INDUSTRIAL RELATIONS

SYSTEM TRANSFORMATION
Christopher L. Erickson
and
Sarosh Kuruvilla

Prepared by: Francisco, Raymund

About the authors
Christopher L. Erickson
• Assoc. Professor in Human
Resources and Organizational
Behavior area of the UCLA
Anderson Graduate School of
Management
Sarosh Kuruvilla
• Assoc. Professor in the
Collective Bargaining, Labor
Law, and Labor History
department and International
and Comparative Industrial
Relations department of the
New York State School of
Industrial and Labor Relations,
Cornell University
“TRANSFORMATION”
Does Transformation of IR System exist?
YES NO

• Kochan, Katz and • Golden, Wallerstein, and

MacKersie (1986)
• Katz (1993)
• Locke, Kochan and Piore
(1995)
• Armingeon (1994)
• Kuruvilla (1996)
Lange (1997)
• Crouch (1993)
• Hyman (1994)
• Dunlop (1993)
• Freeman and Katz (1995)
Studies of Industrial Relations System
Study Claim Basis of Transformation System

Kochan, Katz and McKersie Transformation Level of bargaining; strategic decision makers; innovation in workplace practices
(1986)

Katz (1993) Transformation Employer-initiated decentralization of bargaining

Locke, Kochan, and Piore Transformation Enterprise focus; increased flexibility; focus on skills development; union membership
(1995) declines
Armingeon (1994) Transformation Changes in legislation

Kuruvilla (1996) Transformation Changes in IR policy and practice

Golden, Wallerstein, and No Union density and coverage rates; union concentration and monopoly; statutory
Lange (1997) Transformation authority of central unions and employer federations; centralization of wage bargaining

Crouch (1993) No Stability of formal institutional mechanisms

Transformation

Hyman (1994) No Dimensions of change in management initiative; decline of unionism; deregulation of

Transformation labor markets; decline of national systems

Dunlop (1993) No Adaptations in IR due to changing demographic, market, technological, and political
Transformation environment

Freeman and Katz (1995) No Mixed evidence regarding increased variation in wage structures
Transformation
 Two types of Transformation
Incremental (Adaptive)
• Evolutionary Biology
(gradual)
• Fundamental change of
function in any institution
can still be evolutionary
• There is a significant
effect of contingency and
incumbency in evolution
Discontinuous (Revolutionary)
• Punctuated Equilibrium Theory
• Undergoes periods of apparent
stability with only gradual and
non-fundamental change
punctuated by periods of rapid
change when the basic
assumptions and principles
underlying that system come
under question
• Regulation framework
• 3 main components: deep
structure, equilibrium periods,
revolutionary periods
Most interesting questions
• Why some systems gradually
adapt while others remain rigid
until they undergo
discontinuous change?
Answers:
• Tayloristic – Job-control-based
systems are inherently rigid
and most therefore snap and
change in punctuations
Answers:
• Corporatist System are inherently
more flexible and therefore can
more gradually adapt external
circumstances that are no longer
consistent with internal logic of the
existing system.
The Swedish example
• Sweden is a corporatist
system, that recent
developments there amount to
discontinuous change. The
Swedish example is a counter-
example of the Tayloristic-job-
control system.
Questions that require lengthy analysis
before firm conclusions can be reached
• Is the various national IR systems are
changing in a similar direction?
• Is the development of economy generating
a common set of external imperatives that
are driving the different systems toward a
single model?
Aims of the study of Erickson and Kuruvilla

• To provide the beginnings of a framework

for the definition of Industrial Relations
System Transformation
• To distinguish incremental from
discontinuous transformation in those
system
• To be used for further research
Reference:
• Erickson, C. and Kuruvilla, S. (1998) “Industrial Relations
System Transformation” in Industrial and Labor Review,
vol. 52, no. 1, October 1998, pp. 3-21