‘Should The State Play An Active Part In Employment Relations Or Are Such Matters Best Left To Employers And Their Associations, Workers And Their Unions.’

Employment relations refer to the institutions, laws, and conventions that regulate the work environment. It is a multidisciplinary field that has sought to analyze the various factors that impact the performance of business organizations. Moreover, the field strives to assess the ways in which the relations between employees and employers can be safeguarded for the benefit of each stakeholder as well as for the greater benefit of society.  There has been an intense debate regarding the role of the state in regulating employment relations. One side argues that it is for the employers and workers to play a role in employment relations with minimum government intervention. The other side argues that it is crucial for the state to play an active role in employment relations. This paper argues that the state should play an active role in order to balance the relations and privileges of employees and employers while striving to create harmony and social welfare in society.

Pluralism in the context of industrial relations is a theory which states that organizations consist of various subgroups that strive to achieve power and protect their interests. The state in this context should act as a neutral institution which can act as an impartial mediator that can maintain social order in industrial relations (Holgate, Abbott, Kamenou, Kinge, Parker, Sayce & Williams, 2012). Unitarism is a theory which considers the organization to have a harmonious structure that allows the workforce and management to work towards common goals and interests. It uses a paternalistic approach towards employee needs and requirements (Lansbury, 2016). Corporatism argues that the market should play a critical role in influencing the mechanisms of the labor relations (Katz & Colvin, 2011). It rejects the role of the state as causing inefficiency and ineffectiveness in the economic sector.  The radical perspective believes that capitalist societies are based on exploitation of the workforce. The perspective states that inequalities must be reduced through active state intervention (Naidu, 2012).

The state should play an active role in employment relations because it needs to be concerned with the economic and social development of the state. In other words, the state has to perform the function of devising economic policies and objectives that would lead to prosperity and growth. These economic goals can include providing employment, implementing price stability, and protecting the exchange rate (Kaufman & Gall, 2015). The economic objectives are strongly related to employment relations. For instance, many countries like China encourage trade unions so that the rights of the workforce can be safeguarded. Other countries like Germany and Netherlands strive to have a minimum national wage which helps to provide a basic level of income for the workforce (Naidu, 2012). The systems theory based on the pluralist frame argues that industrial relations are a sub system of the wider social system. The system consists of various formal and informal rules and regulations that help to govern the issues related to industrial relations. In the context, the role of the state is to provide a framework that can be used for maintaining harmony, efficiency, and social value between employees and employers. However, the state must strive to undertake measures that safeguard the interests of the employers. Employment relations in the context of employers seek to enhance productivity and improve profits. This can be achieved only when employers have access to talented and qualified workforce. The goal of the state in this respect is to allow rights and privileges to employers so that they can be protected from malpractices done by the workforce. For instance, France has laws in which employers have the right to terminate the services of a non-performing employee. In such cases, the unfair dismissal laws will not be applicable provided the employer has been able to provide a valid reason. Employee training standards are important from the perspective of employers as they must be able to upgrade the competencies of the workforce.  The role of the state is important in this respect as it helps to establish a framework for mandatory training in the work environment (Naidu, 2012).

Another reason that the state should play an active role in employment relations is to ensure that the primary and fundamental rights of the workforce and employers can be protected. The theory of unitarism argues that society is a unified system which has several interdependent parts. The stability of society is achieved when these interdependent parts work in harmony in order to promote social order (Martinez, 2015). This is based on shared values that are held as valuable by society. In the context of industrial relations, the state should act as a facilitator and arbitrator in promoting social order. The role of the state should be to safeguard the various employment rights such as adequate salaries, job security, equality and training. For instance, the state helps to evaluate the national minimum wage which can provide a level of security for the workforce. The National Minimum Wage Act (1998) in Britain helped to provide a legal basis for a national minimum wage for all workers (Martinez, 2015). Consequently, the hourly rate was determined by the state at appropriate levels in order to reduce the impact on the competitive nature of British industry. The lessons are that the state should play an active role in employment relations because it has the resources and authority to determine the needs of the employers and employees. It can help to maintain a balance so that efficiency and effectiveness can be attained within short time.  The legal interventions by the state can be modified to provide comprehensive set of rights and obligations in accordance with changing circumstances. The passing of the Employment Relations Act (1999) in Britain helped to provide comprehensive legislation that provided maternity and paternity rights; mechanisms for trade union recognition; and allowing one year for employees to claim unfair dismissals (Martinez, 2015). These examples show that the state can play an active role in defining and expanding the scope of employees’ rights. This is important in order to promote social justice and maintain employment levels in society without causing problems for industries.

Another reason for the state playing an active role in employment relations is to combat the problems of discrimination and labor market segmentations which can exist in a country where the state has decided to pursue a minimum role in industrial relations. The segregation of labor markets tends to create immobility in the labor market. Immigrants and minorities may face barriers to employment as their role is restricted to few occupations and industries. The consequences are low wages, poor working conditions, overcrowding, and work intensification. The role of the state in such conditions is to remove such imbalances because they need to focus on creating a competitive economy that absorbs the skills of a diverse workforce (Bélanger, Lévesque, Jalette & Murray, 2013). Additionally, the role of the state is to create working condition that allows social mobility while striving to restrict socioeconomic problems that impact the marginalized segments of society. Effective government regulation can move to reduce social imbalances and rectify income disparities through the use of effective and efficient strategies.  For instance, the United States in the 1960s sought to pass many laws that combated discrimination in the work environment (Bélanger, Lévesque, Jalette & Murray, 2013). They also passed laws for ensuring equal pay for all people regardless of their ethnic, social, and racial affiliations. Limited mobility in the labor market means that employees will be impacted by the imperfect competition present in industries. This can lead to poor working conditions and wages that can reduce the commitment and motivation levels of the workforce (Chung, Muntaner, Benach & Network, 2010). Industrial conflicts are a common feature of modern industrialized societies. This is because conflicts will erupt between the employers and employees. The consequences can be disastrous for society as it can lead to economic stagnation, civil unrest, and social problems. The state in this role plays a critical role in reducing or avoiding industrial conflicts through a comprehensive set of institutions and mechanisms. Mediation, conciliation, and arbitration are methods which can be provided by the state in order to avoid industrial conflicts (Bach & Bordogna, 2011).

In conclusion, the state should play an active role in employment relations because of the fact that the labor market is in a state of continuous change and fluctuation. The role of the state is important in facilitating social goals and protecting the rights of the various stakeholders. Moreover, the goal of the state should be to create a framework in which the rules and laws can be implemented for the benefit of all members of society. The segregation of labor markets tends to create immobility in the labor market. Immigrants and minorities may face barriers to employment as their role is restricted to few occupations and industries. The consequences are low wages, poor working conditions, overcrowding, and work intensification. In a nutshell, the state should actively strive to promote employment relations through the use of flexible and holistic strategies that focus on long term outcomes.

References

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Chung, H., Muntaner, C., Benach, J., & Network, E. M. (2010). Employment relations and global health: a typological study of world labor markets. International Journal of Health Services, 40(2), 229-253.

Bélanger, J., Lévesque, C., Jalette, P., & Murray, G. (2013). Discretion in employment relations policy among foreign-controlled multinationals in Canada. Human Relations, 66(3), 307-332.

Holgate, J., Abbott, S., Kamenou, N., Kinge, J., Parker, J., Sayce, S., & Williams, L. (2012). Equality and diversity in employment relations: do we practise what we preach?. Equality, Diversity and Inclusion: An International Journal, 31(4), 323-339.

Katz, H., & Colvin, A. (2011). Employment relations in the United States. International and Comparative Employment Relations: Globalization and Change, 30(5), 62-87.

Naidu, S. (2012). The Nexus between human resource management practices and employment law in the Fiji Islands: a study of the employment relations promulgation. International Journal of Entrepreneurship and Small Business, 16(2), 164-175.

Kaufman, B. E., & Gall, G. (2015). Advancing Industrial Relations Theory: An Analytical Synthesis of British-American and Pluralist-Radical Ideas. Relations Industrielles/Industrial Relations, 70(3), 407-431.

Lansbury, R. D. (2016). Varieties of Transformation in Industrial Relations: An International Perspective. Ind. & Lab. Rel. Rev., 69(1), 1288-1294.

Martinez, L. M. (2015). Beyond consensus: the state and industrial relations in the United Kingdom from 1964 to 2014. Employee Relations, 37(6), 692-704.