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Employment Relations
BRAY WARING COOPER MACNEIL
Employment
This fourth edition of the market-leading Employment
Relations: Theory and Practice provides readers with a
Relations
THEORY & PRACTICE
4e
comprehensive and engaging introduction to employment
relations in Australia. Each chapter is underpinned by a strong
theoretical framework and brought to life with contemporary
case studies, examples and discussion questions.
Connect is proven to deliver better results.
Content integrates seamlessly with enhanced
Thoroughly revised and updated, this edition features a wide digital tools to create a personalised learning
variety of new and updated cases and problem-based learning experience that provides precisely what
BRAY
activities, which encourage readers to apply theory to practice you need, when you need it. With Connect,
and to develop a critical perspective. It pays close attention the educational possibilities are limitless.
to current themes, trends and developments in employment To learn more about McGraw-Hill Connect® visit
relations, and canvasses the political and regulatory landscape. www.mheducation.com.au/student-connect
WARING
This edition also features new web-based and interactive
activities, as well as substantial instructor resources.
Written in clear, accessible language, Employment Relations
COOPER
MACNEIL
4th Edition
www.mhhe.com/au/bray_employment4e Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
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spine: 18.86mm
EMPLOYMENT
RELATIONS
Theory and Practice
4E
MARK BRAY
PETER WARING
RAE COOPER
JOHANNA MACNEIL
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
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Published in Australia by
McGraw-Hill Education (Australia) Pty Ltd
Level 33, 680 George St, Sydney NSW 2000
Product manager: Jillian Gibbs
Content developer: Isabella Mead
Senior production editor: Daisy Patiag
Permissions editors: Natalie Crouch and Haidi Bernhardt
Copyeditor: Martina Edwards
Indexer: SPi-Global
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
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Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
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Glossary 489
Index 493
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
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Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Glossary 489
Index 493
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Peter Waring BCom (Hons), LLB (Hons) (Macquarie), Grad Dip Leg Prac (ColLaw), PhD (Newcastle)
Peter is an Associate Professor and Murdoch University’s Singapore Dean. He has previously held academic positions
at the University of Newcastle and the University of New South Wales and is an admitted solicitor of the Supreme
Court of New South Wales. Peter is the co-author of three books on employment relations and has published more than
60 book chapters and articles in leading international journals such as the Journal of Business Ethics, the International
Journal of Human Resource Management, Employee Relations, Corporate Governance: An International Review, the
Journal of Industrial Relations and Personnel Review. His research and teaching interests span the business and law
fields of employment relations, human resource management, corporate governance, strategy and labour law. He has
lived in Malaysia and Singapore for the past 12 years.
Johanna Macneil BA (Melbourne), Grad Dip Ed Psych (Monash), MBA (Melbourne Business School), PhD
(Melbourne)
Johanna is Professor and Assistant Dean, Teaching and Learning, of the Faculty of Business and Law at the University of
Newcastle. Prior to this, she was Associate Professor in the Employment Relations and Human Resource Management
group. In 2007, Johanna worked for several years as an employment relations consultant, advising large and primarily
unionised client organisations in the energy, communications, distribution, defence and education sectors. Johanna’s
research and practical expertise is in understanding and fostering collaborative, collective employment relations. She
has published two books on best practice and benchmarking, as well as articles in journals including the International
Journal of Human Resource Management, the Journal of Industrial Relations, and Labour and Industry. Johanna has
integrated problem-based learning (PBL) into her teaching, receiving faculty, university and national awards for these
efforts, including a National Teaching Excellence Award.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Janet Walsh is Professor of Human Resource Management and Employment Relations at King’s College, London and
has previously held appointments at many universities including the University of Melbourne. Her principal areas of
research include human resource management and employment systems, working-time, gender and the work–family
interface, and workforce diversity.
David Plowman passed away in December 2013. He was previously a Winthrop Professor at the Graduate School
of Management, University of Western Australia and was Foundation Director of this school from 1993 to 1999. In
February 2013 he won the Vic Taylor Award for a distinguished long-term contribution at the Association of Industrial
Relations Academics of Australia and New Zealand.
Michelle Brown is Professor of Management (Human Resource Management) at the University of Melbourne. Her
research interests include industrial relations.
Acknowledgments
The authors and McGraw-Hill Education would like to thank the reviewers of the previous editions, whose input has
helped shape this book:
∙∙ Robert Tierney, Charles Sturt University—Bathurst ∙∙ Narendra Prasad, University of the South Pacific
∙∙ Gordon Stewart, Central Queensland University ∙∙ Gordon Stewart, Central Queensland University
∙∙ Matthew Bambach, Edith Cowan University ∙∙ Janis Bailey, Griffith University
∙∙ Patricia Todd, University of Western Australia ∙∙ Christina Howe, Curtin University
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
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The four chapters examine in turn the state, management, and union and non-union forms of employee
representation. Each topic has been thoroughly revisited to take into account organisational and
institutional changes flowing from amendments to the Fair Work Act 2009.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
Created from murdoch on 2022-02-28 05:57:42.
The first page of each chapter presents 2.1 Define theory and discuss its value to students of employment relations.
2.2 Understand the distinction between description and explanation in
a list of learning objectives that set out social science analysis.
2.3 Provide examples of taxonomies in the study of employment relations.
what you should be able to achieve after 2.4 Distinguish between commonsense description and theoretically
informed description.
completing the chapter. Revisit them 2.5 Understand the necessity of both agency and context in the
explanation of employment relations.
to assess your competency. Learning 2.6 Provide examples of agency and context in employment relations
objectives are also tagged to the main content in the chapter to aid understanding and revision.
explanations.
that students need to know in relation to enforcement process, whether acting singularly or through collective representatives. It also the employment
takes little imagination to realise that the rules of the employment relationship are inevitably
relationship
each chapter. affected by governments or, more broadly, the state. These simple observations, however,
belie a wealth of complexity.
First, employees often do not participate directly in the rule-making process, but engage
a range of other agents to act on their behalf and to represent their interests. The extent to
which employees act alone or join with others to form collective organisations is a central
42 inPart
issue One Theory
employment and context
relations. When employees act individually, we can anticipate highly
individualised rule-making processes. When employees form collective organisations to
ER News represent their interests, collective forms of regulation will likely follow. The collective
organisations created by employees can be trade unions (see Chapter 6) but there are also
Saving
other, non-union, theformsPortland
of employee smelter:
representation workers offer 7).
(see Chapter wage freeze
Describing the many
ER News
In a letter to Alcoa, Davis said that the union was aware that it was a ‘difficult year’ for the smelter
These stories provide valuable contextual separation between ownership and management and between managers with different
and offered the wage freeze ‘in recognition of the uncertainty that exists about the future of the Portland
specialised roles (see Chapter 5). In addition, while it is often neglected in the modern era
smelter and our desire to see the smelter continue into the future’. In these circumstances, he said, ‘we
background to how employment relations of employment relations—which has become preoccupied with the individual enterprise—
believe that … bargaining would be clouded for both sides in light of the other issues that confront us’.
employers often joinbywiththe each
unionother
was to form collective organisations,
Portlandusually
smelterreferred to as
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
presenting five fictional characters and the then had months off work after a truck had crushed his foot when it reversed
into the dock to load. George saw the whole thing—or he thought it was the
temporarily ‘forgetting’ the rules. Certainly, the yard manager had been at them to move fast because
they were way behind. And the driver of the truck was one of those crazy owner-drivers who was
always in a hurry—always thinking about the next job and the finance repayments on his truck.
On top of all this, George knew, he just knew, that the manager and the owner-driver would give
evidence that contradicted his—he reckoned they were out to protect their butts. Could the judge see
through the competing descriptions of the events that he would inevitably be given and get to the truth?
George doubted it. But George also didn’t want to lie—apart from the obvious risk that lying before a judge
bra65586_fm_i-1.indd xvi was perjury, George considered himself an honest and principled man and he did not lie. But perhaps 08/16/17
he 12:38 PM
could select the ‘facts’ that he reported in a way that anticipated the evidence of the others? But would
46 Part One Theory and context
employment relations, but it does this in different ways. Description is a valuable form of
analysis in its own right: we need to be able to describe social events and social processes in
a theoretically informed way if we are to simplify the complex world we live in and develop
a better understanding of how that world works. The lens of ‘the rules that regulate the
employment relationship’ ensures that description and taxonomy are informed by theory in
order to maximise these analytical benefits. The broad scope of the subject matter covered in
Text at a glance xvii
this book and its status as an introduction to employment relations means that much of the
analysis provided in this book is descriptive in nature.
Deeper explanation of why different patterns of employment relations emerge in different
circumstances is also part of the study of employment relations, even if it is not the dominant
focus of this book. The general models of employment relations, which were only briefly
END OF CHAPTER exposed in this chapter, provide a guide to how explanation can be developed, although they
do not—and perhaps never could—deliver complete causal explanations. The key lesson
that emerges is that the explanation must involve a combination of contextual and agency
factors.
Summary SUMMARY
∙ Theory is about explanation: it is ‘an attempt to account for a given phenomenon—that is, to show
what, how or why it is’.
Each summary is a synopsis that iterates ∙ There are, however, many different types of theory and different levels of explanation.
∙ Description—provided it is informed by theory—is the first step towards explanation.
the key points made in the chapter, ∙ Description in employment relationship uses taxonomies that help create understanding of the parties
to the employment relationship, the rules they make and enforce, and the processes by which those
while covering the chapter’s learning rules are made and enforced.
∙ Explanation in employment relations mostly comes in the form of models.
objectives. Use these summaries as a ∙ Explanations of employment relations must combine context and agency.
∙ Contexts are the external circumstances in which the parties find themselves—circumstances that are
reliable pre-exam revision tool. largely beyond their control.
∙ Agency emphasises the choices that the Chapter
parties to
Twoemployment
The study ofrelations make
employment on theanalytical
relations: basis of their
tools 47
ambitions, their values, their perceptions of the situation they are in, the options they have available
to them and the course of action that is most likely
Chapter to achieve
Two The studytheir goals.
of employment relations: analytical tools 47
DISCUSSION QUESTIONS
Discussion questions 1. What is theory, really?
DISCUSSION
KEY TERMS QUESTIONS
2. Why do students of any subject need to understand theory?
1.
3. What
agencyHow is. .theory,
. . .do we . . really?
. . . .select
. . . the
. . . .facts
. . . . that
. . . . we
. . . want 43includeparties
. . . . . to . . . . . . . . . . . .we
in the descriptions . . .make?
. . . . . . For
. . . .example,
. . . . . . . . how
. 37
These short-answer discussion questions 2. Why
contexts . do
do our
election?
students
. . . . . . . . of
. . .positions . .any
.and . subject
. .values . . need
. . . . . to
. . . . . mediate . .understand
. our 40 theory?
procedural
explanation of therules outcome . . . . . of
. . .the
. . . most
. . . . . recent
. . . . . . .federal
. . . 36
3. How
description do . .What
. . we . . . .facts
. select . . do
. . the . . you
. facts . leave
. . . that . . in
. . . we . .and
. want what
. . .to
30 do rule
include you exclude?
in the
. . .descriptions
. . . . . . . . . . . we
. . . .make?
. . . . . .For
. . . example,
. . . . . . . . .how
. 34
give you an opportunity to think about and 4. do
Whatourispositions
explanation
election?
. the . . . . . and
. . . difference. . . . values
What factsNominate
. . . . . .mediate
. between
do you leave
. . . . . .our
. . commonsense
in
. . 33explanation
and what do
of the
description
substantive and outcome . . . .of. . the
theoretically
rules . .most
. . . . .recent
. . informed
you exclude?relations and discuss how they help
. . . . federal
. .description?
. . . . 35
5.
formalWhat
rules is . taxonomy?
. . . . . . . . . . . . . . . . . . . .two
. . . taxonomies
. . . . . . 35 in employment
taxonomies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
discuss different situations directly related
126 Part Two The parties
4. What
us to is the difference
better between commonsense description and theoretically informed description?
informal rules . . .understand
. . . . . . . . . . the
. . . .real
. . . .world
. . . . . of employment
. . 35 theoryrelations.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
5.
6. What
Why isis explanation
taxonomy? Nominate important in two the taxonomies
analysis ofinsocialemployment
relations?relations and discuss how they help
to the chapter you’ve just read. 7. us
6.
to better
What understandbetween
is the difference the real a world
list ofofexplanatory
employment relations.
factors and a model?
8. Why it aismany
IsAfter explanation
problem months
when important
ofpeople
stalled try in the analysis
negotiations
to explain of social
preceding
things by therelations?
conciliation,
reference only to initial
agencyprogress
or onlywastolimited.
context?
7.The What
Why? is the difference
Commissioner adopted between a list ofblock’
a ‘building explanatory approach,factors firstand a model?
working with the parties to reach
9.agreement
8. Is it a problem
Provide on less
two when
examplescomplex people issues
of agency and
try to then to
explain
helping moving
things
explain on
bytheto more
reference
actions difficult
only
of issues.
to
parties agency or only to relations.
to employment context?
While there was some agreement in the initial stages, more challenging matters that were unable
10. Why? Is it 46really possible to develop causal explanations (as defined by Lewins) in employment08/01/17 relations?
Case Studies
bra65586_ch02_028-050.indd 11:31 AM
9.toProvide
be resolved were set aside
two examples of agencyfor later, allowing
helping officials
to explain theand the delegates
actions of parties to to seek feedback
employment from
relations.
their members and to report back at the next conference.
10. Is it really possible to develop causal explanations (as defined by Lewins) in employment relations?
Conferences were held during July and August 2012 on site in Gladstone, in addition to a large
number of telephone conferences.
Challenges and twists: Australian of bothcar manufacturing
Each chapter concludes with at least one CaseThe Study combination of early success, the preparedness
working through issues, and the independent assistance of the Commissioner resulted in a
the unions and SMIT to keep
Department
1.Like What ofsectors
Industry,
legislative ofInnovation
provisions and Science 2016, Automotive Transformation Scheme (ATS),
and wasallowed thegrowth
Minister forfor Workplace Relations to get involved in
happening in the case and why. world
fact
benefited
passenger
in other
this
terms
sheet,
dispute?
from
of volume
Australian
vehicles the(‘[History
system
manufacturing,
Government,
of Cars
noted the particularly
Canberra,
tariffsarticle
(Lee
of Australian
the designautomotive
and production
https://www.business.gov.au/~/media/Business/
n.d.).n.d.).
title]’ Following the commitment to tariff reduction
manufacturing
of large-sizedhad
2.ATS/Automotive-transformation-scheme-fact-sheet.ashx?la=en,
from Like Is
theitother
a1980s
good thingof
onwards,
sectors that the Australian
the Commission
manufacturing, could
government
the growth intervene
of introduced
Australian
accessed
in situations
various
automotive
27 March
likeother
this? industry
manufacturing
2017.
support
had
Dowling,
measures
benefited
3. CommissionerJ.from
2015,
to keep
the‘Who the killed
system
Booth industry the
isof car industry?’
afloat.
a tariffs
member (LeeThese
ofn.d.).
theThe Sydney
included
Following
Government Morning
A new car
theServices Herald,
planpanel
commitment for13 November,
atogreener
oftariff http://
future
the reduction
Fair Workin
2008,
from www.smh.com.au/business/the-economy/who-killed-the-car-industry-20151112-gkx1c8.html,
the which
1980sbecame
Commission (see the
onwards, the
the Green Car
Australian
FWC’s Innovation
government
website, Fund and provided
introduced variousgrants other for
https://www.fwc.gov.au/about-us/members-panels). research
industry and
support
accessed
development
measures What to is 5akeep
February
and
panel? forHow
the 2017.
early-stage
industry thiscommercialisation
does afloat. These
explain includedofA projects
Commissioner new to reduce
car involvement?
Booth’s plan for a fuel
greener consumption
future in
and greenhouse
Henson,
2008, E. 2014,
which became gas emissions
‘Redundancy
the Green ofCar
motor
packages onvehicles
Innovation the table (Productivity
Fund after
and Holden Commission
provided signsgrantson its 2014);
for final and, more
workplace
research and
March
research and
(Department
2017.and
research
development
Hopkins, and investment
C. 2017, ‘Managing change in new plantin theand equipment
Australian for eligible
car industry’, HRM, businesses
3 March,(Department
http://www.
(continued)
Chapters 4 to 13 include problem-based cases of Industry,
PBL Case How
Innovation do
and we
Science design
2016). an internship
hrmonline.com.au/section/featured/hr-dealing-death-car-industry/?utm_source=HRM&utm_ program?
medium=e%2Dnews&utm_campaign=HRM+announcement, accessed 5 March 2017. (continued)
developed on the principles of problem-based Kurmelovs,
Johanna Macneil, R. 2016, ‘The end
University of of the road for South Australia’s auto industry’, SA Weekend
Newcastle
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
workplace.
Library/pubs/rp/BudgetReview201415/Automotive, accessed 5 March 2017.
Productivity Commission 2014, Australia’s automotive manufacturing industry, inquiry report no.
70, Australian Government, Canberra, http://www.pc.gov.au/inquiries/completed/automotive/
report/automotive.pdf, accessed 27 March 2017.
‘[Title of the page where the information was found]’ n.d., History of Cars, http://www.historyofcars.
com.au, accessed 31 January 2017.
Bibliography
bra65586_ch04_080-132.indd 126 08/14/17 01:37 PM
BIBLIOGRAPHY
Bibliographies at the end of each chapter Abercombie, N., Hill, S. and Turner, B. 2006, Dictionary of sociology, 5th edn, Penguin, London.
Bain, G. and Clegg, H. 1974, ‘Strategy for industrial relations research in Great Britain’, British Journal of
cite referenced sources in full and Industrial Relations, vol. 12, no. 1, pp. 91–113.
Berger, P. and Luckman, T. 1967, The social construction of reality, Anchor Books, New York.
provide an extensive set of resources to Blyton, P. and Turnbull, P. (eds) 1994, The dynamics of employment relations, Macmillan, London.
Bray, M. and Macneil, J. 2015, ‘Facilitating productive workplace cooperation: a case study of Sydney
expand your knowledge. Water and the ASU water division’, Fair Work Commission, https://www.fwc.gov.au/documents/
documents/engagement/case-studies/syd-water-case-study-2015.pdf, accessed 4 May 2017.
Bray, Mark, et al. Employment Relations : Theory and Practice, McGraw-Hill Australia, 2017. ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/murdoch/detail.action?docID=5471287.
bra65586_ch02_028-050.indd 49 08/01/17 11:31 AM
Created from murdoch on 2022-02-28 05:57:42.
Case Studies
At the end of each chapter is one case study detailing various real-life organisations and the specific situations and
people within them. These Case Studies illustrate the key theoretical concepts covered in the associated chapter. Each
study concludes with ‘Issues for debate’—a set of questions that ask students to apply the concepts in practice, and
explain what is happening in the case and why. These questions also ask students to consider how these concepts apply
at a more abstract or general level; for example, how could the principles demonstrated in a particular case apply to
other cases, organisations or contexts?
Several cases also provide sources of more detailed information. For that reason, teachers may decide that one or more
of the organisations or cases about which there is a great deal of publicly available information (e.g. Qantas, OneSteel,
Westpac or Australia Post) would make a good case study assignment, perhaps with additional questions or topics to
evaluate summative knowledge across a number of weeks. Or teachers may invite guest speakers from management or
unions at the Case Study organisations (or others like them) to come and talk to the class. As with the other pedagogic
features in this book, we encourage students and teachers to actively anchor the theories, concepts and perspectives they
are learning to practical examples and further applications—we think this is the most effective way to learn.
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
ER News
ER News items can be found in every chapter. These items provide illustrations of various employment-related issues
from Australian media sources on current affairs. They report data, anecdotes, analysis and opinion. Some focus on
companies, some on unions, some on individuals, some on industries, some on government policy and legislation, and
some on academic research. They provide a window to how employment relations news is conveyed to the public and
they should help students understand how concepts play out in the real world. Discussion questions accompany each
article and guide critical thinking on the issues presented.
Students are encouraged to actively read news sources, listen to the radio, browse the internet, watch television
and movies, and talk to their peers, family and colleagues, looking for employment relations ‘angles’ on work and
organisations. For example, each week students could conduct an analysis of a relevant media story, either one in the
book or another they have found themselves, asking questions such as: What is the issue? Who is involved? What views
are reported? How can it be interpreted? This type of analysis will help students understand and more confidently
communicate the nature and importance of employment relations.
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Work Stories
Work Stories feature in all but one chapter and several chapters contain numerous stories. The Work Stories are about
five different characters.
Name: Terry
Company: PastaCo
Profile: Terry is a sales supervisor for a leading national pasta company. He has worked for 13
years with the company and has progressed beyond his basic salesman job of promoting
pasta products to supermarkets and shops to overseeing the work of seven part-time and
full-time sales staff.
Name: Susie
Company: Happy Valley Local Council
Profile: Susie is one of three human resources (HR) officers at Happy Valley Local Council
reporting to the HR manager. She helps to manage employment relations and HR issues
for council staff employed in very different occupations, such as childcare, parks and
grounds, libraries, roads maintenance, town planning and recreation services.
Name: Li Wen
Company: Seaside Restaurant
Profile: Li Wen works part time as a server at Seaside Restaurant. Li Wen comes from a well-
off family that immigrated to Australia from Hong Kong when she was young. This
job is a way for her to earn some money and gain some work experience before she
graduates from university.
Name: George
Company: Top Trucking Company
Profile: George works in the yard of this trucking company. He is a union delegate and a
member of the occupational health and safety (OHS) committee.
Name: Pam
Company: Royal Southern Hospital
Profile: Pam has worked for over 20 years in a large public teaching hospital, Royal Southern
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
Hospital. More recently, she has taken on a supervisory role as a Nurse Unit Manager
(NUM).
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Character Chapter
1 2 3 4 5 6 7 8 9 10 11 12 13
Terry ✓ ✓ ✓
Susie ✓ ✓ ✓
Li Wen ✓ ✓ ✓
Pam ✓ ✓ ✓
George ✓ ✓ ✓ ✓
Each Work Story is designed to illustrate the employment relations challenges faced by these individuals in their various
roles—as workers, worker representatives, supervisors or advisors to management. The various storylines of the Work
Stories run through successive chapters, allowing students to see how the five individuals face a range of work- and
employment relations-related challenges over a course of time. So, for example, Susie’s Work Stories describe the sort
of situations in which a human resource officer might find herself: trying to find a workable approach to managing
absenteeism; analysing the cost of human resources in preparation for competitive tendering; or advising managers on
proper (and legal) human resource procedures.
The Work Stories are designed to encourage a broad, problem-based approach to analysis. This means that there
may be any number of hypotheses that might reasonably explain what is going on in the story, what might happen next,
what might be a more effective course of action to take and how to go about it. These stories are designed to resemble
real life—a lot of views and options, and no easy solution.
We encourage instructors to use the stories in small group discussions. Each story has associated questions,
prompting students to consider how the characters might analyse and act in the situations in which they find themselves.
The questions can be used to help students prepare before class as well as to guide class discussion. Alternatively, class
discussion about the Work Stories could simply be organised around the following opening question: what is going
on here, and if you were the main character, what would you do? The stories are designed to develop two critical
employment relations skills—first, the ability to identify legitimate plural perspectives on a situation; and second, the
ability to make a plausible, defendable argument in favour of an approach to tackling an issue.
Discussion questions
At the end of each chapter there are discussion questions. There are two types of questions. Some questions are written
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
to help students revise the chapter material and test their comprehension of the concepts in the chapter. Students may
use these questions or they may be used as lecture or tutorial exercises by instructors. There are also more general
discussion questions that ask: What do you think? How would this work? How have things changed? These require a
broader analysis of the topic and application of the concepts, and may inform longer discussions, or even be used as
essay questions.
PBL Cases
Problem-based cases have been developed on the principles of problem-based learning (PBL). The PBL methodology
organises learning around a real-world problem. The task of defining and working out how to solve the ‘problem’ is best
done in a group, so everyone gets the benefit of different perspectives and ideas. Students work together to understand
and define the exact nature of the problem, conduct both practical and academic research to learn more about the nature
of the problem, and consider the advantages and risks of different possible solutions. This mirrors what happens in real
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organisations—in reality, there is seldom one ‘right’ answer to a problem or challenge, only solutions that are well-
researched and backed up by good evidence and effective argument.
The PBL Cases in this book reflect challenges that practitioners of employment relations face every day: How do
we make sure everyone feels safe and respected at work? How do we make sure our workers are paid and rostered
properly? How do we avoid unfair dismissal claims? Having any prospect of coming up with a good solution to these
challenges requires a good understanding of the rules that apply, familiarity with how other people or organisations have
tackled the same or a similar problem, gathering of evidence (including empirical research) to inform your thinking, and
application of theory to help you explain and predict what is happening, or should happen.
Moreover, the PBL cases pose these questions from the point of view of a range of employment relations practitioner
roles—workplace relations managers, but also union officials, line managers, bureaucrats and consultants—because,
after all, many people have a professional stake in getting employment relations right; and learning to see problems
from different points of view gives us a much richer understanding of the issues. Practitioners of employment relations
must be able to offer a strong and reasoned argument for a particular way forward, based on a deep theoretical, as well
as a practical, understanding of different views. Mastery of the PBL approach helps develop this capability.
We hope that students and teachers find these features useful and interesting, and that they contribute to your
enjoyment of the study of employment relations.
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Theory and
context
Chapter One What is employment relations?
Chapter Two he study of employment relations:
T
analytical tools
Chapter Three The study of employment relations: values
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Chapter 1 Start
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INTRODUCTION LO 1.1
Everyone who derives an income through work or who becomes involved in the organisation
and management of employees at work is immersed in the practice of employment relations.
The overall quality of the employment relationship and changes in employment relations can
have an important effect on the overall performance of an organisation. At the same time, the
terms and conditions of employment directly affect the quality of employees’ working lives and
their wellbeing outside of work. These issues of ‘efficiency’ and ‘equity’—the contributions of
employment relations to the effectiveness of workplaces and even the national economy on the one
hand, and the consequences of changing employment relations for employees on the other—are
central themes in recent national policy debates, in strategic deliberations in company boardrooms,
and in everyday discussions in workplace lunchrooms, around kitchen tables and at barbecues.
The public-policy relevance of employment relations in Australia is long-running and
undeniable. It has, at times, been a major issue in national elections, such as the huge impact
of the 2005 WorkChoices legislation on the federal election in November 2007. The urgency
of the issue has since eased, but this is likely to be a temporary lull in a conflict where
employment relations is a defining issue that can mean the rise and fall of governments.
The efficiency–equity theme at the company level regularly arises as owners and managers
confront the pressures of competitive product markets by reducing labour costs. On a more
mundane but equally important level, many of the decisions of courts and tribunals—
involving situations such as employees being kept at work with nothing to do in order to
avoid making redundancy payments, or businesses paying compensation to employees who
are subject to discrimination—are publicised by popular television programs and become
hot topics of discussion in forums far beyond the workplaces involved.
At the core of employment relations are different views about the most effective way
to manage the relationship between an organisation and its representatives (the managers),
and employees and their representatives. In addition, there are parallel arguments about
how governments should frame laws and policies to best encourage efficient and equitable
employment relations within organisations. At least at the rhetorical level, many managers
say that employees are their organisations’ greatest assets and—given the right environment
and market forces, and applying rational calculation—managers will invest in and properly
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
maintain these precious assets to the mutual benefit of all. Similarly, governments may argue
that their main responsibility is withdrawing their direct interference in the employment
relationship and providing a flexible and decentralised environment that most effectively
allows managers and employees to reach mutually advantageous agreements. Both managers
and governments of this ilk are opposed to institutions like trade unions and arbitration
tribunals, which reduce both the operation of free market forces and the capacities of
managers and employees to choose arrangements that suit their needs.
At the other extreme, many employees see their colleagues being made redundant and find
themselves working harder and longer without an effective avenue to voice their concerns at work,
let alone to change the situation. Critics like trade union leaders condemn the trend in government
policy towards flexibility and market forces, seeing them as a prescription for managers to exploit
their new-found freedoms and thereby create growing inequality at work. They consider trade
unions and state regulation essential for maintaining effective labour markets and a fair society.
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These contrary views show how employment relations is inevitably a site of competing
ideas. It represents an area of social relations that affects everyone who works, and about
which almost everyone has an opinion—often opposing ones. The many controversies about
employment relations demonstrate its great strengths as an academic subject. It is lively and
passionate. It is relevant and compelling. It is everyday, but it is also concerned with great
social movements, and it seems to require commonsense at the same time that it requires
deep analysis and a grasp of complex concepts.
Properly harnessing the potential of employment relations as an academic subject,
however, requires clear thinking and a set of concepts that allows students of the subject
to see past the confusion of competing ideas and to understand the complexities of both
its practice and its rhetoric. The aim of this chapter is to begin this task. The first step is to
define the area of study by going beyond the commonsense and the often narrow conceptions
of industrial relations to the broader and more considered theoretical approach associated
with employment relations. This allows us to introduce some key concepts, such as the
employment relationship, and to discuss some examples of employment relations situations.
It also distinguishes employment relations from other intellectual traditions that sometimes
analyse the employment relationship.
workplace conflict. The following ER News report provides a good example of the popular
characterisation of industrial relations. The subject of this report is a strike and picket by a
manufacturing union. While the report presents both sides of the story and is therefore far
from biased, it leaves little doubt that industrial relations is:
∙ sensational—in that the event is dramatic and newsworthy, with elements of secrecy and
extreme behaviour, and marked by economic and political consequences
∙ collectivist—in that the event involves group behaviour by employees and the activities of
a trade union
∙ conflictual—in that the event involves disagreement and protest, even violence, with the
members of the union refusing to engage in their usual work duties in protest against their
employer’s actions, and an employer responding by resorting to police protection and
court action.
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ER News
Tensions on the picket line
A union official—Electrical Trades Union organiser, Steve Diston—has been charged with assault following
an alleged altercation at a picket line outside Carlton & United Breweries.
Police allege that Diston pushed a man to the pavement after a ‘verbal altercation’.
Mr Diston, 29, has been summonsed to appear at Melbourne Magistrates Court on 16 April 2017.
State secretary of the ETU, Troy Gray, said they had 14 witness statements and video footage to
demonstrate that the organiser was ‘not the aggressor’ of the incident.
‘We are not concerned about the case and I would think that when the police hear the witnesses and
see the video footage, they will throw this out’, Mr Gray said.
‘If not, we look forward to our day in court.’
Gray accused Carlton & United Breweries of provoking the picket line.
The police investigation into the alleged assault has also been heavily criticised by City of Yarra councillor,
Stephen Jolly, who was outraged that ‘fourteen witnesses have not yet been interviewed by police’.
He also condemned police actions. ‘This is a benign picket line with a permit from the council … they
are not trying to blockade or stop production. But the police have been used by CUB to harass picketers
over the most minute matters.’
The alleged assault is the latest incident in a bitter conflict between unions and CUB, arising after CUB
terminated a long-standing maintenance labour contract at the factory.
The termination of the labour contract left 55 skilled fitters and electricians unemployed after they
refused to reapply to the new contractor. Union officials said that the new contract offered inferior conditions
even though wages in the new positions ranged from $72,000 to $120,000.
To protest the job losses, the Electrical Trades Union and Australian Manufacturing Workers’ Union have
been picketing outside the brewery’s gates for the past 21 weeks.
The protest is also supported by wider union movements, which have called on Australians to boycott
products of the company. CUB is the nation’s largest brewer and produces many popular beers including
VB, Carlton Draught, Melbourne Bitter, Pure Blonde and Fat Yak.
The alleged assault is not the first time the protest turned ugly. In August, the Fair Work Commission
granted orders banning union officials from insulting the labour-hire workers with slurs like ‘scabs’, ‘dogs’,
‘rats’, ‘f---wits’ and ‘c---s’. The union was also prohibited from using offensive signs, filming them and
harassing or accosting them.
The ongoing picketing forced labour-hire operator, Programmed Maintenance, to withdraw from its
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
multi-million-dollar contract with CUB in August due to concerns about staff wellbeing and their ability to
get ‘normal, safe and secure access to the site’.
Unions say the loss of the experienced maintenance workers has resulted in increased costly machine
stoppages and a decline in beer production. This claim is supported by leaked documents from the
brewery, which show that management is concerned about the downturn in machine and factory efficiency
and that the brewery is struggling to keep up with customer demand. The company has to bring in staff on
weekends and rostered days off, which incurs heavy penalties, to meet demand.
‘To ensure that we can meet the requirements of our customers, we are having to work longer hours to
achieve the planned volume.’
The brewery has reassured its customers it has ‘adequate supplies of beer for the upcoming peak
season’.
(continued)
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‘We are proud of our brands and of our employees’, the brewer said. ‘Our people continue to produce
high-quality and much-loved beers.’
Source: Adapted from Toscano, N. 2016, ‘Union official charged with assault at brewery picket line’, The Sydney Morning Herald,
8 August, http://www.smh.com.au/business/workplace-relations/union-official-charged-with-assault-at-brewery-picket-line-
20161107-gsk8fg.html, accessed 29 January 2017.
Questions
1. Does this story demonstrate the traditional picture of industrial relations as sensational, collectivist
and conflictual? Provide specific examples from the report.
2. Does it imply who is to blame for the strike and picket?
3. How could this story have been written in a way that avoided being sensationalist?
This relatively narrow and largely negative conception of industrial relations has been
reinforced over the years by some special interest groups that have denigrated the term
‘industrial relations’ and used it negatively to criticise institutions and practices of which
they disapprove. In 1989, for example, the Business Council of Australia (BCA 1989, p. 5),
the leading organisation representing major Australian corporations, argued:
… industrial relations assumes employers and employees are inherently at loggerheads,
and that, in the public interest, the outcome of their relationship in the workplace must
be regulated in detail, both to protect employees and to control wages and otherwise
avoid disrupting the economy. As a result, the main concerns of industrial relations are
with pay and conditions and the resolution of disputes.
Similarly, when championing the WorkChoices reforms in 2006, the then Minister for
Workplace Relations, Kevin Andrews (2006), stated:
Continued workplace reform is essential to improve productivity and support high levels
of employment. The Howard government wants to continue the shift away from an ‘old
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
industrial relations’ system where the rights of employers and employees were controlled
and could only be changed by industrial tribunals together with lawyers, unions and
employer associations.
The problem with the sensational, collectivist and conflictual interpretation of industrial
relations is that it creates a false impression of the practice of industrial relations activities
in which employees, managers and (sometimes) union officials are engaged. The reality is
that the vast bulk of industrial relations consists of routine, everyday actions and practices
within workplaces rather than the drama of strikes and confrontations taking place in
courtrooms or as portrayed in the media. The latter are, in fact, rare events. While collective
action by groups of employees seeking to promote and protect their wages and working
conditions is an important part of industrial relations, it is by no means the whole story. The
absence of a trade union or collective action by employees does not mean that industrial
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relations will suddenly disappear. Individual employees are constantly negotiating with their
fellow workers and their supervisors over new patterns of behaviour within the workplace
or over compliance with existing rules—the relations between individual employees and
managers and within non-union workplaces have long been important topics in the study
of industrial relations. Finally, the everyday world of industrial relations is dominated by
routine cooperation rather than conflict. Employees on the shop floor or in the office are
inevitably focused on ‘getting the job done’, and even the working time of union officials is
mostly devoted to working with managers to resolve problems rather than calling strikes or
directing picket lines.
The contest over the meaning of industrial relations in real-world practice is reflected in
scholarly debates over the definition and scope of industrial relations. A number of scholars
from both the United States (e.g. Kaufman 1993) and the United Kingdom (e.g. Kelly 1994;
Ackers & Wilkinson 2008) have argued that the vitality and relevance of industrial relations
has been undermined by its traditional preoccupation with the study of trade unions and
collective bargaining, coupled with the decline in union membership and power.
There also appears to be considerable agreement over the most appropriate solution
among those sympathetic to industrial relations. The main organisation bringing together
academics and practitioners in the field changed its name in 2010 from the International
Industrial Relations Association (IIRA) to the International Labour and Employment
Relations Association (ILERA). Most scholars accept that the field of industrial relations
should take account of the wider aspects of the employment relationship or, as Kaufman
(1993, p. 194) stated, the nexus of ‘institutions, practices and outcomes associated with the
world of work’. In Britain, Blyton and Turnbull (1994, p. 28) noted and supported a focus
on all employment relationships and not merely the ones involving unionised male manual
workers in manufacturing. In the Australian context, Lansbury (1995) argued that the subject
has been defined too narrowly, partly because of a preoccupation with the distinctiveness of
the arbitration system, and recommended that scholars locate their analysis of workplace
relations within a wider international context.
It is important, then, to go beyond the commonsense approach associated with industrial
relations to a more considered and systematic definition of the area that captures the breadth
of real-world practice, rather than the narrow perceptions of the subject held by many
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
people. This does not suggest a complete rejection of industrial relations—it has a long and
distinguished tradition of research and practice—but it does mean it is important to build a
broader theoretical approach.
A preference for the term ‘employment relations’ over ‘industrial relations’ has gained
widespread scholarly support in recent years:
… there is a developing consensus around the proposition that IR [industrial relations]
as traditionally conceived is too closely associated with a narrow concern with unions
and collective bargaining and that a more modern and wider appellation is needed. The
leading candidate appears to be ‘employment relations’. (Giles 2000, p. 55)
If ‘employment relations’ is accepted as the most appropriate term to describe this broader
theoretical approach, what does it mean? Defining employment relations is important not
only because it determines the boundaries of the subject, and thereby the scope of this
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book; the term can be defined very generally as ‘the study of the employment relationship’,
but this definition is too broad because there are many very different academic disciplines
using diverse theoretical concepts that fall under it. A narrower definition is required if we
are to effectively understand the distinctiveness of employment relations as a subject, and
some explanation is needed of the differences between the various theoretical approaches
to studying the employment relationship.
Work Story
Individual contracts and change at PastaCo
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This pattern was suddenly disrupted in August last year. Under the direction of a new national
human resource (HR) manager, the state sales manager announced that all sales staff would be offered
individual contracts—these were to be common-law contracts. The wages specified in the contracts
were well above the minimums set out in the award, which was good, but there were several other
clauses that were less clear-cut. The company’s expectations about working hours were one issue,
while its denial of any overtime and penalty rate payments was another. A peculiar provision in the
contract stated that all employees would, on signing the document, become probationary employees
subject to confirmation of continuing employment.
Staff like Terry, who had worked for the company for many years, considered these provisions of
the contract to be not only insulting but also highly suspicious. What was the company up to?
Terry’s natural reaction to these events was to talk with the other sales staff and supervisors, both whenever
they met at work and through evening phone calls at home. After a lot of discussion and argument, many
of the staff felt that the company was not abiding by the award and refused to sign their contracts. They
organised a meeting with the state sales manager, who was sympathetic and prepared to raise their concerns
with senior management. By Christmas, it was obvious that management was not sure what to do next; no
one from management was prepared to admit that they had been poorly advised in this initiative. However,
early this year the company issued a revised plan, with a longer timeframe and a mechanism for consulting
existing staff before changes were made. Things are now back to normal, but Terry and his colleagues still
feel bad about the episode—several have now accepted jobs with rival companies and moved on, while
Terry is not quite as committed to the company or as motivated about his work as he used to be.
Questions
1. What’s the issue here? What do you think is the basic cause of the upset? Why does Terry feel less
motivated than before?
2. What else could Terry and his colleagues have done in response to the original announcement?
3. If you were Terry, what would you like to know or do before you make a decision about leaving?
In Susie’s Work Story, employment relations lies at the core of her work duties. Recruitment
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
and selection is the process by which the employment relationship is established, and forms
the key link between the external labour market and the workplace. Similarly, absenteeism,
the focus of Susie’s troublesome project, is a key indicator of the state of relations between
employees and employers (see Chapter 12). In many instances, it is a sign that something is
wrong when employees regularly choose not to come to work; it suggests that employees are
feeling unhappy in their job, which is often due to poor management practices as much as it
is to lazy or uncommitted workers. In Susie’s story, employees have been following informal
rules within the parks and grounds department, meaning that systematic absenteeism is
accepted (even if just implicitly) by managers. More senior managers have started to realise
the inefficiencies created by these local rules, but the problem needs to be treated delicately.
Apart from Susie’s difficult personal position, where she might be alienating her immediate
boss, the recommendations she makes to management need to strike a balance between
improved efficiency and maintaining employee commitment and union cooperation.
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Work Story
Absenteeism at Happy Valley Local Council
Questions
1. Susie has collected data on levels of absenteeism. What other information or support should Susie
gather before she reports to the manager of parks and grounds?
2. How can Susie help to avert a strike? List four recommendations that you would make in such a
situation.
3. As a member of the HR staff, are there other actions that Susie and her team can take to make it
less likely in future that poor behaviour will be ‘indulged’?
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Li Wen’s Work Story at the seafood restaurant is a sign of the times. Employment in
the services sector has grown in recent years (see Chapter 4), and restaurants and cafés
are an essential part of this growth. Lots of small employers in highly competitive markets
employ thousands of workers, mostly young people, who shift jobs regularly, often work
on a part-time and casual basis, and rarely see their jobs as having long-term prospects.
Formal rules in such an industry are usually uncommon—union membership is low
and collective agreements are rare; awards are used to provide minimum standards but
individual contracts are increasing in number. Informality is more common. The formal
rules and industry-wide standards are often breached, with the demands of the product
market and the limited finances of employers dominating. In this context, Li Wen is lucky
to work for a good employer, but the situation has its complications.
Work Story
Uneasy times at Seaside Restaurant
this was a career for Li Wen—she was out of there once she graduated. She just wanted a good reference
when she went because that was really important when applying for entry-level graduate jobs.
Friday and Saturday nights in particular were busy. The pace was frenetic, the customers demanding
and the noise intimidating. Still, the time went quickly and the kitchen staff and the servers helped each
other out. But last weekend a member of the kitchen staff, Dong, someone she didn’t know very well,
broke his arm quite badly when he slipped on the floor. Dong wasn’t a part-timer like her; he worked
full-time but he had begged Jim to be paid cash-in-hand. However, since Dong wasn’t on the books, he
wasn’t covered by WorkCover. Jim had sent Dong to hospital and someone had told Li Wen that he was
going to cover Dong’s expenses and give him some money to ‘tide him over’.
Li Wen didn’t want to get Jim into trouble, and she certainly didn’t want to lose her job, but what if Dong
wasn’t okay? Who was going to look out for him? And what would happen if someone else was hurt?
(continued)
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Questions
1. What are Li Wen’s options?
2. What information or support could Li Wen gather before she decides whether to do anything?
3. What do you think Li Wen should do? What could be the result?
Market transaction
An agreement is struck between the
supplier of labour (employee) and the
purchaser of labour (employer) about
the price and conditions of employment.
Production relation
An ongoing and ever-changing
relationship between employee and
employer regarding how, when and
under what circumstances work is done.
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relationship is ongoing. It is also usually impossible at the time of the market transaction to
anticipate all the terms and conditions of employment that will apply during the forthcoming
period of employment; the relationship is just too complex and is ever-changing. Consequently,
there is a production relation within the workplace, whereby employers must ensure that production relation
employees deliver on their agreements by working as hard as promised or with the promised the ongoing
interaction between
skills when they enter the workplace. This is the second step in the employment relationship. managers and
At its most simple, employers not only pay wages but must also manage employees in such a employees in
which managers
way to ensure they ‘get their money’s worth’ and the employees ‘get things done’! seek to ensure that
In Terry’s case, he worked during the early weeks of his employment with PastaCo under employees deliver
effort and skills in
the direct supervision of a more senior sales representative who showed him the ropes, the workplace
helped him to learn about the company’s products and looked over his shoulder whenever
Terry dealt with customers. After this period, direct supervision was no longer possible
because Terry was ‘on the road’ by himself for the bulk of his working week. His work effort
was monitored in different ways: he had to submit a detailed work diary each week showing
where he had been and for how long; the amounts of pasta purchased by his customers was
routinely calculated and he received a bonus if he exceeded his target sales; and any adverse
comments from customers were quickly followed up by his supervisor. Terry understood
the situation—even though he was the most reliable of employees, PastaCo had to ensure
that he was doing his job properly.
The problem of absenteeism that Susie faced in the parks and grounds department at
Happy Valley Council (see the Work Story ‘Absenteeism at Happy Valley Local Council’),
also illustrates the production relation. Over the years, the managers in the department
had been too close to ‘the blokes’ and had allowed loose work practices to develop—the
systematic absenteeism was just one of them. Almost everyone at the council knew that parks
and grounds was not very efficient. The council was certainly not getting its money’s worth
from those employees. Rapidly rising insurance costs and higher expectations about service
from ratepayers, however, were putting a lot of pressure on senior council managers, not to
mention the political posturing of the new mayor. Susie reckoned that her report was the first
step in a campaign to clamp down on the indulgence of employees in parks and grounds.
To conceive of the employment relationship in this way—that is, to focus on the open-
ended and indeterminate nature of the employment relationship—has important implications
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
for the way that we study employment relations in this book. First, we are interested in
both the labour market and the workplace. With respect to the labour market, we study
the ways that employees, employers and their representatives determine wages, working
hours and other terms and conditions of employment. With respect to the workplace, we are
interested in the strategies that employers use to manage employees at work, the responses
of employees to these strategies and the ways that employee representatives (union and non-
union) become involved in workplace issues. Second, the indeterminacy of the employment
relationship establishes, at a general and abstract level, a potential source of conflict between
employees and employers within the structure of the employment relationship itself. Not
only must the parties to the relationship come to agreement over the price to be paid or the
promises to be made at the time of the market transaction, but they must also agree on the
effort to be expended or the skills that are subsequently applied within the workplace. Third,
it demonstrates the importance of power in the employment relationship. If the parties are
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to advance their interests and secure wages and working conditions that achieve their goals
in the employment relationship, then they must mobilise whatever resources are at their
disposal. Fourth, the open-ended and indeterminate nature of the employment relationship
requires a theoretical framework that focuses on how both the parties deal with the two steps
in the employment relationship.
1. analytical tools
2. values.
A discussion of analytical tools focuses attention on the various sets of concepts used
to analyse the employment relationship. In other words, different intellectual traditions
look through different theoretical lenses, emphasising different aspects of the employment
relationship. Budd and Bhave (2008, p. 93) call them ‘coherent models of how the employment
relationship works’. With respect to values, different people perceive the employment
relationship from different and competing positions about what is valuable, and those
different positions usually reflect deeper assumptions about the nature of organisations and
society as a whole. Even when scholars (and practitioners) do not think they are exercising
value judgments, the assumptions they make, the way they select the issues to be analysed
and the prescriptions they produce are invariably value-laden. As Table 1.1 shows, these two
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a preoccupation with outcomes (like employment levels, wage rates, labour costs and
productivity) rather than the processes by which the outcomes are determined.
On the surface, the market focus of neo-classical economics—or what Budd and Bhave
(2008, pp. 102–3) call the ‘egoist’ theory of the employment relationship—might appear to
be value-free because it leaves employees free to negotiate with their employers individual
contracts of employment, which represent mutually agreeable terms and conditions.
However, this appearance is actually deeply value-laden because it relies on an assumption
that ‘workers and employers are equal in terms of economic power, legal expertise and
protections, and political influence’ (Budd & Bhave 2008, p. 103)—an assumption that
rarely occurs in reality. Furthermore, it assumes that maximum value will flow from
employees acting as individuals, rendering collective organisations like trade unions both
unnecessary and undesirable. Consequently, the values underlying neo-classical economics
are widely considered to favour employers because they generally enjoy greater market,
political and legal power than employees.
Human resource management (HRM) offers a second approach to the employment human resource
relationship. Since capturing the imagination of many management scholars and practitioners management (HRM)
an approach to the
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
during the late 1980s and 1990s (Boxall & Dowling 1990; Strauss 2001; Bray, Waring & practice and study
Cooper 2011, p. 627), the dominant approach within HRM has employed analytical tools of the employment
relationship that
associated with psychology and organisational behaviour, combined with an emphasis on focuses on the role
strategy and the strategic fit between an organisation’s human resource strategy and its broader of management
in eliciting effort
business strategies. In other words, the dual focus of this ‘unitarist’ theory of the employment and value from
relationship (Budd & Bhave 2008, p. 103) is the universal psychological needs of individual employees
employees for happiness, social interaction and intellectual stimulation at work, which
management needs to satisfy if an organisation’s workforce is to contribute effectively to
achieving the organisation’s goals; and the management initiatives and organisational policies
that enhance employees’ job satisfaction, motivation, work performance and organisational
commitment.
HRM is based on conservative, pro-management values. Employees and employers
are assumed to have deep common interests—employees and managers will both benefit
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ER News
RMIT academics and happiness at work
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
In March 2012, Fair Work Australia ruled that Melbourne’s RMIT University was entitled to introduce a
behavioural code for its employees, the ‘behavioural capability framework’, which sets expectations
depending on an employee’s level of employment. It said that the university was not in breach of its
workplace agreement with staff in introducing the framework.
Steve Somogyi, RMIT’s chief operating officer, said that RMIT introduced the framework in order to
implement improved career development options for staff, following a staff survey in 2010. Under the
framework, some of the academic staff and professional staff would need to achieve ‘external benchmarks
of performance excellence’ and ‘promote the positive rather than the negative’. Mr Somogyi said the
framework would assist academics in their work rather than hinder them, and would not curtail their
intellectual freedom in any way.
Linda Gale, senior industrial officer of the National Tertiary Education Union (NTEU), described the
behavioural framework as ‘nonsensical … some of it is impossible’ because RMIT’s expectations were
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vague and unreasonable. She asserted that university communities are meant to be questioning and
sceptical. The hearing date for the NTEU’s appeal against the Fair Work Australia decision has not yet
been set.
In the meantime, RMIT staff are campaigning against the framework which they say forces them to
display a positive attitude and show passion.
RMIT staff members must sign the framework by 13 April and the NTEU has advised staff to add a note
to say they are signing under duress. In July staff will have to begin negotiations for a new collective
agreement with the university.
Professor Andrew Stewart, an academic from the University of Adelaide and expert on employment and
industrial relations law, said that although he understood RMIT’s frustration with complaining academics,
compulsion to exhibit positivity in a university environment was likely to unleash an ‘immediate backlash’
as staff would consider it an attack on their critical thinking.
Source: Adapted from Priess, B. 2012, ‘RMIT academics really not happy about having to be happy at work’, The Age, 27 March,
www.theage.com.au/national/education/rmit-academics-really-not-happy-about-having-to-be-happy-at-work-20120326-1vuob.
html, accessed 2 May 2017.
Questions
1. If you asked a neo-classical economist what he or she thought of RMIT management’s proposal,
what would he or she say? If you asked a Marxist? An HR manager?
2. What about you? What do you think?
Employment relations, the fourth approach, adopts a different set of analytical tools employment
that flow from an ‘institutionalist’ theoretical tradition (for more detail, see Chapter 2). This relations an
approach to the
assumes that the attitudes and behaviours of employees and employers can best be understood practice and study
by focusing on the ‘rules’ that regulate the employment relationship. In other words, rather of the employment
relationship that
than assuming that individual employees and employers are driven by rational economic focuses on the
decisions based on market forces (neo-classical economics) or by organisational policies creation and
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
enforcement of
that align the psychological motivations with organisational goals (HRM), employment rules that regulate
relations assumes that the attitudes and behaviours of both parties are heavily influenced by that relationship
social norms and expectations, especially those within the workplace. These are rules of the
employment relationship. The definition of employment relations therefore becomes:
the study of the formal and informal rules which regulate the employment relationship
and the social processes which create and enforce these rules.
Employment relations is also recognised as displaying a ‘pluralist’ values or ideology
(Budd & Bhave 2008, p. 104). Rather than the assumption of common interests inherent
in the neo-classical economic or HRM approaches, or the unsolvable conflicts of interest
evident in the Marxist approach, employment relations sees employees and employers as
having both common and conflicting interests in the employment relationship. Conflict is
therefore understandable and even inevitable, but it can be managed and accommodated
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in ways that meet the interests of both sides of the relationship. The management of
conflict, however, requires the recognition and representation of each side’s interest as
well as appropriate institutional arrangements (like collective bargaining) to facilitate the
negotiation of compromise.
This demonstrates the distinctive approach of employment relations to the study of the
employment relationship: an institutionalist set of analytical tools focusing on the rules and
how they are created and enforced; and a pluralist ideology (see Kochan 1998; Bray 2000).
These two features will be explored in more depth in Chapters 2 and 3 respectively.
CONCLUDING OBSERVATIONS
Employment relations is a diverse and challenging field of study, if for no other reason
than its relevance to so many people; it is frequently a subject of controversy and debate.
The aim of this chapter was to begin the presentation of a theoretical approach to the
study of employment relations by defining the boundaries of study, providing examples of
employment relations systems and using brief comparisons with other theoretical traditions
to identify the two distinguishing features of employment relations: first, rules regulating the
employment relationship as analytical tools; and second, pluralist values. These two features
will be explored in more depth in Chapter 2 (analytical tools) and Chapter 3 (values).
SUMMARY
∙ It is important to study employment relations because it has powerful impacts on the economic
efficiency of enterprises, industries and nations and it is central to equity and the welfare of employees.
∙ The ‘commonsense’ perception of industrial relations is that it focuses on sensational conflict
situations between trade unions and employers.
∙ There is a need to go beyond this commonsense perception to a ‘theoretically informed’ definition of
employment relations that sees it as the study of the employment relationship.
∙ An employment relationship is created whenever one person sells his or her labour to another person
or organisation and thereby works on behalf of that other person or organisation. It comprises two
steps: the market transaction and the production relation.
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
∙ There are different and competing approaches to the study of the employment relationship, which
can be distinguished by their analytical tools and ideological perspectives.
∙ The theoretical approach to the study of the employment relationship adopted in this book is distinctive
in its analytical focus on the creation and enforcement of the rules that regulate the employment
relationship and the underlying pluralist values.
KEY TERMS
employment relations. . . . . . . . . . . . . . . . . . . . . 19 market transaction. . . . . . . . . . . . . . . . . . . . . . . . 14
employment relationship . . . . . . . . . . . . . . . . . . 14 Marxism. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
human resource management (HRM). . . . . . . . 17 neo-classical economists. . . . . . . . . . . . . . . . . . 16
industrial relations. . . . . . . . . . . . . . . . . . . . . . . . . . 6 production relation. . . . . . . . . . . . . . . . . . . . . . . . 15
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DISCUSSION QUESTIONS
1. How important are employment relations for the efficiency and equity of nations and companies?
2. Where do we get our ideas about employment relations: from our own experiences, from the media,
from our families and friends, or from somewhere else?
3. What is the point of theory? How is it supposed to help us understand the world we live in?
4. When looking at the different theoretical traditions that study the employment relationship, what
does it mean that they have different ‘analytical tools’?
5. Are all theoretical approaches to the study of the employment relationship really value-laden?
6. Consider the three work situations of Terry, Susie and Li Wen. How do they differ in terms of:
a. the work tasks that they must perform in their jobs?
b. the skills they need to perform those tasks?
c. the employment relations arrangements in their places of work?
d. their likely wages and working conditions?
managers to talk about how to transform the mail facility into a ‘high-performance organisation’
(HPO). Bill’s not sure what an HPO is but he thinks it relates to introducing work teams. He has
some concerns about what this might mean for his job. He’s also worried about how receptive the
mail officers will be to the change. One thing is for sure—Bill has no doubt that the union will have
an opinion!
MailCo is part of Australia Post’s Mail and Network Division. In 1999, as part of the FuturePost
strategy, an overall commitment was made to introduce new technology, develop the skills of the
workforce and transform the corporation into an HPO. More than a decade on, many changes have
happened but there is still much to be done.
Australia Post is one of Australia’s ‘oldest continuously running commercial organisations’
(Australia Post 2003, p. 12). In 1989 Australia Post became a government business enterprise and
(continued)
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subsequently achieved remarkable success despite a range of major challenges, including the
development of email and the internet and the opening up of the parcel market to competition.
From its yearly profits, Australia Post usually pays a handsome dividend to the federal government.
Australia Post has continually been rated one of the most trusted commercial organisations in
Australia; in 2002 it was rated second after the Salvation Army (Skotnicki 2004).
Between 1999 and 2004, Australia Post, through the FuturePost strategy, invested more than
half a billion dollars in restructuring and introducing new equipment within the Mail and Network
Division (Australia Post 2003, p. 7). One of the key objectives of FuturePost was to reduce mail-
processing costs through the introduction of coding equipment to reduce manual mail sorting, and
the commissioning of automated equipment for sorting large letters.
Australia Post’s corporate policy is to work with its unions, to invest in staff skills, to empower staff
in the context of the organisation’s values and to be a leader in progressive employment policies
(Skotnicki 2004). The FuturePost strategy was introduced in the context of Australia Post’s stated
objective, specified in the corporation’s fourth and fifth Enterprise Bargaining Agreements (EBAs)
with its unions (EBAs 4 and 5), to become an HPO.
Pay and financial recognition for award staff is negotiated Australia-wide through the EBA
process. Equitable treatment at work is largely dictated through corporate policies which govern
the work conditions of all Australia Post employees. These include policies covering employee
health and safety as well as harassment and diversity, and the Australia Post Code of Ethics.
While corporate staff set the overall direction for the states, state managers have a great deal
of control over how policies are implemented. Industrial relations on site at MailCo are primarily
conducted with the Communication, Electrical, Electronic, Energy, Information, Postal, Plumbing
and Allied Services Union of Australia (CEPU), which covers a majority of mail officers. Negotiations
for the EBA are conducted at national level, with state involvement. EBA 5 provided for a ‘team
skills loading’, a $650 one-off payment for mail officers who had successfully moved into a team-
based structure. EBA 6, which covered the period 2004–06, acknowledged that ‘the roll-out of
team-based work in mail and parcel processing has been a long and complex exercise’ (as it has
been in many organisations which have gone down similar paths) (Australia Post et al. 2004, p. 8). It
was agreed in EBA 6 to give the move to team-based work new emphasis. The team-skills loading
hasn’t been paid at MailCo yet, although it has at some other facilities.
The major pieces of equipment on the MailCo floor are the machine that processes standard
letters (the MLOCR, or multiline optical character reader) and the machine that processes large letters
Copyright © 2017. McGraw-Hill Australia. All rights reserved.
(the FMOCR, or flat mail optical character reader). Both machines are supported by barcoding and
video coding of addresses. Mail that is not successfully sorted through this equipment is manually
sorted, a more costly method of mail processing. Key overall measures of performance for MailCo
and other mail processing facilities are cost per article, percentage of on-time delivery and lost
time injury frequency rate. The first two measures are significantly influenced by the performance,
on any one shift or day, of the MLOCR and the FMOCR.
Bill was involved in the team responsible for getting the FMOCR up and running when it first
arrived. He thinks the way the team introduced it might be what the managers are talking about
when they refer to an ‘HPO’.
In 2003 the senior managers called for 70 volunteers to work on the new FMOCR machine.
Because the introduction of the FMOCR on the floor was such an important initiative, dedicated
managers and technical staff worked with mail officers to train people how to operate the machine.
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Daphne.
Adana 261.
Aden 256.
Aleppo 62, 162, 214 Anm., 235, 241, 246, 251, 252, 255, 257, 260,
283;
Burg 259, A. 253.
Alexandria 232.
Allāt 91.