains the Employment Court and its exclusive jurisdiction over legal issues which arise out of employment agreements Mediation The Department of Labour is required under the Act to provide mediation services to ‘support all employment relationships’. Mediators are expected to do more than help resolve disputes. They may provide: -general information about employment rights and obligations; - information about services available to help solve employment relationship problems; - other services that assist the smooth conduct of employment relations; - services that assist people to resolve their employment relationship problems promptly and effectively; - services that assist people to resolve problems with the fixing of new terms and conditions of employment.

Employment Relations Authority An investigative body that has the role of resolving employment relationship problems by establishing the facts and making a determination according to the substantial merits of the case, without regard to technicalities. Employment Court The decisions of the Employment Court are final. Unions Unions benefited a lot from the Employment Relations Act, because its major impact was to provide a legal status for unions – a status removed by the Employment Contracts Act – and to give unions a monopoly over the negotiation of collective employment agreements.

Union recognition Any organisation may be registered as a union under the Employment Relations Act, provided that: -It is incorporated under the Incorporated Societies Act 1908; -It aims to promote its members’ collective employment interests; -Its rules are reasonable, democratic, not unfairly discriminatory or prejudicial, and not contrary to law; -It is independent of, and ‘is constituted and operates at arm’s length from any employer’.

Collective bargaining The process of determining wages, salaries and other employment terms and conditions by negotiation between one or more employers, and one or more unions on behalf of some, or all, of their members. Advantages of collective bargaining -Collective bargaining has the advantage of settlement through dialogue and consensus rather than conflict and confrontation. It differs from arbitration, where the solution is based on the decision of a third party. -Collective bargaining is a form of participation. Both parties participate in deciding what proportion of the ‘cake’ is to be shared by the parties entitled to a share. It is a form of participation also because it involves a sharing of rulemaking power between employers and unions in area which is earlier times were regarded as management prerogatives. -Collective bargaining usually has the effect of improving industrial relations. This improvement can take place at different levels.

Good faith in employment relations The legal requirement of the Act for all parties to employment relationships to treat each other ‘in good faith’. Good faith should be used in: -Collective bargaining; -Questions about a collective agreement which arise while the agreement is in force; -Consultation between employers and employees and union about employee’s collective employment interests, including the effect on employees of changes to an employer's business; -Employer proposals that might have an impact on employees (e.g. a proposal to contract out the work they do, or to sell or transfer the business); -Redundancy; -Access to a workplace by a union representative; -Communications between unions and employers regarding secret ballots held for collective bargaining purposes.

Managing Employee Relations Employee relations includes strategies, plans and processes for developing and maintaining the commitment of employees in times of change, promoting effective communication within the organisation, developing employee support services, developing an effective occupational safety and health environment, ensuring that organisation complies with its own policy requirements and with its contractual and legal obligations, developing and maintaining effective negotiation and consultation processes with groups and individuals, and developing effective grievance and disciplinary processes. Today you might notice: -Reduced role of unions; -Changes in the workplace; -Insecurity and changing loyalties.

Mutuality The idea that employees and employers have common and shared interests. The new HRM model is composed of policies that promote mutuality – mutual goals, mutual influence, mutual respect mutual rewards, mutual responsibility. The theory is that policies of mutuality will elicit commitment which is turn will yield both better economic performance and greater human development. Development and maintenance of a positive psychological contract becomes a cornerstone pr positive employee relations.

A model of the psychological contact (Guest, 1996) CAUSES CONTENT Organisational culture

Fairness

CONSEQUENCES Organisational Citizenship

HRM policies and practices

Organisational Trust

Commitment

Experience Motivation Expectations

Alternatives

The delivery of the deal

Satisfaction and well-being

Causes of the psychological contact -Organisational culture; -HR policies and practices; -Previous employment experience; -Expectations about employment; -Alternatives. Employee loyalty and commitment - From control to commitment; - The Japanese/ excellence school. Trust people and treat them like adults, enthuse them by lively and imaginative leadership, develop and demonstrate an obsession for quality, make them feel they own the business, and your workforce will respond with total commitment.

Problems with commitment It is probably wise not to expect too much from commitment as a means of making a direct and immediate impact on performance. It is not the same as motivation. Commitment is a wider concept and tends to be more stable over a period of time and less responsible to transitory aspects of an employee's job. It is possible to be dissatisfied with a particular feature of a job, while retaining a reasonably high level of commitment to the organisation as a whole.

Culture Norms -Values -Philosophy -Rules of the game -Feeling the climate -

Types of culture -Power culture (based around a founder of an organisation, fast changing and resistant to external environment); -Role culture (bureaucracy); -Task culture (based on jobs and project); -Person culture. Impact of culture

Managing culture

Building a new culture

Challenges of managing culture Most organisations are still in transition from an ‘old’ culture to a ‘new’ one that requires greater flexibility, as well as the willingness and capability to operate in conditions of rapid change and uncertainty. We live in an increasingly multi-cultural world. Should an organisation set out to instill new values and develop a new culture? Organisation climate questionnaire 7. Conformity 8. Responsibility 9. Standards 10. Rewards 11. Organisational clarity 12. Warmth and support 13. Leadership

Developing the employee relations plans Answer these questions first: -How good are working relationships in the organisation? -What do the managers think of other staff? -What do employees think of the organisation and its management? -How well do HR policies and practices contribute to positive employee relations? -How skilled and knowledgeable are the managers in regard to their employee relations and people management responsibilities? The results of the audit will inevitable lead to discussion of what the ideal state should be. The organisation needs to consider: -Organisational factors; -Management factors; -Staff factors; -Environmental factors.

Reducing resistance to change -Education and communication; -Participation and involvement; -Facilitation ad support; -Negotiation and agreement -Manipulation and co-option; -Explicit and implicit coercion. Stages in change -Unfreezing -Changing -Refreezing

Communication in the workplace One way communication Sender

Message

Receiver

and media

Two-way communication Sender

Message and media

Feedback and media

Communication flows Vertical Horizontal

Receiver

Communication skills Speaking - informal - planned - formal Writing Listening Asking questions Non-verbal communication Facial expression Eye contact Gestures and movements Posture Physical appearance Non-verbal vocalisations

Space and territory -an intimate zone - a personal zone for close friends; - a social-consultative zone a public zone. Barriers to communication -Inappropriate language; -No feedback; -Wrong medium; -Distractions; -Too much communication; -Poor listening; -Assumptions and conclusions; -Too kind

Atmosphere -Cultural differences; -Different roles and perceptions; -

Organisational barriers -Distance -Long communications lines -Ineffective process -Specialisation -Pressures -Status differences -Filtering.

Communication methods -Handbooks -Magazines and newsletters -Manuals -Grapevine -Team briefing Cross-cultural communication -Organisational issues -Job interviews; -New employees -Problems and solutions.

Effective communication -Do I know what I want to communicate? -What do I expect to happen when my message has been passed? -What other interpretations might be put on my message? Can I be misunderstood? If so, how can I prevent that happening? -Is my message complete, correct, and appropriate to the situation under review? -Do I really listen to people? How do I know? -What communication breakdown have I experienced today? Why did it happen? Could it happen again?

Negotiations and bargaining To try to reach an agreement or arrangement by discussion. Approaches to negotiation -Avoiding -Defusing -Confronting -Collaborating. Negotiation skills -Knowledge of the facts -Communiaction skills -Objectivity, fairness -Social skills.