Employee Relation

1. Employee Relation

2.  Employee relations is a study of the rules, regulations &
agreements by which employees are managed both as
individuals and as a collective group, the priority given to
the individual as opposed to the collective relationship
varying between companies depending on the values of
the management.
 It is concerned with how to gain people’s commitment to
the achievement of the organization’s business goals &
objectives in a number of different situations.
 Employee relations management is about ensuring that
organizational change is accepted and then
implemented.

3.  Attitudes to work and relationships at work have certainly
changed since the late 1970s.
 The reason for this have been increased competition,
reductions in international trade barriers, public sector
financial constraints, pressures for higher value-for-
money, rapidly changing & easily transferable technologies
and customer demands for products and service
increasingly customized to their needs.

4. Advantages of employee relation:
 raising the skills of their employees
 providing high quality services and products
 giving excellent customer service
These in turn generate high profits, high earnings & a
relatively more secure future for employees.

5. Employees Relations: Meaning
 ‘Employee Relations’ refers to the interrelationships,
both formal and informal, between the regulation of the
relationship principally by means of collective
bargaining. managers and those whom they mange.
 Thus, employee relations have a wider scope than
‘industrial relations’. The employee relations are
concerned with all aspects of the interrelationship
between management and employees and ‘industrial
relations’ is confined to

6. The ‘employee’s relations’ is usually confined to:
1. The contractual obligations between employer and
employee
2. Communications policy & practice
3. Joint decision-making
4. Joint problem-solving
5. Collective bargaining
6. Individual grievance, disciplinary policy & practice

7. The components of employee relations:
1. Players
2. Mechanism
3. External environment
4. Bargaining power

8. Employee relations systems in an organization have a
number of components. First there are the ‘players’ in
employee relations activities. These players are:
1. individual employers
2. individual employees
3. employee representative bodies (staff associations,
trade unions, work councils etc)
4. employers’ associations
5. public bodies

9.  These players operate in a labor market in which they
attempt to protect and advance their respective
economic interests relative to each other.
 Employees in the labor market have interest that is
different from the employers, both have a common
interest in the survival of the employing enterprise.
 They have a mutual interest in resolving the problem
because not to do so will result in mutual destruction.

10.  The employee relations ‘players’ also have expectations
of how each will behave towards the other. This is
referred to as the ‘psychological contract’, a set of
unwritten reciprocal expectations between an individual
employee and the organization.
 These are job satisfaction, career progression and
reward, relationships with managers, wellbeing
(employment security, skill development etc) and
technology upgrading.

11. Second, there are mechanisms available to the buyers
and sellers of labor services by which will govern the
employment relationship and at the same time
accommodate their different economic interest. These
mechanisms include:
 consultation
 employee involvement and participation
 communication process
 collective bargaining
 legal regulation

12.  The third component is the external environment.
The selling & buying of labor services also takes place in
the context of an external environment. The Omani
government sets minimum standards of behavior for the
buyer and sellers of labor services.
 Employee relations system is also influenced by the
balance of bargaining power at the sector and
enterprise level. If a group of workers who have the
power to stop an organization’s activities are willing to
exercise that power and have exercised it successfully in
the past, they will have a relatively greater bargaining
power. This is the fourth component of employee
relation.

13. How employee relation is viewed by:
1. Managers
2. Trade unions
3. Individual employees
4. Third parties

14. Managers tend to see employee relations in terms of the
following activities:
1. Creating & maintaining employee motivation
2. Obtaining commitment from the workforce
3. Establishing mutually beneficial channels of
communication all over the organization
4. Achieving high levels of efficiency
5. Negotiating terms & conditions of employment
with employee representatives
6. Sharing decision-making with employees
7. Engaging in a power struggle with trade unions.

15. Trade Unionists tend to see employee’s relations as:
1. Collective bargaining about terms & conditions of
employment
2. Representing individuals & groups of individuals in
conflict with their management
3. Improving the ability of employees to influence events
in the workplace
4. Regulating relations with other trade unions

16. Individual employees tend to see employee relations in
terms of the opportunity to
1. Improve their conditions of employment
2. Voice any grievances
3. Exchange views & ideas with management
4. Share in decision-making

17. Third parties such as Government ministers, arbitrators,
judges & civil servants may see employee relations more in
terms of:
1. Creating & maintaining harmonious relationships at
work
2. Creating a framework of rules of fair conduct in
employer-employee relations
3. Representing the community as a whole in dealing with
the repercussions (results) of internal conflicts of
decisions made within individual organizations
4. Establishing peace-making arrangements to deal with
breakdowns in employer-employee relations
5. Achieving a prosperous society with justice.

18. Reconciliation by means of Processes leading to
Agreements that reflects the balance of bargaining power
between buyers & sellers of labor as influenced by the
economic and legal policies of governments, and the
implementation of technological change.
Refer diagram.

19. Third-party intervention:
 In situations where the employer and employees are
unable to resolve their collective differences, they
may agree voluntarily to seek the assistance of an
independent third party.
It can take three forms:
 Conciliation
 Mediation
 Arbitration

20. Conciliation:
 In conciliation, the role of the third party is to keep two sides
talking and assist them to reach their own agreement.
 Conciliation is a dispute resolution mechanism whereby the
parties to a dispute (including future interest disputes) agree
to utilize the services of a conciliator, who then meets with
the parties separately in an attempt to resolve their
differences.
 He does this by lowering tensions, improving
communications, interpreting issues, providing technical
assistance, exploring potential solutions and bringing about a
negotiated settlement.
 The conciliator acts as a link between the disputing parties.
 The conciliator does not impose any action or decision on the
parties.

21. Mediation:
 Mediation is a way of dealing with dealing with conflict or disputes
that aims to enable the parties involved to reach an agreement that
satisfies everyone.
 A mediator listens to the arguments of the two sides and makes
recommendations on how their differences might be resolved. The
parties are free to accept or reject these recommendations.
 The process is totally voluntary and no one can be forced to take
part.
 Mediators are impartial and won’t take sides, make judgments or
lay blame.
 The mediation process is totally confidential and no information
given by either party will be shared unless permission is given.
 Any agreement reached can be informal and voluntary or the
parties can choose to make it formal by having a legal document
drawn up based on agreements reached in the mediation.

22. Arbitration:
 Arbitration removes from employers & employees control over the
settlement of their differences.
 The arbitrator hears both sides case and decides the solution to the
parties’ differences by making an award.
 Both parties having voluntarily agreed to arbitration are morally obliged,
but not legally bound, to accept the arbitrator’s award.
In Oman, Article 96 of Labor Law states that unsolved disputes could refer
to arbitration. The arbitration will be composed of:
1. A representative of H.M. who has no connection with the two parties
2. A representative of the employer member
3. A representative to the board appointed by the minister
4. A secretary to the board appointed by the minister.
 The board has the right to call a witness, appoint experts, and inspect
places & documents and so on. The decision reached will be binding on
both the parties.

23. Industrial sanction:
 The use of industrial sanction is generally a last
resort because it is costly to both sides to impose
them on each other.
The main sanctions available to the employer are:
1. closing down the factory
2. relocating operations to another side
3. dismissing employees who participate in industrial
action

24.  The main industrial sanctions that employees can
impose on employers are:
1. a ban on overtime
2. working to rule
3. imposing a selective strike
4. calling an all-out strike

25. Employee Involvement and Participation
Employee involvement
 Employee involvement covers a wide range of practices.
These are initiated by the management and are designed
to increase employee information about, &
commitment to, the organization.
 Employee involvement concentrates on individual
employees & is designed to produce a committed
workforce more likely to contribute to the efficient
operation of the organization.
 By introducing employee involvement mechanisms,
management seeks to gain the consent of the employees
to its proposed actions on the basis of commitment
rather control.

26. Employee participation
 Employee participation concerns the extent to which
employees are involved with management in the
decision making machinery of the organization.
 This includes joint consultation, collective bargaining
and worker representation on the board.
 It is management who makes the final decision as to
whether employees are to be involved and to participate
in management decision making.
 The decision whether to accept or reject the views of the
employees rests with the management.

27. The aim of employee involvement & participation:
 Increasing international competition and technological change in the last 25 years have meant that higher skills and far
greater flexibility are required of the employee. In this changed environment, a commitment strategy towards the
workforce is required. A commitment strategy involves dispensing with whole layers of management and minimizing status
differentials so that control depends on shared goals and expertise rather on a formal position that carries influence with it.
 Under an employee commitment strategy, performance expectations are high, to emphasize continuous improvement and to
reflect the requirement of the market place. No organization in today’s modern world can perform at peak levels unless each
employee is committed to the corporate objectives and works as an effective team member.
 There is clear evidence that employees want to be part of a successful organization which provides a good income and an
opportunity for development and secure employment.
The involvement of and participation by employees in any organization should aim to:
● generate the commitment of everybody to the success of the organization
● enable the organization better to meet the needs of its customers and adapt to changing market requirements
● help the organization to improve performance & productivity and adopts new methods of working to match new technology
● improve the satisfaction employees get from their work
● provide all employees with the opportunity to influence and be involved in decisions which are likely to affects their interests.

28. Management must also demonstrate a commitment to
its employees in terms of:
● Job security
● Pay and other employment conditions (single status)
● Access to training and retraining
● The provision of a safe working environment
● A balance between the work and the employees’
wellbeing

29. An Industrial Relations Services Survey (1999) of 49 organizations’
experiences with employee involvement practices over the period 1992
– 1999 reported that:
● around three quarters believed it had enhanced employee
commitment & motivation
● approximately six in ten said the quality of products manufactured
had improved
● Over half claimed there had been advances in labor productivity
● just under a half believed that their employees’ job satisfaction had
increased
● the same proportion claimed that their organizational profits or
performance had increased.
● one third said that involving employees had reduced absence rates.
● 30% believed switching to more participative working
arrangements had improved their capacity to attract and retain
employees.

30. Employer Association:
An Employers association is defined as any organization whose
membership is composed of employers & whose purpose includes the
regulation of relations between employers & their employees or trade
unions.
Major functions of employer association:
1.The direct negotiation of collective agreements with trade unions.
2.Assisting its members in the resolution of disputes: it assist their
members to resolve disputes by negotiating & operating on their
behalf a dispute procedure with recognized unions.
3.Providing general help & advice to its members on industrial
relations matters.
4.Representing its members’ views & interests to government & other
agencies: they present evidence to governmental inquiries &
provide the employers representatives on a range of bodies such as
industrial tribunals & ACAS.

31. Methods of gaining employee cooperation:
Employee cooperation, involvement & commitment is essential for the improvement of business performance.
1. Representation /Participation
2. Consultations:
3. Team working
Teams working together have the following benefits:
 Increase job satisfaction
 Increase motivation & loyalty to the organizations &
 Ultimately improves business performance
4. Employees share ownership.
This method has the following advantages-
Motivate staff & encourage them to work harder because they will receive a part of the profit
Reduce possible conflict between the workforce & top management.
5. Quality circle
Quality circles have the following advantages:
 It increases workers motivation
 It raises quality awareness which affects the value of end product
 Job security: here, to make employees work harder & to increase their loyalty to the organization, employers
should offer jobs which are to some extent guaranteed for the foreseeable future. The main advantages of this
approach for gaining employee cooperation are that no job is guaranteed due to economic trends & fluctuations.

33. A grievance is a complaint by an employee that something
in the management’s behavior has breached his or her
employment rights and that he or she is unhappy about it.
It may be real or it may be the result of a misconception or a
misunderstanding. In either case, settling it quickly and
effectively is important.
A grievance may be felt by a group as well as an individual
and in case if left unresolved, it may develop into a major
collective dispute involving a trade union. All employee
grievances have the potential to damage the quality of an
organization’s employee relations, quality of life of its
employees and thereby its competitive position.

34. The purpose of grievance procedure
1. ensure that fair and consistent treatment of employees
2. reduce the risk of unpredictable action
3. clarify how grievances will be dealt with
4. maintain a good employee relations environment
5. help the employer to avoid disputes

35. In managing employee complaints, management is guided
by a number of principles, such as:
1. Fairness,
2. Consistency,
3. Representation and
4. Promptness.

36. Trade Union
A trade union may be defined as any organization, whose
membership consists of employees, which seeks to organize
and represent their interests both in the workplace and
society and, in particular, seeks to regulate the employment
relationship through the direct process of collective
bargaining with management.

37. Functions of a trade union
1. Power
2. Economic regulation
3. Job regulation
4. Member services
5. Self-fulfillment

38. Trade Union – Oman
The Omani labour law issued by Royal Decree No. 35/2003
is regarded as the first step paving the way for the
formation of trade unions in the Sultanate of Oman. This
law granted the workers in the private sector
establishments the freedom to form among
themselves representative committees aiming at
enhancing and protecting their rights and interests in the
workplace.

39.  In 2006, the Omani Labour Law was modified by Royal
Decree No. 74/2006 issued on 8 August 2006. The
amendments allowed the formation of trade unions aiming
at protecting the interests of workers, defending their
rights, promoting their social and material status and
representing them in all matters related to their
wellbeing in the workplaces.
 These modifications also stipulated the establishment of the
‘Genera Federation of Oman Trade Unions’ to be the
formal body that will represents the workers of the Sultanate
in front of the official authorities and in the local, regional
and international events and meetings.

40. Objectives
 Representing the workers of Oman in all relevant matters in front of the official
authorities.
 Representing the workers of Oman in the local, regional and international
conferences or forums
 Enhancing the skills and abilities of the workers, developing their professional
levels and improving the work conditions to ensure a decent work environment
and achieve stability in the work places.
 Promoting the values and concepts of work and its fundamental role in achieving
the social and economic development in the Sultanate.
 Supporting the efforts to Omanize jobs and occupations in the Sultanate.
 Improving the social and cultural standards of the workers and raising the level of
awareness on the importance of occupational health and safety.
 Fixing the maximum amount of annual membership fees for the trade unions and
federations affiliated to the General Federation of Oman Trade Unions.

41. The role of Federation of Oman Trade Unions
 It provides assistance and support to complete the requisite procedure for
forming trade unions across the Sultanate. Till January 2011, there were 85
trade unions across the Sultanate with the highest in commerce and
industry at 19 and 16 in oil and gas.
 Contributes in the resolution of a number of issues arising between trade
unions and employers.
 Receiving complaints of workers from different private organizations and
adopting necessary legal procedures in coordination with the competent
authorities.
 Assisting trade unions in signing collective work agreements between the
representatives of employers and workers.
 Reviewing some articles of the labor law and discussing them with the
concerned authorities and submitting relevant recommendations.