HUMAN RESOURCE MANAGEMENT

Human Resource Management

Human Resource Management

Introduction

A 70-30 joint venture company between an established European-based MNC and a local GLC is being formed under the name TWI Sdn Bhd. The union of the local GLC is considering collective bargaining (CB) between TWI and its blue-collar employees union (BCU). BCU is known to be quite “militant” in its approach and is affiliated under the umbrella of the national union, MTUC (Malaysia). The past 5 CBs had not been easy, with many deadlocks, requiring interferences from the Minister of Human Resources. In its initial submission, BCU is demanding a 25% increase in wages & benefits across-the-board, as well as a “signing bonus” of RM 10,000 each for its 1,200 members.

This paper explores the approaches, strategies, and action plans to make this collective bargaining a “win-win” for both the company and the union. The paper proposes these approaches, strategies and action plans in light of the current economic climate prevalent in Malaysia. The paper concludes with identifying the most appropriate bargaining style that will ensure a successful HR role in execution of the bargaining agreement.

The Significance of Labour Unions and Collective Bargaining

Labor unions are organizations formed by employees for using their collective strength to improve compensation, benefits, and working conditions through bargaining; to bring fairness to the workplace through the provision of due process mechanisms; and to represent the interests of workers in the political process (Blackett & Sheppard 2003, p.419).

Economists have traditionally viewed unions as functioning as labor market monopolies. Because they raise wages above the competitive levels set by the market, economists argue that labor unions create inefficiencies resulting in the loss of jobs and greater income inequality in the workforce (Boeri & Burda 2009, p.1440). For this reason, economists view unions as an undesirable interference in the operation of the market. However, some economists argue that in addition to their negative monopoly face, unions have a second, positive collective voice face. They further argue that, on balance, the positive impact of unions outweighs the negative (Elangovan & Mohna 2011, p. 114-116).

For workers, collective bargaining, wages and ensures proper working conditions for grants to "all" workers "one voice", which benefits them only when the employment relationship refers to a single individual. Influencing personal decisions and achieve an equitable distribution of the benefits of technological progress and increased productivity (Graham 1994, p. 25-30). For employers, as is an element that helps to maintain social peace, promotes stability of employment relationships can be disrupted by unresolved tensions in the workplace. Through collective bargaining, employers may also address the adjustments that require the modernization and restructuring. Contrary to what is commonly thought, according to a study conducted in the framework of the ILO, in many countries collective bargaining has been one of the main roads which have helped to achieve consensus on flexibility labor markets.

Collective Union among Employees

Over time, employees have come to use the collective power of unions in three different ...