Discuss the view that industrial relations represents a redundant and anachronistic form of management and regulation.
Over the last 20 years, the use of industrial relations (IR) as a method of management and regulation has become increasingly less prevalent. Trade union membership has steadily declined and the once solid ideal of collectivism now seems obsolete. The question of what has caused this decline has been the subject of a great deal of academic literature. Government legislation, macroeconomic conditions, a changing employment structure and more recently the rise of human resource management (HRM) have all been blamed for this trend, but the issue that appears central to this discussion is; has industrial relations become redundant and anachronistic or has it been made redundant and anachronistic?
In order to discuss the issue of change within both industrial relations and the greater macro-economy we must first look briefly at where the field has come from, how it originated. We must then consider the debate on why such a strong limb in the body of industrial Britain has fallen so consistently since the start of the 1980's. This will position us well to discuss the value of industrial relations in the 21st century, and decide whether it does or does not represent a redundant and anachronistic view of management and regulation.
Britain was the first country in the world to become industrialised; this coincided with the first attempts to establish collective organisations. These early trade societies performed a range of friendly societal functions, the more traditional union functions only appearing later (Visser, 2000). Collective bargaining first began in some cotton textiles in the 1860's and the Trades Union Congress (TUC) was founded in 1868. Britain still remains one of the only countries to have a specific national trade union centre in the form of the TUC.
Over the following century the British trade union structure evolved into a highly fragmented system, notorious for its complexity. Mergers and legislation were constantly changing the emerging relationship between its three key actors - state, employers and unions (Kelly, 1997). The percentage of workers that belong to an organised union has fallen by 28% since membership was at its highest in 1979 (Machin, 2000). This represents a significant shift in the way labour is organised within this country. We are now entering a new era of employee relations, indicating that the old industrial relations approach is becoming redundant and certainly an out of date method of management and regulation. However, as will be seen, a new paradigm within industrial relations could lead the way to its resurgence, and collectivism may still have a place within the new labour market.
Government legislation is thought to have played a significant role in the dissolution of British union strength. Work by Freeman and Pelletier (1990) outlines the major legislative reforms of the Thatcherite conservative government of the 1980's and its impact on our unions. A succession of eight pieces of legislation were passed between 1980 and 1993, approximately one every two years, each one gradually taking more power away from the trade unions. The Employment Act (1982) put an end to union immunity against civil court actions, while the Wages Act (1986) removed manual workers right to be paid in cash. The final piece of legislation, the Trade Union Reform and Employment Rights Act (1993) went as far as to abolish all wage councils, end minimum wage fixing, and even allowed employers to offer financial inducements to unionists to leave their union. Freeman and Pelletier conclude by saying, "the vast bulk of the observed 1980's decline in union density in the UK is due to the changed legal environment for industrial relations", this has become a widely accepted view but does this result in industrial relations being redundant in the modern world? The mere fact that the government of this country has made it more difficult for employees to organise themselves collectively does not mean that industrial relations is of no use elsewhere.
John Kelly (1998 : 1) believes 'it is possible to show that worker collectivism is an effective and situationally specific response to injustice, not an irrelevant anachronism.' Drawing on examples from Visser's (1994) work on industrial relations across Europe several examples of collectivism and effective trade-union action can be identified in countries where government legislation is less restrictive than it is here in the United Kingdom. Belgium and Denmark have both recorded increases in union density throughout the 1980s and 1990s, where unions play a key role in the administration of some state benefits. In Germany and Denmark the greater prevalence of industrial relations practices is reflected in lower unemployment, while Sweden and Norway have shown rises in union density through the presence of generally less hostile governments (Kelly, 1997). While decline can most definitely be seen as the general trend, it is not universal. Further examples of this can even be seen from within the UK. Some unions in parts of the service sector have experienced consistent membership growth despite the restrictive legislation by operating in stable labour markets and buoyant product markets. Unions in health, higher education, the state, entertainment and finance have all experienced growth to some extent. Kelly again reminds us, "decline has been the dominant but not the universal experience and in thinking about the future of unionism we should not lose sight of this fact" (Kelly, 1997 : 401).