S02E01 - How the Role of the Global Employee Relations Executive Was Born

Transcript

Back in 2020, in a world before COVID, I launched the “Wild-side podcast.” After 26 episodes, the podcast paused as the pandemic changed the world – and not least the world of work – and I joined Amazon. The company was striving to meet massive increases in demand whilst assuring employees of a safe and healthy working environment. Doing this with the support of trade unions and works councils was one of the biggest challenges in my career. Meanwhile, the 26 episodes of the Wild Side went viral with more than 6,000 regular listeners in more than 60 countries.

As planned, and three years on, I’m back with the HR Policy Association and a new consulting venture – Global Employee Relations Solutions. A lot has changed and, re-listening to the podcasts, I decided to bring them up to date and to add some new ideas and fresh thinking. So, over the next months, we’ll be bringing back the Wild Side.

In this first episode, I’ll look at how the role of the employee relations executive was created as an essential ingredient to business success. Going forward we’ll look at international institutions and the framework for employee relations; outline some key concepts to enable the understanding of the global role; I’ll talk about national employee relations systems from works councils in Western Europe to power-based systems in the United States; the impact of social networks on employee relations; and how to identify and manage employee relations risk.

I’m Alan Wild, Senior Advisor on global employee relations to the HR Policy Association, the leading voice of CHROs today. You are listening to “A Walk on the Wild Side… Managing Global Employee Relations in Modern Times … 10 Minutes or so at a Time.”

Let’s start with a modern definition of employee relations. There are many. Our own Global Employee Relations Fundamentals program talks about “A value driven framework for managing relationships with workers that optimizes engagement, productivity and flexibility and identifies, predicts and manages risk wherever the business operates in the world.” It contains important words: value driven, engagement, productivity, flexibility, and risk. All of them important, but, personally, I prefer the broader and simpler definition: “listening and responding to employee voice.” It goes beyond the old-fashioned notion that employee voice is the monopoly of trade unions; beyond the idea that employee relations risk comes only in the form of strikes or work to rule type sanctions; or that an employer’s responsibility starts and ends with those with an employment contract.

Don’t get me wrong, trade unions are neither dead nor dying and we’ll be looking at how their role is changing. Indeed, as I record this, the US has faced threatened conflict at UPS and real conflict in the motor industry; union bargaining claims at Starbucks and Amazon became front page news; in the Fall of 2023, strikes in the UK are at their highest in recent history; and France has been brought to a halt by mass strikes and protests over pension reform. If only it were that simple. Google workers staged a protest that moved across the globe in a wave from East to West in the so-called #GoogleWalkout without a union in sight. Business Executives lost their jobs after social media protests about their personal behaviors … think Susan Fowlers blog that started the social tsunami that resulted in the removal of Travis Kalanick. In Mexico, Susana Prieto led a protest in Matamoros against a deal struck by unions that shut down 90 companies with 90,000 workers following her strike call and securing a massive pay increase. Beyond the employment relationship, there are many examples of business disruption, but the Rana Plaza disaster in Bangladesh that damaged the reputation of major apparel companies stands out. It fueled subsequent legislative actions making companies responsible for workers in their supply chain and outside their home country. UK anti-slavery laws and the proposed EU supply chain Directive are good examples of how soft law pressures that started in the early 1990s are turning into hard law.

In the series we will dive deep into all these questions. But first things first. Let’s step back a little and talk about how the management of what was labour relations changed from a local or occasionally national issue to a global one, and how the role of the global employee relations executive was born.

In my lifetime, and at the start of my career, labor relations was still about dealing with trade unions, and those dealings were local. The “traded world” was limited to the US, Canada, Western Europe and Japan. In the Anglo-Saxon part, with the UK and United States being the exemplars, labor relations specialists met with shop stewards and union officials to bargain on pay and changes in working practices for sites. In Western Continental Europe sectoral or national bargaining set pay and conditions for entire industries without company management or local employee representatives being present. Day-to-day issues were discussed with works councils. Japan had its very own distinctive Shunto system of pattern bargaining and continuous improvement management techniques.

Trade unions were powerful and well-organized in industries like the mines, docks, steelworks, newspapers, the motor industry and manufacturing generally. Trade union leaders were household names and wielded political influence with their financial and vocal support for left wing parties.

… and then came four massive shifts that changed the conduct of employee relations for ever.

First, a massive wave of offshoring started in 1989 with two geopolitical events and a technology breakthrough. The fall of the Berlin Wall opened the door for the countries of Central and Eastern Europe into the global market economy. The incident in Tiananmen square reinforced China’s move into the market economy as the government recognized the need to improve the living and working conditions of the Chinese population. If Central and Eastern Europe and China became magnets for manufacturers, the democratization of access to technology at established India as the offshore location of choice for services.

The number of workers in the trading nations of the world literally doubled, and the workers were skilled and cheap.

Second, companies not only offshored their own jobs but had also begun to outsource manufacturing of goods like clothes and toys elsewhere around the world and to more distant places like Bangladesh, Vietnam, Thailand, the Dominican Republic, Peru, the Cote d’Ivoire and more. Concerns over exploitation of children and forced labourers, and damage to the brand reputation of companies like Nike, Matel, Apple and Nestle accelerated the move on supply chain compliance based on ILO and UN instruments. The UN Guiding Principles on Human Rights agreed in 2011 led the movement from soft law to hard law.

Third, employees who were not union members found a new voice. The explosive growth of social networks across society found its way into employee relations. Global campaigns, like #metoo, attracted the attention of boards of directors and #Google walkout showed the power of a different form of activism.

Fourth, and finally, the European Works Council Directive passed in 1994 provided a ready-made vehicle for face to face networking of employee representatives and access to senior managers in major international companies.

That, in a nutshell is how it all went global and how the international employee relations specialist role was born,  and this series of podcasts is for you. In the coming episodes we will be putting meat on the bone in a practical way based on real events and stories. I am Alan Wild and you’ve been listening to “a Walk on the Wild side.”