Employment relations

Posted: October 17th, 2013

Employment relations






Employment relations

Historical background

Employee relations form part of the fundamental components of business systems through their unique structural features that they impose on various parts of the Australian economy. The analysis of the progress and change in employee relations has been given little attention. Understanding the source and dynamics would be vital in shedding light on the emerging employee relations system. Historically, the industrial revolution was the starting point for the modern employee-employer relationships. The harsh conditions such as dangerous work, low wages and long working hours triggered violent strikes, economic instability and creation of industrial relations to create a middle ground for the economists and proletariat.

An industrial relations system is made up of a range of networks between and among employers and employees that are managed through cooperation and differences. Proper industrial relations systems are those in which relationships between all the stakeholders that are employees, employers and representatives are synchronized, harmonious and more cooperative than conflictual. Such conditions create cordial environments that are necessary for economic prosperity as well as the motivation, development and productivity of the workers generating trustworthiness and mutual confidence (Kaufman, 2004).

The contemporary employment relations systems indicated a paradigm shift from the traditional industrial relations systems. The contemporary perspective puts a greater focus on the employee as the center of the employment system. Employment relations involve maintaining healthy employer-employee relations that lead to satisfactory motivation and morale. Advice is given to superiors on the dismal performance by employees as well as employee misdemeanors. Information is also given to employees on the company’s goals and objectives. All over the world, organizations exhibit disorganized employee relations systems with flaws such as over-regulation, bureaucracy and suppression of trade union activities.

Most of the organizations in the world today exhibit a hybrid of the two systems: the industrial relations and the employee relations systems.

The change from the traditional system to a modern system that focuses on the employee has been both positive and negative. Trade unions have a reduced impact on the employees over the years. Even though regulations by anti-union laws control the extent and scope of trade unions, their effect has waned across Australia. Changes within the structure of the economy have manipulated have changed the union membership trends. These changes have made most of the employees become offended and abandon their various union groups in the face of the ruthless reality. Human resource analysts have mentioned that unions have evolved to become unavoidable, but a disadvantage to maintain owing to the tight regulations imposed by the government.

The issue of collective voice has been discussed at length by many Australian workers. They all have the right to gain information and consultation on the issues at the workplace. However, in the contemporary employment relations system, these rights are hardly exercised. The government also contributes very little towards sensitizing Australian workers on their right. Non-union workers within Australia are even worse off as they lack the support, advice and training to carry out their functions (Coats, 2012).


Scholars of industrial relations have come up with three major theoretical perspectives that assist in the understanding of the relations at the workplace. These approaches are known as radical, unitarism and pluralism. In the pluralism approach, the workplace or company is viewed as having different powerful sub-groups with each possessing their own loyalties, leaders and objectives. The most dominant sub-groups within the pluralist model are trade unions and management. The pluralistic approach attempts to addresses the conflictual relationship between managers and workers over the allocation of revenues and explains its different aspects. The role of the management then transforms from enforcing and coordination toward persuasion and negotiation (Mullins, 2005).

Collective bargaining is used as a means of dealing with conflict. However, conflict is not necessarily deemed a terrible thing as it can be manipulated to produce positive change and evolution. This theory therefore urges managers to let conflicts play out as they hold a greater predisposition for success when compared to harmony. One of the implications of using this approach is that the company should invest in industrial relations specialists who provide advice managers on the best way to handle staffing, union and negotiation matters. The negotiation among employees and employers must also be arbitrated over by external parties. Lastly, within the pluralistic approach, unions are given recognition and provided with the platform to carry out their activities (Blanpain et al, 2009).


In the unitarism approach, the company is perceived to be one harmonious coalition of employees and employers. The approach assumes that the management and the staff are in constant harmony and share a common objective and purpose. Unitarism, unlike pluralism, demands the loyalty of all employees and being inclined to use the management to enforce this loyalty as well as emphasizing other organizational opinions. Within such environments, the trade unions are considered unnecessary as both employees and the management now that they are expected to be loyal to their organization. In such organizations, conflict is deemed as disruptive to the normal working conditions.

A core assumption of this approach is that the management, staff and other stakeholders share a common objective, interest and goal. Unitarism also has a paternalistic aspect that may deny many of the employee relations actors a chance to express their wishes and achieve their goals. As far as employees are concerned, the unitary approach has the following implications. One, the working conditions are more flexible. Two, any forms of unions are considered to be channels through which the staff and the company can communicate. Three, the employees participation is encouraged and facilitated to empower them in their functions. There is an emphasis on teamwork, creativity, innovation and problem-solving skills (Lansbury, 2012).

From the employer’s position, the unitary approach has the following conditions and ramifications. The company’s policies should strive to unify, motivate and inspire employees. There should be proper communications channels along and across the management levels. The employer is also expected to establish reward systems that will entrench devotion and commitment to the firm. All conflicts arising from the staff are assumed to be due to a lack of communication and inadequate company policies. Lastly, the employer should try as much to integrate the individual employee’s objectives into the organizations goals.

Transformation in the industrial relations in Australia

            The Australian government has been at the forefront in debates concerning employment relations over the last two decades. The introduction of “high commitment” and “high performance” as some of the new standards into work systems emphasize the adoption of employee motivation and increased involvement. The reforms within Australian work systems have come about due to collaborative forms of innovation and forceful change due to crises. The new Labor government has also played a large part in shaping and orchestrating the reforms to a more employee-centered system (Verma, 2005).

The Labor Party in the period 1983 to 1996 forged many reforms such as the formal Accord with the union organizations to allow the unions to oversee the wage demands while the state would look into economic reforms. Later on, the Labor Party opened the industrial relations field by authorizing non-union contracts in the workplace. The reforms included fostering industrial democracy and increase employee participation. The Hawke Labor government later dropped this system and adopted a policy called managed decentralism. This policy ensured the abolishment of wage indexation and the introduction of a two-tier wage system. The most affected areas were the automobile and the steel industries. At this juncture, certain laws addressing the relationship between employees and employers were adopted. The Minimum conditions of Employment Act of 1993 served as the origin of unitary reforms within the work system of Australia.

Much later in 1996, the fragmented flexibility policy was adopted. This allowed a more fragmented system that had individual bargaining allowance between employers and employers. Currently, the Australian workplace has slight improvements that are based the fragmented flexibility policy adopted in 1996. In the recent years, there has been a move to introduce management strategy as a way of dealing with industrial relations issues and challenges. This developed work system introduced new aspects such as the Occupational Safety and Health Act, the Mines Safety and Inspection Act as well as the Workers’ Compensation and Injury Management Act.  These policies address the health, safety and working conditions of workers in Australia.  Currently, the thre most dominant reforms applying in the industrial relations sector include the Industrial Relations Act 197, the Employment Dispute Resolution Act 2008 and the Minimum Conditions of Employment Act 1993.


Bamber, G., Lansbury, R. D., & Wailes, N. (2011). International and comparative employment relations: Globalization and change. Los Angeles: SAGE.

Blanpain, R., Bromwich, W., Rymkevich, O., Spattini, S., & Aparicio, V. L. (2009). The modernization of labour law and industrial relations in a comparative perspective. Austin: Wolters Kluwer Law & Business.

Coats D. (2012) Time for a rethink: a new employment relations system for the UK. IPA. 30 September 2010. Retrieved from http://www.ipa-involve.com/news/time-for-a-rethink-a-new-employment-relations-system-for-the-uk/

Kaufman, Bruce E. (2004). Theoretical Perspectives on Work and the Employment Relationship. Industrial Relations Research Association

Lansbury R. D. (2012) Workplace change and employment relations reform in Australia: Prospects for a new Social partnership? Australian Review of Public Affairs. Retrieved from http://www.australianreview.net/journal/v1/n1/lansbury.pdf

Mullins, Laurie J (2005). Management and Organizational Behavior. FT Prentice Hall.

Verma A. (2005) What Do Unions Do to the Workplace? Union Impact on Management and HRM Policies. Journal of Labor Research. Retrieved from http://www.wallnetwork.ca/resources/Verma.UnionImpactOnHRM.JLR2005.pdf



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