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Costs Of Labor Contracts Essay

1330 words - 5 pages

Introduction
Labor relations are a key area in enhancing efficiency in human resource management. This is especially with the realization that human resource forms the basis of organizational competitiveness. As such, labor relations entail recognizing and respecting legitimate interests of labor as well as those of the management. This is necessary in developing and maintaining relationships essential in enhancing organizational capabilities in adapting to the ever dynamic business environment (Holley, Jennings, & Wolters, 2012). Labor relations are characterized by collective bargaining. Collective bargaining involves a process through which the employer (s) representatives negotiate for various aspects of work with the representatives of the worker (s).
Structure of Labor Relations
As observed by Katz, Lee, and Lee (2004), the structure of labor relations has extensively changed to adopt a tripartite approach in addressing issues to labor. This entails the involvement of the workers, employers, and the government in labor relations. The workers are represented by unions that seek to advance their interests to the maximum and address potential exploitation. On the other hand, unions representing the employers intend to ensure that agreements aimed at enhancing labor productivity are arrived at. In the recent past, the government has become an integral part in labor relations since it is an employer too and is responsible for generating laws and legislations governing labor relations.
Process of Collective Bargaining
The collective bargaining process is quite elaborate and entails various steps. The process starts with a bargain notice by the employer or employee union inviting the other party to review a collective agreement. A dispute notice is filed to the Minister of Labor in cases where impasses are reached, or where there is no appropriate response within the given deadline. The minister is responsible of appointing a conciliation officer (s) to mediate in the dispute. The mediation is supposed to take about sixty days, where either conflicting parties can request time to temporarily restrain from the reconciliation engagements. At this point, an industrial action can be issued by the representatives of the conflicting parties, but a notice of about seventy-two hours must be issued first (Hayter, 2011).
Approaches to Collective Bargaining
As noted by Hayter (2011), approaches to collective bargaining can largely be categorized as either defensive or proactive. The defensive approach entails efforts geared towards the reduction of labor costs. Although the employees may be the complaining party in the bargaining process, employers’ representatives engage in the negotiations with cost reduction as their main agenda and core reference point. As such, the ideas adopted to realize this objective may include wage cuts, staff retrenchment, and working hours’ extension. Differently, the proactive approach is founded on...

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