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The Implications of the New HRM for
School of Business
University of Alberta
T6G 2R6 CANADA
By and large, North American manufacturing unions are not used to performing within production systems
not based on adversarial employee-management relations. Executing since their inception
their "pure and simple" job-control philosophy, these unions have confined
themselves to a limited bargaining agenda reflecting the immediate interests of their
members in the workplace. While for years this orientation has meshed neatly with
managements' industrial relations orientation embedded in Scientific Management, in many
cases it is no longer the case. Changing union environments and management industrial
relations practices challenge union capabilities to deliver traditional services, regulate
the worker-management relationship, maintain intra- and inter-organizational solidarity,
avoid decertifications and attract new members.
We have mentioned that three of the key assumptions of the
union economic paradigm are that: An
inherent exclusivity of interest exists between the union and management (#3); a union
should not involve itself in management decision making (#4); and collective bargaining,
therefore, forms the basic regulatory mechanism of the labor-management relationship (#5).
New HRM arrangements violate all of these assumptions, and the altering union environments
render an alternative action model difficult to devise.
- First, the New HRM implies that communality of interest between labor and management
does exist. By participating in decisions which influence plant layout and production
design, workers and their union are being drawn into decision-making processes that have
traditionally been managements' sole responsibility.
- Second, this process seriously erodes collective bargaining's role as the preeminent regulatory
mechanism of the labor-management relationship and with it unions' regulatory role in the
worksite. To be effective, new HRM arrangements empower front-line employees to consider
such issues as manning, job description, rewarding and disciplining, hiring and firing, and pay
which were once the sole responsibility of, and arguably still are an integral part of, the collective
bargaining process. The boundaries of the collective bargaining's jurisdiction are growing
More specifically, HRM innovation may be used to enhance managerial flexibility in managing
the workforce, "by replacing rigidities in contractual relations between unions and management
with more flexible and cooperative arrangements entailing greater commitment by employees to
management goals" (Wells, 1993: 56). In the course of the change, workers are expected to enter
into a new relationship with superiors, assume new responsibilities, and learn to play a new role
at work. For weak unions, HRM innovation likely means the abandonment of at least some
aspects of job control and, often, the absence of any guarantee of alternative sources of leverage.
Consequently, HRM reforms can undercut workplace unions by improving communication and
expanding collaboration between managers and workers in ways that are not mediated by
- Third, management may use work team meetings to directly communicate with the workers on
how to improve production processes and quality of work life, thereby offering the workers
alternative, direct modes of interest representation. During team sessions, management and team
members may discuss issues that have been part of collective bargaining. In the process of
implementing team recommendations, management can grant workers benefits which they have
refused the union leadership through collective bargaining. Consequently, unions are rendered
less useful to members.
- Fourth, new work arrangements, such as self-organized, self-monitored work teams, may lead
workers to assume responsibilities, such as hiring, disciplining and rewarding, that have
previously been reserved for managers. This, in turn, can undermine the union's ability to protect
members against unfair labor practices; there is no legislated procedure parallel to the grievance
process that unions can use to protect one union member against unfair decisions made by
another union member. Consequently, union solidarity can be eroded as some union members
may use their newly assumed powers against other members.
- Fifth, HRM innovation can further undermine union solidarity if it leads to a cleavage among the unionís
ranks. Some union members can be deeply involved in
restructuring efforts against their union officers' and members' opposition (Reshef, Lam & Kizilos,
1996). Consequently, the innovation results in a split among the union's ranks which may
undercut its power to negotiate innovation implementation in the next collective agreement.
- Finally, it has been suggested that innovations may be designed to enhance employee
involvement in decision making, an important component of many HRM reforms. If controlled by
management, they simply replace traditional bureaucratic control with peer control, thus
fragmenting the work force (Grenier, 1988; Metzgar, 1990). Such innovations may serve mainly
as an echo of management in decision making. For example, in the name of working together
toward the common goal of being the best in an industry, workers can be pressured by
management and/or fellow team members to work overtime without extra pay. The power of the
union to regulate work through the collective agreement is thus diminished.
Since union capabilities to deliver selective services are weakening and since the
three most important things workers expect from their jobs (a good salary, job security,
and appreciation for a job well done) are increasingly being provided by nonunion firms (Business
Week, July 8, 1985, p. 76), unions cannot stem declining popularity and
organizational atrophy. Thus, given that industrial relations abhors a vacuum, when unions
lose ground as worker service agents certain union functions have to be performed by
management and/or government agencies. Indeed, nowadays, more and more, the courts and
state legislatures are becoming the most effective advocates of employee rights (Business
Week, July 8, 1985, p. 72), thereby further eroding the needs for unions.
To recapitulate, changes in union environments and management industrial relations
practices have been challenging U.S. manufacturing unions on several counts.
- Unions have difficulties to deliver traditional services such as pay increases and job
- Unions have lost part of their regulatory capabilities. On many occasions, the
worker-management relationship is regulated outside the structure of collective
- Union intra- and inter-organizational solidarity has diminished. The above changes have
increased competition among individual workers, work groups, and locals of the same and of
- It becomes more and more difficult to attract new members.
A New Paradigm for Unions?
Firms' approaches to labor relations are undergoing the most dramatic change since the
early part of this century. And, since unions' very existence is predicated on how firms
organize work, unions are now obliged to completely reassess their own raison d'Ítre,
their basic beliefs and assumptions.
In the past, firms' human resource management practices rested on a tripod composed of:
elaborate bureaucracy; military organization; and the principles of scientific management.
This potent mix initially increased production efficiency. But, because of the vertical
and horizontal task differentiation which it promoted, and the deskilling and alienation
of many workers which it also caused, this labor relations paradigm lead to an atmosphere
of mutual mistrust between management and workers. This, in turn, lead to the adversarial
IR system we see today.
This traditional human resource management paradigm will no longer work for firms
struggling to survive amidst the heightened competition "globalization" has
introduced. A firm's surviving a global shakeout with a hostile, alienated workforce is
about as likely as a nation capturing Olympic medals with athletes who are compelled to
Firms who find themselves in the dramatically heightened competitive environment global
competition has spawned demand engaged committed workers who understand and identify with
the interests of the firm. The problem that managers who are trying to survive in
this global marketplace face is how to create this new culture, how to convert managers
and workers alike to a new set of very different basic assumptions, to a new paradigm.
I believe that the economic paradigm
"fits" with firms' traditional labor
relations paradigm. The question for unions is: What new roles and supporting assumptions
will fit with the "cooperative" paradigm now emerging?
Two approaches to this dilemma can be detected. Some unions have decided that the
changes firms are making are permanent and profound, and are grasping, with varying
degrees of success, for a new role. Other unions believe that cooperation is merely a ploy
by firms to weaken unions, another union avoidance tactic. Unions holding this belief are
retaining an adversarial stance.
Whichever approach they takes, unions must reassess their assumptions about labor
relations. If a union sees the current changes as the "dawning" of a "new
age" of cooperation it must find a place for itself in this new world. It must also
explain its new stance to other unions who may accuse it of wholesale acceptance of
management's plans and a wholesale abandonment of any national labour standards.
If the union feels that cooperation is merely a new union avoidance tactic, it still
must develop a rationale demonstrating that it does not simply lack imagination and
foresight. Either way, unions cannot carry on as before.
I do not believe that cooperation is simply a new union avoidance tactic. This is not
to say that I believe attempts at cooperation will be successful. All the arguments
concerning the difficulties, for unions, of changing paradigms apply equally to firms.
Firm are just as likely to encounter difficulties changing paradigms as unions are. In
fact, the interdependence of unions and firms make each antagonists' adjustment even more
difficult. Many firms and unions share decades of mutual mistrust, yet each is
institutionally interlocked with the other through collective bargaining agreements. These
inter-organizational structures will further sabotage each parties' efforts to change
Unions must, however, remember that they are secondary institutions whose existence is
predicated on firms' choice of labor relations paradigm. Thus, their continued survival is
not assured when firms change their labor relations paradigm. A strong argument can be
made that if a firm adopts the cooperative paradigm, a union is unnecessary. Combine this
argument with the institutional inertia arguments presented above and change from one
paradigm to another may be best explained by a selection model -- not an adaptation model.
Hannan and Freeman (1984) argue that structural inertia in large organizations achieves
such an elevated level that change in "form" in a population of organizations
occurs principally through processes of selection rather than adaptation. A selection
model would predict that firms that are unable to escape the embrace of unions will simply
wither away, their market share taken by non-union organizations whose managers and
workers both subscribe to a new "cooperative" paradigm.
While the weight of evidence seems to support the selection explanation for change, I
do not feel that selection is necessarily in the best interests of workers, firms, or
society generally. A smoother, more painless transition to a new paradigm would be
achieved, I believe, with union participation.
But, if adaptation is to be achieved, we must first understand the inertial forces
arrayed against it. This is why I have attempted to describe the paradigm concept. While
paradigms are essential guides to action, they exert an inertial force far more powerful
and more insidious than the inertia forces described by Hannan and Freeman.
Unions, then, must "unfreeze" the basic assumptions which, unseen, guide all
their actions. Only when they have done this can they struggle toward a new role. Here, at
least, some guidance is available. Jan Carlzon (1987: 101-2), former President of Scandinavian Airlines,
for example, has articulated the following new role for unions:
- First, and most important is the cooperative role. Together with top management
the unions participate in analyzing, discussing, and establishing the company's overall
role and strategy. The unions should participate with middle management in planning the
acquisition and distribution of resources, determining the earning targets, devising
investment guidelines, and so on. With the front line the unions play a natural part in
backing up the people they represent, meaning those who now make all the decisions.
- The second role of the unions is similar to that of an internal
auditor. They should
critically examine how well the company is complying with labor laws, collective
agreements and, in our context, the principles of the high-performance system or
- The third role is more traditional: Unions still must sit down at the other side of the
table during negotiations. But now that the unions have helped shape the company's
operations and investments, they can no longer pursue and adversarial role that undermines
the company's overall strategy. To do so would serve no purpose since they have been
participating in the construction of the company's strategic foundation all along.
that accept these roles become vital contributors, not threats, to the management process.
Because of their relationship with rank and file, unions have access to a large fund of
knowledge, ideas, and opinions that might otherwise be unavailable to top management.
Unions have a network of contacts out in the company that management lacks.
Unions will only survive to enjoy this or some other new role, however, if they first
recognize and overcome the inertial force paradigms (both those constraining firms and