LARM NOTES FOR EXAMS
STUDY UNITY 1
EMPLOYMENT AND LABOUR RELATIONS:
Employment relations are about the behavior, interactions, and psychological processes
involved when people (employees) and organizations are at work. Furthermore, employment
relations are also about the work experience, involvement, and behaviour of each employee.
PARTIES TO THE EMPLOYMENT RELATIONSHIP AND THEIR RESPECTIVE
ROLES:
The employment relationship comes into existence as soon as one party employs another
person. In its basic form, the employment relationship is economic, meaning that one party is
prepared to do work in exchange for some reward. And, as the term indicates, the employment
relationship is, at its core, between the employer and employee(s). This is known as the primary
relationship, while the relationship with the state forms the secondary relationship.
Employer and Employee Roles
As in many other relationships, the roles and status of the parties to the employment
relationship are largely assigned by custom and tradition. Traditionally, the employer, owner, or
entrepreneur plans, decides, directs, and controls, while the employee executes the orders of
the owner, takes no part in decision-making or planning, and is not concerned with the results
of their actions. Employers are legal entities such as incorporated companies, close
corporations, trusts, partnerships, or entities resembling partnerships that employ people
(Grogan, 2020).
The State as Party to the Relationship
The state fulfils multiple roles in the employment relationship, which includes setting relevant
policy direction in terms of political, economic, and social aspects. The role of the state is to
regulate the employment relationship using law-making and to actively participate as an
employer or, in some cases, as an observer.
The Union as Party to the Relationship
The employment relationship between employers and employees is very complex and dynamic
since there are conflicting and shared interests. To safeguard the interests of these parties, both
employers and employees traditionally join organisations like employers’ organisations and
,trade unions so that they can collectively bargain on matters of mutual interest and contain
conflict. The employment relationship is therefore also, at times, described as a management–
union relationship or, less frequently, as a relationship between an employers’ organisation and
a union or unions.
Factors Impacting Interactions between the Parties
Numerous factors will affect the labour relationship. The most important of these are:
-the extent to which the parties acknowledge that they have common interests and agree to co-
operate with one another.
-the level of conflict in the relationship and the emphasis placed on collective bargaining.
-the distribution of power between the parties and the type of power applied.
-the degree to which participants, and union members in particular, are free to make their own
decisions versus their allegiance to the collective.
THE POWER DYNAMIC
THE SHIFTING NATURE OF POWER
Because it is most often based on win-lose outcomes, the process of collective bargaining, as
practiced in contemporary labour/employment relations, relies greatly on the use of power.
Collective bargaining commences only when one side sees the other as holding power and the
process involves continual attempts to balance or equalise power. The amount of power
wielded by either party at any time is dependent on certain power variables. Of these, the most
important are:
-dependence
-importance
-scarcity
-non-substitutability.
The Predominance of Coercive Power
Much depends on the one party’s perception of the other’s power. Power, if it exists, must be
seen to exist. Therefore, it is sometimes necessary for one of the parties to engage in an open
display of power to persuade the other party to engage in meaningful bargaining.
The Five Forms of Power: Referent and Expert Power as Preferred Modes of Power French and
Raven (1959) identified five forms of power:
1. Coercive power: for example, the threat of punishment or harm, like in industrial action
2. Reward power: the ability to bestow favours on the other person
, 3. Legitimate power: obtained by being in a position of authority over another
4. Expert power: resting on knowledge and experience
5. Referent power: obtained when others identify with a person or his or her value system and
look up to that person.
STUDY UNIT 2
DIFFERENT ROLES OF THE STATE
Government and the State
The state may be described as the abstraction of all the individuals in a society. It represents
society at large. However, it is very difficult to picture the state in such abstract terms. Thus, the
state is commonly seen as being embodied in systems of government.
4 ROLES
1- The State as Legislator
When it comes to the work relationship, the legislative role of the state is the most important.
The state may legislate on individual rights and collective rights; it may establish collective
bargaining machinery and may prescribe statutory procedures to be followed by parties to the
relationship. Generally, the type and amount of legislation will depend on a government’s overall
policy regarding intervention in the labour relationship. This is, in turn, dependent on the
numerous interacting factors mentioned in the previous section.
2- The State as Conciliator
In pursuing its objective of maintaining labour peace, a government may establish conciliation,
mediation, and arbitration services. The use of such facilities may or may not be made
compulsory by the government. In certain instances, the government itself may interfere in
disputes or act as a conciliator/mediator.
3- The State as Regulator
If the state wants to regulate the conduct of the employment relationship, it will have to
intervene more directly in the relationship and, particularly, in the conduct of collective
bargaining. The most common form of regulation is found in the establishment of an income
policy or a complete freeze on wages and prices, but the state also regulates the relationship
when it provides for compulsory recognition and bargaining and when it compels workers’
participation at the plant level.
4- The State as Adviser
The state may set itself up as a watchdog and adviser in the sphere of labour relations. In this
instance, the state will establish various bodies to monitor developments in labour/employment
