“Management strategies in industrial relations are the result of constrained rational choice, but are always aimed at maintaining security within the organisation’s decision-making process.” Salamon (1987)
If one is to fully appreciate Salamon’s statement it is necessary to understand the fundamental principles of industrial relations and be aware of relevant factors which have altered the context of the employment relationship, since the traditional ‘master’ and ‘servant’ relationship of the early and mid-nineteenth century. In examining and presenting the evidence which supports the above quoted conclusion, it is hoped that this paper will portray a logical and incisive representation of Salamon’s beliefs in this area.
The situation surrounding the industrial relations process up until 1971 (and indeed for most of the 1970s, following the enactment of TULRA 1974) was very much a ‘voluntarist’ tradition, which enhanced the position surrounding the trade unions and workers, with respect to industrial action legalities. The government’s restoration of trade union tort immunities in an attempt to contrast a corporatist relationship between parties, proved a futile method of precluding the “strike ridden winter of discontent” during 1978, and led to a transformation which could be considered a watershed. In 1979 Margaret Thatcher and the Conservative party came to power and introduced wide ranging measures to depoliticise industrial relations and weaken collective organisation and industrial action. One of the most notable features of industrial relations during the 1980s was the shift in power from the workforce to the employer, which has obviously influenced ensuing management strategies aimed at “maintaining management security within the organisation’s decision making process.”
Although the traditional ‘master’ and ‘servant’ employment relationship has long since gone (today’s typical employer being a public or private corporate body and also an abstract, legal entity which uses ‘managerial agents’ to draw up employment contracts between the ‘employer’ and the ‘employee’), the power distinction apparent in the traditional employment relationship is echoed in remaining ‘common law duties’, which offer only a “dependent and a subordinate” relationship on the part of the employee. Managers today are disparate from the ‘owner’, but popular management ‘buy outs’ often provide a sense of ownership for managers. Salamon believes that the shift from ‘agency’ principle to the “possession of enterprise principle” gives authority to management (since management believes and accepts that it has the “requisite knowledge and ability to direct the affairs of the organisation”), and has perhaps been influenced by the socio-economic background of more recent ‘graduate’ managers.
This change which Salamon refers to as ‘managerialism’ is illustrated by the growth of sophisticated organisations based upon the function specialisms such as marketing, research and development, and finance. Hierarchical structures within organisations also assist the development of managerialism, and may result in what Fox describes as a ‘low trust’ relationship; managers at the lower end of the spectrum such as supervisors are excluded from management decision making, and as a consequence may seek “collective consciousness” to give them a sense of security. The ostracism of lower management members could prove detrimental to the long term effectiveness of the organisation, since industrial relations decisions frequently occur at operational levels and not just strategic levels.
In view of the common law duties for employees to ‘obey’ all reasonable and legitimate instructions of their employer, and therefore ‘submit’ to the reasonable ‘authority’ of the employer, it is understandable that an organisation’s “sectional interest groups” (management on one hand and employees on the other) often possess divergent interests which may result in...
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