QUESTION
Can the interest of employees and the interests of business really coincide? What happens when they are in conflict? And what role should HR managers take when they do?
1. Find an example of a situation in which you believe that the interests of senior management/owners are clearly in conflict with the interests of some or all of their employees.
NB. Chose an example described in the media/public domain. When you submit your paper, append key article/s or any lengthy descriptive information.
2. Imagine you are an HRM professional in this situation. What are three options available to you to address the conflict? Which option would you chose and why? Defend your choice in relation to what constitutes ethical and professional behaviour
SOLUTION
Introduction:
This paper seeks to explain and analyze a situation where there is a conflict of interest between the management and the employees. The main focus is to highlight the situation and to analyze the effect of the decision made by the management on the employees and the role that an HR plays in such situations. The specific situation addressed here is one where around 3500 workers at 7 coal mines of BHP-Billiton Mitsubishi Alliance (BMA) (Philips R, 2012) walked out as a result of a failed negotiation related to the contract and working conditions in the coal mines owned by BMA. The parties involved are Australian Manufacturing Union, Construction Forestry Mining and Energy Union (CFMEU), and the Communications, Electrical and Plumbing Union. This shows that all types of factory workers are being affected by this situation. The main agenda for the negotiations were the renewal of the agreement with the enterprise such that the workers benefit from them and get motivated to increase the productivity of the mines. Agitation by workers was a result of many rounds of strikes and failed negotiations. In this paper I will argue that the decision taken by BMA has been motivated by the interests of shareholders and the workers’ interests have been not only ignored but clearly suppressed by the management. The argument will focus on behavior and response of the management towards the demands of the unions. There is an indication that there have been a lot of modifications to the agreements that the unions have originally signed.
Analysis of the conflict of interests:
The conflict is between the workers’ union as indicated by the parties who represent the workers and the management of the company BMA which owns many coal mines in Australia. The negotiations are being done in order to implement a new enterprise bargaining agreement with the company BMA such that it addresses the demands of the workers. The company BHP-Billton has been making huge profits but has offered very small pay rises to the workers. In comparison with the standard of living the pay hikes have been very low and have hardly helped in improving the conditions of the workers. The company BMA has rejected the proposal for increasing the number of breaks for a 12-hour shift, and has further indicated that the work rosters would be modified according to the decision taken by the management. In addition to the existing issues, a mail sent by the chief executive stated clearly the intentions of the management with respect to the current situations. The mail states that the management will not be having any sort of negotiations with the workers’ association and indicates the shutdown of few or many of the coal mines that the company owns. It is clearly mentioned that the company has support from other mining corporations in the country which are facing similar types of problems and are demanding the government to take proper actions against such agitations in the industry.
In order to properly analyze the situation, we need to understand the interests of each parties involved and the reason of conflict between the parties. Firstly, the interests of the workers union is to reach to a bargaining agreement which addresses their concerns- increase in wage rate, leisure hours, and improving working conditions in the coal mines. The unions have been struggling for years in order to solve the dispute with the management. However, due to constant resistance from the management the unions had to go on frequent strikes in order to address their issues. Secondly, the interest of the management in the situation is not to give up to the demands of the unions. The company is a highly profitable company and owns many coal mines in the country. Such a company needs to employ a huge workforce in order to maximize its productivity. But the response of the company is such that they do not want to negotiate with the unions who regularly disrupt the operations of the company. Thus, they demand a government action in order to penalize for such strikes in the industry. It is essential to respond to the needs of the employees as they form an integral part of any organization. The response from the organization indicates that they are not at all interested with what the workers need and have even threatened to close down few coal mines in order to end this dispute which has resulted in huge costs for the management.
Three Options:
As an HR manager in such a company, the important job to do in a situation of conflict is to identify the problems and the parties involved and try to separate them both. It would be expected from the HR to design a strategy considering as many options available in order to satisfy all the parties involved. In this case I will consider the three main options available to me, and explain the consequences of all the three options.
Firstly, one of the options that are available is Accommodation (Robbins S, Decenzo D). This option needs to give priority to any one of the parties involved. This means that one of them has to give into the demands of the other in order to resolve the conflict. In this case I would advise the management to accept the demands of the workers as they form an integral part of the company. Being a profitable company, the company can afford to give a reasonable hike to the wages being paid; this would also help in boosting the morale of the workers and can help in improving the productivity. This solution also improves the relationship between the management and the workers and might indicate that there would be less or no strikes which caused a major disruption in the operations of the mines and resulted in huge loss. This option also demands to improve the working conditions in the mines, which should be taken up by the management as better working conditions means better safety for the employees and also reflects a better image about the company.
Secondly, in order to resolve a conflict one needs to consider what are the benefits and problems for all the parties affected by the conflict. An option which considers the above mentioned factors is Compromising (Robbins S, Decenzo D). This demands each of the parties to give up some demands in order to reach an agreed solution. I would implement this option in such a way that the workers would be given a pay hike but they cannot avail the extra hours of break. Moreover, the work rosters will be implemented after considering the employees’ view. On the other hand, the management would be benefited with no strikes and no disruption in operations. The management would have the choice of signing the new agreement such that it does not give the workers much benefit which results in high costs and at the same time there would not be any indication of dissatisfaction for the workers.
Thirdly, the option of Collaboration (Robbins S, Decenzo D) could be implemented, which would be a win-win solution for both the unions as well as the management. It would mean that the workers be offered whatever demands they make and those should be accepted in such a way that there are no additional costs incurred in the process. This option is difficult to implement as it is not easy to satisfy both the parties at the same time as one’s benefit is other’s loss.
Choosing the most ethical and/or professional option:
Ethical behavior of a person reflects the point to which one is honest, dignified, fair to everyone as well as in every situation (healthprofessions). An ethical person is one who in all circumstances takes a decision which respects each and every individual involved and does not harm anyone in the process. Ethics deals with how one’s behavior affects the entities surrounding the person and how one feels about the decision one takes (learn.co). I believe that ethical behavior reflects about the integrity that a person possesses. It defines one’s behavior and the attributes that one has developed in oneself throughout one’s life. In making certain important decision one will face with situations which may be profitable for the entity but might not be ethical. Such cases test the integrity of the entity taking the decision.
In the corporate world, every professional is expected to respect each other’s principles and needs to behave in such a manner that no one’s integrity is hurt. Three main characteristics that define professional behavior are (wordconsturctions): a) Respect for others: As already stated one is said to be professional if he/she respects other’s value in a workplace and is fair in the work one does. b) Responsibility and integrity: one need to present himself in a manner to gain other’s respect. It is very crucial for one to be honest in such situations in order to prove his/her integrity and c) Commitment to quality and oneself: One has to give full effort to complete a job efficiently as well as effectively.
It can be seen that there is overlapping between ethical behavior and professional behavior. HR personnel are the interface between the management and the workers in manufacturing companies and factories. They have huge responsibilities with them as it is known that there is some difference in views of both the unions and the organization. Moreover, in such cases a question arises of whether the decision taken by the company is ethical? Therefore, in a situation like this I would select the option Accommodation as the management is morally obliged to provide suitable working conditions and motivate its employees towards their work. As explained this option demands the organization to forego their rigidness and accept the fact that with the closure of the mines there would be huge loss not only to the workers but also to the company. It is the responsibility of the organization to ensure that it has taken all the safety precautions in the coal mines. Coal mines is a risky organization as there has been many instances where due to natural calamities many have lost their lives. The option I chose is the best solution in this case as there has been repetitive disruptions for the organizations due to the unions and as a result they have incurred huge losses. Giving into the demand would ensure that in future there would be high satisfaction among the unions and it would definitely improve the relationship between the organizations and the unions. This solution can be seen as a new benchmark set by the organization in the industry and the other organizations can follow in order to bridge the gap between these two entities.
Conclusion:
The report starts with a brief introduction about the conflict that has created lot of disturbances in the industry. The next section provides the context of the situation explaining the issue in detail and provides the analysis of the situation and the viewpoints of the parties involved. It builds up by explaining the interests of the parties and the reason of conflict between them. The next section lists out the options available with an HR in the organization in order to solve the conflict. The three options available were Accommodation, Comprising, and Collaboration. Finally the meanings of ethical behavior and professional behavior were explained. It was highlighted why it is necessary for a person to be ethical and professional in an organization and on the similar line was the option of accommodating the workers with their demands was chosen. It was concluded that it is the ethical and best choice under given circumstances.
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