An employment relationship refers to a contractual relationship between an employer and an employee providing details concerning an employee’s duties and the employer’s obligations to the employee in terms of compensation and the provision of a satisfactory working environment. The Employment relationship has undergone an evolutionary process in response to or in line with the evolution of HRM as a strategic activity within the organisation. This essay aims to critically discuss the argument that the employment relationship (ER) has transformed from a collective relationship to an individualised relationship whereby a positive association between a manager and the employee leads employees to be more committed to organisations and deliver superior performance. Several theories are applied in this discussion, including the matching model, the Harvard model, the pluralist theory, the Marxist theory of employee relationships and the contextual model of human resource management. The essay begins with an introduction. The introduction section precedes a critical discussion of the shift in employment relationships from collective to individual. The third section presents a conclusion of the essay, whereas the fourth section outlines the practical implications of the essay findings.
A critique of the shift in employment relationship from a collective to an individual relationship
A shift in employment relations is being motivated by the transformation in human resource management.
According to Chang and Andreoni (2020), there has been a shift in employment relationships from a collective relationship to individual relationship. This shift has occurred because of a shift in the human resources approach whereby organisations initially paid attention to personnel management. However, recently, management has focused on human resource management rather than personnel management. Personnel management was concerned with maintaining a collectivist approach to managing employees. Likewise, personnel management was concerned with creating and maintaining indirect communication between the management and employees and a sociological approach towards handling the relationship between management and the organisation.
On the contrary, human resource management shifted focus from collectivism to individualism with regard to the relationship between management and employees. Additionally, under human resource management, the management adopts direct communication with employees rather than indirect communication using representatives. Further, under human resource management, organisations mainly focus on the psychological relationship between the management and employees. In this regard, human resource management is perceived as a strategic unit within the organisation which is applied to bring forth improvement in the organisation’s performance. According to Stone et al. (2020), in 2017, IBM replaced its collective bargaining approach in the form of annual performance reviews with individualised feedback systems whereby the management engages individuals to understand their performance and determine their appropriate reward. As opposed to the personnel management approach, which focuses on collective bargaining, human resource management entails individual employees maintaining personal relationships with their management to achieve higher benefits from their employment relationship. The above views echo the viewpoints of Monks et al. (2012), who observed that there had been a significant transformation in employment relationships with the focus shifting from collective bargaining to individual relationships between management and employees, whereby the maintenance of good relationships between the management and employee bear superior performance.
A shift in employment relations with employment relations being a subset of HRM
Research by Ackers (2012) also shows that there has been a shift in human resource management whereby rather than being an equal partner to human resource management, employment relationships are currently being taken as a subset of human resource management. Therefore, management applies employment relationships to get maximum input from employees. Likewise, according to Chris et al. (2013), the shift to human resource management has led to a shift in employment relationship management. Management is concerned with getting maximum input from employees. Therefore, the main goal of maintaining employee relationships within the organisation is to ensure that the relationship between employees and management yields maximum benefit to the organisation in terms of higher productivity levels. In Marginson (2015) opinion, a positive relationship between an employer and the employees is an integral factor that improves employee commitment and performance. For instance, maintaining good employer-employee relationships in Virgin Atlantic has helped the company achieve high levels of employee commitment, reduced turnover and improved productivity and business performance. According to Mistry (2017), through the employee-come-first policy, Virgin Atlantic has maintained touch with human capital considering employees as core to their success. The positive relationship between employees and the employer is a crucial strategic goal that managers pursue to enhance employee commitment and performance. Therefore, the organisation pursues a strong, close and positive relationship between the management and employees to bring forth stronger performance. Indeed, pursuing a positive relationship between the manager and employees is important as it communicates to the employees that employers value their employees, thereby winning employee commitment and strong performance.
Employee relations as a key driver to employee commitment and performance
There has been a shift in employment relationships from a collective to an individual relationship between the employer and the employee, mainly because of an increasingly competitive business environment (Piore and Safford, 2006). Increased competition in the business landscape has seen organisations perceive an employee as a crucial strategic asset. Therefore, attracting and maintaining highly effective talented employees is crucial to the firm’s long-term success. In this regard, the management perceived the maintenance of an individual and personal relationship with employees as a crucial step towards the firm’s long-term success. Therefore, firms have consistently maintained high levels of an individualised approach to human resource management in the recent past to ensure that they achieve superior performance levels. According to Townsend et al. (2014), the Harvard model of HRM, the role of HRM is to over decisions that ensure an optimal relationship between an organisation and its employees. Therefore, based on the Harvard human resource management model, the relationship between organisations is perceived from a long-term perspective whereby employees are considered an important asset (Guest, 1987). Therefore, according to the Harvard human resource management model, management needs to maintain an individualised and personal relationship with employees. This strategy is effective in the sense that it brings forth improvement in the level of employee commitment and, subsequently, their performance. In the past, employment relations were mainly based on collective representation, whereby trade unions were responsible for representing employees’ issues to management. This was witnessed in the case of Southern Rail when the organisation tried to introduce a new operational mechanism in which the driver was to be in charge of the opening and closing of the door, with conductors only being charged with handling passengers. The trade unions, namely RMT and ASLEF, considered this move as a strategy aimed at reducing the effectiveness of their role because conductors’ strikes would not be felt in the future, thus leading to massive strikes. This case illustrates the importance of collective bargaining as opposed to an individualised approach to managing employment relationships.
Employment relations shift from collectivist to individualist due to the effectiveness of employee voice.
There has been an increase in the shift from collective representation to the individualised relationship between management and employees. An increase has influenced this shift from collective bargaining to individual bargains in the desire by employees to have a direct conversation with the management about matters affecting their welfare. The decreasing popularity and influence of trade unions have further evidenced this shift. Indeed, trade unions’ role and influence have decreased over time in the UK and other countries worldwide (Brunetto et al., 2011). An increasing number of employees are considering the need to maintain a personal relationship and communication with management to ensure that their welfare is well cared for. Likewise, the management perceives a shift to an individualised relationship with employees as effective in yielding higher commitment and performance. For instance, in 2017, General Electric replaced its collective performance rating of employees with an individualised assessment of employees and management of individual relationships with employees (Engagedly, 2022). This move evidences a shift from a collectivist approach to employment relationships to a more personalised and individual approach associated with higher commitment and superior performance. Employees consistently believe that when they deal with the management directly, they are not only listened to but also their issues are addressed accordingly and in a timely manner; the shift from collective representation to individual bargaining between employers and employees has improved the employer-employee relationship and subsequently improved employee commitment and performance.
According to Kai and Brown (2013), there has been an increase in the shift from representation to employee voice. Under-representation, employees rely on collective bargaining and trade unions to ensure that employers address their issues. On the contrary, employees are more critical in managing their relationships with employers under the employee voice. In this case, employees seek to ensure that their issues are heard and that the management adheres to their demands. This move has occurred because of the declining popularity of trade unions. As a result, employers have increasingly sought to have influence rather than priding themselves on union membership. This has been the case because employees believe that the mere fact of being a member of a particular trade union fails to guarantee effectiveness in ensuring that employees’ matters are addressed.
For this reason, employees have sought to use a more effective approach to addressing their issues. This approach entails engaging directly with the management through employee voice and employee engagement. This move has further shown that, indeed, the maintenance of a positive relationship between the management and employees contributes towards improvement in the overall level of employee commitment and, subsequently, their performance in an organisational setting.
However, other researchers like Kai (2014) hold a contrary opinion asserting that the collectivist approach to employment relations remains relevant and needs to be replaced with an individualistic approach. Accordingly, collective bargaining as an approach towards maintaining good employer-employee relationships and securing the welfare of employees remains effective in the contemporary workplace. The collectivist approach to employment relationships can better be emphasised using the pluralist employee relationship model. Organisations have different interest groups according to the pluralist approach to employee relationships. On the one hand, employers are interested in getting maximum output from employees.
On the other hand, employees are interested in getting maximum compensation and a good working environment from employers, which is an expense to employers. Even though some interests may coincide, most interests between employers conflict, as such conflict in the workplace is inevitable. Based on the Marxist model of employment relationships, employees’ interests and employers’ interests are on opposing sides, and as such, there is a need for collaboration among team members to promote improved commitment. For this reason, employees pursue collectivist measures to improve representation (Gong et al. , 2010). Despite the waning influence of trade unions, employees of Coca-Cola persisted with trade unions as main representatives of their issues, as in the case of Coca-Cola employees in the Philippines, whose trade unions prevented Coca-Cola from using the pretext of Covid Union to lay off workers and dismiss trade union leaders (Business & Human Rights Resource Centre, 2020). Therefore, employees need an organisation representing their interests to the employers to ensure they get their part of the bargain. According to Gong et al. (2010), it is only through collectivist approaches to employment relationships, such as trade unions, that employees can have their interest care of. In the same manner, the author argues that maintaining a positive relationship between employers and employees cannot be achieved solely through the individual relationship between the two parties but rather through some form of representation, such as trade unions. Therefore, employees must form and sustain trade unions to take care of their interests before the management.
Conclusion and implication for practice
In conclusion, there has been a huge debate as to whether there has been a transition from a collectivist to an individualistic ER with respect to employment relationships. Most past studies indicate that there has been a shift from collective to individual relationships. Evidence for this trend is the decline in the membership of trade unions in the recent past. Employees are increasingly losing interest in trade unions, with most pursuing employee voice rather than being represented. This move has occurred due to employees’ desire to use more influential means rather than trade unions, which are not influential in bringing forth desirable outcomes in the workplace. Additionally, research shows that the maintenance of a positive relationship between employers and employees serves to enhance improvement in commitment and performance. Nevertheless, some studies show that trade unions and collective approaches towards maintaining employee relationships remain relevant in today’s workplace. In conclusion, employee relationships are shifting with a significant transition from collective to individual relationships between employees and their employers. This shift has occurred because of employees’ desire to maintain an influential and persuasive relationship with employers, thereby improving their welfare in the workplace.
Employment relationships have shifted in the recent past from a collective relationship to an individual relationship between an employee and the manager. Maintaining a positive relationship between an employee and the manager has increasingly become a key driver in improving employee commitment and performance(Gong et al., 2010). This shift has specific managerial implications, particularly with regard to enhancing the performance of the employee’s performance. Specifically, management must invest in employee engagement to create good relationships with employees and enhance their performance (Kai, 2014). In the same manner, management needs to develop effective human resource management strategies to ensure that employees’ welfare is well catered to, which would bring forth improvement in their commitment and performance.
The second managerial implication of a shift from collective to individual approaches to employment relationships is the need for management to invest in employee voice policies. Specifically, the management needs to develop human resource management policies and practices that encourage employees to easily voice their opinions and views on matters affecting the firm and their welfare (Chang and Andreoni, 2020). Improvement in employee voice is important as it will ensure that the company can achieve higher levels of employee commitment. Additionally, improvement in employee voice will encourage employees to feel listened to within the organisation, which further leads to improvement in employee commitment to the organisation and overall performance (Brunetto et al., 2011). In this regard, the management needs to invest in such human resource management measures as suggestion boxes for employees, employee meetings in which employee welfare is discussed and feedback from employees concerning the organisation and how it takes care of their needs.
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