Ppt presentation will support to understand approaches and theories of Industrial Relations

1. Dr. Kokila Saxena

2. Approaches Used to Define Industrial Relations
(1) Institutional-based definitions:
industrial relations are the sum of institutions and institutional
processes that establish and administer the rules regulating
workplace relations
(2) Social Psychology-based definitions:
industrial relations are the sum of social psychological interactions
between individuals
(3) Class-based definitions:
industrial relations are the sum of institutions, interactions and
processes that are a product of wider social and economic
influences, in particular the class divisions of contemporary
capitalism

3. Approaches Used to Define Industrial Relations
(4) Human Resource Management:
contracts of employment (involving trade unions, worker collectives,
labour courts and government agencies), as well as management of
conflict arising out of the personal interactions of individuals in the
workplace, are part of labour management functions ( i.e. recruitment,
selection, training, development, performance management, and so on)
(5) Employment Relations (or Employee Relations):
contracts of employment (involving trade unions, worker collectives,
labour courts and government agencies), as well as the management of
conflict arising out of the personal interactions of individuals in the
workplace, are equal parts of workplace relations, together with the normal
functions of Human Resource Management.

4. Industrial relations encompasses ‘the processes of
regulation and control over workplace relations, the
organisation of tasks, and the relations between employers
and their representatives, and employees and their
representatives, and is the sum of economic, social and
political interactions in workplaces where employees
provide manual and mental labour in exchange for
rewards allotted by employers, as well as the institutions
established for the purpose of governing workplace
relations.

5. Frames of Reference
Unitarism
Assumptions about workplace relations
- management and employees share common interest
- one source of legitimate authority (management)
Assumptions about workplace conflict
- inevitable, aberration, destructive, to be avoided
- caused by poor management, dissidents, agitators or poor
communication
Assumptions about trade unions
- a competing and illegitimate source of authority
- an unwarranted intrusion in the workplace
- create conflict where none would otherwise exist
Assumptions about collective bargaining
- creates and institutionalizes unnecessary divisions of interest
- serves to generate workplace conflict rather than resolve it

6. Frames of Reference
Pluralist
Assumptions about workplace relations
- managers and employees have different objectives
- multiple sources of legitimate authority
Assumptions about workplace conflict
- inevitable, caused by different opinions and values, benefit to an
organization
- avoid by accepting trade unions, include in decision-making
Assumptions about the workplace role of trade unions
- not the cause of conflict
- are expression of diverse workplace interests that always exist
- a legitimate part of workplace relations
Assumptions about the role of collective bargaining
- deals with problems on a collective basis
- most efficient means for institutionalising employment rules
- fairer outcomes by balancing employee and management power

7. Frames of Reference
Marxist
Assumptions about workplace relations
- reflects a wider class conflict between capital and labour
- reflects coercion of working class into dominant capitalist values
Assumptions about workplace conflict
- inevitable: capital seeks to reduce costs, workers seek fairer price for
labour
- will only cease by revolutionary change in distribution of property and
wealth
Assumptions about trade unions
- should raise revolutionary consciousness of workers
- should not limit action to improving material lot of workers
- union leaders who accommodate management betray the workers
Assumptions about collective bargaining
- merely offers temporary accommodations
- leaves important managerial powers in tact

8. Theories of Industrial Relations
Human Relations Theory and Neo-Human Relations Theories
Key proponents: Mayo, Maslow, McGregor, Herzberg
Frame of reference: Unitarist
Focus: Workers’ social and psychological needs
Reference to industrial relations: Implicit
Theory: a system of management, maximise output by meeting social and
psychological needs of employees in the workplace.
(i) managers identify and satisfy employees’ social and
psychological needs
(ii) employees seen as different to other production resources
(iii) employees organised into teams
(iv) employees included in work allocation decision-making processes
Result: worker morale maximised, motivated employees productive.
Neo-Human Relations theories add individual satisfaction and motivation is
through worker ‘self actualisation’ by ‘hierarchy of needs’

9. Theories of Industrial Relations
Systems Theory
Key proponent: Dunlop
Frame of reference: Pluralist
Focus: a general theory of industrial relations
Reference to industrial relations: Explicit
Theory: industrial relations is a sub-system of wider society with four
elements:
(i) actors: employers, employees, their representatives, government
agencies
(ii) environmental contexts: technology, market, budgets,
distribution of power
(iii) procedural and substantive rules governing the actors
(iv) binding ideology, common beliefs encouraging actors to
compromise

10. Theories of Industrial Relations
Labour Process Theory
Key proponent: Braverman
Frame of reference: Marxist
Focus: Labour’s relationship with industrial processes
Reference to industrial relations: Implicit
Theory: improved technology and scientific management techniques are
(i) de-skilling work
(ii) fragmenting tasks
(iii) centralising knowledge in management
(iv) diminishing workers control of pace and conduct of work
Result: labour is increasingly alienated and exploited, leading to
resistance by organised and unorganised industrial conflict.

11. Theories of Industrial Relations
Strategic Choice Theory
Key proponents: Kochan, Katz and McKersie
Frame of reference: Pluralist
Focus: a general theory of industrial relations
Reference to industrial relations: Explicit
Theory: emphasizes the strategic choice of actors in deciding industrial
relations outcomes, as influenced by:
(i) declining union membership
(ii) breakdown of collective bargaining frameworks
(iii) retreating government intervention
(iv) pro-active human resource management techniques
(v) spread of organisational authority for industrial relations

12. Theories of Industrial Relations
Scientific Management
Key proponent: Taylor
Frame of reference: Unitarist
Focus: Use and control of labour
Reference to industrial relations: Implicit
Theory: system of management maximizing output by greatest technical
efficiency of work methods, achieved by:
(i) unchallenged management powers to allocate work tasks
(ii) managers relationship with employees is rational and objective
(iii) managers treat workers impersonally and collectively
(iv) work tasks reduced to basics for low-skilled, low-paid
employees in assembly line production
(v) employees are chosen to suits the tasks to be performed
(vi) employees given training in best work methods
(vii) employees motivated by incentive payment schemes

13. Theories of Industrial Relations
Theories of lesser note…
Transaction Cost Theory
Key proponents: Williamson, Milgrom and Roberts
Frame of reference: Unitarist
Focus: Costs of formal and informal labour contracts
Reference to industrial relations: Implicit
Theory: all economic transactions incur costs, including labour contracts.
Open-ended contracts more cost effective than detailed contracts
Regulation Theory
Key proponents: Stigler and Friedland, Joskow
Frame of reference: Pluralist
Focus: State intervention in industrial relations
Reference to industrial relations: Explicit
Theory: (i) ‘capture theory’ (ii) ‘bargaining theory’

14. Theories of Industrial Relations
Theories of lesser note…
Labour Market Theory
Key proponent: Friedman and Friedman
Frame of reference: Unitarist
Focus: The settlement of wages, employment and the allocation of work.
Reference to industrial relations: Explicit
Theory: people are ‘rational economic maximisers’, ‘perfectly
competitive’ labour and product markets yield most efficient
economic outcomes.
Institutionalist Theory
Key proponents: Webb and Webb, Commons, Clegg
Frame of reference: Pluralist
Focus: History and development of the institutions of industrial relations
Reference to industrial relations: Explicit
Theory: capitalism creates sectional interests and institutions to regulate

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