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LABOUR MANAGEMENT RELATIONS AND ITS EFFECTS ON PRODUCTIVITY

ABSTRACT

Labour management relations are important in terms of organisational productivity and an on-going debate from the last few decades. In general opinion, the success of any organisation is not only measured by the amount of profit the company could make but also by the degree of industrial peace and harmony that could be maintained in the said organization. The overall aim of this dissertation is to identify the impact of labour management relationship on the organisational productivity. For this purpose, a detailed investigation was carried out to evaluate how various management styles affect the behaviour and output of employees at work. It was also critically evaluated that how labour management relations have an impact on organisational productivity by distributing 150 questionnaires to the organisations in the Delta State in Nigeria. The results of the primary investigation reveal that survey respondents are aware of the importance of industrial and labour relations in terms of boosting organisational performance but importance is not given to labour productivity within the organisations in Delta State. A gap between the thinking of management and labour about the objectives of labour management relations was also found during primary research. It was also identified that most of the organisations in Delta state are not using any leadership pattern and other organisations are using traditional democratic style leadership.

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Recent years have witnessed a growing call for a more cooperative relationship between labour and management as a means of increasing productivity. Despite the growing attention being paid by scholars to labour management cooperation, only a handful of studies have examined the impact of labour management relationship on organizational productivity. Several studies have seen that effective labour management relationship is essential to promoting organizational change and increasing productivity (Black and Lynch, 2001).

Basically, the management at any level is focuses on a productive organization which applaud good morale and increased productivity that could boost profit growth (Ajala 2007). The study of labour management relations (LMR) refers to the rules and policies which govern and organize employment, how these are established and implemented, and how they affect the needs and interest of employees and employers. LMR has implications for the organization of work as well as economic policy (Von Otter 2007). The focus gradually has broadened from the formation and operation of national and local institutions and collective bargaining to strategic human resource policies. Most recently a multi-level agenda has formed, following new needs for regulations in world trade, in the extended European union, and in former communist and newly industrialized countries (Von Otter 2007).

Often times, labour relations differ between countries. Having a clear view on labour relations systems as well as the collective bargaining situation each country faces will give a clearer picture of the nature of the economy, its production methods as well as the countries background and development (Caulfield 2004). Understanding the economic expansion and changes that affect each country helps better understand labour relations system so the study of both labour relations and collective bargaining should not be neglected (Kuruvilla 1994; Napathorn and Chanprateep 2011). Collective bargaining on the other hand is the process by which organised groups of employees and employers search for ways to coordinate their conflicting goals through common circumstances (Vettori 2005). Its main function is being able to meet a common interest that organizes terms and conditions of employment (Bamber and Sheldom 2002).

The quality of the labour- management may have more to do with organizational performance than unionization. However, there is considerable debate among academics, union officials and management executives concerning the benefits drawbacks of labour- managements Cooperation (Thornicroft 1993). Black and Lynch (2001) came to the conclusion that unionized organisations that support joint decision making together with incentive based bonuses have greater output than non-union plants. On the other hand, organizations that are unionized but carry on traditional labour management relations have lesser productivity.

As noted by Barbash (1984) and Cooker and Meyer (1990), the labour- management relationship has traditionally been characterized by higher wages and benefits a well- developed grievance  procedure, strong adherence to seniority; and restrictive work rule and job classification procedures. Furthermore, labour management relations have been largely adversarial and power-oriented; with both parties viewing the relationship as distributive and accepting the position that management was responsible for increasing the wealth of the organization while labour’s responsibility was to bargain for a share of wealth (Stephen and Roderick 2005).

1.2   PROBLEM STATEMENT

In essence, the employees of labour must pay very serious attention to the due and cry of their employees and their various needs so as to be able to ascertain all the prerequisites to industrial peace and harmony, high organizational productivity and to the success attainment of the company’s goals and objectives. This is so because all the activities of the company are invited and determined by the persons that constitute the institution. It is recorded modern firms using plant equipment, automated equipment, computer, etc. tend to be non-productive except for the human effort and direction that any company needs to get whenever it is going to.

In addition, the impact of Labour-management can also increase organizational productivity. Labour-management co-operation is advocated as a means of promoting industrial democracy. Workers should have a “say” in the administration of the enterprise to which they belong Employees decisions and they are more likely to be totally committed to work harder to achieve ideas which they help create.

It is contended that a closer association between labour and management leads gradually to the appreciation of the problems of one by the other and the development of an accommodative frame of mind. Through better labour-management relations the strength, experience and enterprise of the workers can be effectively harnessed to accomplish the company objectives rather than being used in undoing what management does. It is necessary to note the labour-management relations. If we consider the definition of industrial relations by Yesufu (1981) as the whole web arising out of employment contract” the central issue of concern is how the labour- management interactions at work can maintain and attain maximum levels of productivity.

The maintenance of industrial peace therefore is an essential condition. Condition for the socio-economic growth and stability of any society. In essence, the management and the workers in any organization need to work towards varying objectives, and in the process of doing this, the need for occasional joint construction over several issues which may include improved production and welfare of the employees cannot be over-emphasized.

The organizational goal of increased profitability and productivity can only be realized in a peaceful industrial environment, hence the need to ensure good labour – management relations in any work organization. The central issue of concern is how the labour – management interactions at work can attain and maintain maximum levels of productivity. The productivity of the selected companies in Delta state Nigeria as a means of promoting the economic growth of Nigeria. Its workers Union as an organized labour movement exists to maintain and improve the working condition and terms of employment of workers. The employers are interested in maximising and more realistically, optimizing the returns from their investment while the employees are interested in how to maximize their returns in the form of wages and other benefits and maximize the inherit physical and other industrial hazards. Hence there arise the need to find out the sort of labour –management relationship that exists at the selected companies in Delta State and its effects on productivity of labour.

1.3 AIMS AND OBJECTIVES

The overall aim of this dissertation is to identify the impact of labour management relationship on the organisational productivity and the underlying objectives are as follows:

·  To evaluate how the various management styles affect the behaviour and output of employees at work

·  To evaluate how labour management relations have an impact on organisational productivity on the survey companies

·  To evaluate critically how labour management relations in the surveyed companies could also be improved so as to ensure their attainment of a high level of productivity.

1.4 SCOPE AND PURPOSE OF THE STUDY

The modern work place like the world at large continues to feel the impact of many changes and challenges. Labour – management are increasingly being asked to deliver quality product and services in abundance and at reasonable cost. Amidst it all, labour – management is increasingly being recognised as the basic building blocks of organizational performance (Chandrasekar, 2011). In every organizational setup, therefore whether economic, social, cultural or otherwise, two indispensable groups are easily discernible these group labour – management constitute the pivot upon which the activities of one existing organization revolves (Tangen 2005).

It is generally believed that the areas of the most common mutual interest where labour and management may co-operate consciously to the advantage of both promoting efficiency  and productivity, eliminating waste reducing lost and improving the quality of the product. On the other hand, if there are no good interests among labour – management there will be low rate of productivity. Every organization or company is set up to achieve or attain some defined objectives. These objectives which have to be accomplished through the instrumentation of the aforementioned groups also include high organizational productivity.

The promotion of industrial peace and harmony, which are the major variable for socio – economic growth and development, should be one of the objectives of labour- management relations. Therefore, the extent of the success in achieving these desired goods depends largely on the type of relationship that exists between labour and management and how will the two actors play their expected roles. For any company is to be associated with success there has to be certain degree of compatibility between labour and management. An employee will be highly dedicated and co – operation his interest should be promoted and protected.

It is a general opinion that the success of any company is not only measured by the amount of profit the company could make but also by the degree of industrial peace and harmony that could be maintained in the said organization.

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