Critically evaluate the case for social partnership between unions and employers

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Critically evaluate the case for social partnership between unions and employers

The concept of social partnership originates from the Rhenish model of industrial relations. It has passed in to the British lexicon through the European Union. At a European level, the social partners are trade unions and employers federations. However, in the UK the employers peak federation the CBI has indicated that it is unwilling to fulfil such a role at a national level. Instead, the Anglo-Saxon model of social partnership operates a company and workplace level. This essay will investigate the arguments for and against social partnership on the Anglo-Saxon model from the perspective of the employer and trade union. It will recognise that the criteria for judging the efficacy of social partnership differ between employers and unions. The case for social partnership from the employer perspective is ambiguous and will be contingent on management attitudes and business strategy. It will argue that while social partnership undoubtedly presents problems for trade unions it is by far the lesser of two evils when compared with individualised employee involvement and human resource management policies. Trade unions should promote partnership as an alternative ideology to capital driven unitarism.

The principles underpinning the concept of the ‘mutual gains enterprise’ (Kochan, T. &

Osterman, P. 1994) are set out in the table below:


If implemented in the context of collective bargaining mutual gains principals offer a model for company level social partnership. Proponents of the mutual gains enterprise are quite clear that it is not a universally applicable prescription. To be made to work it requires high levels of investment in human resources, employees cannot be treated as just another cost, to be trimmed where possible. However, companies willing to pursue ‘mutual gains’ policies benefit from increased productivity and creativity, and consequently higher profitability. Companies that are trying to compete purely on the basis of lowest cost would not be able to implement the principles. Kochan and Osterman marshal considerable case study evidence to support their theory. However, at the moment the empirical research to validate it does not exist Freidman (1977) has proposed that employer strategies towards the workforce are contingent on the economic cycle. When factors are favourable, employers are more likely to emphasise policies with elements of employee involvement and greater trust that are likely to win loyalty and support of the workforce. While in times of recession, declining profitability and an unfavourable labour market position employers are more likely to fall back on authoritarian policies, cutting back wages and increasing supervision. This theory may provide a framework for understanding the conditions in which employers are prepared to enter into social partnership agreements

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Kochan and Osterman offer the further hypothesis that mutual gains theory will work better if the enterprise recognises independent trade unions. They argue that union based voice mechanisms are more effective than the alternatives because they recognise that the interests of the workforce and the company will not always be in unison. Where conflicts do arise, union voice mechanisms allow them to be negotiated and resolved without compromising the climate of co-operation and trust. This is not a view shared by everyone. Nestle provide an example of a company introducing HRM practices to achieve mutual gains objectives in parallel ...

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