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The relationship between employers and employees has long been the subject of widespread study and debate within the business world. This employment relationship can be defined as a complex system in which social, economic and political factors combine with an employee who exchanges mental and manual labour for rewards allocated by the employer (Encarta Encyclopaedia Deluxe. 2004). Industrial relations and human resource management advocates have traditionally held different views on the subject of organisational conflict. Many authors have argued that organisational conflict is inevitable in most work settings and that the employment relationship is essentially a trade-off ground (Alexander and Lewer, 1998; Deery, Plowman, Walsh and Brown 2001; Edwards, 1986). Supporting this argument, this essay will argue that conflict is both inevitable in the employment relationship and also potentially productive.
When employers and employees come together in the workplace, sooner or later there is invariably some conflict that will arise. Once conflict has arisen, there is many different ways in which employees will show their discontent for their working conditions. Some forms will be shown in overt and obvious ways, the most blatant and publicised of these being strikes (Alexander and Lewer, 1998).
Strikes involve a removal of labour by employees from the whole or, sometimes, a part of an organisation. The purpose of the strike is to enforce demands relating to employment conditions on the employer or of protesting unfair labour practices (Hyman, 1984). During the twelve months ended May 2003, there were 241,900 working days lost due to industrial disputes (Australian Bureau of Statistics, 2003). Other forms of overt conflict include stop-work meetings, work bans and boycotts.
The traditional view of industrial relations was that a lack of strikes meant that all was well and conflict was being kept to a minimum. But in recent years widespread study has found that there are many other forms of conflict that are carried out in a much more covert manner (Alexander and Lewer, 1998; Deery et al. 2001). These can include absenteeism, high employee turnover, accidents, slow downs, sabotage, theft, low morale, slackness and inefficiency. This type of response to conflict tends to be undertaken by disgruntled individuals rather than groups due to its covert nature (Edwards, 1986). Alexander and Lewer (1998) found that the losses caused by covert expressions of conflict far outweigh the overt. They reported that in 1997, absenteeism alone cost Australian business over $15 billion, or 6.75% of each company’s payroll. Both these forms of dealing with conflict relate back to the underlying principle that employers and employees have different objectives, thus ensuring conflict is inevitable.
There are five key actors in the employment relationship: Employees, Employers, Trade Unions, Employee Associations and The role of the State. Each of these actors interact to and exchange conflict and resolutions.
Trade unions are responsible for enterprise-level bargaining on behalf of the employees, though recently there has been more reliance on the arbitration system. By giving workers a united voice, a union can often negotiate higher wages, shorter hours, and better fringe benefits (such as insurance and pension plans) than individual workers can negotiate on their own (Davis & Lansbury, 1993). The last 30 years have seen a steep decline in the union density and power than unions hold. In 1976, 51% of all employees were in trade unions, by august 2002 this had fallen to 23.1% (Australian Bureau of Statistics, 2003).
Multi-unionism at the workplace has tended to fragment authority and obstruct union-management relationships, in cases causing workplace uncertainty and conflict from employees over who is representing them (Deery et al. 2001). Employer associations represent employers and help defend against the often well organised assault from trade unions. The role of the state is to oversee the employment relationship and ensure that employers, and employees and their representatives are able to cooperate in a manner that provides high inventory turnover, in an unbiased, safe workplace (Bamber & Davis, 2000).
Employers, unions and governments have mainly divergent concerns about the future directions and impacts of workplace conflict and the effect it has on their objectives. Employers are concerned about economic performance and viability in the face of an increasingly competitive local marketplace. Staff or wages cuts which may be necessary to stay economically viable will almost certainly cause conflict with employees. Unions are concerned that poor performance in the business economy will cause higher unemployment and put workers current terms of employment at jeopardy, a potential cause of great conflict. Unions also fear that continuing measures by the state to reduce their powers will cause further falls in membership levels, mean reduced influence onto employers.
Identifying the underlying causes of this widespread conflict is important as it allows management to determine what resolution approach to take. The causes of this conflict will generally fall into two broad categories, collective and individual reasons (Deery et al. 1998).
Collective causes of conflict generally are to deal with an employee’s disagreement with the structural make up of their work environment. Examples of this are poor employee reward systems, limited work resources, poorly constructed policies and work requirements conflict. Edwards (1979) believes that the underlying reason in this category is because there is a strong conflict of interest between employers and employees. What is good for one party is frequently costly for the other. An example of this is management’s objective of maximising the level of effort that employees apply to their work while also attempting to minimise wage expenditure (Deery et al. 1998). Studies also suggest that if workers feel they are being underpaid and cannot take collective action, they may very well adjust their work effort down to match the wage (Deery et al. 1998; Edwards, 1979). These points strengthen the aim of this essay because the wage-effort trade off will continue to exist further causing conflict amongst the employment relationship.
The general approach to negotiation response to collective causes of conflict is through a process called collective bargaining. There are three main levels of collective bargaining in the Australian system: National level bargaining, industry level bargaining and workplace level bargaining (Macklin, Goodwin & Docherty. 1993). At the national level of bargaining, the Australian Industrial Relations Commission (AIRC) plays an arbitration role in industrial relations matters which cannot be resolved at lower levels.
Industry level bargaining occurs within a particular industry, generally between trade unions and employer associations, with both these parties representing their members. This level of bargaining can determine industry-wide agreements on terms of employment. In recent years workplace and individual bargain has become a more preferred method of conflict negotiation (Alexander & Lewer. 1998). This level allows individual employers and employees to bargain without the need for representatives. These different approaches to collective conflict negotiation allow employees and employers to come to some agreement in a fair and formal manner.
Individual causes of conflict can be provoked by a large combination of issues. Biases and prejudices, inaccurate perception, personality differences, cultural differences, differing ethical beliefs, poor communication and lack of skill in conflict resolutions are all pieces that can make up a larger picture of organisational conflict. Robbins, Bergman, Stagg and Coulter (2003), found that there are 5 main techniques to reducing individual conflicts: forcing, collaborating, compromising, avoiding and accommodating. Which approach to use depends on the manger’s desire to be more or less cooperative and more or less assertive (Robbins et al. 2003).
Not all conflicting situations are bad. Several authors have argued that, when the level of conflict is low or nil, internal work characteristics tend to be apathetic, stagnant, unresponsive to change and lacking in new ideas (Robbins et al. 2003, Lewicki & Litterer 1985). By directing conflict from a position of disagreement to an exchange of ideas, an environment of cooperation and trust is possible which can lead to mutually beneficial outcomes (DeChurch Marks, 2001; Van Slyke, 1997).
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