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HRM and Employment Relations in Public Services
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HRM and Employment Relations in Public Services Lecture Notes
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HRM & Employment Relations in Public Services*2 paragraphs of the concept of NPM in essay: what it is, how it was established, the impact*
Pros and cons of PRP
Collective bargaining – 2 questions from first 5 weeks of lectures – 1 question from elka lectures
Lecture 1
Why Public Management Matters:
The public sector is important:
o 17.4% of U.K. employment (21.4% in Scotland)
i.e. 5.3 million employees (542,000 in Scotland)
o 1.5 million NHS employees in U.K.
o Public spending in public sector accounts for 42% GDP
o Private sector funds £44 billion in public service contracts
A complex and varied area: scale, function, sector, funding, stakeholders (e.g. in health,
education, local government, and civil service)
Considers the management of people in the public sphere
Why Public Management Matters:
An increasing blurring of boundaries:
o Private sector management approaches in public sector
o Privatisation of public bodies/functions
o Public services contracted-out to private and third sectors
Shift towards ‘New Public Management:’
o Its appropriateness/benefits questioned
o Fundamental, comprehensive shift
’Doing more with less,’ in an era of austerity:
o Effective HRM in public bodies required to maintain public services
Why Public HRM Matters:
Effective HR is even more important in public services, which are HR-intensive:
o E.g. public workforce pay accounts for 30% of total U.K. public spending
Austerity meant needing to ‘do more with less:’
o 650,00 job cuts in 2008-2015 in local government alone
A Distinctive Public Management:
Public services management arguably has unique features and challenges:
o Focusing on democratic accountability, fairness and public interest
o Restricted by regulation/legal frameworks
o Public managers mandated to respond to socio-political demands, political pressure
and public discourse
o Exposure to (expert and non-expert) public/political/media questioning and scrutiny
o Rationing services; not maximising ‘sales’
o Monopolistic; not responding to consumer needs ‘non-excludable’ public goods and
services
, o Successes and failures have ‘externalities’
o So, performance not defined by simple bottom line or shareholder value:
Multiple, complex, long-term outcomes, affected by external factors
A Distinctive Public HRM:
Tradition of paternalistic ‘model employer:’
o Good working conditions; job security
(Traditionally) hierarchal/regulated with limited discretion for managers
Particular challenge of linking individual and organisational performance
Macro-pressures:
o Target for spending cuts or ‘employer of last resort’
Public managers arguably face distinctive HR and employment relations issues:
o Union membership rates four times private sector, but is declining;
1989 – 80%; 2000 – 60%’ 2016 – 53%
‘Different people:’
o Women account for 67%; 43% private sector; higher qualified (40% degree qualified
vs. 25% in private sector)
o Social demography is constantly evolving and changing
Professionals:
o Key role in service delivery, setting standards, training and organising work
A ‘New Public Management:’
NPM has distinctive features and differences when compared with traditional public
administration
Thus, a profound shift in represented from the traditional management to a new public
service landscape
NPM further characterises the modernisation of public relations and with that, employee
relations
NPM as an Overarching Theme:
Since 1980, there has been a fundamental shift in public management in the U.K., and
perhaps beyond
Relationship between public service and those utilising the service is the defining factor
Not a single policy but cluster of ideas about reforming public management:
o Transferring ideas derived from private sectors and markets
From traditional ‘public administration’ to ‘New Public Management’
From traditional ‘personnel administration’ to NPM-style HRM/Performance Management
Political choice of austerity in 2010 greatly impacted the behaviours carried out within the
practice of public service
The last 10 years have focused on maintaining and providing a service with fewer funds and
people
The public sector is significantly shaped by government actions and policies, i.e. ending
alcoholism in low-income, high poverty areas, whereas, the private sector carries out actions
based on the objective of enlarging customer base and driving profits up, i.e. increasing
profits and widening accessibility to new customer bases and niche markets
o The state sets the direction in order to enable executive agencies i.e. Job Centre
Plus, to carry out collective tasks
,From ‘Public Administration’ to NPM?:
Traditional ‘Public Administration’ New Public Management (NPM)
Hierarchical top-down Decentralisation and specialisation
control/accountability
Central role of state and State to ‘steer not row’/contracting-out
public servants
Professional expertise and autonomy rule of Managers should be ‘free to manage’
law/highly formalised procedures
Standardised ‘one best way’ of working Markets, contracts and competition
Components of NPM
Hood (1991) Pollitt (2007) Dunleavy et al., (2005)
Hands-on managers free to
manage
Performance Performance Incentivisation
measurement/management measurements/standards
Focus on outputs and Shift focus from inputs to
outcomes outcomes
Disaggregation and unbundling Lean. Specialised organisations Disaggregation
organisations
Contract-based competition Contracts and market Competition
competition
Resource discipline and Shift focus from equity to
efficiency efficiency
User choice and customer
focus
Does NPM matter for HRM in Public Services?:
Transferring private management best practice:
o Emphasis on strategic HR function
Growth in management capacity:
o Historically, more constraints and bureaucracy present on HR professionals
Professionals are those with qualification degrees who are fundamental in the public sector
o Typically, the role of professionals i.e. doctors, teachers, is seen as privileged
Devolution and decentralisation of HR
Organisational disaggregation:
o More mission-focused HR; more decentralised employment relations e.g. agencies;
contracting out
Developing ‘transformative’ leaders
Does NPM matter for work in Public Services?:
, Focus on performance management:
o Quantify, incentivise and reward performance
Functional, numerical and temporal flexibility
Lean staffing and management:
o Eliminating ‘waste;’ fragmenting work
Professional autonomy versus managerialism
Arguably more demanding, intensified work
Tension within NPM:
The challenge lies in commanding and organising these professionals i.e. doctors, as it
creates tension
Collective bargaining is a behaviour adopted within the public sector
Tensions present within the shift from public administration to NPM
Changing the role and status of professionals in the public sector, whom are largely familiar
with a significant degree of autonomy is a sizable source of tension
This ‘shift’ is composed of collaborating ideas from the private sector and markets into the
workings and behaviours within the public sector:
o The ongoing shift moves away from bureaucracy to management techniques,
market, privatisation and performance management to understand new behaviours
of professionals and service users
Academics birthed the idea of NPM as a cluster of ideas/themes
Parallel shift in how public servants are managed
Traditional personnel management to different types of managing people, resources and
services
Shift towards policies, procedures and ways of working which are much more evident in the
private sector
Public services are distinctive:
o Values objectives and outcomes
Private sector ideas and practices ‘shoved’ into public sector practices are a considerable
source of tension
Establishing Performance Management Practices in Public Sector:
Typically, in the private sector, markets and consumer habits drive appropriate behaviours
Thus, public sector management established the creation of performance management
practices in order to ensure efficiency and equity within the services provided:
o Creation of league tables in educational institutions
Taking private sector principles into the public sector in order to drive up performance
outcomes, as well as the efficiency of professionals within the sector
Conclusion:
Public management matters:
o Major employer of managers and key sector
Public HRM/employment relations have distinctive features and challenges
Since 1980’s, a continuous process of dynamic and contested reform i.e. a shift towards a
‘new public management’
The historical and ongoing shift towards NPM has consequently resulted in a different
industrial relations climate
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