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The Impact of Collective Bargaining On The Nature of Industrial Relations
The Impact of Collective Bargaining On The Nature of Industrial Relations
The prevailing trends in the international business environment during the recent
decades has contributed to greater openness in trade, investment, finance and
technology resulting in increased international integration and interdependence in
business and between states. Further, the growing culture of globalization and its
perceivable effects in several areas of the world overlay the contemporary changes in
the existing world economy and standards ( 2003). Globalization is currently the tag for
the promises as well as risks facing humanity in the modern era ( 1999; 2000; and
2000; and 2000). As a result, there is global cooperation among independent states
directed to improved socio-political, economic, and cultural progression.
Among the most important factors that constitute an effective human resource
and industrial relations is collective bargaining. This paper argues that the structure of
collective bargaining can have an important impact on the nature of industrial relations.
In particular, it applies to the perspectives of various countries such as the USA, UK,
Germany, and Japan.
The current belief that the general tendency will be toward an upgrading of the
employment structure is supported by recent trends in the skill or functional distribution
of the labor force. On this aspect, worldwide collective bargaining systems and structure
affects the development of the existing industrial relations philosophies. For example,
conflict management requires bargaining strategies that will uphold the principles of
industrial relations as it pertains to fair employment welfare. There are several ways for
two parties to negotiate their sides; these methods are most often used for labor
relations especially when unions are attempting to discuss with the other parties
concerning their wants and needs to be applied in their work. These bargaining
strategies are extremely helpful especially in the organizational setting; as such
discussions can lead to the overall improvement of the industrial relations regulations
and policies. However, at the same time, these negotiations may also be
disadvantageous when used in the inappropriate setting, especially when it has the
potential to become a major battle between the parties, with several groups of people
being directly and indirectly affected by their conflicts ( 1998).
• United Kingdom
(1993) and and (1992) reported that UK’s collective bargaining structure is
decentralized as similar to USA. It started in the 1960s and eventually accelerated in the
1980s. This is among the most notable decentralization that has taken place in the
industrial relations history ( and 2002). In UK, and (1979) categorized collective
bargaining systems through joint consultative committees which often become the pre-
bargaining forms. Additionally, managers have been keen partners of shop stewards in
allowing several of these committees to become lighter in nature. For instance, basic
financial rewards and conditions of service in UK are determined by national bargaining
or government minimum wage legislation or by collective bargaining with labor unions.
Details of conditions of service are often more important than the basics ( 2002, ). The
European Union, commonly known as EU, is a popular communal organization of
European democratic countries dedicated to increasing economic prosperity, lasting
peace, and strengthening cooperation among its members and is perhaps the most
important agent of change in contemporary government and policy-making in Western
Europe ( and 2000, ). Today, UK’s collective bargaining structure greatly reflects the
goals of EU, thus, it affects industrial relations especially in the national level of
application.
• GERMANY
ANALYSIS
Collective bargaining structure affects the nature of industrial relations as
collective bargaining systems are dependent on the existing industrial relations
regulations and vice versa. Among the four (4) countries discussed, the difference in
terms of collective bargaining structure is a result of national economic considerations
as well as organizational or corporate applications. In general, a newsletter article
published by the (2004) states that “collective bargaining coverage is on average
almost four times higher in the European Union than in the USA and three times higher
than in Japan”. Nevertheless it is also important to not that the centralization and
decentralization of collective bargaining structures is the main determinants of
protecting the welfare of both employers and employees. Although in most countries,
the percentages of workers who are covered by collective agreements are higher than
those who belong to trade unions, it is still practical to evaluate the coverage of
industrial relations. There are many different employment and economic factors that
differ in every country and can possibly affect the nature industrial relations. These
unobserved differences are important indicators of overall condition of the global
workplace and its immediate environments. The ( 1997) recognized the presence of
institutional factors and policy instruments that affect the labour market performance. It
is also vital to see that some collective bargaining systems are independent to the
existing policies and regulations of the government or any governing body or maybe
collective bargaining systems interacts in various ways – easy or complex – and
includes bargaining variables. From the viewpoint of the collective bargaining
relationship, human work force must be treated in the most objective ways possible –
without sacrificing any aspect of industrial relations. Procedures for hiring, layoff,
transfer, and reassignment as well as wage and remuneration packages must
established in terms of incremental effects of identified changes on the size and
composition of the work.
Like any other conditions, the industrial relations and collective bargaining
structures are subject to emerging trends that affects the global marketplace. With the
era of globalization, stiff competition and technology revolution, it is expected that
aspect and conditions of employment are directly or indirectly affected. The welfare of
the international human labour force is the main consideration of many countries in
devising their national collective bargaining structures that is associated with the
globally acceptable principles of industrial relations.