Time for trade unions to reinvent themselves

Written by YRK Reddy | Updated: Oct 29 2005, 06:21am hrs
Some trade union federations in India have targeted ICT and BPO companies for special protection and unionisation by end-2006. While most companies and industry associations oppose this move, some perceptive people believe that such inevitability can indeed be turned into an advantage, if unions reorient themselves.

The familiar purpose of unions was beyond the enterprise and in favour of workers solidarity, even if class struggle has become rhetorical history by now. Trade unions have been competing for the loyalty and commitment of employees against managements. Some foolish managers tried the sledgehammer approach, which only strengthened the resolve and need for unions. In this struggle, there have been much cloak-and-dagger gyrations that dissipated energies, misdirected attention and drained emotional capital required for survival and growth. The eyes of both parties were off-the-radar, to try and make the other blink first!

Such approaches and methods of both unions and managers have only increased the transaction cost in managing human resources to unsustainable levels. They have heightened divisive thinking and bickering that are common to union-centred politics. They also induced bureaucracy and rigidity in the name of internal equity and rights, both of which can be massaged around dynamically to suit individuals and the context. There is much fatigue amongst all for thissurveys show that a majority of employees now wish to stay away from unions.

It is no wonder, then, that a large number of companies in the sunrise industries remain non-union. And these firms are exceptionally aggressive in promoting human resource policies and building human capital that can be effectively utilised. An unstated assumption behind human resources management practices, as against the conventional personnel management, is that work places will be mostly union-free. Most of the companies rated as great places to work are indeed non-union.

Surveys show a majority of employees want to stay away from trade unions
Most companies that are considered great places to work are non-union
Increasing transaction costs for a work place will only damage the unions
In June 2005, the Society for Human Resource Management, USA (SHRM) and the Great Places to Work Institute (GPTW) announced the top 50 small and medium companies to work for in America. Amongst these, only two had unionised workersGraniterock, a mining, building product and asphalt construction company and MidState Medical Centre, a private, non-profit hospital. As reported in the recent SHRM magazine, these two reportedly overcame what some believed as a vexing challenge and potential road block. The companies evidently treated unions with respect and fulfilled their obligations, but kept union-related issues at the margin. The idea probably was to think less of the union and focus more on people directly. They apparently ensured that the union does not drive the atmosphere in the company and made work highly enjoyable and satisfying for employees.

As such an ideal is difficult to achieve for many, one could also hope that unions will see reason to restructure and reorient their assumptions and tactics. Some trade union federations in the world have shown the way. Thus, for example, the Trades Union Congress in the UK has encouraged firm-level structures by which the shop stewards adopt a new role as intermediates in effectively managing training, learning and knowledge. They have evidently realised the importance of competitive survivalthat their job and wage security is less contingent on managers and more on competition.

Increasing the transaction costs and making employees take their eyes off competitive challenges would result in unions shooting themselves in the foot, and hard. The question now is not whether BPO and call centre industries should be unionised or notthe employees will answer that better, with their choices. But, as to what type of approaches, methods and tactics the unions would adopt in these industries. Would they join hands with managers to curtail attrition, help attain continuously higher productivity and quality levels, even while protecting the security and welfare interests of the workers Will they act as the new intermediary for learning, knowledge management, competence building and team-work, which hitherto was not their concern at all Or will they be driven by history into the past, retarding the industrys growth For, with a hint of higher transaction cost and risk of disruption to work-flow, jobs can indeed fly elsewhere as swiftly as they had landed in our country!