The ER world is changing. Is your business ready to ride on the crest of the wave?
Employee relations is at a tipping point. For a significant number of businesses, their strategy is less about growth and profits and more about survival and minimising losses, which most companies are seeking to achieve through increasing productivity and flexibility and reducing costs.
What does this mean for ER strategies and in particular, enterprise agreement negotiations?
For the last 20 plus years, enterprise bargaining has been the mainstay of Australia’s industrial relations system. Enterprise agreements have clearly benefitted business by operating to remove industrial risk for the duration of their term. However, the flip side is a steady creep of terms and conditions favourable to employees, and wages in excess of award rates (significantly in some industries). Neither of which in a growth economy is a bad thing. Now, however, the greater risk to business is no longer industrial risk, but an inability to flexibly manage its business to drive change and avoid losses, at best, and permanent closure, at worst. This change in risk profile means a change in the focus and direction for ER strategies.
However, adjusting ER strategies to achieve these emerging requirements is something that is not simple to attain. The options available without employee agreement are limited and require a particular factual background. Achieving change in enterprise bargaining negotiations through employee and union agreement beyond freezing wages has been demonstrated to be very challenging (think Aurizon, Toyota, GM Holden, Qantas and the list goes on).
Further, this changing ER reality needs to be balanced with a strong human resource strategy, recognising that employees are people, not just assets, and a positive employee culture is a key ingredient in future business success. How to maintain this positivity in the face of what employees can perceive to be an unnecessary stripping of terms and conditions is difficult to achieve. In this way, businesses are in the proverbial rock and hard place.
Finding this balance and assessing the right ER strategy for your business, is what Enhanced ER’s business model is about - enhancing business outcomes through a multi-faceted approach. If you are interested in seeing how Enhanced ER may assist you please contact Rebecca.
