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"A Trade Union (Labor union)is a continuous association of wage-earners for the purpose of maintaining or improving the conditions of their employment" A trade union is an organization that employees can join in order to have their interests and goals better represented. A worker will pay an annual subscription and in return will have their interests more powerfully represented than if they had to negotiate with employers on their own. Workers acting together in a trade union can counterbalance the power of large firms. This is due to collective bargaining where all trade union members are balloted (given the opportunity to vote) on issues and a trade union representative then negotiates with the employer on their behalf. The negotiations and relationship between a trade union and an employer is known as industrial relations.

Functions of Trade Unions

Traditionally trade unions used to focus their attention on obtaining a good standard of pay for their members but more recently unions are concentrating on protecting the individual rights of their members. This may mean providing legal and financial support and advice for members who feel their employer has discriminated against them or dismissed them unfairly. Trade unions aim to: Improve the pay of workers. Improve working conditions and secure longer holidays. Protect members' jobs. Provide local, social and welfare facilities.

Types of Trade Union

A trade union is an organization which represents workers. There are four main types:

Craft unions Represents skilled workers from one occupation. For 82 (printers) and the AUEW (engineering). General unions Represents mainly unskilled workers from many occupations. For example the TGWU (Transport and General Workers' Union). Industrial unions Represents mainly workers in one industry. For example, the NUM (miners' union) Professional or white-collar unions Represents skilled workers in mainly service industries. For example, the NUT (teachers' union). example, SOGAT


The majority of worker-to-manager and therefore union-to-employer problems are worked out peacefully through negotiation. However occasionally an issues arises where no agreement or solution can be reached. This is when a trade union may conduct some form of industrial action in order to force the employer to back down. There are several different types of industrial action that could be taken: Strike Workers select a day(s) on which they will not come into work. Work to rule Workers apply the firms rules and procedures to the letter with the objective of slowing down production. For example a machine worker may be told to ensure his machine is clean and safe before starting work and so he will be deliberately nit-picking and spend hours doing exactly this. Go slow Employees carry on working but at the minimum pace possible in order to slow down production but avoid disciplinary action. Picketing Workers may stand at the entrance to the employers factory or place of work and demonstrate with banners or slogans. Overtime ban Workers simply refuse to work overtime as they are not obliged to. This can prevent a firm being able to produce quickly enough to meet demand and they may lose orders.


The central function of a trade union is to represent people at work. But they also have a wider role in defense of their members' interests. Individual unions and the Trades Union Congress play a very important role in lobbying the government and other decision makers to ensure the best possible deal for working people. They also play an important educational role, organizing courses for their members on a wide range of matters. Seeking a healthy and safe working environment is also a prominent feature of union activity. Unions also provide a variety of other benefits. For example, many union members can now have half an hour's free professional legal advice on anything - it does not need to be connected to their work. Many other unions provide benefits of membership such as cheap travel and insurance plans. Most importantly, almost every improvement in workplace conditions - for example, equal pay laws, stronger health and safety legislation and statutory redundancy pay came about following pressure from trade unions. The main service a union provides for its members is negotiation and representation. There are other benefits people get from being members of trade unions.

Negotiation Representation Information and advice Member services

Negotiation is where union representatives discuss with management issues which affect people working in an organization. The union finds out the members' views and relays these views to management. There may be a difference of opinion between management and union members. 'Negotiation' is about finding a solution to these differences. This process is also known as 'collective bargaining'. In many workplaces there is a formal agreement between the union and the company which states that the union has the right to negotiate with the employer. In these organizations, unions are said to be 'recognized' for 'collective bargaining' purposes. Pay, working hours, holidays and changes to working practices are the sorts of issues that are negotiated. People who work in organizations where unions are recognized are better paid and are less likely to be made redundant than people who work in organizations where unions are not recognized.

Trade unions also represent individual members when they have a problem at work. If an employee feels they are being unfairly treated, he or she can ask the union representative to help sort out the difficulty with the manager or employer. If the problem cannot be resolved amicably, the matter may go to an industrial tribunal. Industrial tribunals make sure that employment laws are properly adhered to by employees and employers. They are made up of people outside the workplace who listen to the employer's and the employee's point of view and then make a judgment about the case. People can ask their union to represent

7 them at industrial tribunals. Most cases that go to industrial tribunals are about pay, unfair dismissal, redundancy or discrimination at work. Unions also offer their members legal representation. Normally this is to help people get financial compensation for work-related injuries or to assist people who have to take their employer to court.

Information and advice

Unions have a wealth of information which is useful to people at work. They can advise on a range of issues like how much holiday you are entitled to each year, how much pay you will get if you go on maternity leave, and how you can obtain training at work.

Member services During the last ten years, trade unions have increased the range of services they offer their members. These include:
Education and training - Most unions run training courses for their members on employment rights, health and safety and other issues. Some unions also help members who have left school with little education by offering courses on basic skills and courses leading to professional qualifications. Legal assistance - As well as offering legal advice on employment issues, some unions give help with personal matters, like housing, wills and debt. Financial discounts - People can get discounts on mortgages, insurance and loans from unions. Welfare benefits - One of the earliest functions of trade unions was to look after members who hit hard times. Some of the older unions offer financial help to their members when they are sick or unemployed.

Career development

A number of trade unions have introduced innovative services for members. Guidance on Career development is one of the major tasks that has been undertaken by a lot of trade unions. to name a few: The British telecom managers union Connect, for example, launched its Opus Careers Advice counseling service in January 2002. Opus makes use of qualified and experienced counselors, and two programmes are currently offered, one on career assessment and the other on getting interviews. Each programme takes about four to six weeks to work through, and is based on a set of five 40 minute counseling sessions which take place either by phone or face-to-face. The cost of the programme for Connect members (about 290) is lower than equivalent commercial services, and it is preceded by a free half-hour session, to allow the individual to assess its suitability for their needs. Hourly career counseling is also available (100 ph). Connect originally introduced Opus for its own members, but now makes it available (at a slightly higher price) to members of other trade unions and (at a higher price) to non-union members.

Another British union, Prospect, has its own Career Plus career development programmed, delivered to members as a series of webbased worksheets. Career Plus includes modules on continuing professional development, skills, training and mentoring, and applying for jobs. Members work through the material in their own time.

SIF (Sweden) has had many years experience in helping members in career development. For example, it made use early on of the internet to deliver the Career coach (Karrircoach) service to members. This is a web-based tool designed to help individuals analyze their working life prospects. SIF members receive a password from the union and can then work their way in their own time through the programme. This is one of a number of innovative developmental tools which SIF has developed for delivery to members over the internet or on CD-ROM.

Finansforbundet in Denmark is another union to offer help in career development and in personal and professional development for managers. This ranges from individual advice and guidance (for example, on appropriate lifelong learning options) to whole day or after-work sessions on particular subjects relevant to professional staff. Finansforbundet says that this has proved a popular initiative, with in recent years approximately 15% of the unions members in professional and managerial posts participating each year.

Also in Scandinavia, the Finnish union Insinrliitto IL offers both webbased advice to members on how to apply for better jobs and more traditional courses, on topics such as career development and job applications. Insinrliitto IL offers legal advice to members who are negotiating their contracts and salaries with new employers

The Belgian union for professionals LBC-NVK has for several years offered its members career management workshops. Currently, two sessions are held each year, each open to 25 participants. The union hopes to extend this initiative from January 2005, to enable about 200 members each year to have access to this service.


Employment agencies

In many countries, trade unions in the past played an important role in directly finding work for members. This tradition was associated particularly with craftbased unions, as part of the mechanisms used to control access to particular professions and to prevent dilution of professional skills. It is perhaps not surprising; therefore, if some unions are now looking to recreate a similar service for their own professional and technical staff members. TEK (Finland) operates a Recruitment Service for its members, using the unions website. Employers can advertise current job vacancies for engineers and technical professionals on the site, without charge. Members can access this database, but can also submit on-line their own CVs (in Finnish and in English). These CVs are searchable by employers looking for new members of staff. Connect (UK) decided to set up its own employment agency in the early 1990s, at a time when large numbers of Connects members were being offered voluntary redundancy by British Telecom. The vast majority had only ever worked for BT, and found the prospect of looking for work elsewhere daunting. In France, the five major union federations have come together, along with the employers organisation MEDEF, to create a non-profit organisation APEC, lAssociation pour lemploi des cadres (Association for the employment of professional and managerial workers). APEC offers a major web-based employment service for cadres.It claims to have been used to date by 25,000 companies and 400,000 individuals. At any one time, around 10,000 jobs are likely to be posted on the website; individuals

11 can also post their own CVs. APEC is available to all cadres, including those who are not affiliated to the participating unions.

Provision of training courses and lifelong learning

Unions can contribute in several different ways to the extension of training provision for members. Firstly, for many unions this is an important issue to be raised during the collective bargaining process. The Belgian managerial and professional union LBC-NVK speaks for many when it says, Training and retraining are such fundamental rights that we try at all costs to establish these rights in collective agreements, both at company and sector level.Naturally, unions in many countries are also actively engaged in bipartite (union/employer) and tripartite (government/union/employer) organisations and initiatives to promote vocational Training. In France, for example, CFDT Cadres plays a key role in CESI, Centre dEnseignement Scientifique et Industriel, the body which coordinates the training of engineers, technicians and cadres. The Portuguese bank union SBSI participates in the Portuguese vocational training institute for the banking sector, whilst in Spain the UGT is a partner in the 2004 Plan for continuing vocational training. Unions are also developing partnerships with educational institutions. SIF (Sweden) reports that it co-operates with local universities and university colleges in Sweden in order to offer members possibilities to participate in specific curricula and courses. An example, where there have been places reserved for SIF members, is a course in project management. SIF pays for the training, and the employer lets the member participate in the course during working hours.


Unions also themselves put on a wide range of training courses for their own members. Whilst these include more traditional courses designed for union activists on such topics as representing members and occupational health and safety, unions are increasingly focusing on servicing their members needs for professional qualifications. SIF, for example, arranges about fifteen educational seminars a year designed specifically for professionals and managerial staff, each focusing on a key work-related issue. In Finland, TEK currently arranges about 35 training workshops and lectures each year, tailored to the needs of its members. Another Scandinavian union, HTF (Sweden), also runs seminars and courses for managers. As the HTF puts it, We help such members to create networks and develop their skills in subjects that are important to them.

The Norwegian managers and technicians union FLT has gone even further, establishing the Addisco organisation and website specifically dedicated to delivering professional training. A range of courses can be accessed through Addisco at a range of levels, including an MBA in Technology Management. This MBA course was originally developed in Australia by the engineers and scientists trade union APESMA, in conjunction with Australian universities. Addisco has adapted this for the needs of Norwegian students. A number of British unions have also made this MBA available to their members.


Preventing and combating sexual harassment:

Trade unions are uniquely able to take steps to "raise awareness of the problem of sexual harassment in the workplace" by conducting training of company officers and representatives on sexual harassment and by including information on sexual harassment in all union-sponsored or approved training courses.

Trade unions also have an opportunity to encourage employers to adopt "adequate policies and procedures to protect the dignity of women and men at work in the organization."

Trade unions may play a role as advisor to union members who have sexual harassment complaints, providing guidance on among other things, "any relevant legal rights. Trade unions could consider designating specially trained officials to advise and counsel members with complaints of sexual harassment and act on their behalf if required. This will provide a focal point for support. It is also a good idea to ensure that there are sufficient female representatives to support women subjected to sexual harassment."



Trade unions have always had two faces, sword of justice and vested interest". The balance between these two features can change over time; however it seems clear that in many countries, unions have lately come to be widely perceived as conservative institutions, primarily concerned to defend the relative advantages of a minority of the working population. However if we examine closely we shall find that trade unions have not just benefited the employees but also the employers in a number of ways: Helps management in bringing about any kind of changes Provides for a mechanism to deal with employees at large, dealing with large number of workers on one to one basis is not possible, this is where a trade union comes into picture Securing maximum cooperation from workers. Meeting its social obligations



There are many misconceptions about trade unions. Firstly, their members are not just in manual trades; there are trade unions for everyone from airline pilots to zoologists. Secondly, there are no 'dinosaurs' - unions have a responsible and progressive approach to industrial relations. Nor are they dominated by old, white males - forty percent of members are women, and many unions now have sections dedicated to meeting the needs of young workers. Most employers do try to follow the law and be fair and responsible, but problems are inherent in the very nature of the relationship between employer and employee. Even when there is a forward-looking, understanding management and a loyal and co-operative work force, there will be differences of opinion in the relationship between management and staff. From time to time, organizations need to respond to new situations. Staff will be asked to change their patterns of work. You may be faced with doing something that you do not want to do. You may be asked to learn difficult new skills. You may be asked to work over a weekend when you had planned something else. Redundancy now touches every level of an organization. Knowing your statutory rights or best practice in these situations is not always easy on your own. Alone, raising issues can be pretty daunting - if not impossible. This is where trade unions can help. They can provide you with the advice and support to ensure that these differences of opinion do not turn into major conflicts. The more members a trade union has in a particular company, the more likely it is that there will be formal 'recognition'. This means that management has agreed to allow the union to represent its members. It might also mean that management and the union meet every year to discuss pay and

16 conditions - such as hours of work. At present, forty-four out of the top fifty companies recognize unions, and the results are impressive. The average union member earns more than the average non-member. In private companies the union "mark-up" is 6p in the pound for manual workers and 4p in the pound for white collar staff. The average union member also gets more paid holiday than the average non-member. Two out of three union members get twenty-five days or more paid leave a year. Only one in three non-members enjoys this much holiday. Recognized unions, therefore, produce real results for their members and are responsible for tangible differences in the living and working conditions of many working people. Even if a union is not recognized, members can receive free advice and support on anything connected with their employment. Membership of a union is an insurance policy. Unions win more than 300 million a year in compensation for members who suffer injuries or discrimination at work. Non-union members are twice as likely to be seriously injured at work. Not only do unions do a great deal to prevent problems in the first instance (by, for example, lobbying for proper health and safety regulations, or for a rigorous equal opportunities policy), they are also on hand to help when things go wrong (by, for example, giving legal advice and counseling, and advising members on their rights in relation to contracts, conditions, discrimination and dismissal).



Several changes in recent years have been responsible for more attention being paid to employment relations within organizations. 1) The first is the impact of globalization which has significantly changed the ways in which enterprises are managed and work performed. Enterprises have resorted to a range of measures to increase efficiency and competitiveness, based not on low wages and natural resources, but on innovation, skills and productivity as ways of improving quality and reducing costs. Since productivity and quality have become major considerations in

competitiveness, the quality of the workforce and training have become critical factors. Shorter product life has enhanced the need for multi-skilled easily trainable employees. Employee skills have become important determinants not only of flexibility, productivity and quality, but also of employability, investment and the ability to rapidly adapt to market changes. 2) A second development which has shifted attention to workplace relations is technology. On the one hand, technology management is possible only through people, and the way they are managed and trained affects the success of such transfer. Technology is also displacing traditional jobs and creating new jobs requiring different skills. Technology is already facilitating changes in organizational structures creating flatter organizations. This has resulted in management effected less by command and supervision, and more through emphasis on cooperation, information-sharing and communication, and with a more participative approach to managing people. Modern technology now makes it possible for aspects of work to be performed outside the enterprise, for example from home, and even outside national borders. Part-time work is

18 increasing particularly due to the influx of more females into employment and their preference in some cases for part-time work. Developing countries are also feeling the impact of these changes. 3) A third factor is the changes occurring in workforces, to varying degrees, in both industrialized market economies and developing economies. Many countries have witnessed the emergence of workforces with higher levels of education and skills than before which need to be managed in a manner different from the way in which employees, especially blue collar employees, have hitherto been managed. This will assume more importance in the future as a result of the enlarging service sector and the growth of knowledge-intensive industries. Further, the many emerging work arrangements do not fit into the traditional employment relationships.( outsourcing, assembly firms etc.) These trends will not be confined to the highly industrialized countries, but will appear in the fast growing economies as costs rise, competitiveness increases, and more women participate in economic activity. 4) In the USA collective bargaining has, with some exceptions, been very much at the enterprise level; in the UK there is a marked shift towards enterprise bargaining; and the trends in Continental Europe are also in that direction. In many Asian countries outside Australia and New Zealand, the relatively little collective bargaining has been mostly at the enterprise level. In New Zealand negotiation has in the 1990s been almost entirely decentralized, and in Australia the trend is in the direction of decentralization. Exceptionally (in the USA) employers have reduced terms of employment through 'concession bargaining' when firms have been in financial difficulties. 5) In more recent times IR has been influenced by other social sciences such as organizational psychology and behavior. Traditionally economics and law were the two main influences on IR, which led to a concentration on macro level IR, and therefore on unions, government and collective bargaining, important as they were. Organizational behavior has been influenced by psychology which

19 centers on the individual, and by social psychology which focuses on relationships between people and on group behavior. In a globalize environment with businesses, money and people moving with relative ease across borders, the relentless pursuit of competitive advantage at the expense of all else, the disruption of social relationships and stability, the rapid outdating of knowledge, skills and technology, with learning being a lifelong pursuit, and increasing job insecurity, the only certain factor is change and its rapidity. Poverty worldwide is nowhere near reduction to minimal levels, and on the contrary, is increasing. Many of the benefits of recent changes have benefited a few, and in many countries income gaps are widening, rather than narrowing. IR is no doubt undergoing needed changes. Its major contribution was that it facilitated distributive justice and thereby contributed to social stability. Western Europe is probably the best example of an IR system which was underpinned by its social market principles and, by concerning itself with distributive justice and equity, raised the living standards of the majority, thus providing decades of relative social stability. In fact when we speak of changes in IR in many countries, it does not always imply a radical change, but rather a change of emphasis. For instance, the idea of negotiation on which collective bargaining is based, continues to be valid even if the trend is towards decentralized bargaining. Traditional IR institutions such as freedom of association, collective bargaining, minimum employment terms (e.g. age of employment, force labour, safety and health, holidays), social security and dispute settlement mechanisms continue to be relevant. Policies need to be formulated on these matters and applied across society. The fact that some traditional IR features may need to be changed, does not imply that they are irrelevant; the need for a greater enterprise focus does not imply the absence of a national focus as well.


With the gradual opening up of economies to world trade and foreign investment, local employers are now compelled to compete with enterprises with sophisticated technology, more productive ways of providing goods and services, and the advantage of being global players. In many instances these foreign enterprises are able to attract the best local talent on terms and conditions beyond the capacity of many local enterprises to pay. With the acceleration of the process of globalization, accompanied by the movement of former centrally planned economies towards market economies, governments and private enterprises have had to compete in the global market by developing competitive advantages, which are affected by costs and quality. Productivity increase as the measure of performance at the national and enterprise levels, with quality as an intrinsic part of productivity, is becoming the goal of many developing countries as well - now pushed to the forefront by the forces of globalization and the collapse of economic systems which were alternatives to a market economy. Economies which are seeking to progress from low cost manufacturing to highlyskilled and technology-based production need pay systems which not merely recognize skill differentials (as standard pay systems do), but also provide an incentive to acquire skills and multi-skills facilitated by years of careful and correct investment in education and training.



Early emphasis At its inception the labor market was dominated by the classical economics view which espoused free and unregulated labor markets. This laissez-faire capitalism led to social injustices and inequities since labor did not have the power to bargain with employers. Additionally, the dominant position of the employer in what was formerly termed the "master and servant" relationship prevented labour from enjoying rights. IR therefore came to espouse a degree of labour market regulation to correct the unequal bargaining power. The causes of labor problems - even those within the enterprise - were thought to need addressing through a range of initiatives external to the enterprise, by

The State through protective labor laws and dispute settlement mechanisms. Voluntary action on the apart of employees to protect themselves and increase their bargaining strength through freedom of association and collective bargaining, but backed by State interventions to guarantee these rights.

Collective IR operates in three ways. One way is through national or industry level agreements between unions and employers' organizations. A second way is through agreements between a single employer and a union. A third way is through legislative enactments applicable to employers and employees generally, or to particular sectors, or to particular categories of employees.


Current and future issues

Cross-Cultural Management Asia is a heterogeneous region, characterized by ethnic, cultural, linguistic and religious diversity. Due to substantial increases in investment in Asia by both Asian and Western investors, many employers and unions are dealing with workers and employers from backgrounds and cultures different to their own. Some of the resulting problems and issues fall within cross-cultural management. The problems arise due to differences in IR systems, attitudes to and of unions, work ethics, motivational systems and leadership styles, negotiating techniques, inappropriate communication, consultation and participation procedures and mechanisms, values expectations of workers and interpersonal relationships. These cross-cultural management issues in turn pose the following problems:

What particular IR and human resource management considerations at the regional, sub-regional and country level affect the development of sound relations at the enterprise level in a cross-cultural environment?

What would be the most effective programs for this purpose? How can investors in Asia familiarize themselves with the environmental and cultural considerations in the recipient country relevant to their managing people at work?

How could information be collected, analyzed and disseminated?

23 Industrial Relations/Human Resource Management Training Since IR has assumed a particularly important role in the context of globalization, structural adjustment and in the transition to a market economy, employers in each country would need to identify what aspects of IR and HRM should be accorded priority, how training in them could be delivered, and what concrete role is expected from an employers' organization.

Balancing Efficiency with Equity and Labour Market Flexibility Traditional IR view labour problems arising due to employers wish to use resources productively and to generate profit, while employees wish to maximize their return on labour. The State intervenes for a variety of reasons. The setting in which IR developed was conditioned by the national environment - political, economic, social and legal. But today the conditioning environment increasingly includes the international and regional context. Globalization has created pressures on IR for efficiency in the employment relationship, reflected for instance on the emphasis on flexibility (types of contracts, working time, pay, etc.) and productivity. These developments and the pressures for labour market deregulation and flexibility raise the issue of efficiency versus equity. However, the main issue for IR in this regard is not efficiency and equity as antithetic concepts, but how to achieve a balance between the two. This is because while an IR system should facilitate competitiveness, it should also promote equity by ensuring a fair return on labour and a fair sharing of the gains from economic activity, reasonable and safe working conditions, and an environment in which employees can communicate and discuss their concerns and be represented in order to protect and further their interests.

24 Freedom of Association, Labour Rights and Changing Patterns of Work With the disappearance of major ideological differences with the end of the cold war, unions are likely to move towards a greater concentration on their core IR functions and issues. In some Asian countries freedom of association, including labour rights in special economic zones, has rise as an issue. The need for employees and their representatives to be involved in change and in transition, and the willingness of employers to involve them, is an emerging issue in many Asian countries. Changing patterns of work (e.g. more homework, part-time work sub-contracting) have created concerns for unions in particular. Job security, social security and minimum conditions of work are some of them. Traditional IR systems based on the concept of a full-time employee working within an enterprise is increasingly inapplicable to the many categories of people working outside the enterprise. In some countries in terms of numbers they are likely in the future to exceed those working within an enterprise. Women The increasing influx of women into workforces has raised issues relating to gender discrimination, better opportunities for them in relation to training and higher-income jobs and welfare facilities. Migration There is a large migration of labour from labour surplus to labour shortage countries in Asia. Among the issues which have arisen are their legal or illegal status (which may affect their rights), trade union rights and their access to the same level of pay and other conditions enjoyed by nationals. Social security for migrant workers is one of the major problems as many receiving countries do not extend social security benefits to them.

25 Transition Economies In countries in transition to a market economy major challenges and issues have arisen. Principally because they are seeking to adapt to an IR system in which, for instance, employers' organizations and union pluralism have hitherto been unknown. Unions in such economies may play a welfare role, and sometimes a supervisory role, rather than a negotiating role. Managements and unions in such a system do not participate so much in deciding terms and conditions of employment, but in applying decisions which are largely made outside the enterprise. In a market economy decisions are for the most part, made within the enterprise, and where they are made externally, they are generally the result of discussions with workers' and employers' organizations representing the interests of their members vis-a-vis each other and with the government. The government creates the framework in which the social partners are consulted on matters directly affecting the interests they represent, and the social partners seek to influence the economic and social policy formulated. Labour relations are based largely on the basis of negotiation between the two social partners, and the outcomes are usually recognized by the State so long as they do not conflict with national laws or with fundamental national policy. Another reason for the critical role of IR in an economy in transition is the absence or inefficiency generally, during the process of transition, of safeguard mechanisms (such as for dispute prevention and settlement) at the national, industry and enterprise levels, to channel differences and disputes into peaceful means of resolution. The disputes therefore can involve considerable work disruptions and sour the environment needed to achieve sound industrial relations, and thereby also retard the achievement of overall development objectives. In these circumstances countries in transition to a market economy are addressing a range of problems such as: the role of employers' and workers' organizations; national policy formulation through a tripartite process; a labour

26 law system relevant to the new economic environment; methods and criteria in wage determination; dispute prevention and settlement procedures and mechanisms; and managing public sector enterprises in a competitive environment.

Economies in Transition
In Asian economies in transition (China, Mongolia, Viet Nam, Laos and Cambodia) the governments are seeking to establish a labour law system relevant to a market economy. Viet Nam already has a Labour Code, and China is in the process of enacting several laws including one covering collective bargaining contracts. There were hitherto no IR in these countries as known in a market economy, as there were no private employers (or employers' organizations), and employees were not expected to have interests different from those of the employer (the State) as they were considered to be the owners of the enterprises. Decisions were made not so much by managers as by the State. These countries are now seeking appropriate IR 'models'. Employers in these economies will need to develop the expertise necessary to persuade the other two constituents that the labour law framework should not be too regulated so as to deprive enterprises of the flexibility which will be needed to adapt to changes when these economies have to move to the next stage of economic development.



'Unions were of course very important once upon a time, but their job has been done. The age of mass production is over. The new world is all about individual relationships, and unions will wither away. A glorious past perhaps, but no real future.' And there was at least some evidence to support that view. Union membership had fallen every year from its post war peak in 1980. The government had cut unions almost entirely out of the political loop, and their electoral strategists were still convinced that attacking unions was a vote winner The power of trade union has been gradually eroded over the last 20 years. This is due to a number of reasons:

Laws passed by Conservative government during 1980s and 1990s which have weakened the power of trade unions Decline in trade union membership Change in structure of industry from heavily unionized manufacturing industry towards service sector businesses. Also more women and parttime workers who are less inclined to join unions.

Change in philosophy from conflicts due to collective bargaining to individual bargaining between firms and employees

A report published in January 2005 suggests that the decline of trade unions in the UK private sector is such that it might culminate in their eventual demise. Unions need to focus on organizing new recruits as well as servicing existing members, but without further state support this seems an uphill task. One potential glimmer of hope is said to be provided by the introduction of legislation to implement the EU information and consultation Directive. An independent 'think tank, the Work Foundation published a report in January 2005 investigating trends in trade union membership and their changing role in

28 the workplace. The report, British unions: resurgence or perdition?, written by Professor David Metcalf of the London School of Economics, argues that the future is bleak for private sector unions in Britain. Trade union membership in Britain peaked at 13.2 million in 1979, before falling by 5.5 million over the next two decades. Today, around three in five public sector workers and under one in five private sector workers are union members. The decline, according to the report, reflects sectoral and occupational change in particular the shift from heavy industry to service sector employment - as well as changes in the business cycle to do with inflation, real wages and unemployment. Also important have been government policy and changes in the law, employer attitudes and the strategies of unions themselves, which have failed to deliver sufficient replacement membership.




Apart from the fact that trade unions have undergone a process of erosion, it is evident that they have also become less appealing to workers. There are a number of reasons that have contributed to this. Some of them have been underlined below: Changes in composition of work force Its basic cause has to do with the changes in the economy that have led to fewer male industrial unskilled workers, and more female service sector workers. Changes in labor market structure The labor market has changed dramatically in the last twenty years. Part-time work has increased, more women are in work, and more people work for themselves Changes in the structure of economy The economy has been shifting from manufacturing to the service sector. Jobs have continued to decline in industry, construction, and energy-related firms, even when the economy is growing. In contrast, jobs in the service sector - areas like hotel and catering, business services, and health and education - have continued to grow. Growing emphasis on individual relations A major reason for decline in trade union density has been the more emphasis that is being paid today to the individual relations. Management now directly deals with individual workers and at the time employment the terms of employment are decided well in advance leaving little work to be done for trade unions and lesser issues for collective bargaining.


SUGGESTIONS FOR SURVIVAL AND REVIVAL OF TRADE UNIONS In the changing scenario the role to be played by the trade unions must also change if they want to survive. To organize professional workers successfully and appropriately, unions need to understand their needs and concerns. The sense of collective solidarity is likely to be weaker than for other groups of workers, and there may be less of a tradition of union organization on which unions can build. Professionals expect unions themselves to be professional, and to deliver the services members need in an efficient way. The point to understand is that there is competition for the services unions can offer. The table below seeks to identify the likely work-related needs which a professional worker perhaps working on a contract basis rather than in a traditional employment relationship, perhaps working away from a central workplace, perhaps working for a number of different clients could be expected to have. Whilst in many ways these needs resemble those which are currently met through the familiar industrial relations structures, other agencies could (and do) step in to service them: a problem at work could be guarded against in the same way, say, as a motorist arranges vehicle breakdown protection or a householder organizes a service contract for domestic appliances.

Negotiation on pay or contract fee

Agents Commercial training courses in

negotiating skills/assertiveness for individuals negotiating for themselves

Health and safety advice

Commercial telephone help lines Web based advice services Specialist consultants Doctors


Employment rights

Attorneys/lawyers Specialist consultants Commercial telephone help lines Attorneys/lawyers Specialist consultants Accountants Commercial help lines Specialist tax advisory services Web-based associations Informal networks More focus on neighborhood rather
than workplace socializing

Disciplinary representation

Taxation advice

Social activities

Legal advice

Attorneys/lawyers Legal insurance (perhaps as add-on

to other insurance)

Psychological and physical health

Doctors/health services Private practice therapists Private insurance companies Private financial advisers/brokers Informal networks Web based services (
etc) Professional associations/member cooperatives

Pensions/social protection

Finding work

Providing access to training

Educational institutions Commercial training providers Specialist consultants Commercial telephone help lines

Equal opportunities

These service providers may operate as commercial ventures, or as non-profit professional mutual associations or societies. In each case, however, they are effectively competing with trade unions own services, and as a consequence threaten membership income and organizing muscle.


Finally, unions are likely to find themselves increasingly needing to overcome the limitations which they have as organizations based within single nation states. Multinational companies already operate effortlessly beyond national boundaries, and partly as a consequence professional workers are increasingly geographically mobile, across frontiers. Unions in the twenty-first century will have to demonstrate a new-found practical, as well as ideological, commitment to internationalism. There are, then, some significant challenges facing trade unions, particularly those looking to organize professional workers. Nevertheless, at a time when work experiences are changing rapidly, trade unions continue to have a potentially significant role to play in helping meet the employability and adaptability needs of these workers. This report has attempted to demonstrate that many unions are already many steps down the road to achieving this objective.


CONCLUSION: THE CASE FOR TRADE UNIONS In the light of activities performed by trade unions and the new pioneering roles that the trade unions are playing it can be reasonably concluded that managing without trade unions if not impossible, is very tough. Not just for the benefit of the employees but also to the best benefit of employers the trade unions must exist at least till the time a better system for addressing issues of workers and for dealing with workers be devised Freedom of association is rightly prominent in every charter and declaration of human rights. It is no coincidence that authoritarians and dictators of left and right usually crack down on trade unions as a priority. A free and democratic society needs to be pluralist. There must be checks and balances on those who wield power. There must be a voice for everyone, not just the rich, the privileged and the powerful. And that simple principle goes just as much for the workplace as it does wider society. Indeed while the politics of the 1970s raised questions about union power and influence, today the same questions are being asked about Boardrooms. Inequality has grown. While directors' pay soars, huge numbers of workers remain locked into poverty pay rates. There remains an unacceptable gender gap. Despite the equal pay legislation women's pay still lags almost 20 percent behind men's. And too many black lives continue to be blighted by discrimination and disadvantage in the workplace. All the evidence shows that if you are black in Britain today you are more likely to be unemployed, less likely to win promotion up the career ladder, less likely to receive training and support.

34 The relationship between employer and employed is inherently unbalanced. Trade unions give that opportunity for employees to speak collectively, to pool their limited power in order to bring some balance to the employment relationship and to tackle these deep rooted inequalities.

We should however not forget that the membership of trade unions have declined over the years indicating the declining confidence shown by the workers in the trade unions. Trade unions though do not have the divine right to exist. Nevertheless they can benefit if they seek to maximize the opportunities which come from the established representational functions they undertake in many sectors and companies, and from the access they already enjoy in many workplaces as a recognized social partner. In the changing scenario the role to be played by the trade unions must also change if they want to survive. To organize professional workers successfully and appropriately, unions need to understand their needs and concerns. The sense of collective solidarity is likely to be weaker than for other groups of workers, and there may be less of a tradition of union organization on which unions can build. Professionals expect unions themselves to be professional, and to deliver the services members need in an efficient way. The point to understand is that there is competition for the services unions can offer.