Another factor that will influence the shaping of the industrial relations system is management style. Perlmutter (1969) distinguished between companies that are ‘ethnocentric’ and those which are ‘polycentric’ in their management approach. Ethnocentric companies (for example, US- and Japanese-owned companies) are likely to be centralized in their management of overseas operations, whereas polycentric companies (for example, European) are more likely to be decentralized. In the former, overseas operations are run in the image of the parent company, whilst in the latter, management style is more locally determined. Perlmutter predicted that the transnational corporation would evolve its own unique ‘geocentric’ style characterized by an international management structure transcending national borders and local differences in management approach and style. Whether this has occurred is open to debate. Many so-called ‘global’ companies are still essentially quite ethnocentric in their management approach.
Marginson and Sisson (1994) argue that industrial relations policy within a global management structure will in the future be shaped more by the nature of the particular business than by practices in specific countries. In some cases, the nature of the business will highlight the importance of local industrial relations, whereas in other cases local considerations will be relatively less important. Centralization is more likely in companies (for example, food manufacturing) that pursue the same activity in several locations in different countries (for example, through expansion into new markets for established product lines) because of the gains afforded by introducing standard operating procedures. A decentralized approach is more likely when unrelated business activities are pursued in different locations (for example, via acquisitions, diversification).
Business Unionism
Hyman (1994) argues that business unionism has replaced class unionism in the contemporary industrial relations system. This is due in part, he argues, to the de-industrialization of the UK (as well as many other countries in Europe) characterized by major growth in the service sector and a rise in number of female employees, particularly in part-time white-collar type jobs. The service sector, notes Hyman (1994), is characterized by heterogeneity and thus presents very different patterns of opportunity and obstacle for trade unions. For instance, at one extreme is the retail distribution, and hotel and catering type employment environment with a high reliance on low-paid, vulnerable and overwhelmingly female employees with few qualifications. At the other extreme is the specialized services with a high proportion of professional and quasi-professional employment. Both sectors, according to Hyman (1994), provide obstacles to unionization.
Other factors that have eroded traditional unionism are described as:
· centralized authority within individual unions has been weakened by increased internal differentiation of interests and by tendencies towards decentralized forms (that is, organization-specific) of collective bargaining (as described above);
· differentiation at a wider economic and political level between employed and unemployed, those with atypical as opposed to typical employment contracts, those with new specialized qualifications versus those with outdated qualifications or no qualifications whatsoever.
These economic and political conditions have been described as ‘interest disaggregation’, although as Hyman (1994: 112) is quick to point out, aggregation may have been more a product of unionism (that is, strategic unity) than a true indication of employee solidarity. In practice, the trade unions have always operated by imposing the interests of one segment of the employee population (for example, full-time male employees in core industrial sectors) on others. The result of this was to unwittingly produce a category of non-unionized ‘outsiders’, whose interests were never represented within union policy making. Thus the demise of the traditional union system may constitute not the demise of unionism per se, but of only one particular type (that is, unionism in the unquestioned image of the male manual manufacturing worker). In parallel with this is a rise in the number of different ‘voices’ from previously excluded groups seeking attention to their own particular collective priorities.
Unions themselves have contributed to this scenario. Trade union movements that had at their inception been underpinned by broad-based political and social motives (for example, communist, democratic), became increasingly preoccupied with the collective bargaining agenda. The political issue thus became increasingly ‘rhetorical’ (Hyman, 1994: 113). At the same time, the industrial relations terrain and its autonomy was increasingly being undermined by macro-economic and legislative regulation of employment relations. Initially, bargaining concerns were focused on payment terms. Later, their concerns were broadened to include working conditions, organization of production and division of labour, and even career development. Thus unions, in response to reduced autonomy with respect to issue of pay, evolved a more progressive approach to interest representation.
However, with the advent of economic crisis (global competition, decline in GNP, increase in unemployment), the margin for real improvement in terms and conditions is very small. As companies respond to economic crisis with increased rationalization and attempts to economize, the industrial relations scene has become a terrain of merely ‘concessional’ type bargaining (that is, instead of negotiating improvement in returns and ensuring job protection, mediation with regard to the reduction of wages and regulating the terms and rapidity of downsizing projects is now involved). In the words of Hyman:
almost as a grotesque parody of the qualitative ‘new demands’ of radical trade unionists in the 1960s and 1970s, the rhetoric of humanization and employee involvement has been transmuted within the new managerialism as a means of integrating (core) workers within the constraints of corporate competitiveness in hard times. (1994: 114)
The eclipse of the traditional union is perhaps a reflection of a more general erosion of societal collectivism. Economic crisis has both afforded (and actively) encouraged a growth in market liberalism and individualism. Coupled with this is a rise in the importance of consumption (in parallel with the rise in the service sector), rather than production, in shaping personal identities and interests (Hyman, 1994: 117). Moreover, traditional trade unionism was rooted in a particular type of occupational identity (in a relatively undifferentiated work situation). In contemporary UK, however, there is a growth in individualized career expectations (see Chapter 3, Part 1 for more on this) and thus a far more complex (and potentially problematic) relationship between collective and individual interests. If these employees unionize (and this is rare) it is more for the pursuit of fair ‘career’ opportunities. In combination with this is a tendency for companies to ‘personalize’ the employment relationship.
There has always been a tension, behind the stereotype of union solidarity, between individual and collective interest in the industrial relations scenario. This does not, however, deny the fact that changes in climate and society consciousness have occurred affecting the readiness of people to attach themselves to unions. Even upon the joining of a union, this does not mean than an individual will necessarily act on their membership (that is, follow its advice and instruction). There is clearly a ‘diminished mobilizing potential’ attributable to shifts in attitudes towards unions and what they represent. Those in the service sector (union members and non-members alike) also have to face the fact that any form of industrial action will affect not only the employer, but the consumer, with the potential consequence of losing public sympathy. It has been noted by many that younger workers in particular are less and less likely to want to participate in union activity or even take on positions of representation, pursuing, instead very different interests and aspirations than those contained within the union agenda.
One response by unions to this crisis of identity is to focus on the qualitative dimensions of managerial discourse (which have low cost implications) as reflected in the philosophy of ‘humanization’. Another form of attempt at identity reconstruction in new terms is the emphasis on procedural demands (also with little if any cost implication), such as forums for consultation. Efforts to rebuild union strike capacity focus less on the strike as a show of strength (that is, in the ideological struggle between labour and capital) and more as a symbolic demonstration at a socio-political rather than economic level (see the box below for a brief history of strike patterns in a European context).
What then is the future of the trade union? Hyman (1994: 133–136) describes four potential union identities:
· Providers of services to workers as individuals (premised on the displacement of collectivism by individualism). This is not new. It is an identity inherited from the ‘method of mutual insurance’ (that is, collective support to individuals with common work-related interests) common in 19th century Britain.
· The union as part of a ‘productivity coalition’ with management, collaborating to develop policies to enhance company performance. This identity is premised on the fact of altered power relations between employees and employers and structural pressures on companies in the face of intensified competition. A form of this has been operational in Italy since the 1980s and is termed ‘microcorporatism’.
· The union as an interlocuter of government, that is, forum for social dialogue in the ‘social wage’.
· The union as a popularist campaigning organization.
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