Small change,big impact? Organisational membership rules and the exit of employers' associations from multiemployer bargaining in Germany

German employers' associations first introduced a so‐called “bargaining‐free” membership (BFM) category in 1990, giving companies the option to join and access services while avoiding the obligations arising to regular members from industry‐level collective agreements with unions. To explain how this phenomenon contributes to change in the German political economy, we investigate why some associations offer their members BFM status whereas others have refused to introduce this option. Controlling for influences such as size and industry, our multivariate analysis of survey data shows that four sets of influences are positively associated with BFM: the role of courts' judicial decisions as “door openers,” structural characteristics of diverging business environments, the evaluation of multiemployer bargaining by the leadership of the association, and the strategic choices of associations.     

Adapting to survive: The case of Danish employers' organisations

Scholars often characterise Danish employers' organisations (EOs) as relatively stable, with a continuing role in the coordination of industrial relations and corporatist policymaking. This article shows that, beneath surface stability, Danish EOs have significantly adapted structurally and functionally to survive environmental pressures. However, rather than converging onto a liberal market trajectory, we find that Danish EOs have layered new functions onto traditional collective functions. We also find significant variations in functional adaptation depending on the employer constituencies' exposure to international competition and position in value chains. We argue that these adaptations imply that the provision of collective goods, especially in collective bargaining, is no longer sufficient for the survival of EOs.     

The impact of HRM practices on service quality,customer satisfaction and performance in the Indian hotel industry

This article reviews findings from a first survey of employers' views on collective bargaining reform that now forms the centrepiece of post-apartheid South Africa's experiment with 'democratic corporatism'. Using factor analysis, three constructs have been identified that inform employer attitudes to a revised system of sectoral bargaining: 'autonomous capacity'; 'conditional association'; 'external threat'. Despite the potential for anomie, these factors appear significant in the way they consistently explain an employer's orientation towards associational membership and, by proxy, sectoral bargaining. Moreover, at least two-thirds of responding firms identified strongly with each of the three factors but, typically, firms with weak capacity and in need of collective protection from the other actors are most likely to associate. Regression analysis further reveals company well-being, foreign ownership and union presence to have a significant impact on these three factors to varying degrees. Equally, two of the factors (autonomous capacity and external threat) impact significantly on an employer's tolerance of free-riding in others and on the temptation to do so for oneself. Overall, for this sample of firms, employer bodies are to be viewed more as 'political devices' than as 'economic agents' in the immediate aftermath of political liberation. In this sense, they are different from their European counter-parts. However, there is an increasing likelihood of this changing as the flexibility agenda looms ever larger in employers' minds and as issues of 'political insecurity' correspondingly fade.     

Collective bargaining in Portugal in the aftermath of the crisis: trends and prospects

This article examines the decline of collective bargaining in Portugal during the recent economic crisis and why, following significant improvements in the economic and political contexts, the number of collective agreements published each year remains lower than before. Drawing on theoretical work on institutional change by Streeck and Thelen (2005) and Baccaro and Howell (2017), it argues that industrial relations institutions in Portugal have been subject to an incremental but transformative process of liberalisation. The analysis of national data and in‐depth interviews with key informants reveals that serial legal amendments since the 1990's weakened unions, converted bargaining into a mechanism to introduce flexibility and wage austerity and reduced incentives for the parties to conclude agreements. While these changes were gradual, their consequences became clear during the crisis. By improving understanding of recent developments in Portuguese collective bargaining, the article enriches knowledge of processes of liberalisation of industrial relations in Europe.     

Decentralised bargaining of working time in the German automotive industry

The article addresses the question whether or not the trend towards the decentralisation of collective bargaining on working time in Germany entails a loss in the binding power of industry‐level agreements. To this end, both working‐time agreements and practices are examined at the firm or establishment level in the automotive industry. Additionally, the article examines the extent to which workplace micro‐level changes are reflected in official statistics. The findings indicate that unions and works councils have taken on new roles preventing a widespread erosion of collective regulations.     

The economics of union organization: Efficiency,information and profitability

This article presents a game-theoretical model of union organization that highlights the role played by efficiency and asymmetric information as determinants of unionization and questions commonly-held assumptions about the effect of firm profitability on unionization decisions. In the model, employers set wages taking into account the effect of their choices on workers' incentives to unionize. As a result of employers' strategic wage setting, collective bargaining emerges in equilibrium only if it increases surplus or if there is asymmetric information about the consequences of unionization. While unionization is usually assumed to be more likely in more profitable firms, the model shows that the probability of unionization will be higher in firms with lower rents. It also shows that the union wage premium and unionization will tend to be negatively correlated.     

When territory matters: Employer associations and changing collective goods strategies

Recent research shows employer associations strategically responding to external challenges, from collective bargaining decentralisation, by altering their offerings of “selective” goods (to directly address threats to membership levels) and of “elective” goods (to revenues). Implicit is that traditional “collective goods” are irrelevant for achieving sustainability. That literature also suggests that territorial associations are more vulnerable than sectoral ones. In this qualitative, longitudinal comparative case study, we explore why and how two territorial associations, the largest each in Italy and Australia, have pursued sustainability by also innovatively enlarging their collective goods activities. This has involved shifting from bargaining leadership to promoting economic dynamism within their territories. Using metaorganisation theory and the resource‐based view, we explain how these associations realised their strategic advantages. Our evidence suggests that innovatively developing new collective goods may be another important way associations can improve their competitive positions.     

Flexible collective bargaining agreements: Still a moderating effect on works council behaviour?

We analyse the interaction between different labour market institutions in Germany, namely, industry‐level bargaining and firm‐level codetermination by works councils. In particular, we are interested in the moderating effect of flexibility measures on the link between the existence works councils and collective agreements on wages and productivity. In presence of institutional changes, the question is whether works councils in covered plants still generate rather than redistribute rents, given recent decentralisation processes in the German system of industrial relations. We augment a theoretical model to provide hypotheses, which are then tested using empirical analysis of representative German plant level data. We find that the existence of flexibility provisions in collective bargaining agreements does not alter the effect of works council on firms' wages. We find, however, that with flexibility provisions works council presence is associated with higher productivity levels than without such provisions. These findings, however, depend on the level of collective bargaining: they can only be observed in plants covered by industry‐level contracts, but do not hold in plants covered by firm‐level contracts.     

Individual contracting,collective bargaining and wages in Australia

We examine wages in Australia under federally registered individual contracts and collective agreements (CAs) using unpublished data from a national earnings survey. The distribution of earnings under registered individual contracts was more unequal than under CAs. Average and median earnings under registered individual contracts were lower than under CAs. There was little evidence that individual contracting raised wages through raising productivity. The link between contracting and pay appears contingent, varying between occupations, industries, and firm size bands and dependent upon employees' position in the labour market and employers' use of union avoidance strategies. This has implications for the interpretation of studies of union wage effects.     

Setting the minimum wage

The process leading to the setting of the minimum wage so far has been overlooked by economists. There are two common ways of setting national minimum wages: they are either government legislated or the byproduct of collective bargaining agreements, which are extended erga omnes to all workers. We develop a simple model relating the level of the minimum wage to the setting regime. Next, we exploit a new data set on minimum wages in 68 countries having a statutory national minimum level of pay in the period 1981–2005. We find that a Government legislated minimum wage is lower than a wage floor set within collective agreements. This effect survives to several robustness checks and can be interpreted as a causal effect of the setting regime on the level of the minimum wage.     

The trend of strikes in coal mining 1949–1979

Explanations for the pattern of strike activity in British coal mining have focused upon the industry's changing economic fortunes or developments in its collective bargaining structure. The author examines these explanations and suggests four additional factors that account for the trend of coal mining strikes.     

Shaping the bargaining agenda. The Audit Commission and public service reform in British local government

This article examines the role of the Audit Commission (AC) in local government collective bargaining. While the AC has no official role in such bargaining, it has a role in monitoring the performance of local government services. In this role the AC has a clear potential, in the context of the government's ‘modernization’ agenda – as manifested in its ‘Best Value’ regime, for influencing both the content of collective agreements, and the process of collective bargaining, where these are seen to conflict with other Best Value objectives – particularly in relation to external competition. The research conducted involved a content analysis of AC inspection reports on human resource services and longitudinal case studies of two local authority union branches' experiences of Best Value and the role of the AC. The findings from the inspection reports indicate that, while the AC is actually acting to promote activities that could be seen as supportive of union bargaining agendas, notably in relation to equality type issues, they are also supporting service externalisation and thereby acting to limit the scope of their impact. The reports also indicate that, despite there being prescribed ‘best practice’ for local government employment relations (‘social partnership’ with unions), the AC is not promoting any such engagement with unions. Evidence from the case studies add weight to these observations: the AC, in one case, was deeply suspicious of an attempted union management agreement on procurement, while in the other, the AC made no criticism of the costly effects that externalization had on union-management relations.     

Free riders: the rise of alternative unionism in Denmark

In this article we analyse some disturbing trends in the Danish labour market: while collective bargaining coverage is still relatively high, union density has been declining and—worse than that—there has been a substantial shift away from recognised and in favour of alternative unionism. The alternative unions are not parties to collective agreements, and they offer membership much cheaper than the recognised unions, in effect taking a free ride on the institutional supports that used to be effective only for the recognised unions. The article explains this conundrum by pointing to the political and institutional backgrounds to this development, which threatens to erode the very basis for the Danish collective bargaining system. On the background of general statistics and of a general employee survey, we point out the reasons behind the challenges confronting the recognised unions, pointing out that the recognised unions must become both more efficient in the member services and more cost efficient, if they wish to halt the present downhill trend.     

The meaning of work,employment relations,and strategic human resources management in Israel

The paper deals with the meaning of work, employment relations, and strategic human resources management. First it shows that Israeli workers have become more individualistic and materialistic, and less collectively oriented, as instrumental achievements outweigh contributions to society. These issues apparently influence employment relations and organizational policies. Next, it deals with the corporatist employment relations system, based on tri-partite collective bargaining among employees, employers, and the state. During various times, the relative balance of power among the three parties swayed considerably, according to major political, economic and social events taking place in society. The final section on strategic human resources management focuses on the transition of Israel's Human Resources profession, from the traditional HR role to the new Strategic Human Resource Management role. These three spheres have gone through some significant changes in the last several decades, perhaps not parallel to most industrial nations.     

Free collective bargaining and incomes policy: learning from Barbara Wootton and Hugh Clegg on post‐war British Industrial Relations and wage inequality

Growing income inequality has returned as a major political issue in affluent, advanced economies, often associated directly with the decline of trade unions and collective bargaining. In policy terms, this has been reflected in the British campaign for a ‘Living Wage’ and the new German minimum wage. Yet on the broader front, Industrial Relations (IR) struggles to find a credible regulatory strategy to address inequality—one that combines state and civil society initiatives and can be legitimised in political philosophy. This History and Policy article argues that there is much to learn from the IR past, before neo‐liberalism. My focus is the writing of Barbara Wootton and Hugh Clegg on ‘Incomes Policy’, from the 1950s to the early 1980s, when this was a central intellectual and policy issue in British IR. I explore the differing justifications for Incomes Policy, from corporatist macro‐economic management to social equality, comparing and contrasting the democratic socialist political principles of Wootton with Clegg's social democratic pluralism. The conclusion relates this historical debate between state pattern and civil society process to current concerns about how social democratic ideas and IR policy can address the problem of labour market inequality.     

Two speed ahead: social Europe and the UK after Maastricht

Legislation and collective bargaining are a different but often complementary means of protecting employees and strengthening workers’ rights. At the EC level both means are now being followed but, at present, since Maastricht largely without the UK. Here the author considers whether in the longer term the UK's isolation from such developments can be sustained even in the light of the outcome of the April General Election.     

The National Football League payroll cost function and labor market institutional changes

Sports club payroll costs typically comprise over 50% of sport clubs' total operating expenses, but little is known empirically about this largest component of club costs. Using data from the National Football League Players Association Salary Cap Information System from 1981 to 2000, a National Football League club payroll cost function is estimated to examine the impact of labor market institutional changes (strikes and collective bargaining) and to test existing theoretical sports club cost functions. As expected, strikes have a negative effect on total payroll, and the two collective bargaining agreements had opposite effects during this time period. Additionally, empirical support is provided for the standard two‐team sport league cost function.     

British employer resistance to trade union recognition

Following the introduction of a statutory mechanism by which trade unions can gain recognition from employers, this article examines employers' attempts in Britain to resist campaigns for union recognition and to undermine newly granted recognition agreements. Using an array of primary and secondary sources, the extent and nature of these employer activities are documented. The article develops a revised schema, following Roy (1980), to help understand and interpret these anti‐union activities. While of significance in deterring and undermining new recognition agreements, these activities are found to represent a minority current in the overall response of employers to campaigns for union recognition.     

European industrial relations in 1999: chronicle of events

This article chronicles industrial relations developments throughout the European Union (EU) during 1999. The information is gleaned from articles published by the European Industrial Relations Observatory (EIRO). The text therefore contains numerical references to records contained in the EIRO database in order to allow the reader easy access to the relevant records. The article is divided into five sections. The first contains an overview of political, economic and legislative events at EU‐level, the second looks at EU‐level developments in employee representation, the third looks at the impact of European economic and monetary union (EMU) on industrial relations and collective bargaining and the fourth and fifth give a more detailed country‐by‐country analysis of main trends in key industrial relations areas—collective bargaining and industrial action; and employment creation, working time and new forms of work.     

Buying into the ‘good worker’ rhetoric or being as good as they need to be? The effort bargaining process of new migrant workers

A great deal of attention in the literature has focused upon employers' stereotypical perceptions of Central and Eastern European workers as ‘good workers’, and the impact such views have on hiring processes in low‐skilled employment. Drawing on multiple case studies, this paper examines the good worker rhetoric through the lens of the effort bargaining process and hard HRM strategies that target marginalised workers in the labour market. In particular, the extent to which migrant workers buy into the rhetoric is explored. It is argued that migrant workers do not fully buy in to the good worker rhetoric because of issues such as high levels of education and personal aspirations and importantly, issues related to employers' strategies, bullying, discrimination, and the segmentation of migrant workers in each organisation.