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Chapter 10
Employee relations,
involvement and
participation
Chapter objectives
This chapter considers the notions of employee relations, employee involvement and employee participation to review the extent to which employees may influence managerial decision- making. In particular, the chapter aims to:
● Recognize debates about employee/industrial relations. ● Assess the differing ways in which conflict may be conceptualized and resolved in the tourism and hospitality workplace. ● Consider the role, or lack of it, for trade unions in the tourism and hospitality industry. ● Appreciate how employee involvement and employee participation mechanisms can be used by tourism and hospitality organizations.
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Introduction
The idea of some kind of employee influence in organizational decision-making is one that seems to attract much support amongst all the parties who are involved in the employment relationship; that is, employers, employees, trade unions and the state. Indeed, as Blyton and Turnbull (2004) note recent years have seen renewed interest in employee involvement and participation. This renewed inter- est is partly explicable by the Labour Government’s attempts to promote ‘partner- ship’ at work as well as the influence of the European social agenda, which has encouraged greater employee participation through a number of European Union (EU) Directives. However, although there may be universal support in principle for the need for employee influence in decision-making, in reality there are likely to be sharply differing views on the degree (the extent to which employees are able to meaningfully influence managerial decisions), level (task, departmental, estab- lishment or corporate), range (the range of subject matters likely to be discussed, from what might be trivial issues such as food in the staff canteen to fundamental strategic decisions) and form (either direct of indirect through representation) of such influence (Marchington and Wilkinson, 2005). Recognizing the above discussion Blyton and Turnbull (2004) suggest a con- tinuum from no involvement through to employee control, although in reality most organizations are likely to fit somewhere in between in the categories of receiving information, joint consultation and joint decision-making, which in a generic sense are likely to be characterized as being either employee involvement, participation or industrial democracy. Underpinning much of this discussion is a need to understand the nature of employee relations and the manner in which many argue that this notion marks a major shift from a more collective view of the employment relationship as embodied in the notion of industrial relations. Initially then the chapter will consider this debate about how best to conceptualize the contemporary employment landscape. Following this discussion we will then move on and examine how these debates can be understand with regard to the ‘frames of reference’ (Fox, 1966) adopted by management in terms of dealing with potential conflict in the workplace. Conflict can be considered at a number of levels, one of which is the potential conflict of interests between trade unions and employers. However, the tourism and hospitality industry is often suggested as being one where trade unions have little or no influence. The veracity or otherwise of this view will be discussed, including why tourism and hospitality employees
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notion of the effort–reward bargain. As we saw in the previous chapter the effort–reward bargain refers to the manner in which employees are rewarded for the effort they expend on behalf of the organization. The potential conflict that would arise in the allocation of effort from employees and reward from employers would often be resolved through the use of, often adversarial, collective bargaining, where trade unions and employers would come together to attempt seek a resolution based on their relative strengths. Industrial relations, then, is often thought of as denoting the formal arrangements to manage the employment relationship that existed in large manufacturing plants where the world of work largely consisted of unionized male manual workers who worked full-time (Blyton and Turnbull, 2004). By contrast, employee relations emerged as a term in the 1980s in an attempt to capture the changing nature of the employment landscape. In particular, as CIPD (2005: 3) argues, ‘employee relations is now about managing in a more com- plex, fast-moving environment: the political, trade union and legislative climates are all shifting. In general, the agenda is no longer about trade unions’. Within this view of employee relations then a key aspect of what is considered distinctive about the term is a lack of trade union influence. In addition, employee relations has also tended to be considered as denoting the changing nature of employment in terms of the shift from manufacturing to service employment and the feminiza- tion of the labour market. These shifts have had a significant impact on employ- ment and work, for example the increasing number of employees who work ‘non-standard’ hours or the much greater involvement of the customer as a third party in the employment relationship (Lucas, 2004). As we acknowledged earlier there are many who would argue that these are rather simplistic interpretations of the terms (Sisson, 2005). To an extent though the above discussion does have an element of truth and at the least it is useful in denot- ing key shifts in the nature of employment in recent years. In particular, the shift from manufacturing to service employment and reliance on collective institutions to a more individualized view of the employment relationship are clearly apparent.
Frames of reference and the resolution of conflict
Notwithstanding the debate about the terms industrial and employee relations a key point that remains is the likelihood of conflict or competing interests existing in the employment relationship. Of course, these aspects may also exist alongside
more co-operative relationships and this notion of how employers view both con- flict and co-operation can be further appreciated by drawing upon the unitary and pluralist ‘frames of reference’ (Fox, 1966) through which the employment relation- ship can be viewed. Within the unitary frame of reference the metaphor of a football team is often used to illustrate this perspective on the employment relationship (Marchington and Wilkinson, 2005). In this view organizations are conceptualized as a team in which all participants are aiming for the same goal, have similar objectives and are not in conflict with one another. The unitary perspective sees the organization as a cohesive and integrated team, where everybody shares common values, interests and objectives to achieve the goal of the efficient functioning of the enterprise. Within this approach a key element is the recognition of the managerial preroga- tive and the unrestrained ‘right to manage’. Managers are the single source of authority and act in a benign and rational manner for the benefit of employees. Resultantly a unitary view of the employment relationship would be framed and constrained by the idea that conflict and dissidence are unnecessary, undesirable, irrational and pathologically deviant behaviour. Any conflict that does arise will be rationalized as being a reflection of frictional rather than structural problems within the organization. Consequently, trade unions are viewed as being an unim- portant and unnecessary intrusion into the organization. One final point about the unitary perspective is the need to recognize there may be differing styles of man- agement ranging from authoritarian to paternalistic, and the latter in particular may underpin a more sophisticated unitarism which finds organizational expres- sion in talk of ‘soft’ HRM in particular. Although the unitary perspective may be easy to criticize for advocating an unrealistic view of the workplace, evidence sug- gests that many British managers still hold unitaristic views of the workplace. Indeed, Lucas (2004) suggests that unitaristic thinking is apparent in large parts of the tourism and hospitality industry; and often this unitaristic thinking is the less sophisticated version premised on cost-minimization and ‘unbridled’ individual- ism, which creates a ‘poor’ employment experience for many in the industry. The ‘them and us’ attitude which unitarism eschews is something that is accepted as being integral to the pluralist perspective on the employment rela- tionship. Conflict is accepted as being inevitable and rational because of the plur- ality of interests in the organizational setting, though the resolution of such conflict may be through differing approaches. In simple terms we can consider this in terms of both collective and individual approaches.
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More recently, as we have already noted, many argue that British public pol- icy has attempted to foster a climate which is more concerned with partnership along European lines, a process that has also been driven to an extent by a number of EU Directives encouraging greater consultation between employers and employees. As well as collective approaches to conflict, disagreement can also take place at a more individual approach. Again conflict is seen as inevitable but the resolution of such conflict does not take place within a collective framework or with the involvement of trade unions. Instead, the employment relationship is based on employment contracts determined by market forces and common law and ‘freely’ negotiated between employers and employees. Conflict may arise as employees seek the highest level of reward, best conditions and least exacting work, whilst employers seek the lowest level of payment, least costly conditions and most efficacious and flexible use of labour. In addition a final perspective initially developed by Fox (1974) and then refined by others, adopts a more radical view of the employment relationship. In this radical/ Marxist approach the employment relationship is seen not so much in organiza- tional terms, but in a much wider social, political and economic framework. In this broader analysis of capitalist society capital and labour are conceptualized as being engaged in an antagonistic ‘power struggle’ that is waged very much on capital’s terms. Marxists or neo-Marxists argue that trade union power is illusory and only maintains the delusion of a balance of power. In its purest form the Marxist per- spective suggests that only by the working class gaining workers’ control will real equality be established. In contemporary market-driven economies moves to work- ers control are very unlikely. Nevertheless, it is important to recognize that the radi- cal perspective provides the theoretical framework for more critical views of the employment relationship, such as labour process analysis.
In sum, then there have been a number of significant changes in the employment relations landscape in recent years. The shift from industrial to employee relations
Review and reflect
Think of your current workplace or where you have previously spent time on work place- ment and consider which frame of reference best describes how conflict is managed. Is this the best way to manage conflict?
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and the decline of trade union power and influence has led to increasing talk of a more unitaristic and individualistic view of the employment relationship. As a consequence there is often increasingly talk of the ‘death’ of trade unions, a view which is now considered in more detail.
Trade unions: in terminal decline?
A wide range of factors has contributed to a decline in trade union membership in the UK in recent years. In particular, the structural changes in the economy and the decline in so-called ‘heavy’ industries such as coalmining, shipbuilding and steel has particularly impacted on the unions. Equally, the legislative programme enacted by the Conservative Governments in the 1980s and 1990s can clearly be seen to be a significant influence. In addition to these aspects CIPD (2005) suggest that global competitive pressures and employee attitudes are equally important. In particular, younger people are unlikely to have ever belonged to a trade union and it is suggested that many of them see no point in trade unions (LRD, 2004a).
The decline in trade union membership is within a context in which for the first time in the UK there appears at first view to be much greater state support for trade unions. This situation is a change from the past where historically there has been little state support for trade union recognition in the UK and much of the twentieth century could be best characterized as being voluntaristic, with minimal intervention from the state in employment relations. More recently, though, there has been greater state intervention, including the area of union recognition. In this sense the Employment Relations Act (ERA) (1999) and (2004) means that trade unions may gain recognition even where employers are implacably opposed to the idea (LRD, 2006). Importantly though the legislation does not apply to small
Review and reflect
Trade unions are increasingly looking to recruit younger employees and in sectors where they have previously had few members, such as tourism and hospitality. Think about your own view of trade unions and consider why you think trade unions have had little suc- cess in the past in recruiting members in the tourism and hospitality industry.
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sub-sectors. For example, within the hotel and catering industry in the UK the cur- rent trade union density is 4.2 per cent and trade unions have little real purchase or influence (DTI, 2006). Conventionally a number of reasons are forwarded for low levels of trade union density in the UK hotel and catering sub-sector (Macaulay and Wood, 1992; Aslan and Wood, 1993; Lucas, 2004 and see also HRM in practice 10.2).
● (^) Ethos of hotel and catering – for example the suggested conservatism and indi- vidualism of the workforce and reliance on informal rewards tends to create a workplace culture which is antipathetic to trade unions. The self-reliance that this individualism tends to breed means that employees prefer to represent themselves in negotiating with management. ● (^) The predominance of small workplaces and their wide geographical dispersion pose considerable challenges to trade union recruitment and organizing strategies. The existence of a ‘family culture’ in many small and medium-sized enterprises (SMEs) is also considered a significant barrier to organizing. For example, Lucas (2004) in her interrogation of the 1998 Workplace Employee Relations Survey (WERS) data found that hospitality employees in very small workplaces demon- strated a much higher level of positive endorsement for their manager’s style of management. ● (^) Structure of the workforce – the workforce has high numbers of young workers, students, part-timers, women, employees from ethnic minorities and migrant
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Table 10.1 Union density in selected countries Country % Union density (2003) US 12. Australia 22. Japan 19. Germany 22. France 8. Italy 33. Sweden 78 Netherlands 22 Ireland 35. New Zealand 22 (2002 figure)
Derived from Visser (2006).
workers, all groups who are not traditionally associated with trade union mem- bership. This situation is also exacerbated by high labour turnover. ● Employer and management attitudes – as we have already noted the industry is characterized by a unitary view of the employment relationship that sees no role for trade unions. Consequently employers and managers are hostile towards trade unions and will often pursue an active non-union policy. ● Role of trade unions – notwithstanding recent attempts by the Transport and General Workers Union (T&G) and the GMB to organize parts of the hospitality sector it is generally acknowledged that for too long trade unions failed to develop effective strategies to organize the sector.
Although trade unions have failed to establish any real foothold within the UK hotel and catering industry there is some evidence that they have had greater suc- cess elsewhere and in doing so improved the working lives of their members (and see HRM in practice 10.3 and 10.4). As we noted earlier the relative lack of trade union presence is not universal in the tourism and hospitality industry in terms of the relative strength of trade
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HRM in practice 10.2 Failing to organize the
Dorchester Hotel
Wills (2005) reports how the T&G targeted the world-famous Dorchester Hotel in 1999 in attempts to gain union recognition. The Dorchester was targeted as it was a stand- alone hotel which did not belong to a national or international chain, so for the purposes of 1999 ERA would be counted as a single bargaining unit. From 1999–2002 the T&G sought to gain union recognition. Although some employees did join the union, high levels of labour turnover and the ethnic diversity of the staff made it difficult to sustain a common union identity. When the T&G came to present its case to the Central Arbitration Committee in December 2002 the union was unable to present a sufficiently compelling case that a majority of workers constituting the bargaining unit would be likely to support recognition. In part, this was due to the Dorchester claiming more work- ers worked in the hotel than the T&G; although the union also found that a number of their claimed members were either duplicate members or were no longer employed. The failure to organize the Dorchester seems to point to the need for British unions to change their tactics in seeking recognition and to develop a broader geographical, occupational and sectoral focus, rather than concentrating on the level of the individual workplace.
In sum, although there may be some pockets of trade union strength in the tourism and hospitality industry, generally trade unions remain a marginal presence. In a broader sense clearly any future for the trade union movement is contingent upon their ability to organize in the service sector. The evidence to date suggests that this may well be an uphill struggle for the trade union movement. As a consequence
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HRM in practice 10.5 Conflict in BA
BA has had something of a chequered history in recent years in its dealings with trade unions. When in 2003 the company sought to introduce a new automated time recording system for check-in and ticketing staff it found itself involved in a costly industrial dispute. The row centred on the introduction of a new electronic clocking-on system at Heathrow airport, which staff feared would be used to push through other changes in pay and con- ditions, such as the introduction of split shifts and annualized hours. These concerns and the manner in which the system was being ‘imposed’ led to a two-day unofficial strike by members of the GMB, T&G and Amicus trade unions. The dispute led to the cancellation of over 500 flights affecting thousands of passengers. As well a PR disaster the dispute was estimated to have cost the company £50 million. More recently the company also found itself embroiled in an equally damaging dispute, albeit one not directly of its own making. In 1997 BA chose to outsource its in-house catering operation to a company called Gate Gourmet, who were the sole catering supplier for the company. Gate Gourmet was already paying relatively cheap wages to their workers when in an attempt to drive down wages even further the company employed 130 agency staff. This was despite the company’s pre- vious attempts at restructuring, which had led to redundancies. As a result the original staff held a meeting to wait for further news, which led to over 650 of them being sacked. In response BA found itself facing costly sympathy action by baggage handlers and ground staff, who were not only in the same trade union, T&G, as the Gate Gourmet workers, but in some cases were also the husbands and brothers of the sacked workers. Once again BA found itself having to cancel hundreds of flights, leading to over 100 000 passengers being stranded. As well as the immediate disruption caused by the action of the baggage hand- lers the dispute in Gate Gourmet dragged on for several months customer refreshments to some BA customer. The cost to BA of the strike action was estimated at between £35– million, though arguably the biggest cost was in terms of the company’s damaged reputa- tion and lost custom in the future. Derived from BBC (2005), Clark (2003), Morgan (2003) Townsend (2005).
this lack of collective ‘voice’ provided by the trade unions means that most tourism and hospitality employees are likely to sustain an influence in managerial decision-making through the processes of employee involvement and participation.
Employee involvement and participation
As we have already noted there is a definitional and terminological debate on the meanings of terms such as ‘employee involvement’, ‘employee participation’ and ‘industrial democracy’ (Blyton and Turnbull, 2004). Hyman and Mason (1995) sug- gest that increasingly, talk of industrial democracy – which denotes a fundamental change in the balance of power in society generally and the workplace specifically, such as the establishment of employee self-management – has little currency in contemporary market-driven economies. Consequently we are left with the notions of ‘employee involvement’ and ‘employee participation’, which represent the ‘two principal and in many respects contradictory approaches to defining and opera- tionalizing employee influence’ (Hyman and Mason, 1995: 1).
Employee involvement
Marchington and Wilkinson (2005) recognize that there are a number of mecha- nisms that have been introduced under the broad heading of employee involve- ment, for example teamworking and empowerment to name just two. Whilst there may be a number of differing initiatives there is nonetheless common agreement of the intent of employee involvement. In that sense most writers recognize that employee involvement is concerned with measures which are introduced by man- agement to optimize the utilization of labour whilst at the same time securing the employee’s identification with the aims and needs of the organization. Employee involvement is seen as being very much a phenomenon of the 1980s and closely linked with ‘soft’ HRM with its emphasis on unitarism and the creation of com- mon interests between employer and employee. Employee involvement is man- agerially initiated and characterized as direct, ‘descending participation’, which is task-centred as it attempts to involve all individuals in the workplace (Salamon, 2000). In this way it seeks to provide employees with opportunities to influence and take part in organizational decision-making, specifically within the context of
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(1995) suggest downward communications mechanisms are ultimately rather super- ficial and question the extent to which they denote meaningful involvement. By contrast a number of upward problem-solving techniques are more likely to denote more meaningful involvement for employees, usually involving two- way communication. These techniques may be directed at either individuals or workgroups and are now considered. Suggestion schemes allow organizations to potentially tap into the creativity in their workforce to make significant improve- ments in just about every aspect of the business, for example improvements in customer service (IDS, 2003). As a result they can improve the motivation and commitment of workers, as they see their voluntary activity as being integral to company success. Equally, there may also be more instrumental and tangible bene- fits both to the individual, whereby employees are rewarded for ideas and for the organization, who may accrue significant cost savings from suggestions emanat- ing from employees. A second technique which aims to encourage more active employee involvement is attitude surveys. More often than not employee attitude surveys will be a census of all staff usually yearly or bi-annually (IDS, 2004). Employees will usually be asked to give their views on a range of issues, including (IDS, 2004):
● The organization’s strategic direction and leadership. ● Organizational culture. ● The organization as an employer. ● Pay and benefits. ● Working environment and conditions. ● Working relationships (i.e. with managers and colleagues). ● Company image. ● Overall satisfaction/commitment to the organization. ● Reaction to the survey and previous follow-up action.
The last point is important in delineating the need for organization’s to be trans- parent in both disseminating results and being seen to act on them. As was alluded to in Chapter 8 there may also be opportunities for employees to appraise their manager’s performance. The suggested benefits of employees commenting on managerial performance through employee attitude surveys are that it makes for better management, although again this is contingent upon management accept- ing and acting upon the results of surveys.
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In a group sense, initiatives within tourism and hospitality which seek to encour- age employees’ involvement in upward communication are likely to be premised on the notion of improving quality within the organization and towards the cus- tomer, finding expression in techniques such as quality circles (QCs) and total quality management (TQM). Lashley (2001) notes how QCs are essentially con- cerned with consultation on the basis of management posing problems in the expectation of receiving suggestions from employees. Suggestions are likely to be directed towards improvements in service quality and productivity in particular. He also reports evidence from the Accor Group where QCs have been used suc- cessfully. Although employees were expected to act as volunteers and are not paid for taking part in the QCs there was still significant interest amongst employees. Amongst other things the QCs in Accor were able to speed-up customers breakfast service and guest check-out times on the basis of identifying problems, suggesting and testing solutions, measuring results and finally ‘rolling out’ the approved solution. A more all-embracing approach to quality is via the notion of TQM, which is more concerned to promulgate an integrated view of quality via company-wide improvements in quality both towards the internal customer (the employee) and the external customer. Baldachino (1995) reports a case study of a luxury hotel where the implementation of a TQM philosophy was beset by a num- ber of problems including employee suspicion of the rhetoric of TQM, empower- ment and involvement when faced with the realities of redundancy, industrial conflict and the more prosaic problem of a ‘them and us’ attitude emerging over the car parking situation for managers and employees at the hotel. More sanguine accounts of TQM claim several benefits from such a philosophy, including, improved organizational efficiency, greater employee involvement, consistently ‘delighting the customer’ by exceeding their expectations and reduced labour turnover (Hope and Muhlemann, 1998). An integral part of a TQM framework is
Review and reflect
Imagine you are a manager in a travel agency which is part of a large multinational com- pany. As part of their involvement scheme the company runs an attitude survey which gives employees the opportunity to comment on your performance. In the last survey your employees have said that you are dictatorial and difficult to approach, how do you respond?
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confidence in the ability of the front-line staff to make suitable decisions. This does not mean that management’s role is completely emasculated or abrogated but merely refined, although this may be particularly difficult for managers to accept (Wilkinson, 1998). Equally it is important to create a ‘no blame’ culture where ‘well intentioned errors’ are discussed in a supportive way in order that lessons can be learned from any mistakes in decision taking by employees. This latter point can be seen as one of the obvious benefits of empowerment and a review of several writers suggests several other benefits to be derived from empowerment (Wilkinson, 1998; Lashley, 2001; Baum, 2006):
● Reduction in the so-called social distance between customers and employees, so service is not seen as servility. ● Improved quality and guest satisfaction, as the removal of close supervision cre- ates a more responsive service delivery system. ● Enhanced motivation and job satisfaction for employees, leading to greater commitment and reduced labour turnover. ● More time for managers to engage in strategic planning and customer responsiveness. ● Cost savings and improvements from ideas generated by employees. ● Word of mouth advertising.
On the other hand there may also be a number of potential problems in empower- ing employees. We have already noted how reality may not match the rhetoric of companies in relation to the tightly constrained discretion which characterizes many empowerment schemes. In addition, employees may also see empowerment as about increasing risks and responsibilities without any commensurate extra reward for the additional skills and discretion they are expected to demonstrate. A further issue is that of job security, as empowerment may be used to justify delayering, which in turn leads to a drastic reduction in the number employed by the organization. There is also the vexed issue of the culturally-bound nature of empowerment, which is often seen as a very Americanized approach to service (Nickson, 1999). Consequently, and as we noted in Chapter 2, it may be especially difficult to create an empowered culture in countries such as China and the post- communist Eastern European states, though even within parts of Western Europe there is also evidence of significant resistance to the precepts underlying empower- ment (Klidas, 2002).
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Employee participation
Hyman and Mason (1995: 21) define participation as ‘state [or supra-state] initia- tives which promote the collective rights of employees to be represented in organ- izational decision-making, or to the consequence of the efforts of employees themselves to establish collective representation in corporate decisions, possibly in the face of employer resistance’. Salamon (2000) characterizes participation as being pluralist, power-centred, indirect, representative and ‘ascending’ in its focus on the managerial prerogative and attempts to extend employees collective inter- est into a variety of areas and decisions at higher levels of the organization. The expression of employee interests over company decisions may be via joint consult- ation, works councils and worker directors. With regard to joint consultative com- mittees (JCCs), Lucas (2004) notes how data from WERS 1998 suggests that management committees for joint consultation, rather than negotiation, are rare in the tourism and hospitality industry. Moreover, where such committees do exist they tend to have quite a narrow focus in terms of what they will allow consultation on. As Lucas notes, ‘Where committees function in the HI [hospitality industry], health and safety is most likely to be discussed, followed by training, working practices and welfare services and facilities. Pay and government regulations are the least frequently discussed issues’ (p. 161). Consequently, in this section the focus is mainly on works councils, both European and national.
European and national works councils
Hyman and Mason (1995: 32) suggest works councils are, ‘a representative body composed of employees (and possibly containing employer representatives as well) which enjoy certain rights from the employer’. Works councils have two principal rights; firstly, the right to receive information on key aspects of company activity, such as restructuring, HRM/personnel issues, health and safety, etc., and secondly, the right to consultation on such issues prior to their implementation by management. Works councils are common in Europe and often underpin approaches based on social partnership, but have been a relatively rare phenomenon in the UK with only a small number of companies setting up voluntary agreement (and see HRM in practice 10.6). More recently though within the UK especially the situation has changed with European-inspired regulation, which has established European Works Councils
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