International labour relations
ā¢Download as PPTX, PDFā¢
11 likesā¢12,430 views
International Labour Relations
Recommended
More Related Content
What's hot
What's hot (20)
Similar to International labour relations
Similar to International labour relations (20)
More from koshyligo
More from koshyligo (8)
Recently uploaded
Recently uploaded (20)
International labour relations
- 1. International Labour Relations Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 2. Industrial Relations ā¢ Industrial relations or employment relations encompasses the interrelations between employers and employees, labor/trade unions, employer organizations and the state/ government. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 3. International Industrial relations ā¢ International industrial relations deals with the complex relationships among employers employing foreign national, employees of different nationalities, home and host country governments and trade unions of the organizations operating in various countries and their national & international federations. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 4. Key Players ā¢ Government ā¢ Employers and their organisation ā¢ Employees and their Organisation(Trade Unions) Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 5. ā¢ Unitarist ā¢ Mutual cooperation, teamwork, sharing common objectives, conflict is seen as destructive ā¢ Pluralist ā¢ Conflict is inevitable, and trade unions are seen as legitimate to counter management authority ā¢ Marxist ā¢ Industrial conflict is because of division in the society , the solution being the overthrow of the capitalist system Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 6. Trade unions/ Labour Unions ā¢ Labour unions or trade unions are organizations formed by workers from related fields that work for the common interest of its members. ā¢ They help workers in issues like fairness of pay, good working environment, hours of work and benefits. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 7. Functions of Trade Unions ā¢ Militant or protective or intra mural functions ā¢ Protecting the workers interest ā¢ Fraternal or extramural functions ā¢ Providing financial and non financial assistance to workers during strikes and lockout ā¢ Political functions ā¢ Affiliating a union to a political party, helping the political party in enrolling members, collecting donations ā¢ Social functions ā¢ social responsibilities through educating the customers ā¢ Ancillary functions ā¢ includes communication, welfare, education and research. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 8. Union Structure ā¢ Craft Unions ā¢ Members do one type of job ā¢ Industrial Union ā¢ Includes members working in same industry ā¢ General Union ā¢ Members working in different industries within a particular city / region ā¢ Federations & Confederation ā¢ National level entities ā¢ Confederation: Association of Federations ā¢ International Federation ā¢ Federations at the national levels join to form international federation to deal with the HR issues of the MNCs Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 9. Key Issues in IIRs (International Industrial Relations) Key issues in IIRs can broadly divided into categories: 1. Who should handle Labour Relations ā HQ or Subsidiaries in the concerned countries. 2. What should be the Union Tactics? Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 10. Who should handle Labour Relations ā HQ or Subsidiaries in the concerned countries? ā¢ Multinationals generally delegate the management of industrial relations to their foreign subsidiaries. ā¢ Corporate HQ will become involved in or oversee labour agreements made by foreign subsidiaries. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 11. Multinational headquarters involvement in industrial relations is influenced by following factors ā¢ The degree of inter-subsidiary production integration ā¢ Higher degree of the degree of inter-subsidiary production integration results in centralisation of IR ā¢ Nationality of ownership of the subsidiary. ā¢ Centralisation is more in US firms than European Firms ā¢ International human resource management approach ā¢ Ethnocentric- centralised IR ā¢ Polycentric- Decentralised IR ā¢ Subsidiary characteristics ā¢ Acquisition- Decentralised IR ā¢ Greenfield ā Centralised IR ā¢ life stage of subsidiary- initial stages- centralised IR ā¢ Performance- Poor performance ā centralisation of IR ā¢ Characteristics of the home product market. ā¢ Large domestic sales- centralised IR Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 12. Influence of trade unions on HR practices of MNCs ā¢ Employment ā¢ Trade unions prefer host country nationals ā¢ Salaries and benefits (Influencing wage levels ) ā¢ Salary discrimination between expatriates and HCN ā¢ Enhancement of Salary for all kinds of employees ā¢ MNCās Optimum size ā¢ Limits the economies of scale that MNC can avail by mergers, takeovers and joint ventures. ā¢ Location and shifting (Social Dumping) ā¢ Opposes the shift to other countries because of the fear of losing job opportunities ā¢ Closure of units ā¢ Lobby the national governments against the closure of units Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 13. Concerns of Trade unions in MNCs ā¢ Formidable financial resources. ā¢ The ability to move production facilities to other countries ā¢ A remote locus of authority (i.e. the corporate head office management of a multinational firm). ā¢ Production facilities in many industries( multiple product lines) ā¢ Superior knowledge and expertise in industrial relations ā¢ The capacity to stage an āinvestment strike,ā whereby the multinational refuses to invest any additional funds in a plant, thus ensuring that the plant will become obsolete and economically non-competitive. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 14. MNCs strategies to Counter Trade Union Influences ā¢ Massive financial resources to absorb losses in a foreign subsidiary ā¢ Options to shift production units to other countries ā¢ Distance between HQ and subsidiary ā¢ Restricting key activities in home country and establish subsidiaries in developing countries for operations that require relatively lower level of skills. ā¢ Development of superior knowledge in labour laws of the host country, skills of negotiations with trade unions on salary, recruitment and other human resources.. ā¢ MNCs stop investing additional funds or divest in order to make the plant less competitive as well as non- economical. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 15. Response of Trade Unions to Multinationals ā¢ The response of labour unions to multinationals has been threefold: ā¢ To form international trade secretariats (ITSs) ā¢ To lobby for restrictive national legislation ā¢ To try to achieve regulation of multinationals by international organizations. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 16. International trade secretariats (ITSs) ā¢ There are 15 ITSs, which function as loose confederations to provide worldwide links for the national unions in a particular trade or industry (e.g. metals, transport and chemicals). ā¢ Mainly operated to facilitate the exchange of information ā¢ The long-term goal of each ITS is to achieve transnational bargaining ā¢ Eg: Euro-FIET (European Regional Organization of the International Federation of Commercial, Clerical, Professional and Technical Employees) Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 17. Lobbying for restrictive national legislation ā¢ Trade unions have lobbied for restrictive national legislation in the USA and Europe for ā Preventing the export of jobs by the multinational to other locations Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 18. Regulation of multinationals by international organizations ā¢ Attempts are made by trade unions to exert influence over multinationals via international organizations such as ā¢ Organization for Economic Cooperation and Development (OECD) ā¢ International Labour Organization (ILO) ā¢ United Nations Conference on Trade and Development (UNCTAD) ā¢ For issuing guidelines covering disclosure of information, competition, financing, taxation, employment and industrial relationsLigo Koshy, Faculty, MACFAST ,Tiruvalla
- 19. Social Dumping ā¢ Social dumping is a practice of employers to use cheaper labour than is usually available at their site of production or sale. ā¢ In the latter case(Sale), migrant workers are employed; in the former, production is moved to a low-wage country or area. Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 20. Industrial relations issues involved in social dumping ā¢ The movement of work from one region to another, and its effect on employment levels ā¢ The need for trade union solidarity to prevent workers in one region from accepting pay cuts to attract investment, at the expense of workers in another region Ligo Koshy, Faculty, MACFAST ,Tiruvalla
- 21. Impact of digital economy ā¢ The creation and loss of jobs ā¢ The content and quality of work ā¢ Manufacturing to a knowledge based ā¢ The location of work ā¢ The nature of the employment contract ā¢ Rigid to flexible ā¢ The skills required ā AI, Analytics, cloud Technologies etc. ā¢ Digital divide exists between countries and within societies Ligo Koshy, Faculty, MACFAST ,Tiruvalla
Editor's Notes
- 5
- Militant or intra mural functions: Protecting the workersā interests like hike in salaries and benefits, job security, cultural adaptability programs, etc. through collective bargaining and direct action Fraternal or extra-mural functions: Providing financial and non-financial assistance to workers during the periods of strikes and lockouts, extension of medical facilities during sickness and casualties, provision of education, recreation, recreational and housing facilities, provision of social and religious benefits etc. Social functions: Carrying out social service activities, discharging social responsibilities through various sections of the society like educating the customers. Political functions: Affiliating a union to a political party, helping the political party in enrolling members, collecting donations, canvassing during election period, seeking help of political parties during strike or lock out. Ancillary functions: It includes communication, welfare, education and research.
- Craft unions: Members do one type of job These are horizontal unions where workers of the same craft or category form into a union. The basic logic behind the formation of such unions is that the workers belonging to the same craft do face similar problems ā mostly non managerial personnel form such unions. [Driversā Association or Signalling Staff Union in Railways] Industrial unions: Includes members working in same industry If the workers from the different categories in the same industry form into Union, that Union is called āIndustrial Union.ā These are vertical unions. The logic behind formation of Industrial unions is that workers of the same industry have the common bend and they are governed by same rules and regulations and are administered by the same management. Importance of these unions is increasing these days. Joint facility for collective bargaining, demand for uniformity in the principle governing all aspects of service and working conditions; and scope for coordination of different sections, levels and natures of industry are advantages General Unions: Members working in different industries within a particular city / region If the workers of any industry, any region and any job or occupation form into one union in order to protect overall interests of the workers , such unions are called āgeneral unions.ā Federations and Confederation: Unions , either of the same industry or of different industries may form into association in order to improve their unity and strength. Such union of unions is called Federation. During critical situations, these federations without losing their individual identity may resort to concerted action. For this purpose Federations form into an association and such association is termed Confederation. International Federation: Federations at the national levels join international federation in order to gather support at the international level as well as to deal with HR issues of MNCs as operations of the MNCs are spread over several countries.
- The degree of inter-subsidiary production integration. Higher degree of the degree of inter-subsidiary production integration results in centralisation of IR The degree of inter-subsidiary production means that a subsidiary in one country relies on another foreign subsidiary as a source of components or as a user of its output. In this context, a coordinated industrial relations policy is one of the key factors in a successful global production strategy. Nationality of ownership of the subsidiary. US firms tend to exercise greater centralized control over labour relations than do British or other European firms. US firms tend to place greater emphasis on formal management controls and a close reporting system (particularly within the area of financial control) to ensure that planning targets are met. International human resource management approach. The various international human resource management approaches utilized by multinationals; ethnocentric, polycentric, geocentric or Regiocentric approaches have implications for international industrial relations. An ethnocentric predisposition is more likely to be associated with centralisation of IR and may results in various forms of industrial relations conflict. ā¢ Polycentric firms will more likely to be associated with de-centralisation, owing to their greater propensity to participate in local events. Subsidiary characteristics Subsidiaries that are formed through acquisition of well-established indigenous firms tend to be given much more autonomy over industrial relations than are greenfield sites set up by a multinational firm. Greater intervention would be expected when the subsidiary is of key strategic importance to the firm and the subsidiary is young. If the subsidiary is more dependent on headquarters for resources, there will tend to be increased corporate involvement in industrial relations and human resource management Poor subsidiary performance tends to be accompanied by increased corporate involvement in industrial relations. Where poor performance is due to industrial relations problems, multinationals tend to attempt to introduce parent-country industrial relations practices aimed at reducing industrial unrest or increasing productivity. Characteristics of the home product market. If domestic sales are large relative to overseas operations (as is the case with many US firms), it is more likely that overseas operations will be regarded by the parent firm as an extension of domestic operations. This is not the case for many European firms, whose international operations represent the major part of their business. Lack of a large home market is a strong incentive to adapt to host-country institutions and norms. Management attitudes towards unions Foreign -owned firms may be under less financial pressure to settle a strike quickly than local firms ā possibly because they can switch production out of the country.
- Employment: MNCs in search for the best talent prefer employment of expatriates whereas trade unions prefer appointment of host country nationals particularly for senior management jobs. Trade unions influence host country governments to enact laws for imposing the regulations and limits over the appointments of all kinds of expatriates. Thus unions in developed countries oppose MNCs relocating of jobs / business outsourcing. Salaries & benefits: Trade unions are concerned with two aspects in respect of salaries and benefits viz. salary discrimination between expatriates and host country nationals and enhancement of salary levels of all kinds of employees. These pressures from unions to increase salaries of host country nationals at par with those of expatriates, their demands for minimum salaries, maternity benefits, gratuity, pension, accident benefits, occupational health benefits and medical benefits result in loss of advantage of locating the operations in the host country. MNCs Optimum Size: Trade unions can limit the economies of scale that MNCs can avail in the process of expansion, diversification, mergers, joint ventures and takeovers. Location & Shifting: MNCs prefer to locate various units in different countries based on the availability of qualitative resources including human resources at the least possible cost. Trade unions of MNCs oppose such shifts to other countries as the move results in lost opportunities to workers in their country. Closure of units: MNCs prefer to close the units in some countries where the human resource conditions and trade union influences are unfavourable. But the trade unions lobby the national governments in order to enact redundancy legislations & regulatory measures. In fact, some unions demand MNCs to leave some countries. Ā Thus trade unions influence the MNCs in their HR practices as well as their business activities. MNCs in turn, in order to protect their interests formulate and implement strategies to counter influence of trade unions.