Managerial Prerogative

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There are still ongoing arguments on whether managerial prerogative should be practise by manager without any external interference from states, trade unions and employees. Human Resource Management (HRM), described by Boselie (2009) is using the human resources through high performance work practises which increase an organisation’s competitive advantage (p.93). Boselie’s reference to high performance work practices indicated strong highly control through managerial prerogative. This paper stressed the importance of interventions from trade unions and state tribunals as supported by Nissan (as cited in Godfrey, Dale, Marchington & Wilkinson, 1997, p.3) that the consequences of allowing managerial prerogative on issues such as recruiting, selecting, training and development reduced teamwork commitment, loyalty to organisation, skilled employees

The unitary theory (HRM) enforce managerial prerogative, one source of authority where decision makings should be done by management solely which employees have to obey the decisions management made. Trade union’s intervention (Bray & Warring, 2006, p. 46) is considered as the inhibitor force due to the effect of collective bargaining on an organisation. On the contrary, Oakland (as cited in Godfrey, Dale, Marchington & Wilkinson, 1997, p.559) argued controlling others is not an effective approach. Pluralistic approach pointed out the need for interventions as conflicts are inevitable. There are always issues to be address and solve. This is where trade union’s step in when managerial control undermines employee rights. Trade union negotiates with management regarding the concerns voiced by employees. At times which management tend to neglect as they emphasised on efficiency and standardisation as well as profitability.

There are several examples incorporated to illustrate the downside of practising the HRM approach. First off is Australia. The Howard Government “Workplace Relations Act 1996” has replaced Keating (Australian Labour Party) Government awards with enterprise agreements. The enterprise agreements encouraged individual bargaining contract agreements whereby increasing managerial prerogative. Bray & Warring (2006) argued the righteousness of the individual contracts because different employees will then have different pay systems in regards to overtime or weekends or public holiday’s rates (p.55). The question is whether employees have a choice to accept or reject the offer? Management has made unilaterally decision making when making that offer to employees. In result, teamwork is damaged consequentially of individual pay system Collective bargaining was reduced during that era. Beaumont & Harris (1996, p.392) agreed that HRM removes collective bargaining. Collective bargaining (Gardner & Palmer, 1997) is the mutual agreement after trade union and management discussed and negotiated after issues such as remuneration and workplace environment. Barneveld and Nassir (2003, p.29) pointed out that the individual contracts reduced labour costs as the centralised awards system were ignored. The inequality pay system caused an employee to have lower wage reduced more as compared to fellow colleagues with position and skills. A trade union as described by Perline and Poynter (1988, p.128) is the solace to fight this inequality as the power of collectivism made their voices stronger in attempting to solve their issues.

Therefore, bargaining experiences as Walton and McKersie (as cited in Beaumont & Harris, 1996, p. 400) emphasised should be share for the benefits of employees. The shared bargaining experiences are the key towards creating effective teamwork beneficial for problem solving of all parties involved. Understandably, the current economic environment, all organisations have to manage effectively and efficiently at the same time using low cost inputs. In order to do this, an organisation has the choice to either hire skilled labour or machineries. Using...
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