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Management-union partnership eases difficult market conditions

22nd May 2002
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Partnership between management and unions can have a beneficial impact on companies' financial performance where the workplace faces a declining or turbulent market, according to new research published today. The finding comes from research undertaken by the independent Policy Studies Institute commissioned by the Department of Trade and Industry. The study - Collective Bargaining and Workplace Performance - is based on analysis of data from interviews in 1998 with 3,000 managers and nearly 30,000 employees.

Other findings include:
- trade unions generally did not have a detrimental effect on workplace performance or the industrial relations climate - overall the effect was neutral;
- 90 per cent of managers rated the employee relations climate as 'very good' or 'good', compared to 55 per cent of employees;
- employees' belief that management took unions seriously
improved perceptions of climate, even when unions were not
recognised.

Commenting on the report, Alan Johnson, Minister for Employment Relations and the Regions, said: "In modern, productive workplaces, trade unions make an important contribution. This report shows that when management and unions work together it can make a real difference. Where partnership exists it can mean prosperity for all, both in
terms of the industrial relations climate and, in the case of businesses facing difficult times, a boost to their financial performance."

The study was undertaken to establish whether different forms of collective bargaining arrangements had different effects on workplace performance. It examined both managerial perceptions of financial performance and managerial and employee perceptions of the management/employee relations climate.

Co-author of the report, Alex Bryson, of the Policy Studies
Institute, said: "These findings are consistent with the notion that the workplace can benefit from social partnership. Our research showed employer orientations to unions and union membership played an important role in determining workplace performance. Managerial support for and a preparedness to engage seriously with unions bring rewards in terms of an improved industrial relations climate. Equally, where unions were present, management opposition to them is detrimental to climate. Unions are also beneficial where employees view them as effective in
delivering for them. The question that the report begs is: what are the conditions under which employees perceive unions as effective, and thus able to contribute to better employee relations?"

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