Industrial relations or employment relations is the multidisciplinary academic field that studies the employment relationship; that is, the complex interrelations between
employers and
employees,
labor/trade
unions,
employer organizations, and
the state.
The newer name, "Employment Relations" is increasingly taking precedence because "industrial relations" is often seen to have relatively narrow connotations. Nevertheless, industrial relations has frequently been concerned with employment relationships in the broadest sense, including "non-industrial" employment relationships. This is sometimes seen as paralleling a trend in the separate but related discipline of
human resource management.
While some scholars regard or treat industrial/employment relations as synonymous with employee relations and
labour relations
Labor relations is a field of study that can have different meanings depending on the context in which it is used. In an international context, it is a subfield of labor history that studies the human relations with regard to work in its broadest ...
, this is controversial, because of the narrower focus of employee/labour relations, i.e. on employees or labour, from the perspective of employers, managers and/or officials. In addition, employee relations is often perceived as dealing only with non-unionized workers, whereas labour relations is seen as dealing with
organized labour, i.e unionized workers.
Some academics, universities and other institutions regard human resource management as synonymous with one or more of the above disciplines, although this too is controversial.
Overview
Industrial relations examines various employment situations, not just ones with a unionized workforce. However, according to Bruce E. Kaufman, "To a large degree, most scholars regard
trade union
A trade union (labor union in American English), often simply referred to as a union, is an organization of workers intent on "maintaining or improving the conditions of their employment", ch. I such as attaining better wages and benefits ...
ism,
collective bargaining
Collective bargaining is a process of negotiation between employers and a group of employees aimed at agreements to regulate working salaries, working conditions, benefits, and other aspects of workers' compensation and rights for workers. The ...
and labour–
management relations, and the national labour policy and
labour law within which they are embedded, as the core subjects of the field."
Initiated in the United States at end of the 19th century, it took off as a field in conjunction with the
New Deal. However, it is generally regarded as a separate field of study only in English-speaking countries, having no direct equivalent in continental Europe. In recent times, industrial relations has been in decline as a field, in correlation with the decline in importance of trade unions and also with the increasing preference of
business schools for the human resource
management paradigm.
Industrial relations has three faces: science building, problem solving, and ethical. In the science building phase, industrial relations is part of the
social science
Social science is one of the branches of science, devoted to the study of societies and the relationships among individuals within those societies. The term was formerly used to refer to the field of sociology, the original "science of so ...
s, and it seeks to understand the
employment relationship and its institutions through high-quality, rigorous research. In this vein, industrial relations scholarship intersects with scholarship in
labour economics,
industrial sociology
Industrial sociology, until recently a crucial research area within the field of sociology of work, examines
"the direction and implications of trends in technological change, globalization, labour markets, work organization, managerial practi ...
,
labour and
social history,
human resource management,
political science,
law
Law is a set of rules that are created and are enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. It has been vario ...
, and other areas.
Industrial relations scholarship assumes that labour markets are not perfectly competitive and thus, in contrast to mainstream
economic theory, employers typically have greater bargaining power than employees. Industrial relations scholarship also assumes that there are at least some inherent conflicts of interest between employers and employees (for example, higher wages versus higher profits) and thus, in contrast to scholarship in human resource management and
organizational behaviour, conflict is seen as a natural part of the employment relationship. Industrial relations scholars therefore frequently study the diverse institutional arrangements that characterize and shape the employment relationship—from norms and power structures on the shop floor, to employee voice mechanisms in the workplace, to
collective bargaining
Collective bargaining is a process of negotiation between employers and a group of employees aimed at agreements to regulate working salaries, working conditions, benefits, and other aspects of workers' compensation and rights for workers. The ...
arrangements at company, regional, or national level, to various levels of public policy and
labour law regimes, to varieties of
capitalism (such as
corporatism
Corporatism is a collectivist political ideology which advocates the organization of society by corporate groups, such as agricultural, labour, military, business, scientific, or guild associations, on the basis of their common interests. The ...
,
social democracy
Social democracy is a political, social, and economic philosophy within socialism that supports political and economic democracy. As a policy regime, it is described by academics as advocating economic and social interventions to promote s ...
, and
neoliberalism).
When labour markets are seen as imperfect, and when the employment relationship includes conflicts of interest, then one cannot rely on markets or
managers to always serve workers' interests, and in extreme cases to prevent worker exploitation. Industrial relations scholars and practitioners, therefore, support institutional interventions to improve the workings of the employment relationship and to protect workers' rights. The nature of these institutional interventions, however, differ between two camps within industrial relations. The pluralist camp sees the employment relationship as a mixture of shared interests and conflicts of interests that are largely limited to the employment relationship. In the workplace, pluralists, therefore, champion
grievance
A grievance () is a wrong or hardship suffered, real or supposed, which forms legitimate grounds of complaint
In legal terminology, a complaint is any formal legal document that sets out the facts and legal reasons (see: cause of actio ...
procedures,
employee voice mechanisms such as
works council
A works council is a shop-floor organization representing workers that functions as a local/firm-level complement to trade unions but is independent of these at least in some countries. Works councils exist with different names in a variety of re ...
s and
trade union
A trade union (labor union in American English), often simply referred to as a union, is an organization of workers intent on "maintaining or improving the conditions of their employment", ch. I such as attaining better wages and benefits ...
s, collective bargaining, and labour–management partnerships. In the policy arena, pluralists advocate for
minimum wage laws,
occupational health and safety
Occupational safety and health (OSH), also commonly referred to as occupational health and safety (OHS), occupational health, or occupational safety, is a multidisciplinary field concerned with the safety, health, and welfare of people at wor ...
standards,
international labour standards
International labour law is the body of rules spanning public and private international law which concern the rights and duties of employees, employers, trade unions and governments in regulating Work (human activity) and the workplace. The Interna ...
, and other employment and labour laws and public policies. These institutional interventions are all seen as methods for balancing the employment relationship to generate not only economic efficiency but also employee equity and voice. In contrast, the
Marxist-inspired critical camp sees employer–employee conflicts of interest as sharply antagonistic and deeply embedded in the socio-political-economic system. From this perspective, the pursuit of a balanced employment relationship gives too much weight to employers' interests, and instead deep-seated structural reforms are needed to change the sharply antagonistic employment relationship that is inherent within capitalism. Militant trade unions are thus frequently supported.
History
Industrial relations has its roots in the
industrial revolution
The Industrial Revolution was the transition to new manufacturing processes in Great Britain, continental Europe, and the United States, that occurred during the period from around 1760 to about 1820–1840. This transition included going f ...
which created the modern employment relationship by spawning free labour markets and large-scale industrial organizations with thousands of wage workers. As society wrestled with these massive economic and social changes, labour problems arose. Low wages, long working hours, monotonous and dangerous work, and abusive supervisory practices led to high employee turnover, violent
strikes, and the threat of social instability. Intellectually, industrial relations was formed at the end of the 19th century as a middle ground between classical economics and
Marxism
Marxism is a left-wing to far-left method of socioeconomic analysis that uses a materialist interpretation of historical development, better known as historical materialism, to understand class relations and social conflict and a dialectical ...
, with
Sidney Webb and
Beatrice Webb's ''
Industrial Democracy
Industrial democracy is an arrangement which involves workers making decisions, sharing responsibility and authority in the workplace. While in participative management organizational designs workers are listened to and take part in the decisi ...
'' (1897) being a key intellectual work. Industrial relations thus rejected the classical econ.
Institutionally, industrial relations was founded by
John R. Commons
John Rogers Commons (October 13, 1862 – May 11, 1945) was an American institutional economist, Georgist, progressive and labor historian at the University of Wisconsin–Madison.
Early years
John R. Commons was born in Hollansburg, Ohio on ...
when he created the first academic industrial relations program at the
University of Wisconsin in 1920. Another scholarly pioneer in industrial relations and labour research was
Robert F. Hoxie. Early financial support for the field came from
John D. Rockefeller Jr. who supported progressive labour–management relations in the aftermath of the
bloody strike at a Rockefeller-owned coal mine in Colorado. In Britain, another progressive industrialist,
Montague Burton, endowed chairs in industrial relations at the universities of
Leeds
Leeds () is a city and the administrative centre of the City of Leeds district in West Yorkshire, England. It is built around the River Aire and is in the eastern foothills of the Pennines. It is also the third-largest settlement (by popula ...
,
Cardiff
Cardiff (; cy, Caerdydd ) is the capital and largest city of Wales. It forms a principal area, officially known as the City and County of Cardiff ( cy, Dinas a Sir Caerdydd, links=no), and the city is the eleventh-largest in the United Kingd ...
, and
Cambridge in 1929–1930.
Beginning in the early 1930s there was a rapid increase in membership of
trade unions in the United States, and with that came frequent and sometimes violent labour–management conflict. During the
Second World War
World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposi ...
these were suppressed by the arbitration powers of the
National War Labor Board.
However, as the Second World War drew to a close and in anticipation of a renewal of labour–management conflict after the war, there was a wave of creations of new academic institutes and degree programs that sought to analyse such conflicts and the role of collective bargaining. The most known of these was the
Cornell University School of Industrial and Labor Relations
The New York State School of Industrial and Labor Relations at Cornell University (ILR) is an industrial relations school and one of the four New York State contract colleges at Cornell University, located in Ithaca, New York, United States. The ...
, founded in 1945.
But counting various forms, there were over seventy-five others.
These included the
Yale Labor and Management Center, directed by
E. Wight Bakke, which began in 1945.
An influential industrial relations scholar in the 1940s and 1950s was
Neil W. Chamberlain at
Yale
Yale University is a private research university in New Haven, Connecticut. Established in 1701 as the Collegiate School, it is the third-oldest institution of higher education in the United States and among the most prestigious in the wor ...
and
Columbia universities.
In the 1950s, industrial relations was formalized as a distinct academic discipline with the emergence in the UK of the so-called "Oxford school", including
Allan Flanders,
Hugh Clegg, and
Alan Fox, Lord
William McCarthy, Sir
George Bain (all of whom taught at
Nuffield College, Oxford
Nuffield College () is one of the constituent colleges of the University of Oxford in England. It is a graduate college and specialises in the social sciences, particularly economics, politics and sociology. Nuffield is one of Oxford's newer c ...
), as well as
Otto Kahn-Freund (
Brasenose College, Oxford).
Industrial relations was formed with a strong problem-solving orientation that rejected both the classical economists' ''
laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups ...
'' solutions to labour problems and the Marxist solution of
class revolution. It is this approach that underlies the
New Deal legislation in the United States, such as the
National Labor Relations Act and the
Fair Labor Standards Act.
By the early 21st century, the academic field of industrial relations was often described as being in crisis. In academia, its traditional positions are threatened on one side by the dominance of mainstream economics and organizational behaviour, and on the other by
postmodernism.
In policy-making circles, the industrial relations emphasis on institutional intervention is trumped by a neoliberal emphasis on the ''laissez-faire'' promotion of
free market
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
s. In practice, trade unions are declining and fewer companies have industrial relations functions. The number of academic programs in industrial relations is therefore shrinking, while fields such as human resource management and organizational behaviour grow. The importance of this work, however, is stronger than ever, and the lessons of industrial relations remain vital. The challenge for industrial relations is to re-establish these connections with the broader academic, policy, and business worlds.
Theoretical perspectives
Industrial relations scholars such as Alan Fox have described three major theoretical perspectives or frameworks, that contrast in their understanding and analysis of workplace relations. The three views are generally known as unitarism, pluralism, and the radical or critical school. Each offers a particular perception of workplace relations and will, therefore, interpret such events as workplace conflict, the role of unions and job regulation differently. The perspective of the critical school is sometimes referred to as the ''
conflict model'', although this is somewhat ambiguous, as pluralism also tends to see conflict as inherent in workplaces. Radical theories are strongly identified with
Marxist theories, although they are not limited to these.
Pluralist perspective
In pluralism, the organization is perceived as being made up of divergent sub-groups, each with its own legitimate interests and loyalties and with their own set of objectives and leaders. In particular, the two predominant sub-groups in the pluralist perspective are the management and trade unions. The pluralist perspective also supports that conflict is inherent in dealing with industrial relations since different sub-groups have different opinions in the day-to-day operations. Consequently, the role of management would lean less towards enforcing and controlling and more toward persuasion and coordination. Trade unions are deemed legitimate representatives of employees, conflict is resolved through collective bargaining and is viewed not necessarily as a bad thing and, if managed, could, in fact, be channeled towards evolution and positive change.
Unitarist perspective
In unitarism, the organization is perceived as an integrated and harmonious whole with the idea of "one happy family" in which management and other members of the staff all share a common purpose by emphasizing mutual co-operation. Furthermore, unitarism has a paternalistic approach: it demands loyalty of all employees and is managerial in its emphasis and application. Consequently, trade unions are deemed unnecessary since the loyalty between employees and organizations are considered mutually exclusive, and there cannot be two sides of industry. Conflict is perceived as the result of poor management.
Radical or critical perspective
This view of industrial relations looks at the nature of the capitalist society, where there is a fundamental division of interest between capital and labour, and sees workplace relations against this background. This perspective sees inequalities of power and economic wealth as having their roots in the nature of the capitalist economic system. Conflict is therefore seen as a natural outcome of capitalism, thus it is inevitable and trade unions are a natural response of workers to their exploitation by capital. Whilst there may be periods of acquiescence, the Marxist view would be that institutions of joint regulation would enhance rather than limit management's position as they presume the continuation of capitalism rather than challenge it.
References
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Further reading
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* Kjellberg, Anders (2022
''The Nordic Model of Industrial Relations'' Lund: Department of Sociology.
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External links
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