Employer-Employee RelationsPrepared bySheila Lo Dingcong

Discussion Outline• Perspectives of Employer-Employee Relations

• Employee Relations in the Micro and Macro Levels

• Management and Employee Rights

• Labor Unions in Business Organization

• Collective Bargaining

What do you expect from your employees?

What do you want to get out of working?

Perspectives of Employer-Employee Relations

Employees

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Management

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What is Employer-Employee Relations?• Originally broadly defined to include the totality of relationships and

interactions between employer and employees. From this perspective, it covers all aspects of human resources management. Sometime, however, in the last century, the term has increasingly taken a narrower, more restricted interpretation that largely equates it with unionized employment.

• ER-EE relations is the interplay of the necessary processes in maintaining the relationship between employees and management. In the Philippine context, this component of human resource management covers representation, negotiated terms and conditions of employment, and the mechanism for dispute or conflict resolution.

Models of ER-EE Relations• Total congruence of employer’s and worker’s

interests and goals, hence there is no conflict.

• Unitarian perspective where the organization is perceived as an integrated and harmonious whole with the ideal of “one happy family”, where management and other members of the staff all share common purpose, emphasizing mutual cooperation.

• Paternalistic approach where it demands loyalty to all employees, being predominantly managerial in its emphasis and applications.

• Consequently, trade unions are deemed as unnecessary since the loyalty between employees and organizations are considered mutually exclusive, where there cannot be two sides

Perfect Polarization

Cooperative Co-optive

Models of ER-EE Relations• The interest of labor and management

are diametrically opposed to each other.

• Referred to as the Marxist or Radical perspective. This view of industrial relations looks at the nature of the capitalist society, where there is a fundamental division of interest between capital and labor, and sees workplace relations against this history.

• Conflict is therefore inherent and seen as inevitable and trade unions are a natural response of workers to their exploitation by capital.

Perfect Polarization

Cooperative Co-optive

Models of ER-EE Relations• There are conflictual interests but congruence of

interests in common areas like profitability and survival of the organization.

• Pluralistic perspective where the organization is perceived as being made up of powerful and divergent sub-groups, each with its own legitimate loyalties and with their own set of objectives and leaders - management and trade unions.

• Role of management would lean less towards enforcing and controlling and more toward persuasion and coordination.

• Trade unions are deemed as legitimate representatives of employees; conflict is dealt by collective bargaining and is viewed not necessarily as bad a thing and, if managed, could in fact be channeled towards evolution and positive changes.

Perfect Polarization

Cooperative Co-optive

Models of ER-EE Relations

• The interests of the workers are subservient to management interests.

• Similar to the perfect model but in the Co-optive model, a union may be allowed to exist but it is more of a “company union” or “yellow union” where it signs a “sweetheart” contract with the management just for show with no substantial concession granted.

Perfect Polarization

Cooperative Co-optive

Employer-Employee Relations at the Micro and Macro Levels

The Signing of the PAL-PALEA Settlement Agreement

Employer-Employee Relations Framework

NATIONAL LEVEL ENTERPRISE LEVEL NATIONAL LEVEL

• Social Justice – • Full protection to labor to

enhance human dignity• Reduce social, economic, and

political inequalities• Equitably diffuse wealth and

power for the common good

• Industrial Democracy• Free bargaining and

negotiation• Voluntary settlement of

dispute• Bipartrite

• Rights and Duties• Civil Code of the Philippines• Labor Code of the Philippines• Concept of shared

responsibility

• Employee Representation• Unions• Associations• Labor organizations

• Collective Bargaining• Terms & conditions of

employment

• Grievance Machinery• Conflict resolution

• Equity• Just share in the fruits

of production• Compensation• Personal satisfaction

• Productivity• Efficiency• Reasonable return of

investment• Growth

• Industrial Peace• Harmonious relations• Social development

and progress

Trade Union Stats

National Unions

Labor Law Compliance and Labor Case Resolution

Management and Employee Rights

What are the rights of management?

• Conduct business

• Prescribe rules

• Select and hire employees

• Transfer or discharge employees

• Discipline of employees

“Management Prerogatives”

Labor Unions in Business Organizations

What are the rights of employee?

1. Security of tenure

2. Living wage and just share in the fruits of production

3. Humane working conditions

4. Self-organization

5. Collective bargaining

6. Concerted action including the right to strike

7. Participate in policy and decision-making processes

What are Labor Unions for?

1. A manifestation of industrial democracy • Equal partners in industry• Shared responsibility

2. Representation of individual employees• In unity there is strength• Organized action

3. Bargaining • Terms and conditions of employment• Participation in policy and decision-making

A manifestation of industrial democracy

“The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace.

The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns on investments and to expansion and growth.” (Art. XIII, Sec.3, Philippine Constitution)

Representation of individual employees

“Free collective bargaining is not possible where one of the parties is in a position to impose its will upon the other. It is, therefore, of primary importance that workers should be enabled to possess a bargaining power at least equal to that of the employers and that they should be fully protected in the exercise of their right to self-organization.” (Royal Interocean Lines Inc. v. CIR, G.R. No. L-11745, Oct 31, 1960)

It is now universally recognized as the rule that working men (and women) have the right to organize into unions, provided it is for a lawful purpose. Labor has as much a right to organize as has capital….Not only trade unions today are lawful, but because their aim and purpose is to better the living conditions of a larger part of the body politic, they are considered a necessary part of the social structure, and recognized as a legitimate and useful part of the industrial system. (63 C.J., Sec.4, p.656 as quoted in Azucena, LCP with comments and cases, Vol 11, 1993)

Bargaining

While it is a mutual obligation of the parties to bargain, the employer, however, is not under any legal duty to initiate contract negotiation. The mechanics of collective bargaining is set in motion only when the following jurisdictional preconditions are present, namely: (1) possession of the status of majority representation of the employees’ representative in accordance with any of the means of selection or designation provided by the Labor Code; (2) proof of majority representation, and (3) a demand to bargain under Article 250, par. (a) of the New Labor Code. (Loy v. NLRC, G.R. 54334, Jan. 22, 1986)

Collective Bargaining

Collective bargaining or negotiations towards collective agreement is a democratic framework under the New Labor Code to stabilize the relation between labor and management to create a climate of sound and stable industrial peace. It is a mutual responsibility of the employer and the union and is their legal obligation. (Loy v. NLRC, G.R.54334, Jan.22, 1986)

Art. 252. Meaning of duty to bargain collectively. The duty to bargain collectively means the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement and executing a contract incorporating such agreements if requested by either party but such duty does not compel any party to agree to a proposal or to make any concession.

Why Collective Bargaining?

1. Highly flexible method of decision-making compared to legislative, judicial or any public administrative process.

2. Collective bargaining as an instrument for applying equity or social justice to the industrial setting or work environment

3. It is also a means to ensure the participation of employees in policy and decision-making.

4. It provides an orderly system to present and resolve grievances and disputes in the workplace.

5. Majority , if not all, of the employees agree to the terms and conditions of their employment based on the agreement.

Art. 253-A. Terms of a collective bargaining agreement. 

1. Five (5) years representation issue

2. Freedom Period – 60 days before the expiration of the contract

3. Renegotiation – not later than 3 years

4. Retroactivity – within 6 months from expiration

5. Failure or refusal to bargain is tantamount to unfair labor practice

Employee relations is human relations.

“Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith”. (Art. 19, Civil Code)

Thank you!