Introduction
The story of risks has been an evolving one. The frontiers of risk have continually been pushed back with breakthroughs in our understanding of risk. This has also been important in our improved ability to identify measure and manage risks. It is worth noting that some of the best practices in risk management globally have continued to be designed, defined and refined by industry participants and the relevant stakeholders. Risk identification has continued to be improved in recent years. The identification of risks is and shall continue to be a major frontier of risk management.
Risk managers face many challenges today as they support their business in various aspects. Apart from the continued regulations from the legislature, investors and other major stakeholders, employees also pose a potential risk to the organization. The worker’s risks are mainly related to their actions against working conditions, compensations and remunerations. This means that a risk manager must be aware of any imminent strike and put the mechanisms necessary to avert it, control it or manage it wisely. This paper discusses several issues related to worker’s strikes. It also examines three examples of large scale strikes in the international arena.
Total risk management
Risk management is one of the most important factors in any business organization. Risk control management system involves identifying and analyzing various factors that cause certain risks. These risk factors have to be assessed to reduce the magnitude of future loss to the company. Workers compensation risk management is important because it helps to identify various loopholes that may cause certain dissatisfaction to the workers. Certain benefits like compensation for injuries and diseases can be major issues in any business organization. Many companies have been faced with various problems that occur as a result of poor compensation policies.
The risk management program helps to meet the goals of the organization especially to ensure that it continues to operate in the market. This also helps to maintain a state of equilibrium between the workers’ forces and the profit forces. Risk management also helps to implement decisions and chat the way forward before, during and even after a workers’ strike. Risk management involves planning and organizing worker’s efforts. It also involves controlling and directing workers efforts. Thus, workers compensation can also be a subset of a corporate risk management program. Risk management programs must begin from the top management because the program cannot succeed without the support of a risk manager or an equally relevant department (Lott, Not Dated).
Large scale managerial disasters
The world in which we live in is changing just the way the organizations in which we work and the jobs that we do change. Since change has always been there since time immemorial, it should form that part of the feature of life that people can cope with. Therefore, many organizations must contemplate and indeed, change with time to improve the working conditions, remuneration, and compensation policies within its structure. Organizational changes occur in a way that the workers may be forced to take on more work and experience more stress.
It may also lead to the loss of one’s job. The above are some of the reasons that make change a hard process to undertake in a business organization. Organization development is, therefore, an important tool that generates a favourable atmosphere that will enhance a good working culture which will also result in employee commitment to their job in any organization. Any company needs to acknowledge that workers come first before other business factors such as profits and branding. The values that the members of any organization hold are important aspects of its culture in this aspect (Martin 2005).
Case studies of workers’ strikes
In the recent past, China and Japan have been faced by many large scale strikes in the mining sectors, the energy sector, and the automobile industry. A good example of one of theses strikes is during the year 2000, when, in May, the Honda transmission plant workers downed their tools and went on strike because of managerial and administrative issues. However, the main reason behind this strike was because their minimum wages had been raised by a net gain of $5 per month.
This was against the worker’s wishes because they wanted a rise equal to the minimum wage in the city of Foshan. The workers went on strike because there was a rise in the cost of living that did not match their wage increase. In trying to deal with this situation, the factory-raised the wages to a mere $24 but then went ahead to reduce the worker’s monthly subsidies for food and housing. The worker’s regular attendance allowances were also reduced. Due to the reduction of these subsidies, the net gain of the worker’s only attained the 5 dollar mark.
The strike was initiated by some of the workers in the automatic transmission department. Two of these workers stopped the assembly line. They did this by pushing the red button that is usually meant to halt operations of the plant during emergency shutdowns. The emergency shutdowns in this energy plant are mainly done when problems of quality and efficiency affect the plant.
Shortly after the beginning of the strike, the Japanese plant manager met with these workers. As a result of this meeting, the management promised to get back to the workers with the appropriate solution within a week. Due to these emergency talks, the night shifts resumed. After a series of many disagreements between the management and the workers, a domino effect of strikes in the Pearl River delta evolved. As a result, many issues concerning minimum wage increment were resolved throughout this region (Luthje2011).
In Egypt, workers in various industries went on strike because of poor working conditions. The other reason for the strike was poor remunerations. The worker’s protests came at a critical time when a nationwide strike was also underway. This national strike resulted in the resignation of the former President of Egypt, Hosni Mubarak. Workers who went on strike include those in the transport industry and state electricity staff. Other workers who also went on strike were those in the technical service at the Suez Canal.
There was a domino effect of strikes throughout the major sectors of industries in the nation. The health sector was faced by a major problem when the worker’s strike in the ministry of health and culture downed their tools to protest against the unfair wage allocations and unfair employment strategies to the youth. Other strikes include those in the telecommunicating industry. In this sector, about ten thousand workers downed their tools to protest against poor working conditions and the huge wage gap between the management and the average workers.
The other sector that went on strike includes the industrial zone sector where the strike was mainly because of an increase in minimum wages and poor working conditions. Also, an increase in bonus was demanded by these workers. The Egyptian workers’ strike received a lot of support from the Global Trade Union movement. The International Trade Union Confederation (IUTC), issued statements that praised the movements in Egypt. Other labour movements that supported the Egyptian strikes include AFL-CIO. As a result, there have been increased efforts by the concerned sectors that are aimed at improving the working conditions and an increase in minimum wages as well as reduction of the wage gap between the management and the average staff (Parkes 2011).
The year 2010 was characterized by a major strike in Philadelphia where the workers downed their tools to protest against poor work conditions. They also protested for improved patient care. This strike attracted more than 1,500 participants at the Temple University Hospital. This is because the workers had worked without a contract for six months. Although the administration of the hospital offered their last, best and final offer, that promised a concession on union rights, the workers went ahead with the strike. The hospital management also offered a concession to union wages and health insurance.
The arrogance of the hospital management was because of a union agreement which stated that the stakeholders must not publicly say anything bad concerning the hospital. Thus, the workers were told that they should go somewhere else if they want their constitutional rights. As a result of this, the strike received a lot of support from other sectors such as the students, Steelworker’s local president among many others who represented the clerical staff. The workers’ willingness to resist the management’s arrogance was exemplified in the first day of the strike whereby all workers joined hands to down their tools thereby paralyzing the hospital’s operations. As a result, the management softened their stand by accepting further negotiations that led to a situation of compromise between the two parties (Harrison 2010).
Causes of workers’ strikes
There are so many reasons that make worker’s strike worldwide. However, among all these reasons, some are more common than others. Workers may stage a large scale strike when they are not satisfied with a large company’s policy. The policies may range from poor working conditions to issues of bonuses. Workers can also stage a demonstration when they are dissatisfied with their remuneration packages. The other reason that can cause a workers’ strike is when they receive a small wage increment that is not up to the mark.
Also, workers can stage large scale protests against the company’s decision to discharge or dismiss their fellow workmen. This decision is usually reached by the workers if they think that the dismissal is misplaced. The other reason that can make workers lodge complains that may lead to a strike is when the company withdraws any privileges to the workers. The company’s working hours and rest intervals can also cause major strikes especially to those workers who do manual and demanding jobs. Overtime packages, leave without pay, holidays and weekends policy can also cause dissatisfaction to the workers hence trigger a workers’ strike.
Other packages such as bonuses and gratuity can also be a major source of conflict between the workers and the management. The same also applies to profit sharing and provident fund that have been knowing to be some of the major causes of workers dissatisfaction. Also, the retrenchment of individual workers due to reasons such as the closure of a company is a sensitive issue that can also cause excitement among the average workers. Last but not least, minimum wage disputes between the management and the average workers are also a common cause of strikes (Naukrihub. com 2007).
Effects of strikes
It is important to support any move that is aimed at protecting and improving the rights of the average workers in a company. On the other hand, it is also important to consider how far the means which are being used to enhance the worthy cause. This is because much as workers have their rights to demonstrate on any dissatisfying issue, the vehicle they use to push forward their desires must be within the existing legislature. The management of the company must also ensure that the methods they use to mitigate, limit or stop a crisis also reflects the existing stipulated legislation. This is because the failure of one party to adhere to the legislation will attract the arm of the government to catch up with them.
The advantages that are derived from a strike are almost equivocal. This is because most of the operations of strikes are often ruinous to the interests of all the parties involved. It is important to note that if the whole labour community were associated in one great confederation, it will form a great union of strength and intelligence that would be fully competent to improve the conditions for all.
On the other hand, much as it is important to improve the working conditions of workers, the employer has to grapple with the fact that they will be forced to look for other means of gaining profits. This fact becomes so difficult to implement especially in the manufacturing industry where most national legal structures only allow the company to sell their commodities at minimum profits. Thus, if a company has to channel all the profits to its workers’ welfare, it will be detrimental to the economy because even the government will not be able to get tax from the organization (Bethune & Bethune 1839 ).
Managing a strike
There are many parameters which the management of an organization can put in place to prevent, mitigate the effects, or control a workers’ strike. One of how the management can prevent a strike is the lockout technique. A lookout is a work stoppage in which an employer prevents employees from working. This technique is usually undertaken by employers. The idea is to put pressure on their workers. This pressure is a diversionary tactic in which the employees’ minds are diverted from conducting a strike. Specifically, a lockout involves the temporary closure of a place of employment or the suspension of work. It is also the refusal of an employer to continue to employ any number of persons who can work.
For instance, if a group of workers strike to paralyze the operations in another sector within the organization, the employer may employ the services of a lockout. Lockouts usually stop slow-downs and stalling of operations in the industry. However, it is very important for both the employees and employers to give notices of imminent strikes and mitigation measures respectively. These actions must strictly follow the existing labour laws within that particular country.
This is because there are penalties that accompany illegal strikes and lockouts in both parties. It must be understood that industrial relations concern the relationship between the management and the employees of a particular industry. Thus, the three major players in industrial relations are the employees, trade unions and the management. The government must also participate by stepping in when the major stakeholders fail to maintain peaceful industrial relations. All the stakeholders must also adhere to the framework of industrial relations provided by the government (Prakashan 2008).
Conclusion
The frontiers of risks have continually been pushed back with breakthroughs in our understanding of risk. Risk management is one of the most important factors in any business organization. Risk control management system involves identifying and analyzing various factors that cause certain risks. These risk factors have to be assessed to reduce the magnitude of future loss to the company. Workers compensation risk management is important because it helps to identify various loopholes that may cause certain dissatisfaction to the workers. It is important to support any move that is aimed at protecting and improving the rights of the average workers in a company. On the other hand, it is also important to consider how far the means which are being used to enhance the worthy cause.
Reference list
Bethune, A. & Bethune, J. (1839). Practical Economy. London: Longmans.
Harrison, M. (2010). Health Care Workers in Philadelphia Strike for Better Work Conditions and Patient Care. Web.
Lott, R. (Not Dated). Controlling Workers’ Compensation Cost: A Risk Management Program. Risk Management Associates. Consultants Inc.
Luthje, B. (2011). China: Worker’s Strikes—What Did They Win? Web.
Martin, J. (2005). Organizational Behavior and Management. Ed. 3. London: Thomson Learning.
Naukrihub.com (2007). Strikes. Web.
Parkes, J. (2011). Egypt’s workers’ Strikes Added New Strength to Protest. Web.
Prakashan, N. (2008). Human Resource Management: Managing People at Work. Abhyudaya Pragati: Niral Prakashan.