Chapter 9: Industrial relations potx

Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Chapter 9 Industrial relations Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Chapter objectives • Discuss key issues in industrial relations and the policies and practices of multinationals. • Examine the potential constraints that trade unions may have on multinationals. • Outline key concerns for trade unions. • Discuss recent trends and issues in the global workforce context. • Discuss the formation of regional economic zones such as the European Union. The focus of the preceding chapters has been on managing and supporting international assignments, post-assignment and the issues in subsidiary operations. In this chapter we: Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Introduction • We need to consider some general points about the field of international industrial relations. First, it is important to realize that it is difficult to compare industrial relations systems and behavior across national boundaries; an industrial relations concept may change considerably when translated from one industrial relations context to another. • Cross-national differences also emerge as to the objectives of the collective bargaining process and the enforceability of collective agreements. (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Introduction (cont.) • Schregle has observed: “A comparative study of industrial relations shows that industrial relations phenomena are a very faithful expression of the society in which they operate, of its characteristic features and of the power relationships between different interest groups. Industrial relations cannot be understood without an understanding of the way in which rules are established and implemented and decisions are made in the society concerned.” (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Introduction (cont.) • Poole has identified several factors that may underlie these historical differences: – the mode of technology and industrial organization at critical stages of union development – methods of union regulation by government – ideological divisions within the trade union movement – the influence of religious organizations on trade union development – managerial strategies for labor relations in large corporations. (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Introduction (cont.) • Union structures differ considerably among Western countries. These include industrial unions, which represent all grades of employees in an industry; craft unions, which are based on skilled occupational groupings across industries; conglomerate unions, which represent members in more than one industry; and general unions, which are open to almost all employees in a given country. (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Table 9-1: Trade union structure in leading western industrial societies Introduction (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Introduction (cont.) • These differences in union structures have had a major influence on the collective bargaining process in Western countries. Some changes in union structure are evident over time. • The lack of familiarity of multinational managers with local industrial and political conditions has sometimes needlessly worsened a conflict that a local firm would have been likely to resolve. • Increasingly, multinationals are recognizing this shortcoming and admitting that industrial relations policies must be flexible enough to adapt to local requirements. • This is evidently an enduring approach, even in firms that follow a non-union labor relations strategy where possible. Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations • Industrial relations policies and practices of multinational firms – Because national differences in economic, political and legal systems produce markedly different industrial relations systems across countries, multinationals generally delegate the management of industrial relations to their foreign subsidiaries. However, a policy of decentralization does not keep corporate headquarters from exercising some coordination over industrial relations strategy. – Generally, corporate headquarters will become involved in or oversee labor agreements made by foreign subsidiaries because these agreements may affect the international plans of the firm and/or create precedents for negotiations in other countries. – Multinational headquarters involvement in industrial relations is influenced by several factors, as detailed below. (cont.) Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – The degree of inter-subsidiary production integration. • High degree of integration was found to be the most important factor leading to the centralization of the industrial relations function within the firms studied. • Industrial relations throughout a system become of direct importance to corporate headquarters when transnational sourcing patterns have been developed, that is, when a subsidiary in one country relies on another foreign subsidiary as a source of components or as a user of its output. • In this context, a coordinated industrial relations policy is one of the key factors in a successful global production strategy. [...]... in industrial relations Where poor performance is due to industrial relations problems, multinationals tend to attempt to introduce parent-country industrial relations practices aimed at reducing industrial unrest or increasing productivity Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial. .. (cont.) • Industrial relations policies and practices of multinational firms (cont.) – MNE prior experience in industrial relations • European firms have tended to deal with industrial unions at industry level (frequently via employer associations) rather than at firm level • The opposite is more typical for US firms In the USA, employer associations have not played a key role in the industrial relations. .. industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – International human resource management approach • The various international human resource management approaches utilized by multinationals; these have implications for international industrial relations • An ethnocentric predisposition is more likely to be associated with various forms of industrial. .. Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Another key issue in international industrial relations is industrial disputes Hamill examined strike-proneness of multinational subsidiaries and indigenous firms in Britain across... issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Overall, it is evident that international industrial relations are influenced by a broad range of factors Commenting on the overall results of his research, Hamill concluded that: “General statements cannot be applied to the organization of the labor relations function within... decision-making • However, processes of operational decentralization with regard to industrial relations are also evident Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Management attitudes... international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Subsidiary characteristics (cont.) • Third, where the parent firm is a significant source of operating or investment funds for the subsidiary, that is, where the subsidiary is more dependent on headquarters for resources, there will tend to be increased corporate involvement in industrial relations. .. associations have not played a key role in the industrial relations system, and firm-based industrial relations policies are the norm Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Subsidiary characteristics... industrial relations conflict • Conversely, it has been shown that more geocentric firms will bear more influence on host-country industrial relations systems, owing to their greater propensity to participate in local events Use with International Human Resource Management ISBN 1-84480013-X Published by Thomson Learning © Peter Dowling and Denice Welch Key issues in international industrial relations. ..Key issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Nationality of ownership of the subsidiary • A number of studies have revealed that US firms tend to exercise greater centralized control over labor relations than do British or other European firms • US firms tend to place . international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – Another key issue in international industrial relations is industrial disputes issues in international industrial relations (cont.) • Industrial relations policies and practices of multinational firms (cont.) – MNE prior experience in industrial relations. • European firms. international industrial relations. First, it is important to realize that it is difficult to compare industrial relations systems and behavior across national boundaries; an industrial relations