History of Labour Relations
Chapter 1: Industrial Relations Theory and Perspectives
Industrial relations are often concerned as based solely upon trade union
actives (Strikes/Stay-aways etc.,)
Objective of the study of Industrial relations- 1. Understanding industrial
relations, 2. Predicting consequences of certain attitudes and actions
There is no unified theory of industrial relations, thus it is easier to
postulate than to attain these objectives.
Historical Background to Industrial Relations Theory
Economists of the industrial revolution (Smith/Mill/Ricardo) – began to
emphasise “natural laws” of economics. This shaped the conditions under
which labour and capital interacted in the employment relationship.
Labour conceptualised as commodity - subject to the laws of supply and
demand.
Believed that there was no justification for any special treatment for
workers – to them special treatment = interfering with the working of the
market forces.
Working class had to bear the pain of the market system – Marx rejected
this notion, which was, described as leading to poverty and alienation
through exploitation.
Capitalist was driven by the need to obtain profits and accumulate capital at
the expense of the worker who was forced to sell his labour/ was paid
subsistence wages.
To the capitalist – worker needed enough to support himself and he’s
family
Capitalist were able to obtain a surplus value from workers.
Surplus Value - the difference between the amount raised through a sale
of a product and the amount it cost to the owner of that product to
manufacture it.
Marx view on surplus value – Surplus Value could only be produced by
labour – thus, this rightfully to the workers and not the capitalists.
Marx theorized that exploitation led to intolerable working conditions
Man became an appendage to the machine during the production process –
alienation/lack of creativity.
, Marx believed “class consciousness”, resulting from the process of
alienation and exploitation, would develop and unify workers, thereby
paving a way to a revolutionary overthrow of capitalist system.
Class consciousness - In Marxism, class consciousness is the set of beliefs
that a person holds regarding their social class or economic rank in society,
the structure of their class, and their class interests.
Marx believed that trade unions should pursue overthrowing capitalist
system.
MARXISM;
1. Workers should not be required to live with the consequences of the
market economy.
2. Conflict of interest based on class difference existed in a cap society.
3. Negotiations with employers provide short-term and temporary benefits
to workers – THUS – replace capitalist system with Marxist state.
4. Trade unions viewed as achieving goals within existing system, however
should ultimate overthrow said system.
WEBBS;
1. Criticised the definition of labour (commodity)
2. Necessity of improving living conditions and upliftment of working class
(like Marx), this can only be done via evolution (unlike Marx –
revolution).
3. Unions viewed as important vehicles for improving the wages of workers
through collective bargaining.
4. Unions advocated that legislation be passed to protect
men/women/children whom were exploited under conditions where the
free market system (capitalist system) was uncontrolled.
Commons (like Webbs) – emphasized the importance of negotiations in
seeking compromise (bet labour/management/public).
How did early “institutional economists” redress the unequal bargaining
power of the parties? – advocated the protection of rights for workers to
join unions and protective labour legislation in areas such as health and
safety.
Pioneers of Industrial relations – concerned with analysis of the role of
trade unions in society (wanted to emphasise/convince management of its
Chapter 1: Industrial Relations Theory and Perspectives
Industrial relations are often concerned as based solely upon trade union
actives (Strikes/Stay-aways etc.,)
Objective of the study of Industrial relations- 1. Understanding industrial
relations, 2. Predicting consequences of certain attitudes and actions
There is no unified theory of industrial relations, thus it is easier to
postulate than to attain these objectives.
Historical Background to Industrial Relations Theory
Economists of the industrial revolution (Smith/Mill/Ricardo) – began to
emphasise “natural laws” of economics. This shaped the conditions under
which labour and capital interacted in the employment relationship.
Labour conceptualised as commodity - subject to the laws of supply and
demand.
Believed that there was no justification for any special treatment for
workers – to them special treatment = interfering with the working of the
market forces.
Working class had to bear the pain of the market system – Marx rejected
this notion, which was, described as leading to poverty and alienation
through exploitation.
Capitalist was driven by the need to obtain profits and accumulate capital at
the expense of the worker who was forced to sell his labour/ was paid
subsistence wages.
To the capitalist – worker needed enough to support himself and he’s
family
Capitalist were able to obtain a surplus value from workers.
Surplus Value - the difference between the amount raised through a sale
of a product and the amount it cost to the owner of that product to
manufacture it.
Marx view on surplus value – Surplus Value could only be produced by
labour – thus, this rightfully to the workers and not the capitalists.
Marx theorized that exploitation led to intolerable working conditions
Man became an appendage to the machine during the production process –
alienation/lack of creativity.
, Marx believed “class consciousness”, resulting from the process of
alienation and exploitation, would develop and unify workers, thereby
paving a way to a revolutionary overthrow of capitalist system.
Class consciousness - In Marxism, class consciousness is the set of beliefs
that a person holds regarding their social class or economic rank in society,
the structure of their class, and their class interests.
Marx believed that trade unions should pursue overthrowing capitalist
system.
MARXISM;
1. Workers should not be required to live with the consequences of the
market economy.
2. Conflict of interest based on class difference existed in a cap society.
3. Negotiations with employers provide short-term and temporary benefits
to workers – THUS – replace capitalist system with Marxist state.
4. Trade unions viewed as achieving goals within existing system, however
should ultimate overthrow said system.
WEBBS;
1. Criticised the definition of labour (commodity)
2. Necessity of improving living conditions and upliftment of working class
(like Marx), this can only be done via evolution (unlike Marx –
revolution).
3. Unions viewed as important vehicles for improving the wages of workers
through collective bargaining.
4. Unions advocated that legislation be passed to protect
men/women/children whom were exploited under conditions where the
free market system (capitalist system) was uncontrolled.
Commons (like Webbs) – emphasized the importance of negotiations in
seeking compromise (bet labour/management/public).
How did early “institutional economists” redress the unequal bargaining
power of the parties? – advocated the protection of rights for workers to
join unions and protective labour legislation in areas such as health and
safety.
Pioneers of Industrial relations – concerned with analysis of the role of
trade unions in society (wanted to emphasise/convince management of its
