In his book, The Wealth of Nations, Adam Smith indicated that among the factors of production, labor was the most important and the only true source of a country’s wealth.
He explained that each citizen or laborer had the ability of deciding what was best for them and if the government left them free without interfering in their activities this could result in maximum and optimal productivity of these laborers. The same could be explained of the human resource management, if the department could allow the workers to work freely in a laissez faire (leave us alone) economic environment, workers could have motivation of working an extra step gaining maximum productivity.
However, in the past this was not possible as it was experienced during the industrialization process. During this period, it was very clear that human capital was the central contributor to the generation of wealth and industrial capitalization with the key to productivity being mass production.
As a result, the employers acquired monopolistic powers controlling labor in the manner they wanted since there were no other alternative sources of income. The employers made bumper harvests becoming even richer at the expense of the laborers who continued living in abject poverty (Engels, 2007).
Due to those conditions, the workers viewed that they were being treated negatively by the human resources and thus they formed labor unions. The unions were used by the laborers to represent their interests in efforts of offsetting the monopolist power, which their employers had acquired in the exchange to gaining of more economic gains.
These gains were realized through advocating for better payments, reduced work times and also the abolition of debtor imprisonments. As a result of these movements, employees were now well recognized although the employers were still using the prevailing oppressive legal environment to arrest and jail the union leaders (Engels, 2007).
The union helps employer-employee relation to work together by providing the rules required. For example, through a laborers’ union, there is usually the power of the collective bargaining where the involved stakeholders negotiates the terms and conditions that will be used before the official signing of the contract. The fame of these unions not only is related to a single country but they have spread in many parts of the world with the formation of International Labor Unions.
To work with labor unions, organizations have established labor relation strategies through which they can choose to cooperate or not to cooperate. The first strategy an organization can use is the acceptance strategy where the organization recognizes the workers’ unions as a legitimate player in ensuring the rights of the workers are not abused.
Other firms use the avoidance strategy, where the organization fears that the union might influence how the workers perform their duties and also losing employees. Such a strategy is not advisable as it creates conflict between the two parties (Holley, Jennings & Wolters, 2008).
The role of unions, however, has of late declined especially due to the economic growth and advancements in technology which has led to the shift towards an information service based economy.
These contributing factors include the changing composition of the workforce with majority of workers not joining the unions and with many people undertaking small businesses it has become hard for the formation of a single workers’ union. There have also been changed attitudes towards the unions due to the fraudulent behaviors of their leaders and finally there have been legislation by the authority which now protects the employees thus rendering the unions inactive.
Though workers remain a formidable asset to the productivity of any organization, in the past there had been instances of workers rights abused by their employers and this forced the workers to form unions which could fight for their rights. These unions have done quite a lot in ensuring the relationship between the workers and their employees is not exploitative.
Reference List
Engels, F. Ed. (2007). Capital: A Critique Of Political Economy: The Process Of Capitalist Production: Cosimo Classics Economics. Volume 1, Part 2 Of Capital: A Critique Of Political Economy, Karl Marx. New York: Cosimo Inc. Reprint.
Holley, H.W., Jennings, K.M., Wolters, R.S. (2008). The Labor Relations Process, 9th Edition. New York: Cengage Learning. Print