Conflicts

Source of Conflict in the Workplace:

An important skill that we have been practising is social skills.
The role and responsibilities of employee and employer representatives, such as trade unions that represent the
interests of the employees, mainly revolve around achieving the main interests of the stakeholder group they are
representing.
The interest of stakeholders:
● Employees
○ Their main interests are having good rates of pay and benefits, job security, satisfactory
working conditions, opportunity to complete training.
● Employers
○ Maximizing profits
○ meeting sales targets
○ low staff turnovers
○ productive workforce

Between these two stakeholders, conflicts can happen. They usually happen for:
● Ineffective communication
○ When you don't know how to talk with other people messages aren't passed clearly and this
creates a problem. This often happens when employees feel left out or don't get what the
employee is saying.
● Change
○ Change can be a very big or small event that causes stress and stress creates bad
communication. The more stress and adjustments employees face, the more likely conflicts
can arise.

● Lack or resources
○ In every organization, resources are limited. Employers have to decide where to use these
resources, and not everyone will be happy with these choices. For instance, if one
department gets new equipment and another doesn't, it can lead to discontent. The most
common resource-related conflict happens when employees want higher pay, but the
employer either can't afford it or chooses to spend resources elsewhere. This links to the
motivational theories we've learned earlier.

● External Factors
○ External factors can significantly impact businesses and sometimes lead to conflicts. Here
are a few examples:

1. Economic Downturn: When the economy slows down, a business may have
less money to distribute, which can cause conflicts over resource allocation.
2. Government Regulations: If the government mandates a minimum wage
increase, employers may have to pay junior employees more, potentially
leading to disputes.
 3. Social Demands for Ethical Practices: When society demands more ethical
products or services, manufacturing changes may be needed, affecting
employees and potentially causing conflicts.

● These external influences can disrupt the internal workings of a business and create tensions.

Approaches to Conflict:
Neither employers nor employees are happy when there is conflict as it has negative consequences on the
organization and its stakeholders.
We need to learn about how employees and employers approach a conflict in the workplace. There are multiple
ways.
Approaches to conflict by employees:
There are three approaches to conflict by employees outlined in the IB Business Management Guide, and these are:
● Collective bargaining
○ is a process where employees, often in unions, negotiate with management about wages
and working conditions. This collaboration allows workers to join forces, increasing their
influence to achieve their interests. It is not limited to unionized organizations but is more
common there. Representatives of the union(s) typically assist in these negotiations,
enhancing the employees' bargaining power.
● Work-to-rule
○ Work-to-rule is an industrial action where workers strictly adhere to established work rules
but nothing beyond them. This approach lowers productivity and efficiency as employees
only fulfill the minimum requirements outlined in the collective bargaining agreement.
● Strike Action
○ A strike is a work stoppage initiated by employees due to wage or condition concerns,
aiming to prompt new negotiations.
Approaches to conflict by employers:
● Collective bargaining
○ Employeers may use the collective bargaining approach to find some common ground
between the parties so an agreement can be reached to result the conflict
● Threats of redundancies
○ Redundancy is when a job is no longer needed, leading to the position being eliminated and
the person losing their job. In tough financial times, managers might use the threat of
redundancy to negotiate lower wages for employees.
● Changes of contract
○ Employers may attempt to alter an employee's contract during renewal to benefit the
company, potentially by reducing pay or benefits. However, laws in most countries protect
both employees and employers from unfair contract changes.
● Closure
○ A closure takes place when the employer closes the business, potentially forever, to avoid
the conflict. Obviously, this would be an extreme approach to employee-employer conflict.
● Lockouts
○ Lockouts are the opposite of strikes. They happen when management locks up the
company or factories during labor negotiations, preventing workers from entering, even if
they want to work.
Conflict Resolution:
● Conciliation and arbitration
○ Conciliation and arbitration can occur in the collective bargaining process
○ Conciliation is the agreement to rely on a third party—someone with expertise in dispute
resolution.
○ Arbitration occurs when management and labour present their arguments and evidence to
the third-party arbitrator, who then makes decisions, which are typically binding for some
agreed-upon amount of time.

● Employee participation and industrial democracy

○ In a broad sense, industrial democracy refers to the process of allowing workers to have a
say in the decision-making of a company.
○ In a narrower sense, industrial democracy is co-determination, whereby several workers
will sit on the board of directors of the company and assist in making the highest-level
organizational decisions.

● No-strike agreement
○ A no-strike agreement is a provision in the collective bargaining agreement whereby the
workers agree that they will not take strike or other industrial action against the company
for a specified period, typically the life of the collective bargaining agreement.

● Single-union agreement
○ Single-union agreement is simply the agreement by workers and management that all
workers at the company or a specific site will be in the same union.