Briefly discuss the issues relating to international
Industrial relations. Give few examples as to how trade unions have responded
to Multinationals.
Ans : There has been a
growing interest in the issue of globalization, internationalization, 'best
practices' adoption and its impacts on the convergence of national employment
relations system. Many scholars concludes that at the industry level, the
needed changes to be more flexible and internationally competitive has led to
several common patterns in term of employment relations. Meanwhile, others
argue that cross-national variations such as culture, economic stage of
development, institutions workers, behavioral mindset still exist and
constitutes diversity within and between nations. This essay will review
some of the most relevant literature, research and debates surrounding the
topic as well as explore different viewpoints in order to make an insightful
understanding of these processes. The paper will also compare and contrast two
of three most dominant national models: Anglo-American and Japanese model
(another is Rhineland-German model) as a case to reflect how convergence and
divergence in term of employment relations system moving unstoppable.
IICONVERGENCE
– COMING TOGETHER
Globalization Impact
Convergence of employment relations system across national
borders was predicted in the early days by many scholars. They stated that
globalization and international trade may put pressure on firms to standardize
practices and policies. Convergence theory was developed by American Harbison
and Myers (1959) and Kerr et al. (1960). They view similar political and
economic systems is the result of industrialization process and rapid growth of
advanced technology. While the theory itself does not specify on industrial
relations or human resource management, but its approach can be applied to gain
understanding of the issue. Globalization's impacts on HRM come via the opening
and penetration of economies to external forces. This is two-way process, with
both indigenous firms and multinational enterprise adopt each other's HRM
practice.
It is easy to advance the view that whilst capital is global,
labour remains local – that whilst business has found the framework to operate
effectively on a trans-national basis, unions remain stuck in a nation-state
view of the world. The IBM protest on Second Life (in this case coordinated by
the Global Union Federation UNI) may or may not prefigure future ways of taking
industrial action, but it does at least suggest that unions are finding
intriguing new ways to try to respond creatively to globalization.
Certainly, trade unions’ adjustment to a globalized world
economy is not unproblematic and remains best described as work-in-progress.
Nevertheless, as an important new collection of essays makes very clear, there
are some significant developments taking place, both in terms of theory and
practice.
The book, Trade union responses to globalization, pulls together in one place some of the work of the Global
Union Research Network (GURN), established in 2004 to encourage researchers and
trade unionists to explore labour movement responses to current developments in
the world economy. The book is edited by Verena Schmidt, from the ILO’s Bureau
for Workers’ Activities, who detects three common threads in this work:
“Firstly the need for enlarging the trade union agenda, secondly the role of
network and alliance building and thirdly the role of the ILO and labour
standards in achieving a fair globalization.”
There is, of course, nothing particularly new about global
trade, a point made by an essay in the book on the banana industry in Colombia
which points out that a small number of global giants have dominated the banana
business for a century or more. Nevertheless, historically social partnership
and collective bargaining have almost without exception been organized within
national state boundaries. This may be beginning to change. Certainly a
significant new role is being taken on by the family of Global Union
institutions, the International Trade Union Confederation (ITUC), the OECD’s
Trade Union Advisory Committee (TUAC), and especially the ten sectoral Global
Union Federations (GUFs).
It has been the GUFs who have led the way in negotiating the
growing number of International Framework Agreements with multinational
enterprises, a model for taking formal collective agreements to the global
level which has now been adopted in more than 30 cases. As Marion Hellmann of
Building and Wood Workers’ International (BWI) points out, international
framework agreements offer a way of moving beyond companies’ voluntary codes of
practice which, she argues, can be simply a marketing ploy. “International
Framework Agreements constitute a formal recognition of social partnership at
the global level,” she writes, stressing that they are qualitatively different
from voluntary codes. “Multinational companies signing such agreements commit
themselves to respect workers’ rights, on the basis of the core ILO
Conventions,” she adds.
She describes in detail one particular framework agreement,
that signed in 1998 between BWI and the Swedish furniture multinational IKEA
which, thanks to commitment from both social partners, has helped raise labour
standards in countries as diverse as Poland, Malaysia and China. Nevertheless,
Hellmann points out some of the practical problems encountered in extending the
reach of framework agreements so that they adequately cover multinationals’
networks of suppliers and sub-contractors.
This last issue – an important one, as many major companies
increasingly outsource aspects of what were once core functions – is picked up
by other contributors to the book. There are clearly contradictory tendencies
at work. On the one hand, outsourcing work once undertaken in-house can be
associated with worsening labour conditions. In an essay looking at the IT
sector in both California’s Silicon Valley and India’s IT centre Bangalore,
Anibel Ferus-Comelo suggests that strong competition on price for computers and
electronics products is leading to highly complex subcontracting chains:
“Whilst this has been a successful corporate strategy, it has detrimental
consequences for workers further down the supply chain in different parts of
the world. Working in the IT industry frequently means having precarious
employment in a highly stratified occupational structure with casual or
short-term contracts,” she writes. Two other writers, Esther de Haan and
Michael Koen, describe the problems of protecting core labour standards in
another outsourced industry, that of the garment manufacturing sector in
southern and eastern Africa.
On the other hand, the increasingly tight-knit nature of
global value chains, which bind together primary producers, manufacturers,
intermediaries and eventual retailers, could be seen as providing new
opportunities for exporting good labour conditions to companies and contractors
operating “upstream”. Lee Pegler and Peter Knorringa, in an essay on the
implications for unions of global value chain analysis, explore among other
things whether companies who participate in global value chains have improved
employment conditions (though the evidence they unearth is, at best,
inconclusive). Nevertheless, multinationals can be seen as acting as a kind of
transmission mechanism, transferring industrial relations practices from their
country of origin to suppliers and contractors elsewhere, and this is an area
to which unions might usefully pay more attention. As Verena Schmidt puts it,
“The concept of value chains presents some opportunities for labour… Organizing
along supply chains could be a way to focus efforts and move beyond existing North-South
cooperation arrangements.”
A major problem for trade unions in organizing, it is argued,
is the fickle nature of multinational enterprise, prepared to relocate
apparently at will to new destinations offering lower costs or higher
government subsidies. For instance, southern Africa’s garment industry, we
learn, has suffered in recent years as Asian investors have pulled out, the
result of the export quota rules changing. Bulgaria’s garment industry, too,
faces serious organizing challenges. Nadejda Daskalova and Lyuben Tomev
describe efforts by the Confederation of Independent Trade Unions in Bulgaria
to protect fundamental labour rights: “In a number of garment companies owned
by foreign investors relocated to Bulgaria from neighbouring countries, the
widespread practice is to work 14-16 hours a day for minimum pay – in drastic
violation of the social and labour laws,” they write.
It is not just capital which can be footloose: in an
increasingly globalized world, labour is, too. The UN recently suggested that
the world’s migrants total 191 million, the majority of whom are migrant
workers and dependants. As is well known, migrant workers are particularly at
risk of facing poor employment conditions and exploitation at work; in some
circumstances, the presence of unorganized migrant workers in a country’s
workforce can also put downward pressures on the conditions enjoyed by domestic
workers. Two particularly interesting essays in this collection report on
initiatives by trade unions to tackle these challenges. Ann-Marie Lorde, who
has played a key role in a recent project on the migration of women in the
health sector coordinated by the public sector GUF Public Services
International, explores the opportunities for a combined trade union approach
to intra-regional migration within the Caribbean area through the work of the
Caribbean Public Sector Unions (CPSU). Jane Hardy and Nick Clark report on the
work being undertaken in the United Kingdom and Poland to organize the very
large number of (primarily young) Polish migrant workers who have recently
moved to Britain. Initiatives include the seconding of a worker from the Polish
union federation Solidarity to the British Trades Union Congress, to work to
organize Polish migrants into British unions. The writers report too on
complementary efforts by Polish unions to advise would-be Polish migrants of
their rights abroad. Whilst collaborations like this are at an early stage, the
experience to date has clearly been positive. “The possibility of mutual recognition
of union cards may enhance the attraction of union membership to a mobile
workforce,” the writers also suggest.
If the need for greater transnational collaboration by unions
is one message from this book, another recurring theme is the need for unions
to reach out to make partnerships with other organizations, especially NGOs. As
Mary Margaret Fonow and Suzanne Franzway point out, “There has been a
proliferation of political spaces where the interests of labour overlap with
other movements and with advocacy organizations concerned with labour rights
and development.” Their own perspective is a feminist one, which sees a strong
need for unions to tackle globalization by developing structures and ways of
working which empower women workers and union members: “Those concerned with
the renewal of the labour movement must come to terms with the fundamental way
that gender structures neo-liberal globalization, labour markets and free trade
agreements. We argue for gender analysis because sexual politics is integral to
trade unions, globalization and efforts to challenge the neo-liberal agenda,”
they maintain.
The value of alliance building by unions with other
organizations is one clear proposal from this book. Another message stressed by
almost all the authors is the relevance of the ILO and of labour standards in
achieving a form of globalization based on fairness and equity. As Verena
Schmidt suggests, the ILO’s role in this respect can be traced right back to
its founding principles in 1919, and certainly to its call in 1944 to avoid
labour being treated as a commodity. International labour standards will be an
important campaign tool, she suggests, to improve working conditions in a
globalizing world economy.
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