Employee Relations over the past 30 years in the UK

1. Employee Relations over the past 30 years in the UK
1. Introduction
Indeed, the employee relations, or previously, industrial relations, which are
defined by Clegg (1979) as the “rules governing employment, together with the
ways in which the rules are made and changed, interpreted and administered”, were
subject to great changes over the past 30 years in UK and globally. This, included
the changes in economic and social spheres, resulted in the alteration of legislative
change and change of political context. The role, authority and right of the State,
employers, Trade unions and employees adapted and adjusted to these contexts.
From traditional approaches with high authority of Trade unions, they moved
forward towards the liberalisation, with the help of the activities of Conservative
governments, and then, transformed into the neo-liberalism of New Labour. So, the
popularity of three theoretical perspectives or frameworks in understanding and
analysis of workplace relations, which are unitary, pluralist and radical perspectives
also varied with the course of time and PEST context. Moreover, the last 30 years
were also accompanied by the crisis of industrial relations and growth of complex
approach to employee relationship with the more emphasis on the study of
organizational behaviour and mainstream economics (Blyton and Turnbull 2004).
So, another important issue is the individualization of the employment relationship,
occurred during the last 30 years, and thus employee relationships becoming the
central point of employee relations (Bacon and Storey 1993). To add, now many
researchers argue for the regeneration of the inclination towards the protection of
employees' rights to comply with international standards and increase the security
of employment because of the increased power of employers. It is also worth to
mention the shift from so called “traditional focus” on actor, such as managers,
employees, government, unions to “new” actors, including customers, families, and
other broadening interest groups. So, the new focus aims at the widened lists of
employee relations concerns and thus requiring more efforts (Heery and Frege
2006).
2. Employee Relations over the past 30 years
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2. According to Blanchflower et al. (2007), the workplace industrial (and later
employee) relations surveys helped in the comprehension of employee relations,
and therefore revealed the practices in this sphere and facilitated the observation of
their changes during the last 30 years (staring from the WIRS84book), so it was one
of the most prominent innovations in the sphere of study of Industrial Relations, as
Millward and Stevens (1986) says.
But apart from the tools of study, and prior to the era of Thatcherism, the
main academic innovation in the sphere of Industrial Relations were the
developments of John Dunlop, who emphasised (1975), (1977) the importance of
"Industrial Relations System" based ‘social systems’, and focused on PEST context,
main actors (initially, employers, manager, union and employees), processes (such
as collective bargaining), and outcomes, such as conflict regulation increased pays
and productivity.
However, the worsening economic and other contexts lead to the disapproval
of the traditional Industrial Relations system with trade unions, as the result of the
failure of collective bargaining, one example is number of stoppages in the UK,
which topped at 4583 in 1979 with the loss of 29 million working days. And starting
from Conservatives government and Margaret Thatcher as the Prime Minister
pursued a policy of diminishing the power of the trade unions, because of the
accusation of the Trade Unions leadership in “undermining parliamentary
democracy and economic performance through strike action” (Soskice 1984, Blyton
and Turnbull 2004).
This lead to the growth of pressure on the trade unions via the legal means
and a set of legal acts, which diminished the power of trade unions and re-
established the privileges to management and employers. The activities of
Conservative governments, for the period from 1979 to 1997 in this sphere were
aimed at the increasing the influence of free market, including such measures as
privatization and “rolling back of regulatory frameworks designed to protect labour”,
as Harvey (2003) notes. These activities in the field of employment law reform
embraced the “removal of statutory support for collective bargaining, and the
dilution of employment protection” (Dickens and Hall 1995, Smith and Morton
2001a, cited in Smith and Morton 2006). This resulted in decreasing both trade
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3. union membership, but also fewer stoppages and number of working days lost,
specifically 630 and 2 million respectively in 1990 (Evans et al. 1992).
So, by the end of 1990s, it was affirmed that the time of the domination of
collective Industrial Relations, with the high authority of independent trade unions in
representing the employees’ interest was finally finished, largely because of the
action of the Conservative government starting from 1979 (Millward et al. 2000).
Millward et al. (2000) also note the sharp drop in number of members of unions by
those who are entering the working age, and thus new generations is “likely to be
non-union relative to their older counterparts, regardless of their other
characteristics”, as Blanchflower et al. (2007) says. However, Kersley (2006) says
that the decline of the union recognition stabilised since 1998, especially among the
“traditional population of workplaces with 25 or more employees” and public sector.
One of the striking example of the decline of UK Union is the disappearance of the
one “strongest forms of unionization”, which is the closed shop (Blanchflower et al.
2007). The term “closed shop” means the type of the union security agreement,
according to which “the employer agrees to hire union members only, and
employees must remain members of the union at all times in order to remain
employed”, and it became strictly illegal according to Union and Labour Relations
(Consolidation) Act 1992 and had virtually disappeared by 1998 (Disney et al.,
1995, Millward et al. 2000). Thus, the decade of 1980s was a period of significant
changes for industrial relations, and after the analysis of WIRS90 Millward et al.
(1992) conclude that the traditional system of Industrial Relation no longer
distinguish British economy, while Purcell (1993) called this phenomenon as “the
end of institutional industrial relations”.
The era of ‘New Right’ was also important for the further popularisation of
Unitarism, an approach, according to with the work organizations are ‘integrated
and harmonious whole existing for a common purpose’ (Farnham and Pimlott 1991
cited in Provis 1996). It assumes that if the employees and management are the
"same team", and employees are loyal to the company (which, in turn, tries to meet
the needs of an employee), then the conflict is considered to be pathological and
should be avoided by a range of means, including pushing forward increasing the
level of participation and decision-making rights to managers, and the legislation
against the trade unions, removal of support for collective bargaining, strikes and
industrial action (Provis, 1996). However, Provis suggest that the values and
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4. approaches of managers are not also considerable as true by the employees, and
conflicts are often occur, despite of the efforts from the proponents of this approach.
But, the new approach to Unitarism is heavily relies on the Human Relations and
Human Resource Management concept, with the ‘individualisation’ of employment
relations and targeting at the individual worker and relationship with management
with the aim of increasing the effectiveness of the whole company (Brown et al.
2000). This is also accompanied by the new management approach because of the
technological advances and focus on flexibility and individualism, with the ‘de-
unionised’ management approach (Dunn 1989, Gall 2000).
On the other hand, Pluralism approach considers the organizations as the
combination of the groups with competing interests, therefore conflict is inevitable
and actually the part of employment relationship, so they should be managed with a
range of measures, one of them is balancing the power between the groups with
inherently different interests, increasing the power of trade unions in representing
employee interests and decreasing their dependency on the employer (Provis
1996). However, Provis notes that this concept is proved to be unreliable, especially
after the cases when it was clearly demonstrated that some of the conflicts are hard
to impossible to manage and parties are not always rational in pursing their interest.
Although, Ackers (2002) notes that economical and social changes, such as
decline of “male, manufacturing employment” combined with “feminised service
work”, in addition to the growth of modern knowledge economy requires completely
different approach in Industrial Relationship aimed at the connection between the
society and employment. Moreover, it is becoming evident that the ‘problem of
order’, the main area for Industrial Relationship, is now less important than the
problems of relationship between employment and society in general, with the
issues of “social breakdown and cohesion, moral communities and social
institutions, civil society and democratic rights, relationship capitalism and stake
holding, and employment regulation" composing the new concept of Industrial
Relationship (Ackers, 2002). Roche (2000) argues for a modern approach
comprising the proper management-employee relations in mainly focused on
involvement, participation and partnership, on the one hand, and assuming the
balances of power simultaneously, instead of the old focus on collective bargaining
and conflict resolution. According to Ackers (2002), the crisis of Industrial Relations
as an area for research results in the necessity of “reframing its underlying
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5. theoretical assumptions”, which requires the connection between employment and
society, employer, managers and employees, and an active implementation of joint
consultation, and to less extend employee involvement, instead of Unitarits' main
emphasis on participation and employee involvement and participation. Ackers
therefore proposes the model of Neo-Pluralism Employee Relations that can be
considered as a more reasonable that the Kelly (1998) attempt to revitalize the
Marxism approach and dominance of Unitarism.
Sennett (1998) suggest the fact that the approach to the job as ‘flexible’,
meaning “constantly changing, high-risk, bitty and short-term—patterns of
employment” are weakening the importance of “identity in our work and life”, while
Lloyd (1998) and Phillips (1998) shows that family is in the social crisis in Anglo-
Saxon world because of these processes, partially caused by the pursue for the
policy of Unitarism. Etzione (1997) and Ackers (2002) also notes the increasing
attention to the issue of family and community as the main public debate over the
future of modern Anglo-Saxon society, because of increasing social breakdown
(i.e. level of crime and alienation), which is broadly credited as the result of failing
families and communities. While Hobsbawm (1994) Sennett (1998) and Himmelfarb
(1994) share their pessimism over the future of managing Employee Relations in
struggling these problems, Ackers (2002) deems New-Pluralism approach as a
remedy for them.
Neo-pluralism approach was largely presented in the New Labour's neo-
liberalism and their programme for industrial relations and employment law starting
from 1997. According to Hall (2002), New Labour differed from previous
Conservative governments in hybrid of the social-democratic measures with neo-
liberalism, while McIlroy (1998) and Colling (2002, 2003) notes the inclination of
New Labour to so-called 'third way' when the partnership is used as a “metaphor
invoked in order to express the highly cooperative ideal expressed by the elastic
employment relation”. The course of New Labour was to combine the Conservative
legislation on trade unions and industrial action on the one hand, and social
partnership and collective and individual rights on the other, thus intervening “the
labour market and the employment relationship ...to promote efficiency” (Smith and
Morton, 2006). However, Ewing and Hendy (2004) note that, despite of these
efforts, UK still do not comply with international standards, especially EU, regarding
workers’ rights to organize and take industrial actions, in addition to some others.
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6. Another issue that is becoming more important in Neo-pluralism approach to
Industrial Relationship theory is the concept of civil society, which proposes more
appropriate answer to the EU's “agenda of human rights and citizenship” (Ackers,
2002). Giddens (1998, 2000) also notes that there is double threat to civil society,
which are specifically the over-reaching state and unregulated global free enterprise
standing one opposite other, so he proposes their combination, or the third way
between the state collective provision and the neo-liberal emphasis on the laizes-
faire and free market, thus suggesting the ideas that are correlating and similar of
neo-pluralism.
Another trend that can also be encompassed by neo-pluralism is the
revitalisation of the interest in collective bargain. According to Smith and Morton
(2006) and Oxenbridge et al. (2003), current statutory recognition procedure
confirms the limited abilities of trade union organization and collective bargaining,
especially considering their sharp decline, and frequent shift to ‘consultative
arrangements that are less dependent than in the past upon the potential for
collective worker action’ . To add, Guest and Peccei (2004) shows that partnership
agreements similarly ensures the power of employee, when the outcome is “leaning
heavily towards management”, while Kelly (2004) calls them ‘employer-dominant’
agreements. So, Morton and Smith (2006) suggest the restoration and expansion of
the trade union rights for the purpose of “safeguarding workers’ interests within the
labour market, employment relationship and society”, because of the limited scope
and access to the employment rights accompanied by the weak sanctions, thus
making the application of European social model in UK “a shadow of its original
pretensions”.
3. Conclusion
So, the impact of the changes on each of the actors and their strategic choice
was discussed and analysed previously. However, they should be summed up from
the prospective of each actor separately. For example management as an actor
was positively influenced by the changes in the balance power, they are more
flexible in their relationships with employees and initiating changes, making choices
for the whole company in this sphere, they are also less subjected to the regulation
of the State and Unions. Thus, it can be noted that the increase of the power of
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7. managers means the increase of the power of employers, their effectiveness in term
of profitability and flexibility, by the cost of the decreasing security of employees.
On the contrary, Trade Unions in UK have lost most of their power during the
last 30 years; although there was a growth of less unionate organizations. To add,
there is an expectation of increasing influence because of complying with EU
regulation and globalisation of Trade Unions. Increased flexibility and improvement
of HRM measures, means better opportunities and incentives for more effective
work for the talented employees, especially considering the rise of new technologies
company, and partially service companies (Howell, 2005). However, nowadays,
because of the increased flexibility, commoditisation of the labour and increased
competition on the labour market, employees feel less secure and less important in
decision making process while comparing with the “old times”.
The State is still the main regulator of the actors, though the approach of
laissez-faire with intervention only if necessary became prevalent in minds of
academics and practitioners. The role of the State remains under the large influence
of the legislation of Thatcher era, however it became more interventionist in the
area of regulatory law. It also important to mention that role of the State in setting
the rules of engagement and also giving example of good clime in some cases, to
motivate the business to increase the level of security and equity standards.
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