dominates the other. In other words, competing forces constrain and check absolute power. While no party is able to achieve all its aspirations completely, both are at least able to succeed partly in their goals. Second, the state is regarded as an impartial guardian of the 'public interest', and its role is largely to protect the weak and restrain the power of the strong. Clegg (1975) has been specific in elaborating his conception of pluralism. He sees industrial relations as a process of concession and compromise in which a body of rules restrains the abuse of power and enables all parties to accomplish some gains. He contends that the pluralist approach explains why, in the face of intractable industrial conflict, modern societies have remained relatively stable. The pluralist approach has its critics. One of the major concerns has centred on its assumptions of an approximate balance of power between the parties as well as agreement on the rules of the game (Child 1981). Hyman and Fryer (1975) argue that, rather than there being some symmetry in the distribution of power between management and unions, power is heavily weighted towards management. They feel that the starting point for any realistic analysis of industrial relations must be the substantial power imbalance between capital and labour. This derives from the fact that the productive system is, in the main, the private property of a very small minority of the population. As Fox (1974) observes:From this view, any talk of 'checks and balances', however apt for describing subsidiary phenomena, simply confuses our understanding of the primary dynamics which shape and move societya useful confusion indeed for the major powerholders since it obscures the domination of society by its ruling strata through institutions and assumptions which operate to exclude anything approaching a genuine power balance (p. 274).

A second, and related, criticism of the pluralist framework is its emphasis on the promotion of rational, efficient and effective conflict management. It has been suggested (Fox 1974, p. 282) that this may be little more than a sophisticated form of managerialism aimed at finding ways of containing conflict within a regulatory framework that promotes and maintains order. Pluralism tends to focus attention on the types of rules, regulations and processes that are likely to contribute to the best interests of the organisation and that will ensure that pressures to distort such interests are countered effectively so as to restore and maintain the equilibrium of the system. Its emphasis is on social stability, on compromise and on granting concessions. In short, it is about making rules. Hyman (1975), a strong critic of this approach, has found this unsatisfactory:To define industrial relations in terms of rules is to emphasise the relatively defined, stable and regular aspects of employer-worker and management-union relationships; by the same token it is to play down the significance of

conflicts of control in the labour market and over the labour process as manifestations of a fundamental'and continuous antagonism of interest (p. 34).

Radical perspectivesThere is one element of the pluralist perspective that is shared by those who adopt a radical approach to industrial relations. This is, the recognition of fundamental and inherent conflicts of interest between workers and employers at the workplace. But, while the pluralists assert that the conflict of interest is not total and that the parties share at least some common goals, radical writers see worker-management relations as only one aspect of class relations, in which the antagonism of interests between capital and labour at the workplace derives from the nature of class conflict in the capitalist society as a whole. The workplace is the arena in which class conflict finds its expression: between the property-owning class and the working class 'there exists a radical conflict of interest, which underlies everything that occurs in industrial relations' (Hyman 1975, p. 23). Conflict, then, is not just an industrial phenomenon. It is a reflection of class conflict, which permeates the whole of society. The conflict that takes place at the enterprise level between those who buy labour and those who sell it is seen as a permanent feature of capitalism and an indication of the concentration of economic, social and political power in the hands of those who own and control productive resources. Unlike the pluralists, radicals see 'industrial relations as an element in the totality of social relations of production' (Hyman 1975, p. ix). To say, as the pluralists do, that industrial conflict is inherent in the structure of employment relations is to stop short of a full explanation. Radicals argue that this evades the question of the extent to which an antagonism of interest is generated at the societal level and is embedded in the mode of production within which the employment relationship occurs. Radicals therefore do not view industrial relations as a self-contained or autonomous area of analysis. Indeed, Hyman (1989) considers that the term 'industrial relations' is both 'vacuous' and 'incoherent'. He claims that:. . . the processes of 'job regulation' can be adequately comprehended only as part of an analysis, on the one hand of the dynamics of production and accumulation, on the other of the broader pattern of social and political relations (p. 124).

Radicals are also critical of the pluralist focus on conflict regulation and rule making. They feel that, by concentrating on how conflict is contained and controlled, the pluralists divert attention from the more fundamental issue of why disputes are generated. In this context, Hyman (1975, p. 22) believes that 'the question whether the existing structure of ownership and control in industry is an inevitable source of conflict is dismissed as external to the study of industrial relations'. Radicals believe that undue

emphasis is placed on how employers, trade unions and other institutions cope with such conflict, and on identifying processes that can be implemented to maintain industrial stability. Radical writers have paid much greater attention to the notion of power than the pluralists have. This is not surprising, given the pluralists' emphasis on conflict resolution and procedural reform (Martin 1981). Radicals see the imbalance of power both within society and at the workplace as central to the nature of industrial relations. At the workplace, those who own the means of production have a power superiority over those who sell their labour for wages. This reflects itself in a substantial inequality in the distribution of rewards. The weakness of labour in the marketplace is said to be reinforced by the creation of social norms, values and beliefs that tend to sustain the existing distribution of power in industry and inhibit the development of working-class political conscious ness (Martin 1981). Marxists do not share the pluralist view of the role of the state as a guardian of the 'public interest', dispensing favours to the weak and curbing the excesses of the strong. For them, the state plays an integral role in protecting the interests of the power holders and maintaining the major structural features of society that are crucial for the power, status and rewards of the owners and controllers of resources. The state's interest lies in developing institutionalised mechanisms for controlling conflict and for achieving social stability. Government intervention to protect the 'national interest' is said to be closely bound up with sustaining the health and strength of private enterprise. Where economic stability is viewed as an important precondition for a society's material well-being, it is claimed that governments of all political persuasions will have an interest in maintaining the 'confidence of industry' and encouraging the accumulation of profit and the generation of investment. The radical approach to industrial relations has been criticised on a number of grounds. Some writers have argued that the Marxist perspective is overly preoccupied with the conflictual aspects of manager-worker relations. As a consequence the role of trust in work relations, and the dynamics of accommodation and co-operation between employers and employees have been seriously neglected (Edwards 1986). Others contend that, while the Marxist focus on the polarised class struggle may have been a valid interpretation of nineteenth-century capitalism, it does not explain the complex economic, political and social conflicts of welfare-state or monopoly capitalism in the late twentieth century (Farnham and Pimlott 1979, p. 66). It has also been observed that capital is comprised of a number of heterogeneous and often competing elements, which belies its monolithic character. Dabscheck (1983, p. 499) has argued, for example, that a concession gained from the state by one fraction of capital may

impose additional costs and burdens on, or be at the expense of, other fractions and capital. Such may be the case with tariff protection, which provides aid to some firms and businesses while at the same time increasing the costs of inputs to other owners and controllers of capital. Yet others have criticised Marxists for their views on the role of the state. Martin (1981, pp. 115-16) has argued that the Marxist analysis underesti mates the independence of the state. He believes that the legislative action of labour governments is, in many cases, designed more to cement political alliances with the industrial wing of the labour movement than to serve the interests of capital.

The labour processAn important body of contemporary industrial relations literature concern ing the labour process is derived from Marxist analysis. Marx saw the labour process as the means by which raw materials were transformed into products through human labour and the use of machinery and other forms of technology. He has argued that one of the central tasks of management in the capitalist mode of production is to convert a worker's capacity to perform work (labour power) into actual work effort (labour) in order to contribute to profitable production and achieve capital accumulation. Because the labour contract is an open-ended arrangement, the translation of this labour power into labour could only be resolved through the establishment of structures of managerial control. This problem has been summed up by Edwards (1979):Workers must provide labour power in order to receive their wages, that is, they must show up for work; but they need not necessarily provide labour, much less the amount of labour that the capitalist desires to extract from the labour power they have sold. There is a discrepancy between what the capitalist can buy in the market and what he needs for production . . . (p. 12).

With the publication of Braverman's Labor and Monopoly Capital in 1974, interest was revived in Marx's analysis of the labour process. Braverman built on Marx's original work by placing it in the context of twentieth-century development. He focused in particular on the emergence of new methods of management control occasioned by the rise of monopoly capitalism. He saw the emergence of scientific management and the de-skilling of work arising from the use of new technology as important means of exercising control over the labour process. He claimed that there had been a general and progressive de-skilling of work in the twentieth century and a long-term trend for jobs to become routinised and increasingly devoid of intrinsic content. Under capitalism, technological change was seen to contain an inherent tendency to degrade craft skills and increase management's control of production. Braverman argued that the logic of capitalist production was to de-skill the labour process. Because

employees could not be relied on to work in the interest of capital, it was therefore necessary to avoid reliance on their skills. The fundamental problem of control could only be resolved through the 'degradation' of work and the removal of knowledge, responsibility and discretion from workers in the actual process of production, and their transfer to managerial and supervisory employees. According to Braverman, de- skilling allowed increased capitalist control over production because opposed centres of knowledge were destroyed and the labour process was fragmented. It also enabled a considerable cheapening of labour and an increased rate of exploitation. The deterministic nature of Braverman's schema has been criticised. Researchers have not been able to find a clear link between different phases of capitalism and phases in the work process. Many have questioned the validity of his insistence on a tendency towards de-skilling, his emphasis on consciously intended managerial strategies, and the inadequacy of his analysis of the role of the labour movement. It is not the intention here to canvass all of the issues raised in the debate on Braverman and the labour process. These have been covered thoroughly elsewhere (Littler and Salaman 1982; Wood 1982; Thompson 1983). It is important, however, to point out that labour process theory has provided a valuable integrating concept for research. Indeed, one commentator noted in the 1980s that some of the better Australian industrial relations literature has been informed by the labour process perspective (Littler 1987). Perhaps the greatest contribution of labour process theory has been to refocus scholarly attention onto the workplace. Efforts to construct more adequate models of managerial strategies in industrial relations and to understand better the process of technological change and its effects on work owe much to the pioneering work of Braverman and to the research debates that have been sparked on the labour process. One of the benefits of this, according to Gospel (1983), has been to widen:the boundaries of industrial relations to cover technology and work organisation which [are now viewed] not as a given constraint or exogenous variable but as a key element in managerial strategies and in managementlabour relations (p. 167).

At a time when industrial relations teaching and research has increasingly been focused on management strategies, the labour process perspective provides a useful and relevant conceptual framework.

Divergence and accommodationIt can be seen that there are a number of different approaches or perspectives for viewing industrial relations institutions, structures and processes. Each one has its own analytical framework, its own assumptions about society and its own way of interpreting industrial events. Distinctions

between these different approaches have become increasingly blurred, however. While the unitary perspective is generally considered to be an unsatisfactory approach to the study of industrial relations, Edwards (1995b) has argued that it highlights an important feature of the employment relationship. In particular, it draws attention to the fact that employeremployee relations are not permanently conflictual. Employees and managers may share common interests on specific issues, such as the survival of the business, and employers may seek to harness employees' loyalty and cooperation, rather than merely their compliance, through a variety of mechanisms (e.g. employee involvement, profit-sharing schemes). According to Blyton and Turnbull (1994), The fact that many people seek intrinsic reward from their work indicates that there is likely to be at least a latent degree of co-operation with management.' This is not to suggest, as many unitarists do, that conflict at work is a pathological deviation from a norm of social harmony and order. Rather, social relationships at the workplace are punctuated by both conflict and co-operation. An appreciation of this dual dynamic is thus essential to an adequate understanding of industrial relations. The pluralist and radical perspectives also feature some similarities. About two decades ago Clegg (1979) observed that there was much in common between the pluralist and radical accounts, particularly in the emphasis on conflict in industrial relations. More recently it has been noted that the two approaches share similar assumptions about the employment relationship (Edwards 1986). Both perspectives take the view that the labour contract is an open-ended arrangement and that the work-effort bargain is subject to processes of negotiation and contestation. While the pluralist and radical approaches are not identical, it is apparent that there has been a process of convergence between these perspectives over the past two decades.

Theoretical developmentsHomo economicus revisited?In their attempt to understand the character of the employment relationship and the social relations of work, industrial relations writers have traditionally paid little attention to economic analysis. This is largely because industrial relations and economics have developed as separate, self-contained areas of study. At an early stage in the development of economic thought, the political and economic branches of the subject diverged. The field of economics became associated with an approach commonly referred to as the 'neoclassical model'. Typically, the neoclassical model considers the labour market to be populated by rational, utility- or profit-maximising 'individual' economic

actorsnot social groups or classesand holds that wages are determined by the 'marginal productivity' of the worker, not a conflictual power struggle between capital and labour. The labour contract is viewed as a relationship of 'economic exchange' in which the services of labour are purchased and sold in a market just like other commodities, such as wheat or cars. The problem of transforming an employee's 'capacity to work' into the appropriate quantity and quality of work output is therefore conveniently sidestepped. The neoclassical model of the labour market has attracted intense criticism. Nolan (1983) has argued that such a model is deficient because it:abstracts from basic problems in industrial relations and work organisation by reducing the labour process to a set of technical relations . . . [SJince workers' co-operation is assured through the act of exchange, technical efficiency can simply be assumed. The problem of how to get work out of the worker does not even arise (pp. 299-300).

Over the past two decades, however, important theoretical developments have occurred in the field of economics which have relevance for the analysis of industrial relations. This new research is often referred to as transactions-cost, contract or principal-agent theory. The basic premise of the transactions-cost approach is the notion that economic transactions, including the formulation and implementation of employment contracts, can be costly. 'Transactions costs' refers to the financial and non-financial costs associated with different modes of contracting, and may include the costs of co-ordinating and motivating employees, the costs of monitoring employees' behaviour and the costs of drawing up and enforcing contracts. It is presumed that the most efficient contractual and institutional arrangements are those that minimise both production costs (determined by technology and mix of inputs) and transactions costs (the manner in which transactions are organised). Transactions-cost theorists, like labour process writers, have rightly observed that most employment contracts are long-term. Milgrom and Roberts (1990) note that:the vast bulk of the transactions for labor services . . . are mediated by complex contracts that cover longer, often indefinite periods of time. These contracts often uncouple pay and productivity. They are incomplete and involve important implicit elements, and they assign significant authority to the employer (p. 329).

Why, then, are most employment contracts typically open-ended, imprecise arrangements? Williamson (1985) argues that open-endedness is an efficient solution to the problems that employers face in constructing modern, complex contracts of employment. He emphasises in particular the difficulties involved in specifying at the outset the full range of tasks required from employees, as well as the way in which tasks need to be adapted in response to possible shifts in the market and technologies.

A comprehensive and detailed specification of tasks and duties increases the complexity of transactions (and therefore the costs) associated with the drafting, implementation and monitoring of labour contracts. According to Williamson (1975):Provision for unforeseeable contingencies is made by writing the contract in general and flexible terms . . . Rather than attempt to anticipate all bridges that might conceivably be faced, which is impossibly ambitious and excessively costly, bridges are crossed as they appear (p. 75).

The transactions-cost approach makes a number of assumptions about human behaviour and the economic environment. Two important behav ioural assumptions are those of bounded rationality and opportunism. Bounded rationality means that individuals have only limited foresight. They cannot predict or plan for every possible contingency that might occur in a complex environment. This is because individuals cannot process infinite amounts of information or communicate with others in a costless or perfect fashion. The consequence is, as Milgrom and Roberts (1990, p. 130) note, that individual economic agents act in an 'intentionally rational manner, trying to do the best they can given the limitations under which they work'. At the same time, individuals are considered to be opportunistic. This type of behaviour denotes 'self-interest seeking with guile', and examples include lying, stealing, 'the incomplete or distorted disclosure of information, . . . calculated efforts to mislead, distort, disguise, obfuscate, or otherwise confuse' (Williamson 1985, p. 47). The bounded rationality of individuals, and the complexity and uncertainty of the economic environment, mean that comprehensive, detailed labour contracts are unfeasible. Transactions-cost difficulties, however, may also be a feature of open-ended employment arrangements. Opportunistic behaviour may emerge, for example, when workers possess a degree of bargaining power in the form of job-specific or 'idiosyncratic' skills. In these circumstances, structured internal labour markets are considered to be a more efficient way of regulating employment than market-mediated or 'arms length' arrangements. Internal organisation is said to enable the employer to 'allocate workers to tasks, specify effort levels and monitor behaviour' (Marginson 1993, p. 135). Company employment policies, including disciplinary procedures, career ladders and seniority wage systems, reduce the prospect of costly haggling over the wageeffort bargain, and ensure that the goals of individual economic actors arc aligned with those of the organisation. According to Williamson (1975), 'contract revision and renewal take place in an atmosphere of mutual restraint in which the parties are committed to continuing accommodation . . .' (p. 81). The 'new economics of organisation' has attracted considerable academic attention. Kalleberg and Reve (1992) have observed that economists are now focusing on the implicit and behavioural aspects of contracts, while

sociologists are investigating their incentive attributes and characteristics. It is claimed that a political economy model is possible that integrates elements of both approaches. For our purposes, however, the important aspect of the transactions-cost approach is that it seeks to theorise, rather than simply describe, developments in the organisation of work and the labour market. As noted above, internal labour markets are considered to be an efficient organisational response to the requirements of increasingly complex and idiosyncratic jobs (see Ch. 3 for an exploration of these issues). Nevertheless, the transactions-cost perspective has been criticised for its 'unitaristic' orientation (see Edwards 1990; Marginson 1993; Nolan and Walsh 1995 for critical reviews). There is a strong presumption, for example, that both employers and workers benefit from the evolution of efficient contractual and institutional arrangements, including hierarchical management structures. Such an approach is at odds with alternative perspectives that emphasise the role of conflict and power in the structuring of labour market and work arrangements (e.g. Marglin 1974). Similarly, the dynamics of trust and reciprocity in employer-employee relations have been neglected, largely due to the assumption that individuals are prone to opportunistic behaviour (Jacoby 1990). It has been argued, however, that consent and co-operation are crucial to an understanding of the employment relationship. According to Edwards (1990):the negotiation of consent within a relationship of exploitation, and not opportunism, is the key characteristic of the labor relation (p. 59).

Indeed, the generation of consent at the workplace, as well as conflict, has been a major preoccupation of recent research in industrial relations and industrial sociology. This literature has sought to explore exactly why workers work as hard as they do, particularly when it is not possible for employers to monitor the intensity of work effort.

The effort bargainWriters in the labour process tradition have devoted considerable attention to the consensual aspects of workplace relations. In his ethnographic study of an American engineering factory, the sociologist Michael Burawoy (1979) sought to address why workers did not perpetually resist management, but 'actively participate[d] in the intensification of their own exploitation' (p. xi). He argues that the expenditure of effort by workers could not simply be attributed to primitive or coercive methods of management control, such as harsh supervision or the threat of dismissal. While these forms of labour management had been prevalent during earlier historical periods, the establishment of trade unions and welfare provision meant that such methods were no longer viable. Under monopoly capitalism,

according to Burawoy, different forms of management control were required in order to persuade workers to co-operate with management. In these circumstances 'spontaneous consent combines with coercion to shape productive activities' (Burawoy 1979, p. xi). Burawoy's study illustrates the processes by which consent is actively generated at the workplace. He found that work had been structured into a 'series of games' in which workers attempted to achieve levels of output that earned incentive pay. Workers perceived that they had won the game if they earned some time to themselves or increased their earnings. Participation in the game meant that time passed quickly, thus relieving a considerable degree of the monotony and tedium of factory work (p. 89). Creating a game out of the labour process, according to Burawoy (1979), 'generates consent with respect to . . . rules . . . [T]he game becomes an end in itself, overshadowing, masking, and even inverting the conditions out of which it emerges' (p. 92). Managerial control was buttressed in other ways, notably by the establishment of an internal labour market, grievance procedures and collective bargaining. While these arrangements enhanced employees' procedural and bargaining rights, they also served to legitimate employers' overall right to direct and manage the labour process. In his analysis of managerial control strategies, Andrew Friedman (1977) has made an important distinction between a direct control and a responsible autonomy approach. A responsible autonomy strategy seeks to harness the creative potential of workers or the 'malleability' of labour. Here, 'top managers give workers status, authority, responsibility and try to win their loyalty and co-opt their organisations to the firm's ideals . . . ideologically' (p. 49). By contrast, a direct control strategy seeks to control and ultimately to destroy workers' initiative and independence through the imposition of harsh discipline, coercive supervision and the progressive removal of workers' skills and responsibilities. Friedman relates these two strategies to the distinctive qualities of labour power as a commodity (p. 48). He argues that workers are 'potentially malleable' in that they are able to exercise discretion and creativity in the work process. At the same time, however, they also possess 'independent and often hostile will(s).' Direct control and responsible autonomy strategies are not wholly separate approaches to the management of labour. Rather, employers may seek to combine the approaches in different ways. For example, a responsible autonomy strategy may be directed towards highly skilled, non-manual workers, and a direct control strategy applied to unskilled or semi-skilled workers. Edwards (1995b, p. 14) has observed that employers may seek to harness workers' creativity and problem-solving skills through the mechanism of employee participation schemes (e.g. suggestion schemes, quality circles) while also maintaining tight control over discipline and attendance. Changes in the product and/or labour market, and the intensification of worker resistance, may also encourage employers to shift

from one approach to another. According to Friedman (1977), the dualistic character of managerial control strategies is a manifestation of a fundamental tension in the capitalist work process: that is, the need to control or coerce workers and the need to secure workers' commitment and loyalty. Drawing on the work of Friedman (1977) and Burawoy (1979), among others, Edwards (1986, p. 6) has sought to develop an integrated model of the employment relationship that takes account of the interplay between conflict and co-operation. He argues that there is a basic conflict or 'structured antagonism' in all work organisations, because 'workers' ability to work is deployed in the creation of a surplus that goes to another group' (p. 5). Against this backdrop, however, there is also scope for co-operation. At the very least, employers require workers' minimal compliance so that the objectives of the business enterprise can be realised. Conversely, workers depend on the firm for their employment and therefore cannot jeopardise their livelihoods by engaging in permanent resistance. In his analytical treatment of conflict and cooperation, Edwards has drawn attention to a body of research that investigates the informal aspects of workplace relations, such as workers' negotiations around the effort bargain, the establishment of customary norms, and the operation of 'fiddles'. Fiddles are defined as 'secondary adjustments around the effort bargain' (Edwards 1988, p. 190), and include behaviour as varied as pilfering, sabotage, output restriction and the manipulation of shift patterns and attendance records. However, while sabotage and output restriction may harm the firm, and may therefore be a manifestation of worker resistance, not all fiddles operate in this way. Some fiddles, such as the alteration of work schedules or production bookings, may not damage worker productivity, and others, for example 'rate busting', or breaking the piece rate for a particular job to increase earnings, may actually enhance production output. It has also been observed that fiddles may reduce more costly forms of employee behaviour such as absenteeism and quitting. This might explain why, in certain circumstances, management actively colludes in the operation of fiddles. Edwards (1988) argues that fiddles are significant because they:give workers some power: workers are active creators of the world in which they live, as they try to infuse their jobs with meaning and make them tolerable (p. 211).

By making the labour process less monotonous and routine, however, fiddles may also serve to accommodate workers to exploitative work regimes and managerial control systems. As this section has shown, the negotiation of consent and conflict at the workplace has emerged as a focal point of theoretical and empirical research in industrial relations and industrial sociology.

Strategic choiceWithin the field of industrial relations, a framework of analysis known as 'strategic choice' has gained in popularity over the past decade. This approach was initially developed by three American writers, Kochan, Katz and McKersie (1986), in their attempt to analyse changes in the development of American industrial relations since the 1970s. They argued that the prevailing method of analysis in industrial relationsthe systems model was flawed. This model conceptualises the industrial relations system as a self-contained, analytical subsystem of the wider society, and is associated with the work of the American labour economist John Dunlop. Writing in the 1950s, Dunlop (1958) argued that an industrial relations system comprised 'certain actors, certain contexts, an ideology which binds the . . . system together, and a body of rules to govern the actors at the place of work and work community' (p. 7). The actors include three main groups: managers and their representatives in supervision; workers and their representatives, and specialised third party agencies such as governmental organisations. These groups interact within a number of environmental contexts, which play an important part in shaping the rules of an industrial relations system. These contexts include the technological characteristics of the workplace, the market or budgetary constraints that impinge on the actors, and the locus and distribution of power in the larger society. The system as a whole is held together by an ideology or commonly shared set of ideas and belief that 'defines the ideas which each actor holds towards the place and function of the others in the system' (Dunlop 1958, p. 17). Kochan, Katz and McKersie (1986) have adapted Dunlop's systems model to take account of the role of the actors in forming the rules of the bargaining system. They take the view that 'industrial relations practices and outcomes were shaped by the interactions of environmental forces along with the strategic choices and values of employers, employees, trade unions and governments' (p. 5). In their opinion, the developments in U.S. industrial relations since the 1970s had resulted largely from fundamental changes in managerial values and strategies. Innovations in human resource management practices were seen as providing the principal source of dynamism. In light of this, it was suggested that a revised theory of industrial relations should incorporate a wider and more sophisticated concept of the role of managerial strategies, structures and policies in employment-related matters. As part of this reconceptualisation, Kochan, Katz and McKersie (1986) pointed to the need to understand the shift in the distribution of decisionmaking power and authority over industrial relations issues within the managerial hierarchy. They found that, in the U.S.A., traditional industrial relations specialists had lost power both to human resource managers and

line managers as top executives demanded greater organisational inno vation in managing employees and stressed the need to achieve a more symmetrical relationship between broad business strategies and industrial relations practices within the firm. This, they suggested, had important theoretical implications for the study of industrial relations. It meant that the scope of the subject had to be broadened to include the strategic decisions of business pertaining to such matters as marketing and production, acquisition and divestiture, and the form and location of financial responsibility within the organisation. Many decisions that had an impact on industrial relations processes and outcomes took place, as Kochan, Katz and McKersie (1986) pointed out, beyond the functional level of industrial relations in the firm and often 'well above both the collective bargaining process and, in some cases, the level of most industrial relations staff (p. 10). This broader conception of the institutional framework of industrial relations led the authors to develop a typology that featured three main levels of industrial relations activity: the strategic, policy and workplace levels. This framework, as shown in Table 1.1, divides the activities of management, labour and government into three tiers. Although each of these tiers is deemed to be relevant to the three main actors in the industrial relations system, the authors are predominantly interested in explaining management's industrial relations activity.Table 1.1: Three levels of industrial relations activity

L ev e l

Em p loy ers

U n io n s

Governm en t

L o n g-te rm stra te gy a nd policy-m aking

M a c roe c on o m ic a n d B u s in e s s s tra te g ie s P o litica l stra te gie s so c ia l p o licie s In v e s tm e n t s tra te g ie s R e p rese n ta tion te gies stra H u m a n re s o u rc e O rga n ising stra te gie s stra te gie s L a b o u r la w a n d C olle ctiv e b a rga in ing ane rs o n n e l p o lic ie s Pd C olle c tive b arga in in g a dm in is tra tio n p e rson n e l p o licy N e go tia tio ns stra te g ies stra te gie s S u pe rv iso ry sty le W o rk e rC ontract a dm in istra tion La b ou r sta n da rd s W orke r W o rk pla ce a n d Wo Jn pa rticipa tion In dividu a l in divid u al/o rga n isa tio np a rticip a tion Jo b de sign a nd rker pa rticip atioo b w o rk orga n isa tio n d esign a n d w ork righ ts rela tio n sh ip s org a nis a tio n

Source: T. Kochan, H. Katz and R. M cKersie 1986, p. 17.

Some writers have questioned the analytical merit of the adaptation of the systems model by Kochan, Katz and McKersie. A widely held criticism of Dunlop's earlier model, for example, is that it did not constitute a theory of industrial relations. Blyton and Turnbull (1994) have argued that: 'systems theory might be viewed as a useful means of classifying variables

relevant to industrial relations, but it is hardly an explanatory approach in its own right' (p. 19). Such criticisms have also been directed towards the strategic choice approach. Indeed, Kochan, Katz and McKersie (1986, p. 19) acknowledge that the three-tier framework 'does not constitute a fully developed new theory of industrial relations', but they contend that it has a number of distinct analytical advantages. First, the framework recognises the interrelationships between activities at the different levels of the system; second, it is able to consider the effects that various strategic decisions exert on the different actors in the system, and third, it focuses analysis on the formal as well as the informal relationships at the workplace. Despite these claims, some commentators have argued that the strategic choice approach reproduces the weaknesses of systems theory. According to Edwards (1995b):such a model does little more than list the parties to industrial relations and their interactions. It gives no flavour of the relations of conflict and dependence which tie the parties together. Indeed, it is scarcely populated by people at all, its actors being disembodied managements and unions (with workers and the state not really figuring as active participants) (pp. 19-20).

Hilderbrand (1988, p. 446) claims that the authors overstate the importance of managerial strategies in affecting the character of industrial relations, and criticises the evidence for the 'rise of integrated management' as 'sketchy and reflective of casual empiricism'. Strauss (1988, p. 450) has also taken issue with the methodology, which he describes as a 'mishmash', relying on a 'range of data, from impressionistic case studies and interviews to quantitative studies that fully conform to the current canons of research orthodoxy'. Perhaps the most systematic analysis of the strategic choice theory has come from Lewin (1988). He, also, is critical of the research methodology, asserting that:. . . it is simply not enough to say that there are linkages among corporate level, business unit level, and plant/facility level industrial policies and practices, or to claim that changing managerial values constitute the linchpin for the theory and practice of strategic industrial relations. Instead, such claims must be tested on data sets obtained from more rigorously constructed research designs that pose specific hypotheses so as better to judge their validity and reliability (pp. 31-2).

Notwithstanding these problems, the strategic choice approach has highlighted the active role of management in shaping the conduct of industrial relations. In this respect, the approach meshes with recent work in the labour process tradition in drawing attention to the importance of management strategy as a key consideration in industrial relations research and analysis.

The approach of this bookWe have reviewed the main approaches to industrial relations, as well as recent theoretical developments in the subject, and in related disciplines. Several themes emerge as important. First, the field of industrial relations study and research has expanded significantly. Industrial relations as a subject area has been broadened to include both the 'collective' and the 'individual' aspects of employment relations. As well as the role and significance of trade unions, collective bargaining and the arbitration system, industrial relations now embraces such matters as how employees are attracted, retained, developed and motivated. This is, in part, a reaction to the growth and development of human resource management, both as an academic subject and as an area of managerial activity. As a consequence, there is now wider appreciation of the role of managerial values and business strategy in the determination of industrial relations processes and outcomes. Second, the analysis of the employment relationship has become more sophisticated. On the one hand, the labour contract involves the exchange of wages for the capacity to work, often within an ongoing and open-ended employment arrangement, and on the other, an asymmetrical power relationship in which the employee submits to the authority of the employer. Industrial relations writers have traditionally emphasised the potential for conflict around the work-effort bargain, and the structural imbalance of power between management and labour. While power and conflict continue to be a central component of industrial relations analysis, recent work has highlighted the importance of co-operation and consent within workplace relations, often involving processes of negotiation and (informal) bargaining between employees and employers. The generation of consent and commitment at work occurs against the backdrop of a 'structured antagonism' between workers and managers (Edwards 1986). Third, the multidisciplinary orientation of the subject continues to be significant. Some industrial relations scholars (e.g. Heller 1992; Purcell 1992) have sought to understand the individual aspects of employer-employee relations more fully by drawing on those behavioural sciences that underpin human resource management, including organisational behaviour, organisational psychology and business strategy. But the relevance of industrial sociology and economics to industrial relations analysis is also apparent from the previous discussion. As we have seen, there has been a growth of theoretical activity in the areas of conflict and the social relations of work, labour-management strategy and labour market organisation. Edwards (1986) has drawn on the insights of sociological studies of the workplace in his theoretical analysis of conflict. Other commentators have emphasised the wider economic and labour market context of industrial relations, particularly in relation to employer

strategy and performance (see Nolan and Walsh 1995, pp. 80-1). At the same time, strategic choice theory suggests that a more complete understanding of labourmanagement practices requires a consideration of both the environmental forces that impinge on the actors in industrial relations and the variables that help explain how the actors use the discretion available to them in responding to their environment. Reflecting these broad analytical concerns, this book emphasises the importance of human resource management initiatives and practices (Ch. 2); the labour market and the economy (Ch. 3), and industrial relations and performance (Ch. 12). The discussion on workplace industrial relations (Ch. 10) takes account of recent debates on the issues of commitment and conflict, including an examination of strikes, labour turnover and absenteeism. The remaining chapters analyse key changes and develop ments in the structure, character and activities of the major institutions involved in industrial relations in Australia, namely management, trade unions, the arbitration system and the government.

D IS C U S S IO N Q U E S T IO N S1. Why are there so many approaches to industrial relations? Do these approaches have anything in common? 2. What do you understand by the term 'industrial relations'? 3. What is meant by the term 'unitary approach'? 4. How does Frederick Taylor's theory of industrial behaviour differ from that put forward by the neo-human relations school? 5. It has been said that the pluralist approach pays insufficient attention to the real disparity of power that exists in society and in industrial relations. Do you agree? 6. Outline the main elements of the radical approach to industrial relations. 7. Discuss the contribution of labour process theory to the understanding of industrial relations. 8. Compare and contrast the transactions-cost and radical approaches to the analysis of the labour contract. 9. To what degree, and in what ways, are Burawoy's and Friedman's works relevant to an understanding of the employment relationship? 10. Outline and discuss the strategic choice perspective on industrial relations. what In ways does this perspective help with analysing industrial relations phenomena?

FURTHER READINGBraverman, H. 1974, Labor and Monopoly Capital, Monthly Review Press, New York. Burawoy, M. 1979, Manufacturing Consent, University of Chicago Press, Chicago. Edwards, P. K. 1986, Conflict at 'Work: A Materialist Analysis of Workplace Relations, Blackwell, Oxford, Chapter 1. Edwards, P. K. 1995, 'From Industrial Relations to the Employment Relationship', Relations Industrielles, vol. 50, no. 1, pp. 39-63. Fox, A. 1974, Beyond Contract: Work Power and Trust Relations, Faber and Faber, London. Friedman, A. 1977, 'Responsible Autonomy versus Direct Control over the Labour Process', Capital and Class, Spring, no. 1, pp. 43-57. Hyman, R. 1989, The Political Economy of Industrial Relations: Tlieory and Practice in a Cold Climate, Macmillan, London. Kaufman, B. 1993, The Origins and Evolution of the Field of Industrial Relations in the United States, ILR Press, Ithaca, New York. Kochan, T., Katz, H. and McKersie, R. 1986, The Transformation of American Industrial Relations, Basic Books, New York. Lansbury, R. 1995, 'Industrial Relations in an Era of Global Change and Challenges', Labour and Industry, vol. 6, no. 2, March, pp. 1-12.

H U M A N RESO URCE M ANAGEM ENT: AN A L T E R N A T IV E P A R A D IG M ?The field of industrial relations study and research has expanded significantly. A decade ago the principal concerns of the subject centred on the state of unionmanagement relations, the level and intensity of strike action and the formal procedures designed to resolve industrial conflict. Industrial relations now embraces a much wider set of issues. Many of these relate to the individual aspects of the employment relationship, and take in such matters as the ways employees are motivated, rewarded and trained. The subject is no longer narrowly focused on the behaviour of the major institutions trade unions, employer associations, industrial tribunals and the stateand the way in which the employment relationship is regulated. The study of individual relationships has been added to the study of collective relationships. A number of academic researchers have argued that human resource management (HRM) has forced open the boundaries of industrial relations through the incorporation of a wide range of managerial issues. In the process, HRM is said to have exposed organisational behaviour mpor and organisational psychology to an understanding of the employment relationship (Heller 1992; Purcell 1992). Commentators have suggested, for example, that the ways in which individual employees and work teams respond to the different motivational

tools available to management can be understood more fully by drawing on those behavioural sciences that underpin HRM. Within the context of these shifting boundaries, Sisson (1993) has claimed that HRM has become 'the industrial relations issue of the 1980s and early 1990s' (p. 201). He points to the possible paradigm shift in the management of the employment relationship one element of which has been a shift from collectivism to individualism. Guest (1991, p. 50) also suggests that the emergence of HRM in the 1980s has posed a challenge to the dominant pluralist orthodoxy of industrial relations. The purpose of this chapter is to identify the differences between industrial relations and HRM, and examine the underlying principles and values that characterise the study of HRM. It commences initially with an analysis of how industrial relations and HRM take different perspectives of the employment relationship, and then it examines the distinctive elements of HRM. This is followed by a discussion of individualism and collectivism, and the relationship between trade unions and HRM. The chapter concludes with an examination of HRM in practice, and the possible contradictions that emerge in the application of HRM policies.

Different perspectives of the employment relationshipIndustrial relations was described in the preceding chapter as a study of the behaviour and interaction of people at work. Us principal concern was said to lie with the ways in which employees are rewarded, motivated, trained and disciplined, together with the process used by the major institutions management, trade unions and the stateto make decisions that shape the relationship between employers and employees (Edwards 1995b). Furthermore, it was also noted that there are three key elements of the employment relationship that are central to the subject matter of industrial relations. Kelly (1994) sees these as the following: the interests of the different groups or parties; the extent of conflict between those interests, and the power resources available to the groups or parties in the pursuit of those interests. In industrial relations, the employment relationship has typically been assumed to be conflictual. The interests of employers and employees have normally been seen as opposed rather than as shared. This is not to suggest that industrial relations writers have ignored the overlapping and otten common interests that employers and employees have with regard to such matters as organisational viability, financial success and job security (Edwards 1995b). However, it has been normal to view the employment relationship as open to contestation and to the negotiation of antagonistic and often contradictory objectives.

In contrast, HRM is distinctly less pluralist in its perspective, and as such sees employers and employees as sharing similar goals and interests. As a way of managing people, HRM emphasises the goals of organisational commitment, and policy integration with the needs of the business (Legge 1989). Storey (1995) has described HRM as an 'approach to employment management which seeks to achieve competitive advantage through the strategic deployment of a highly committed and capable workforce' (p. 5). Because of this, Purcell (1992) believes that:.. . HRM is the visual embodiment of the unitarist frame of reference both in the sense of the legitimation of managerial authority and in the imagery of the firm as a team with committed employees working with managers for the benefit of the firm (p. 4).

In industrial relations, on the other hand, the firm is conceptualised rather differently. Organisations are seen to possess a variety of groups with divergent interests, objectives and aspirations. Managerial power and authority is contested. In HRM, the employment relationship rests on a mutuality of interests, and the organisation reflects integrated and fundamentally harmonious goals. In an expression of support for these principles, one of the country's leading employer associations, the Business Council of Australia (1989), has called for the jettisoning of 'the industrial relations mindset . . . [and] the outmoded assumption of conflict' (p .5), and its substitution with a perspective that emphasises the shared interests of managers and workers.

The nature and characteristics of HRMIn Australia, the area of HRM emerged in the mid- to late-1980s in apparent response to organisational pressures to develop the skills and knowledge of employees to meet the demands of an increasingly competitive marketplace (Dunphy 1987). This was not dissimilar to the situation in Britain, where intensified international competition was also said to have accelerated the introduction of HRM policies (Blyton and Turnbull 1992). In the United States, by contrast, HRM practices had been firmly established by the beginning of the 1980s, with suggestions by some that they were used as a means of averting unionism (Skinner 1981). The earliest development and conceptualisation of the subject as a field of study emerged in the United States. The work of Michael Beer and his colleagues (1984) at the Harvard Business School in partirnlar is seen as something of a starting point (Boxall and Dowling 1990). The so-called Harvard model of HRM is said to contain a number of important elements. According to Poole (1990):[the function] is viewed as strategic; it involves all managerial personnel (and especially general managers); it regards people as the most important single

asset of the organization; it is proactive in its relationship with people; and it seeks to enhance company performance, employee 'needs' and societal well-being (p. 3).

The Harvard framework is depicted in Figure 2.1. It suggests that HRM policy choices will be shaped principally by stakeholder interests and situational factors. The aim of those HRM policies is to achieve four organisational outcomes: employee commitment, job competence, congru ence with the business strategy and cost-effectiveness. In turn, these outcomes are said to have beneficial consequences for the individual employee, the organisation and the society. The framework is openly normative and prescriptive. Noon (1992) points out that it tells us 'how to do it, not how it is done' (p. 20). Kelly (1994, p. 7) has a different problem. He believes that HRM is particularly difficult to define because the term 'has been variously used as a concept, a theoretical framework, a metaphor, a topic for research and an ideology'. Storey (1995) sees the picture as somewhat less confusing, although he regards HRM as 'an amalgamation of description, prescription and logical deduction' (p. 5). He believes that it consists of four key elements. The first concerns an underlying set of beliefs and assumptions. These relate to: a view of the importance of people as a strategic, competitive resource; a belief in achieving the objective of employee commitment, and aFig. 2.1 ap of the H R M T erritory Mi Work technology Situational Government Task forcegroups Community Management Stakeholder Unions Employee Shareholders values philosophy characteristics factors market Labour strategy Laws and Business interests societal Unions and conditions Management HRM policy choices Employee influence Human resource flow Reward systems Work systems HR outcomes Commitment Competence Congruence Cost-effectiveness i Long-term consequences Individual well-being Organisational effectiveness Societal well-being

- ^-

- -^

Source: M . B eer, B . Spector, P. Law renc e, D . M ills and R .E . W alton, 1984.

determination to select and develop employees carefully. The second main element relates to strategy. Here, Storey claims that human resource questions are viewed as matters of important strategic concern, and should consequently be integrated into the business strategy as well as receiving board-level representation. The third element relates to the managerial responsibility for HRM. Storey (1995) suggests that:HRM is too important to be left to operational personnel specialists. Line managers are seen as crucial to the effective delivery of HRM policies: conducting team briefings, holding performance appraisal interviews, targetsetting, encouraging quality circles, managing performance-related pay and so on (p. 7).

The fourth important characteristic of HRM concerns the key organisational levers used to implement policy. Storey believes that there has been a shift in emphasis away from personnel procedures and rules as the basis of good practice, in favour of a new emphasis on the management of 'culture'. Creating the 'right' type of corporate culture is said to be the key to achieving organisational consensusthe sharing of a common set of values and beliefsa willingness to work flexibly, and employee commitment. Guest (1991) has taken a slightly different perspective in untangling the elements of HRM. He believes that HRM has four distinctive goals or objectives: commitment, flexibility, quality and strategic integration. The first goal is to create a committed work force which could be expected to display lower absenteeism and turnover rates and generally higher performance levels. Second, HRM seeks to make the organisation more adaptable to changing economic and technological circumstances by encouraging more flexible working practices and labour utilisation strategies. The third goal is quality. Guest (1991) suggests that, in the context of HRM, quality refers not only to the quality of goods and services, but also to the quality of the work force. This raises the importance of training and development. The last goal relates to the integration of HRM with the business strategy of the organisation. Like Storey (1995), Guest (1991) notes that HRM policies would normally be expected to fit with the business strategy in such a way as to provide the organisation with a competitive advantage through the use of its human resources. Sisson (1990) has added a fifth goal or dimension to HRM. He believes that HRM is characterised by an individualistic, and often non-union approach, to work arrangements. Within th.p context of this set of ^oals or objectives Lc^^c (1995) has observed that there appear to be two different emphases as to what HRM should be. She has termed these the 'hard' and the 'soft' models of HRM. The 'hard' model is said to stress HRM's focus on the close integration of human resource policies with business strategies. It is designed to assist with the achievement of the business objectives of the organisation. From

this perspective, Legge observes that human resources are largely viewed as a factor of production capable of generating wealth for the organisation. The 'soft' model of HRM, by contrast, reflects a form of 'developmental humanism'. Human resource policies are aimed at treating employees as valued assets and as a source of competitive advantage through their commitment, adaptability and high quality of skills and performance. Legge (1995) claims that the characteristics of the 'soft' model of HRM can be captured in the following way:Employees are proactive, rather than passive inputs into productive processes; they are capable of 'development', 'worthy of trust' and 'collaboration', to be achieved through 'participation and informed choice' . . . The stress is therefore on generating commitment via 'communication, motivation and leadership' . . . If employees' commitment will yield 'better economic performance', it is also sought as a route to 'greater human development' . . . In this model, then, the focus is on HR policies to deliver 'resourceful' humans (p. 67).

Legge does acknowledge that in some situations both models may be practised simultaneously. This is particularly the case in high-value-added companies in knowledge-based industries where (core) employees are treated as 'resourceful humans to be developed by humanistic policies' (Legge 1995, p. 67). The distinction between the two models is obvious, however, in the case of an organisation that chooses to compete in a labour-intensive, high-volume industry using a business strategy of cost leadership (see Ch. 6). Here, the 'hard' model is likely to apply, as the strategic objectives are most likely to be met by treating employees as a variable cost which should be minimised.

Individualism and collectivismIt has been suggested that an increasing number of organisations have begun to introduce employment arrangements based on the individual employee, rather than on the work force as a collective group (Hearn Mackinnon 1996; Bacon and Storey 1996). This development has invariably been accompanied by a preference for avoiding union involvement in the determination of these employment policies. Even in situations where management has been unable to exclude unions from the bargaining process, the emphasis on the individual has been evident in the wider use of merit- and performance-related pay systems and the reduced reliance on job- or grade-based pay arrangements (Kessler and Purcell 1995; O'Neill 1995). Other signs of a shift towards the individualisation of employment policies include greater experimentation with individual appraisal and goal-setting procedures, and the more extensive use of direct communi cation systems with the individual rather than through the traditional union channels. The growth of individualistic employment arrangements has not been unattached to wider debates about the role of third parties' institutions in

the labour market. It has been asserted that institutions such as industrial tribunals and trade unions restrict the freedom of individuals to pursue their own self-interests, and consequently impair organisational perfor mance (see Drago, Wooden and Sloan 1992). Human resource management policies that embody techniques of direct communication, appraisals and performance-related pay are, in the words of Kessler and Purcell (1995), 'assumed to encourage individual responsibility for quality and perfor mance' and develop employees who are simultaneously 'committed and empowered to pursue their enlightened selfinterest' (p. 338). Storey and Bacon (1993) have sought to vise individualism and collectivism as a means of clarifying contemporary developments in labour-management relations and employment practices. They believe, however, that the terms possess different meanings and capture divergent trends depending on which dimension of the employment relationship is under analysis. A distinction is drawn, for example, between industrial relations, which covers unionmanagement relations and the associated process of negotiation and bargaining, and the work organisation, which pertains to such issues as the design of jobs and the nature of work tasks. They suggest that, within the industrial relations domain, the terms 'individual ism' and 'collectivism' are used almost interchangeably with 'unitarism' and 'pluralism'. In effect, therefore, 'collectivism comes to equate with trade unionism and individualism with non-unionism' (Storey and Bacon 1993, p. 670). They claim, however, that within the work organisation individualism is more likely to be viewed as part of a Taylorist strategy to fragment and de-skill work, while collectivism is associated with work teams and participative group methods of work. These concepts are shown in Figure 2.2. Within this framework, it can be observed that an organisation embracing 'new' HRM policies may simultaneously take on both a collectivist and an individualistic persona. A shift to team working could be interpreted as greater collectivism. However, should that form of work organisation be installed without union involvement, it could be said that this would signal greater individualism in industrial relations, and a reduction in the collective voice of employees (Storey and Bacon 1993, p. 672). A variety of patterns of individualism and collectivism are thus possible in organisations. These may range between the Japanese style of collectivist industrial relations and work organisation, and the archetypal U.S. high-technology corporate style of individualistic non-unionism, combined with collectivist forms of work relations. The use of the terms 'individualism' and 'collectivism' in this way has attracted criticism from other researchers in the field. Kessler and Purcell (1995) find difficulty, in particular, with the application of the term 'collectivism' to work organisation. They claim that it is wrong to characterise work teams and participative work practices as collectivist

when the aim of such programs is to promote a strong culture of organisational loyalty and commitment to corporate objectives. It is, in their words (Kessler and Purcell 1995, p. 345), 'a culture directed by management . . . [with] a strongly unitarist . . . frame of reference'. They assert that the term 'collectivism' should be used to refer to 'the existence of independent, or quasiindependent, organizations founded to represent and articulate the interests of groups of employees' (p. 345). In short, it can be argued that collectivism is best understood in an HRM sense by looking at the approach of management to trade unions.Fig. 2.2 Sforey and Bacon's criteria for exploring individualism and collectivism in organisationsINDIVIDUALISM COLLECTIVISM

4. Joint consultation collective 2. Work-force a. orientation unit 3. Nature and orientation Industrial relations 1. Management Bargaining bargaining role of Non-unionism b. Scope of bargaining c. Managers Continuity of bargaining d. Form determine rules of bargaining Individual Narrow Sporadic Tokenistic None High

Pro-unionism Pro-unionism Joint procedure Group Extensive Regular Real Regular Low

7. Relation c. Movement 6. Control over job and to social Worktasks of individual 5. Technical organisation High authority jobs organisation of work a. methods/rules between Division of labour b. None Compartmentalisation of Autonomy/supervisor Determined either by strict hierarchical control or by technological control unilaterally decided by managers Hierarchical Low involvement in managerial decisions

Extensive interaction Extensive Group based Joint regulation

Equal status Joint decisions

Source: Adapted from J. Storey and N. Bacon 1993, pp. 665-84.

HRM and trade unionismThis raises the question of the relationship between trade unions and HRM. It was noted earlier that the primary purpose of HRM is to create a more productive, efficient and competitive organisation. Its essential focus lies in building the skills and competencies of employees and their commitment to the firm, and in identifying the most effective ways to put these resources and behavioural dispositions to the best advantage of the company. There is an emphasis on open communications, joint problem solving and the devolution of responsibility to employees. Blyton and

Turnbull (1992) believe that these practices represent a major challenge to the 'traditional pattern of industrial relations built around trade unionism and the formalisation of collective bargaining procedures and joint regulation' (p. 9). Clearly, if the achievement of organisational commitment is a central goal of HRM, it is logical to suggest that trade unions and the bilateral determination of the rules of the employment relationship will be outside the policy parameters of HRM. The early models of HRM were, as Guest (1995) notes, drawn mainly from successful American non-union firms such as IBM and Hewlett Packard. Human resource management may be viewed as a challenge to the existence and operation of trade unions in a number of ways. First, policies that are designed to strengthen an individual's identification with and involvement in an organisation can result in a diminution in the commitment to trade unions. Research findings indicate that employees who enjoy higher levels of job satisfaction and are provided with more extensive forms of communication and greater participative opportunities demonstrate more highly developed forms of commitment to the organisation (Coopey and Hartley 1991). In contrast, where individuals are employed on routine and monotonous tasks, and are denied promotional opportunities as well as fair and just means of resolving their differences with management, commitment is more limited. In these circumstances, there is evidence to indicate that trade union membership will be higher. It has been shown that those employees who join trade unions tend to be less satisfied with their jobs and their pay, and, in the case of women, less satisfied with promotion opportunities (Snyder, Verderber and Morris 1986). Indeed, it has been suggested that opportunities for trade union support will be greater in workplaces where there is a higher degree of industrial disharmony and distrust, and where employees are dissatisfied with their employment arrangements (Deery, Erwin and Iverson 1994). The second way in which trade unionism may be challenged relates directly to the intention of HRM policies and practices. There are some who argue that HRM is part of a strategy designed to weaken the influence of trade unions. Wells (1993) claims that HRM policies are incompatible with strong unionism because the practices that are put into place are frequently pursued for the purpose of undermining the role of unions. He believes that the unitarist assumptions that underlie HRM innovations leave no room for collectivist bodies like trade unions that are able to voice worker concerns independently. In the U.S.A., the decline of unionisation has been associated with the development of what have been termed 'union substitution policies'. Fiorito, Lowman and Nelson (1987) found that various HRM programs involving participation and communication often formed part of employers' union substitution efforts. Wells (1993, p. 80) also supplies evidence that HRM is used to weaken unionism 'by expanding collaboration between managers and workers in ways that are

not mediated by unions'. Certainly there is evidence to indicate that union mediation does affect the character of a firm's employment policies. It has been shown that unions tend to restrict management's freedom to introduce individualistic practices and employment arrangements. Ng and Maki (1994) have found that unionised companies are less likely than non-unionised companies to possess individual performance-appraisal systems as well as profit-sharing schemes. Unions have also been associated with a lower incidence of individual-based incentive pay systems. Unionism, however, had no impact on the adoption of group-level pay schemes and gain-sharing plans, indicating that organised labour's opposition is focused principally on individualistic pay and remuneration arrangements. Similar research findings were made by Guest and Hoque (1996), who showed that trade union presence in greenfieldthat is, newly establishedsites in Britain was associated with less use of performance appraisal and merit pay. On the other hand, there are a number of authors who have argued that the presence of unions is important in guaranteeing the success of HRM policies. Kochan, Katz and McKersie (1986) believe that major human resource changes such as worker participation schemes can be sustained 'only in cases where unions are strong and relatively secure to begin with' (p. 176). Similarly, two U.S. authors, Cohen-Rosenthal and Burton, contend that strong unions are needed to make HRM work effectively:a program with both the union and management pulling equally (as in a rowboat) is a more effective program since it draws on the strengths and resources of both parties. It has a clearer sense of direction and usually can accomplish tasks quicker (cited in Wells 1993, p. 58).

This view is supported by research conducted by Eaton and Voos (1992). They show that certain innovative workplace programs, such as teamwork systems, employee involvement and gain-sharing arrangements, are much more likely to survive and deliver higher productivity outcomes in unionised environments than in non-unionised environments. The authors submit two main explanations for these findings. First, unionised workers have greater formalised job security and guaranteed individual rights than non-unionised workers, and are more likely to request information and to give their opinions and suggestions openly without the same fear of reprisal or arbitrary treatment. Second, unions provide a mechanism through which employees can utilise their collective voice in the design and implementation of programs. This is more likely to result in 'better balanced' programs that are concerned with promoting the quality of work-life and other worker goals, and also with increasing productivity. It is suggested that this will enhance the legitimacy of the schemes in the eyes of the workers and hence increase the likelihood of their survival. In relation to HRM innovations in employee involvement, Eaton and Voos claim that 'Participation programs in the union sector must be carefully

crafted to garner the workforce's continuous collective support. This ultimately increases their effectiveness' (p. 199).

Trade union responses to HRMTrade unions have expressed a mixture of views about HRM, ranging from considerable concern to sanguineness. As a consequence, there have been a variety of responses to HRM. The form of these responses has depended in part on whether the human resource initiatives have been seen as a threat to the role and survival of the union, or whether the changes have been viewed as being beneficial to both the union and its members. The history, traditions and industrial leverage that unions exercise have also been important. Martinez Lucio and Weston (1992) have identified three different approaches that trade unions have taken to HRM: first, a conciliatory and concessionary response; second, a procedural approach emphasising an extended role of collective bargaining, and third, an active localised workplace response. Martinez Lucio and Weston (1992) believe that a conciliatory and concessionary approach is most likely to emerge where unions are confronted by a hostile economic and political climate, and in circumstances where a greenfield site has been established or an existing business is in financial crisis. Under these conditions, unions are often forced to respond to managerially led developments and make concessions such as no-strike agreements or the redefinition of their representative rights in the workplace. Martinez Lucio and Weston also note that new types of worker involvement, both at the company level (such as joint advisory groups) and at the workplace level (teamworking and quality circles), effectively dispense with the principle that unions remain as the sole representative of worker interests. The second trade union response, they argue, is based on an extension of the scope of collective bargaining into such areas as training, skill development and career development. This reflects very much the labour market principles underlying the Accord in Australia. Unions embrace a bargaining role that incorporates issues such as product and service quality, productivity and costcompetitiveness into a wider process of joint regulation. Agreements on more flexible production arrangements may also provide for access to company information on future planning and production issues. It is a more proactive and strategic response than the concessionary approach because, in the words of Martinez Lucio and Weston (1992), it recognises that:developments in sophisticated management techniques, along with the changing expectations of workers themselves . . . [are] challenging the relevance and effectiveness of traditional forms of joint regulation at work such as collective bargaining (p. 221).

The third response to HRM practices takes the form of independent and autonomous initiatives at the workplace level. Quite often these may involve resistance to changes in the representational and bargaining structures, but accommodation to new HR practices such as individualised pay systems, teamworking, direct communication practices and subcontract ing arrangements. Academic commentators have adopted different views on the appro priateness of these various responses. Guest (1995, p. 134) holds the opinion that trade unions should 'see HRM as an opportunity rather than a threat' and should actually champion it. Guest also takes the view that unions should subscribe to many of the policy elements of HRM: careful and fair selection, extensive training, autonomous workgroups, open and extensive two-way communication, single status among all employees and staff, and guarantees of job security. He claims that these are the hallmarks of a competently managed organisation. There are others who also subscribe to this view. Bacon and Storey (1996), for example, state that 'many of the "soft" aspects of HRM are not necessarily anti-union' (p. 54). They suggest that unions should build alliances with firms, introducing such HRM policies as quality programs and teamworking, and develop shared objectives with them. Such a partnership would, they feel, enable employees to display dual commitment to both the union and the company. Indeed, there is a strong body of evidence to indicate that individuals can show commitment to both a union and an employer simultaneously, and that a positive and harmonious industrial relations climate is often related to dual commitment (Gordon and Ladd 1990). However, passive union co-operation and tacit acceptance of human resource initiatives may not be sufficient to guarantee membership allegiance. Studies report that membership loyalty and satisfaction are most likely to increase when individuals perceive the union as being instrumental in achieving valued goals (Deery, Erwin and Iverson 1994). Dual commitment has been found to increase when unions are seen as playing a co-operative but protective role in designing and implementing workplace programs and negotiating successful pay outcomes (Sherer and Morishima 1989). There are some writers who believe that trade unions should challenge rather than embrace the HRM agenda, and should reject the notion of social partnership and co-operation with management. Kelly (1996), for example, believes that 'militancy is likelv to prove a better guarantee of union survival and recovery' (p. 79). He asserts that employers are becoming increasingly hostile to both trade unions and the process of collective bargaining, and that HRM is part of a move by employers towards the unilateral imposition of new terms and conditions of employment. His comments on the situation in Britain have relevance to Australia. He states:

There is little sign here that employers are seeking out forms of moderate unionism, or are open to partnerships with unions: more and more they appear not to want unions at all. In this context union survival must depend on the willingness of the membership to defend the union against attack, if necessary by collective action (p. 92).

There is one area of HRM in particular where union-management co operation may prove to be quite elusive. The goal of flexibilityproviding management with greater discretion in the deployment of workersmay be more compatible with the needs of the organisation than the union or its members. A study in the Australian retail industry showed that many employees, particularly those in full-time employment, vigorously opposed greater temporal flexibility in the form of more evening and weekend work. Should the union have not taken into account those views when formulating its policies, it could have faced serious disaffection among its members (Deery and Mahony 1994). Indeed, research among bank employees in Australia suggests that union members are significantly less prepared than non-union members to be flexible with regard to the timing and number of hours worked weekly, and are less able to balance their working hours and leisure time effectively (Deery and Buttigieg 1995). A possible explanation for this may be the older age and longer tenure of union members, and their greater kinship responsibilities. This is principally the case for female employees. Such evidence, then, might suggest that unions are likely to be somewhat cautious about entering into partnerships with companies that advocate those elements of the HRM model that relate particularly to numerical and temporal flexibility.

HRM in practiceIt was observed earlier that HRM contains a number of essential elements or dimensions (see Sisson 1990; Guest 1991; Storey 1995). These include: a strategic approach to the management of people, and the integration of the HR policies with the overall business strategy; the crucial role of line managers in the delivery of HRM policies; a focus on the achievement of organisational commitment and a common set of values, and a shift from management-trade union relations to management-employee relations from collectivism to individualism. There is a question, however, about the extent to which business organisations have embraced these sets of practices. Is HRM, for example, more rhetoric than reality? What does the empirical evidence indicate about the adoption of HRM policies? Much of the research on this question has been conducted in Britain. Storey's (1995) studies of large mainstream British organisations, for example, have revealed mixed results. He found, first, that most companies continued to recognise and deal with trade unions, and had not embarked on a unitarist style of management. Second, there was little evidence of a

strategic integration of human resource policies with the corporate strategy. Most of the personnel initiatives arose in an ad hoc and unco-ordinated way. Third, his case studies revealed that line managers had increasingly become key players in employment matters, where they were now much more likely to be devising and delivering new policy initiatives. This was consistent with the HRM model. Last, many of these large companies were involved in 'cultural change' programs which emphasised the need for higher organisational commitment. Sisson (1993) has drawn upon the third British Workplace Industrial Relations Survey (WIRS) to shed light on the possible development of HRM practices. From the evidence available, he concludes that important elements of HRM are indeed taking root: direct participation and involvement, performance-related pay, and career development programs; line management is also growing in significance. What is striking, however, is that these practices are much more likely to be found in union rather than non-union workplaces. The non-union sector was characterised by less consultation and employee involvement, and higher incidences of 'unorganised conflict' such as employee turnover and absenteeism as well as by higher rates of accidents and dismissals. There were also fewer formal mechanisms through which employees could contribute to the operation of their workplace (Purcell 1993). Non-union workplaces were not HRM innovators. They were, according to Sisson (1993), better characterised as 'bleakhouses'. Guest and Hoque's (1996) research on HRM practices in greenfield sites in Britain has yielded similar conclusions. They found that a union presence was associated with a 'high utilisation' model of HRM. Unionised establishments were significantly more likely to practice HR policies with both external and internal fit: the policies were integrated with the business strategy and with each other. A much lower proportion of non-union establishments fell into this category. In relation to the larger companies, the British evidence suggests that many of them have adopted a dualistic approach to employee relations. They practised collective bargaining and HRM policies in parallel, with little or no relationship between the two. Sisson (1993) believes that this can be explained by the fact that:many British management know that it is naive to think that they can do without unions in the short run; they do not have the managers who can manage 'individually', and they cannot afford the time and resources in people management that would be required to do so effectively (p. 208).

In Australia the picture is somewhat less clear. Certainly, there is evidence of some organisations actively pursuing an HRM approach. In the case of the mining company CRA, this has taken a strongly unitarist form. The company has sought to place employees on individual contracts and restrict the bargaining activities of trade unions (Hearn Mackinnon 1996). In other cases, such as BHP, the National Australia Bank and the

Ford Motor Company, a collaborative partnership with trade unions has been more evident. Mathews (1994) has shown how the Ford Motor Company, for example, has enhanced both quality of work and productive efficiency by reconstructing jobs to provide for greater responsibility and employee involvement. The strategy, which has included the establishment of selfmanaging teams and other significant organisational and managerial changes at the workplace, has been developed with the full involvement and support of the industry union. Mathews (1994) claims that the company has successfully been able to integrate 'both industrial relations and human resources management in the wider context of production strategy and enterprise restructuring' (pp. 1745). The first Australian Workplace Industrial Relations Survey (AWIRS), which collected information on over 2000 workplaces in 1990 (see Callus et al. 1991), gave little indication, however, that Australian firms in general had embraced HRM. Managers in only one-third of workplaces claimed that they practised a philosophy of teamwork/consultation, and a majority of organisations did not regularly provide information to employees (p. 269). Furthermore, only a minority of organisations reported the use of performance-related pay for nonmanagerial employees, and few work places measured productivity systematically. Moreover, there was little devolvement of responsibility for human resource/industrial relations to line managers. Supervisors and line managers made, on average, only 14 per cent of key personnel decisions (pp. 7980). On the basis of this survey material and other case study research, Bamber (1992) believes that the pursuit of HRM policies is far from widespread:many of the claims about strategic HRM are exaggerated and rhetorical, rather than being realistic and generally implemented . . . inconsistent and ad hoc forms of . . . management have by no means yet been displaced by long term, consistent and strategic HRM (p. 104).

Research conducted by the Department of Industrial Relations (1995) provides more up-to-date information on managerial practices across Australian workplaces. Its national survey of managers and employees, nevertheless, showed little evidence of improved information flows, or more extensive employee participation in management decision making. Moreover, there was a surprisingly low incidence of performance-related remuneration and profitsharing schemes. In addition, it was uncommon to find strategies to reduce absenteeism that may have involved efforts to enhance organisational commitment. Despite these observations, the Department of Industrial Relations (1995) concluded that Australian companies had indeed embarked on quite a range of human resource initiatives, although it observed that 'where change was bargained [with trade unions or employee representatives], the extent of reform appeared to be greater' (p. 166).

Kelly and Kelly (1991) have attempted to make an assessment of the impact of human resource practicesor 'new industrial relations' tech niques, as they call themon the attitudes and behaviour of employees. They reviewed the results of seventeen different studies of share ownership programs, profit-sharing schemes, quality circles and autonomous work groups in the U.S.A., Canada and Britain. Collectively the studies showed that, while employees often demonstrated positive attitudes towards the human resource techniques themselves, there was no lasting impact on worker-management relations, and on 'them and us' attitudes in particular. Kelly and Kelly claimed that there was no evidence to indicate that the variety of practices had altered workers' largely negative views of management in general. This was put down to four reasons. First, employees had little or no say in the decisions to adopt the new human