Topic 9: Employee consultation and voice

1. Topic 9:Employee consultation and voice

2. vs The metaphor of eggs and bacon …

3. Topic overview Definitions of employee voice/employee representation Types of representation – individual and collective Exploring collective forms of representation Union forms Management and state-sponsored forms Employee engagement 3

4. Readings Required reading: Dundon, T., Wilkinson, A., Marchington, M. & Ackers, P. (2004) The meaning and purpose of employee voice. International Journal of Human Resource Management, 15, 1149-1170. Recommended readings: • Batt, R., A. J. S. Colvin and J. Keefe (2002) Employee Voice, Human Resource Practices, and Quit Rates: Evidence from the Telecommunications Industry. Industrial and Labor Relations Review, 55 (4):573-594. • Morrison, E (2011): Employee Voice Behavior: Integration and Directions for Future Research, The Academy of Management Annals, 5(1), 373-412

5. Many related terms for employee consultation … These terms vary by …. • Degree of influence/power given to employees • Information only, consultation, decision-making • About immediate or longer-term/more general outcomes • Satisfaction? Commitment/OCB? Work performance? • Whether underpinning assumptions are unitarist or pluralist • “Every workplace is an integrated and harmonious entity that exists for a common purpose .. Conflict is the result of faulty communications or the work of agitators, or a failure of employees to grasp a commonality of interest.” [Bray et al 2009:58]. • “An enterprise contains people with a variety of different interests, aims and aspirations; power is diffused among the main bargaining groups … conflict is an inevitable and legitimate consequence.” [Bray et al 2009:50]. • Who proposes them • Academics, managers/policy makers, consultants

6. Definition:Employee Voice (and Exit) “There are two main types of activist reactions to discontent with organizations to which one belongs or with which one does business: either to voice one's complaints, while continuing as a member or customer, in the hope of improving matters; or to exit from the organization, to take one's business elsewhere.” [Hirschman 1978:90] “Voice, as defined by Hirschman, is any attempt to change rather than escape from an unsatisfactory situation. In the employment context, voice involves the expression of dissatisfaction by employees; exit occurs when employees quit.” [Hirschman, 1970 in Batt, Colvin and O’Keefe, 2002: 574]

7. Voice as: An articulation of individual dissatisfaction (or satisfaction) An expression of collective organisation Contribution to management decision-making Demonstration of mutuality and co-operative relations Mechanisms/practices to express it Upward problem-solving groups, QCs, SMTs Partnership agreements; JCCs; Works Councils Definitions and classifications‘Employee voice’ Dundon et al 2004

8. Definitions and classifications‘Employee representation’ Employee representation describes the mechanismby which the employee’s or employees’interests in relation to making or changing work or terms of employment are set, or changed. There are different forms of representation: • Individual vs collective • Union vs. non-union • State-sponsored, employer-initiated These forms of employee representation vary by • the type of ‘voice’ they are trying to capture • the degree of independence of the mechanism from management • the rights and powers of employees inherent in the mechanism. Bray et al 2014: Chapters 6 & 7

9. Mechanisms or practices through which individuals express their interests Dundon et al 2004 identify examples such as: • Complaint to line manager • grievance procedure • speak-up programme • attitude survey • exit May also include: • individual discussions, feedback to line managers/team members • individual bargaining

10. Individual v. collective Individual representation may be: • Impractical/costly (for employers), especially in large organisations • costly (for employees), using lawyers, agents • ineffective (for employees), especially because of power imbalance

11. Individual v. collective So collective forms of representation emerge/exist. Union forms of collection representation: • union recognition; • collective bargaining; • industrial action (Dundon et al 2004)

12. Unions as representatives of employees • What is a trade union? ‘an organisation consisting predominantly of employees, the principal activities of which include the negotiation of rates of pay and conditions of employment of its members’ (ABS) • Originally a trades focus but may be organised along other lines eg industry, ‘general’, professional • A key feature of unions is the degree of their independence from management • In the West, unions exist as fully independent legal organisations, required by law to represent the interests of their members • May not always be the case et. ‘enterprise’ unions, traditionally in Japan, now in China

13. Unions as representatives of employees Traditionally in the West, there were seen to be two main roles for collective union representation • ‘monopoly’ face of labour, in reaction to asymmetric market power • the ‘collective voice/institutional response’ face, which allows employees to change a situation rather than leave it [Freeman and Medoff 1984]

14. Employees’ self-reported industrial arrangements, Australia, 2008, per cent

15. Individual v. collective Other collectiveforms of representation emerge/exist: • Also non-union forms eg. Employee councils • And some which are both, particularly those which are a “demonstration of mutuality and co-operative relations” eg. partnership agreements (Dundon et al 2004) NB. Great diversity in use and type of these mechanisms across industries and countries “Collective voice achieves what the lone voice could never do: it humanizes and civilizes the workplace.”

16. Management-initiated (non-union) representation • Employers’ interest in management-initiated employee representation has waxed and waned over the years • Problem-solving groups, quality circles etc. • Employee ‘forums’ or Councils • Employee attitude surveys • Australian managers do not have a strong history of engaging their employees through these mechanisms • Some exceptions eg. ICI Botany (see Davis & Lansbury 1996); SuncorpMetway (Gollan 2006) • While these mechanisms may deliver mutual gains, they can be fragile in the face of change, especially a change in management, since they are not independent of management

17. State-sanctioned (non-union) representation • Intervention by the state (mostly through legislative requirements on employers) usually involves: • ‘indirect’ forms of employee representation, such as Works Councils, elected worker directors • have both a consultative and a decision-making role (i.e. ‘co-determination’) • Key feature is independence from management and unions • Most common in Europe (eg. Germany, Norway); also in Japan, Korea in the form of Works Councils • Australia has some examples of state-sanctioned employee representation: • OH&S committees (eg. HSRs in Victorian OHS legislation) • non-union collective agreement making • Access to grievance procedures through awards

18. Latest Term – Employee Engagement • 'Engagement is about creating opportunities for employees to connect withtheir colleagues, managers and wider organisation. It is also about creating an environment where employees are motivated to want to connect with their work and really care about doing a good job … It is a concept that places flexibility, change and continuous improvement at the heart of what it means to be an employee and an employer in a twenty-first century workplace.‘MacLeod and Clarke (2009:9) • ‘aspirational’ vision, but how to define it, and actually do it? • 'Engaged employees have a sense of personal attachment to their work and organisation' and - recognising this is sometimes a matter of 'feel' rather than measurable data - note that business leaders told them "You know it when you see it" (MacLeod and Clarke, 2009:7). • Places the individual at the centre, as the source and solution to problems of work motivation MacLeod, D. and Clarke, N. (2009) Engaging for Success: Enhancing Performance through Employee Engagement. Office of Public Sector Information

19. Employee Engagement Levels Engaged employees are …passionate about what they do; feel a strong connection to their company and perform at high levels every day, while looking for ways to improve themselves and the company as a whole. Moderately engaged employees are … the employees that show up every day and put in just enough effort to meet the basic requirements of their jobs; neither committed to the company’s direction, nor work against it. Disengaged employees are … a big problem for businesses. Negative by nature, these people are unhappy in their work and they compound their lack of productivity by sharing this unhappiness with those around them. They revel in their discontent while undermining the accomplishments of others; they achieve little themselves and they also prevent others from being productive too. Source: http://www.teamvalues.co.uk/engagement.htm

20. Another approach to ‘engaging’ employees "The full acceptance of the notion that an ..organisation is made up of sectional groups with divergent interests involves a full acceptance [by management] of the fact that the degree of common purpose which can exist in industry is only of a very limited nature. In the sense that the groups are mutually dependent they may be said to have a common interest in the survival of the whole of which they are parts. But this is essentially a remote long-term consideration which enters little into the day-to-day conduct of the organisation and cannot provide that harmony of operational objectives and methods for which managers naturally yearn." [Fox 1966: 393-4] How does management make these common interests less remote and more part of the day-to-day operations?

21. Employee voice and representationLecture recap • Our pluralist perspective on HRM requires acknowledgement of the legitimacy of plural interests • There are good reasons for management to acknowledge employee voice, and good reasons for employees to want to express their voice • There are many different mechanisms through which employees are represented and their voice expressed • The degree of independence of a form of representation is critical to understanding the type and power of voice which is represented

22. References Batt, R., Colvin, A, and Keefe, J. (2002) ‘Employee Voice, Human Resource Practices, and Quit Rates: Evidence from the Telecommunications Industry’, Industrial and Labor Relations Review, Vol. 55(4): 573-594 Bray, M., Waring, P. and Cooper, R (2009) Employment Relations:theory and practice, McGraw-Hill, Sydney Ch 7 & 8 Davis, E and Lansbury, R (1996) (eds), Managing Together: Consultation and Participation in the Workplace, Longman, Melbourne. Dundon, T., A. Wilkinson, M. Marchington and P. Ackers (2004) 'The meaning and purpose of employee voice', International Journal of Human Resource Management 15(6): 1149-1170. Dundon, T., A. Wilkinson, M. Marchington and P. Ackers (2005) 'The management of voice in non-union organisations: managers' perspectives', Employee Relations 27(3): 307-319 Gill, C. and H. Krieger (1999) 'Direct and representative participation in Europe: recent survey evidence', International Journal of Human Resource Management 10(4): 572-591. Hirschmann, A (1970) Exit, voice and loyalty: Responses to decline in firms, organizations and states, Harvard University Press, Cambridge MA Hirschman, A (1978) Exit, Voice, and the State, World Politics, 31(1): 90-107 Kim, D.-O. and H.-K. Kim (2004) 'A comparison of the effectiveness of unions and non-union works councils in Korea: can non-union employee representation substitute for trade unionism?' International Journal of Human Resource Management 15(6): 1069-1093. Markey, R (2006) “The internationalisation of representative employee participation and its impact in the Asia Pacific”, Asia Pacific Journal of Human Resources, 44 (3), pp. 342-63.