Labour Management

Abstract

Working conditions and the relationship between employee and employer are in a state of flux. Decentralising technologies, such as the computer, support for outsourcing, the growth of service industries, and sustained higher levels of unemployment are changing the employment relationship that was part of industrial society. Each of these factors has increased the incidence of external labour markets after several centuries when internalisation had become increasingly popular. In addition, flexibility of skills and individualised work contracts are increasingly seen as the most effective means of harnessing new knowledge and extending economic growth. Again, this reverses the popularity of deskilling and collective bargaining. This process of change is vividly demonstrated in Japan where the broad employment contract, common among large-scale firms since the Second World War, is being replaced by narrower terms in firms such as Nissan and Matsushita. British employment conditions were radically altered in the 1980s and, more recently, in Australia centralised wage determination is in retreat. Firms have mostly recognised the importance of fostering good human resources as a valuable corporate capability and in this chapter we will examine the manner in which they have developed labour-management policies in response to environmental conditions and used them as a source of competitive advantage.