The basics of employee and employer relations boil down to mutual respect, clear expectations, and open communication. It is an ongoing dynamic that affects everything from individual well-being to organizational success. Let’s break it down further.
What is meant by employee and employer relations?
Employee and employer relations refer to the relationship between employers and their workers, either collectively as a group or as individuals. They involve ways how employers deal with their employees, how management cooperates with other workers and how does the business handles trade unions.
Employee and employer relations determine how well employers and employees are getting on and describe the ways in which both parties communicate and inter-relate with each other.
Purpose of employee and employer relations
Human Resource (HR) Management is responsible for creating a favorable climate for employee and employer relations. This means that the two main parties of every business organization ought to maintain good working relationships. It is the HR department’s job to find ways in which this can be done successfully.
This relationship is crucial because employees are the largest cost in any business. Therefore, managing the workforce in the most effective way is necessary for firms wanting to earn high profits in order to reward their owners through higher dividends.
Consequently, any potential conflict between employees and management put business operations at risk, hence is a threat to these profits.
Employee and employer relations are very important in large organizations where trade union representation is strong such as in Sweden and other Scandinavian countries, or in multinational companies doing business in that part of the world.
Main areas of employee and employer relations
The term ‘employee and employer relations’ is a relatively new concept in the business world. The main areas covered by employee relations policies include the following aspects:
- The formal employment relationship. This includes all the legal terms and conditions of employment. Those can be agreed either individually by each employee, collectively for all employees or for a specific group of employees.
- Employee relations policies. This includes all of the procedures related to employment such as discipline, grievance, redundancy, etc.
- Participation and involvement. This include the extent to which a business organization is prepared to allow the workers to participate in decision making that may directly affect them.
- Trade union recognition. This includes the situation when an employer agrees to conduct negotiations on pay and working conditions with a trade union which represents all employees rather than bargaining individually with each worker. While it gives more much bargaining power to the workers, from an employer’s perspective, it is also cheaper and quicker to bargain with just one trade union.
- Collective bargaining. This refers to the process by which pay and conditions of work are settled by negotiations between employers and employees, or by their respective representatives. Also, how those discussions should take place:
a. Centralized. Covering a whole organization or a number of organizations.
b. Decentralized. Taking place at each workplace.
Managers should always strive to ensure that there are good working relationships at work between different parties. Understandably, this is often much easier to do in theory than in practice.
What influence relationship between employee and employer?
There is a variety of reasons that tend to impact the relationship between the employer and its employees such as:
- Payment negotiations.
- Negotiating other terms and conditions of employment.
- Involvement of employees in decision-making team that affect them.
- Degree of trust that exists between the two parties.
- How each party is represented?
- Culture of the entire business organization.
- General atmosphere within the firm.
What happens without good employee and employer relations?
Poor working relationships often lead to disagreements and conflict which can easily escalate into industrial unrest. Workers might he displeased with issues at work, such as pay levels, working conditions, proposed salary increases, etc.
When unrest subsequently arise, the employer and employee relationship will worsen leading to low morale among the workforce. Some individual workers may not be willing to negotiate alone, therefore they might use agents’ such as lawyers or trade union representatives to represent them in the dispute and act on their behalf.
Extreme actions that can be taken by the disgruntled workforce include going on strike or even rioting destroying company property.
In summary, building and maintaining positive employee and employer relations is an ongoing process. By prioritizing mutual respect, clear communication, and employee well-being, both parties can reap the benefits of a productive and satisfying work environment. Ultimately, employees and employer, or their legal representatives, will deal with sources of disputes and handle conflict resolution.
Remember, these are just the basics. Depending on the specific industry, company culture, and individual roles, nuances will exist. If you have any further questions or would like to delve deeper into specific aspects of employee and employer relations, feel free to ask!
