Discuss about the Role of Key Players and Labour Management.
Labour Management Relations (LMR), also known as industrial relations, refer to the interactive system between employees, trade unions, employers and the government that creates governing rules for these relationships as well as the study of the same (Trebilock, 1998). A sturdy industrial relations system ensures a harmonious and cooperative relationship among all parties involved so as to create a conducive environment for economic efficiency (de Silva). It blends societal value, such as freedom of association, and techniques, including negotiation methods, to achieve this (Trebilock, 1998).
An LMR system is necessary to address the various issues arising in the labour industry; these include issues on management policies, working conditions, and inter-personal issues. Questions of wage increments, recruitment and retrenchment, indiscipline, working hours, retirement among others can only be adequately tackled when a good LMR system is in place. The most common features of these systems include; freedom of association, protection from discrimination, right to strike among others.
In Singapore, the LMR system is tripartite led by are the Ministry of Manpower (MOM), the National Trades Union Congress (NTUC) and the Singapore National Employers Federation (SNEF). These institutions collaborate to tackle the above-mentioned issues so as to ensure Singapore can maintain its competitive advantage. The National Wages Council also plays the role of recommending wage guidelines to all these actors to ensure uniformity and flexibility. The following report will analyse the roles played by these actors and their significance to the quest for competitive advantage in Singapore.
Employees, their representatives (trade unions), employers and the government make up the key players in any LMR system. In Singapore, the system is tripartite; that is, a collaboration between workers, the government and employers (Min, 2012). The key partners in this collaboration are the Ministry of Manpower (MOM), the National Trades Union Congress (NTUC) and the Singapore National Employers Federation (SNEF) (MOM, 2016). It is through this concept of tripartism that Singapore has maintained competitive advantage and a long streak of harmony in its labour market. The collaboration ensures re-creation of employment, an effective retirement age, training of workers, proper employment policies and a versatile wage structure (MOM, 2016).
In Singapore, Manpower is the only resource as well as a restricting component towards growth and could as well become a hindrance to new investments and business growth (NAS). The aim of establishing this ministry was to rely on the involvement and contribution of the labour crusade and employers’ unions to form and implement guidelines aimed at strengthening the tripartite model. It represents the government in the tripartite collaboration and as such takes on the role of ‘custodian of labour’ and ‘economic planner’ (NAS) (Geocities).
The Ministry of Manpower’s roles include: planning human resources to sustain competitive advantage, constant training of workers, ensuring industrial relations are amicable, luring foreign manpower and regulating its admission and managing foreign workers as they offer their services in Singapore, as well as providing a friendly, effective and efficient welfare structure suitable for workers in the country (NAS). By carrying out its obligations, MOM creates a national framework for other agencies and parties in the industry to follow as they perform their day to day activities.
A trade union is any temporary or permanent organisation of workers with the aim of promoting industrial relations, improving workplace conditions and increasing productivity (Trade Unions Act, 1941). The NTUC in Singapore is at the centre of the Labour Movement, which is made up of fifty-eight partner unions, two offshoot associations, eleven social enterprises, six allied organisations as well as an expanding ecosystem of U Associates and enterprise partners. It is the umbrella body for trade unions and other professional associations with the aim of enhancing workers social status so as to maintain the country’s competitiveness (NTUC, 2017).
NTUC promotes good industrial relations by working closely with MOM and SNEF to ensure a conducive business environment. It also works to ensure employee grievances are handled correctly by representing them where required and utilising collective bargaining agreements to get better employment conditions for members. Additionally, this body plays the role of ensuring proper working conditions and the improvement of workers’ quality of life through various programmes such as cooperatives, the Workplace Health Programme and the Employment Assistance Programme. All these efforts go into increasing productivity which is to the benefit of all parties involved (Geocities).
Inaugurated in 1980, SNEF is an association of employers driven by the objective to preserve industrial amity and assist employers to achieve success in their employment policies, so as to increase productivity, competitive advantage and the standard of their employees’ work life. It garners the support of over two thousand businesses and has been very diligent in enabling the tripartite partnership among the Government, employers and unions (UWEEI, 2010).
The NWC was established out of necessity in 1972 in Singapore as since then it has played a key role in harmonising the tripartite relationship that is the baseline for Singapore’s competitive success (Lee, 2013). Mr Lee Kuan Yew credited the National Wages Council with strengthening and nurturing tripartism in Singapore over the years by considering and developing guidelines on wages to be implemented by the relevant players; he refered to tripartism as a distinctive system that greatly contributed to Singapore’s competitive edge (Yew, 2013).
The NWC is tasked with the role of formulating guidelines for wages which should go hand in hand with long-term economic growth so as to ensure continued economic and social development in Singapore and maintain its competitive advantage in the labour market (STF, 2017). It formulates these guidelines by taking into account productivity, employment situations, public opinion, international competitiveness as well as economic expansion at the time. These guidelines are then used as references as well as negotiation guidelines in matters of employee wages by the various parties in the labour market.
Competitive advantage refers to the supremacy an organisation gains over its rivals by providing similarly valued commodities at a lower price or higher prices for greater value established through uniqueness (Patwardhan, 2016). Where a company experiences profits higher than those within the industry after matching its core competencies to the available opportunities, it is said to have achieved competitive advantage. In order to achieve competitive advantage, it is important for all key players to ensure they take make strategic decisions in exercising their roles in the industrial relations system (Patwardhan, 2016).
As aforementioned, Singapore’s competitiveness depends on the effectiveness of its tripartite model. As a key player in this model, MOM has contributed to achieving competitive advantage by formulating and implementing policies that ease labour relations, promote employee rights and safety in the workplace, regulating foreign manpower supply and promoting tripartite programmes (Gwee, 2013). The ministry has been able to achieve success in ensuring competitiveness through strategy alignment, innovation, development of core strengths and the competency and commitment of members (MOM, 2011). The government is however faced with the challenge of regulating foreign participation in the labour market in a balanced manner that ensures economic growth and benefits to all parties, Additionally, the aspect of globalisation poses a challenge as there is less control over economic planning which results in the need to change policies, albeit reluctantly, to maintain competitiveness. Competition for investments can also create challenges in securing employee rights.
Additionally, NTUC as a key player in Singapore’s labour management relations system plays a key role in achieving competitive advantage. It has been previously mentioned that workers are Singapore’s most important, if not only, resource (NAS). As such, ensuring they are healthy and have quality life is paramount to achieving competitive advantage. Well cared for workers are highly productive and as such highly profitable. As a trade union, NTUC ensures this through health programmes, collective bargaining, pushing for legislation that ensures workplace safety among other employment conditions (Geocities).
However, a challenge arises from the symbiotic relationship between the ruling People’s Action Party (PAP) and the NTUC (Export.gov, 2016). This relationship is close to the extent that once can say the views of the NTUC reflect those of the PAP (Lepoer, 1989). This relationship means the independence of the union is in question and as such employee rights can be compromised to maintain good relations with the government. In 2012, four Chinese drivers were held and charged with instigating a strike to protest poor living conditions and low wages. Additionally, Singapore has no laws that prohibit antiunion discrimination or retaliation on strikers (Export.gov, 2016). It is possible that if the NTUC had a more independent relationship with the ruling party it would be able to better advocate for employee rights such as these and as such boost productivity leading to a greater competitive advantage.
SNEF, as a player in the tripartite model, contributes to the quest for competitive advantage by offering programs such as Sapphire that help employers to transform workplaces to boost competitive advantage (SNEF, 2017). These programmes assist employers to tackle the issues of age, proper HR policies to boost employee productivity, changes in skill and requirements in the workforce, foreign manpower as well as technology. Ensuring employers are well equipped to deal with these and more issues goes a long way in achieving competitive advantage for the country as a whole.
As aforementioned, the NWC has played a major role in strengthening the tripartite relationship that is key to Singapore’s competitive success. Its wage recommendations, though not binding to members of the model, have been widely implemented and referenced by both unionised and non-unionised companies (Export.gov, 2016). This creates a sense of uniformity which is key for ensuring harmony in the business environment. The guidelines it provides are geared to allow for flexibility in wage negotiations as well as speedy wage reforms so that wage increments are reflective pf the economy’s performance (STF, 2017). Flexibility is key as it enables companies to adjust responsively to the dynamic business environment thus ensuring the country remains globally competitive.
Conclusion
This report was commissioned to identify the role played by Singapore’s key participants of the industrial relations system in achieving competitive advantage. It has succeeded in identifying the tripartite model that has been the backbone of this system and the key to its competitive success. This model, as aforementioned encapsulates the collaboration of workers, employers, unions and the government in the labour industry. In Singapore, this collaboration is through MOM, NTUC and SNEF. However, as identified, wages play an important role in easing this relationship especially in Singapore where the sole resource is manpower. As such, the NWC also plays a key role in ensuring the three bodies achieve their objective by setting out guidelines for wages. The analysis of the role played by these organisations shoes that they face various challenges in achieving their goal by way of factors such as globalisation, foreign manpower, technology among others. However, it is evident that so far, and well into the future, the key players of Singapore’s LMR system will continue to play a significant role in ensuring the country’s competitive advantage.
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