Employee
Participation
The extent to which employees
are involved in the decisionmaking process
Industrial relations

The atmosphere prevailing between a
management & its workforce representatives
– the trade unions
Industrial democracy

When employees have the opportunity to be
involved in and to influence decision making:
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Worker directors (elected to board of directors by
employees from the factory floor)
Works councils
Workers’ cooperatives (where firm’s workers own
majority of its shares, e.g. John Lewis
Partnership)
Works council


Committee of management & workforce
representatives that meet to discuss
company-wide issues, e.g. training,
investment & working practices
Bargaining over issues such as wages, terms
of employment & productivity is left to trade
union negotiations
European works councils
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Under EU law, large companies operating in
two or more EU countries must set up
European works councils
Aim is to ‘improve the right to information and
to consultation of employees’
Aim to restrict power of multinationals & to
provide workers in different locations with the
opportunity to discuss common concerns
Trade Union

A pressure group that represents the
interests of people at work

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Craft union
Industrial union
General union
Negotiation

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Collective bargaining
Union representatives in an organisation
discuss with management the issues that
affect employees in that organisation
Representation

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Trade unions also represent individual union
members when they have problems at work
Offer legal representation, e.g. compensation
for work-related injuries
Do trade unions benefit
employers?

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Valuable communication link between management
& the workforce
Management can avoid time-consuming bargaining
& negotiation with individual workers
Strong union may encourage management to take
workers’ needs seriously  improved morale 
increased productivity, etc
Ease situations such as relocation, downsizing,etc
How have trade unions
changed recently?



Membership has declined – lower union
density
Union density = proportion of all employees
who are union members
Why has this happened?
Reasons for decline

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
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Fall in number of jobs in manufacturing
industries
Privatisation of major utilities, reducing number
of employees in public sector
Increase in flexible working
Increase in proportion of workforce employed by
small businesses
Legislation that makes it more difficult for unions
to operate
Improved employment rights in the workplace
Industrial dispute


A disagreement between management & the
trade union representing
Industrial action = measures taken by
employees to halt or slow production or
disrupt services in order to put pressure on
management during an industrial dispute

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Strike
Overtime ban
Work to rule
Go-slow
Single-union agreement

Recognition by a firm of only one trade union
for collective bargaining purposes

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No-strike agreement
Pendulum arbitration

System of binding arbitration in which an independent
person or panel must decide in favour of one side or
the other
ACAS

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

Advisory, conciliation & arbitration service
Ambition is to improve organisations &
working life through better employment
relations
Funded by the Department of Trade &
Industry
Non-governmental body – independent,
impartial & confidential
Reaching agreement

Conciliation

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Negotiation intended to reconcile differences
between the parties to an industrial dispute (agree
before whether solution will be binding or nonbinding)
Binding arbitration – both parties agree in
advance that they will accept the arbitrator’s
solution
Non-binding mediation – both sides consider what
mediator suggests, but ultimately do not have to
act on it
Collective employment law

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Aims to influence industrial relations & control
activities of trade unions
Employment Act 1980 – employers no longer
obliged to recognise or negotiate with a
particular union