IR issues in mnc
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Industrial relations issues in multinational corporations (MNCs) in India have been largely peaceful recently due to several factors. Educated Indian workers recognize the benefits of cooperation over strikes. MNCs also use strategies to prevent unionization. Unions can regain influence through international cooperation and lobbying, while MNCs should decentralize labor relations and consider host country rules to maintain peace.
IR issues in mnc
- 1. Industrial Relations Issues in MNC Capt.Ramrao Ranadive
- 2. In Indian scenario the present status is very unique on account of record for peaceful Industrial relations in the recent past . This is on account of: a. The boom witnessed in the economy and globalization percolated down to industrial workers in the form of increased emoluments and amenities. b. Workers themselves have recognized the futility of waging strikes or resorting to work stoppages. c. Employees of today are better educated and have better awareness about competition, quality, MNCs and work ethics. Strike is the least preferred choice for employees as of now. d. Business Process Outsourcing, (BPO) companies deploy both exclusive and or inclusive strategies to prevent unionisation. e. The middle class youth ( who are the main beneficiaries) are enjoying the life style and the status associated with their jobs like upward mobility, clean work clothes, and state of the art workplace. f. Finally, proactive HR techniques encourage a more individualistic approach as compared to a collectivistic approach to grievance redressal. Attributes of Overall Peaceful IR in India esp. MNC’s
- 3. 1. Highly educated and skilled workforce, conscious of their value and ability to contribute to organizational success in a individual capacity. 2. More evolved organizational philosophies, that treats its employees as assets and stable holders in achieving organizational objectives. 3. Employee friendly welfare measures, benefits and perquisites making the work place a desirable and comfortable place during work hours. 4, Encouraging employee’s voice in managing organizational process through cross cultural team. Constant feed back from employee to employer and vice versa. 5. Compensation is fairly disbursed in proportion to transparent policies that reward skill and performance. 6. Increasing use of remuneration devices like ESOPs ( Employee Stock Options) ; profit sharing and gain sharing incentives plans that instill a sense of ‘ownership’ in the organization. Resultant Evolution and changes on account of Attributes
- 4. Conceptual model for International Industrial Relations
- 5. Key Issues in IIRs: 1. Who should handle Labour Relations – HQ or Subsidiaries in the concerned countries. This depends on a) The lab. Relations function is centralised and is coordinated by HQs when there is a high degree of inter-subsidiary production integration b) The nationality of ownership of the subsidiary has an impact on the who should handle employee relations c) Subsidiary characters also influences on who should handle employee relations. d) Finally, where a subsidiary depends more on its parent company for Sources, there will be an increased corporate involvement in lab. Relations
- 6. 2. What should be the Union Tactics? a) The most common one is ‘strike’. Unions should be cautions before restoring to a strike in international scenario because: the bargaining power of an union may be threatened or weakened by the financial resources of a multinational. This is particularly evident where an MNC has adopted a practice of transnational sourcing and cross subsidisation of its products or components across different countries b) Form International Trade Secretariats (ITSs) – there are 15 ITSs who mainly facilitate the exchange of information. Primary goal of ITSs is to achieve transactional bargaining with each of the MNCs in its industry. c) Lobbing for restrictive national legislations – on a political level, trade unions have for many years lobbied for restrictive national legislation in United States and Europe. The motivation for trade unions to pursue restrictive national legislation is based on a desire to prevent the export of jobs via multinational investment policies. d) Finally, Labour unions seek intervention from the global body like ILO, UNCTAD, EU, OECD (Organization for Economic Cooperation and Development) etc. who has a clear agenda for safeguarding the interests of workers all over the world.
- 7. ITU Improvement in Recruitment (membership) drive Develop Workers centres Union need to pool resources via Mergers. Lobby for Restrictive National legislation International Trade secretariats (ITS) Using the good offices of international organizations Actions unions can undertake to regain, consolidate and play a critical role
- 8. 1 To overcome the national differences in economic, political, and legal systems causing different labor relations systems across countries, multinationals should delegate the management of labor relations to their subsidiaries. & Subsidiary managers should maintain the peaceful interactions between the employer and the employees in the context of host country’s rules & regulations. 2. Multinational managers should set up international human resource management approaches according to the national conditions of each subsidiary. 3. Multinational managers chosen should have some prior experience in labor relations. 4. Multinational management attitudes or ideology concerning unions must play an important role in international labor relations. 5. International human resource managers should understand international regulations and applying those to labor relations such as those developed by EC, ILO, and OECD, they should have versatile knowledge about the global environment and the international labor regulations. Actions Organizations can undertake to ensure maintaining cordial Industrial Relations