Collective Bargaining - Labor Relations Topic: Identify

Collective Bargaining - Labor relations Topic: Identify differences theories management rights. Essay Question: Identify differences theories management rights. Discuss reasons poles determining management responsibilities maximize managerial authority.

The two types of theories regarding management rights are the residual theory and the trusteeship theory. The residual theory proposes the idea that there is no need to introduce a specific clause (or several clauses) in the agreement between management and labor, because the management only gives up those rights that are explicitly listed as such in the agreement. The residual theory stipulates that there is no need to put in additional clauses, since the management is well aware of what rights it is giving up on: those clearly states as such in the agreement.

Following this description of the residual theory, it is relatively easy to understand that this theory defends the rights of management. The understanding that labor only has the right that are explicitly mentioned as such in the collective bargaining agreements also means that management will negotiate, from a position of force, any rights that labor might want to obtain. This would include, for example, intrinsic rights that labor has in any case, such as the right to strike. Management would be able to stipulate that, since it has not been included, as such, in the agreement, labor does not have the right to strike.

The trusteeship theory proposes a different role for the management, namely that of trustee of the interest of different parties, including the workforce and the shareholders. As a trustee, it is also a mediator between the interests of all these groups. As a consequence, it looks towards negotiating and discussing any potential demand that the union makes and is open towards changes in the relationship between management and labor, including those that might result in the loss of particular rights for the management.

The trusteeship theory defends a more flexible and generous position for management. Under this theory, management is always open to discussing potential demands that labor might have and to consider including them into a collective bargaining agreement. In the trusteeship theory, management abides by its mediating role and aims to identify the best middle ground for all parties involved, in a way that everybody can benefit from the respective solution.

As one can observe, the two theory are poles apart because they attribute different roles to management. In one case, the role of management is to maximize the utility of one of the production means that the organization possesses, namely labor. According to this theory, its role is not perceived as a way to improve the working condition or increase wages. If these measures lead to a better use of the workforce and, as such, to profit maximization, they can be considered, but the primary goal is not that.