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CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Employees are among an organization's most important resources and coined as most valuable assets. The nature and amount of work performed by them have a direct impact on the productivity of an organization. So maintaining healthy employee relations in an organization is a pre-requisite for any organization in order to achieve growth and success (Abushawish, 2013). Employee relations is a broad term that incorporates many issues from collective bargaining, negotiations, employment legislation to more recent considerations such as work-life balance, equal opportunities and managing diversity (Armstrong & Stephens, 2016). It comprises the practice or initiatives for ensuring that Employees are happy and are productive. Employee Relations offers assistance in a variety of ways including employee recognition, policy development and interpretation, and all types of problem solving and dispute resolution. It involves handling the pay–work bargain, dealing with employment practices, terms and conditions of employment, issues arising from employment, providing employees with a voice and communicating with employees (Frank & Jeffrey, 2010). Employee relations is concerned with maintaining employee-employer relation, which contributes to satisfactory productivity, increase in employee morale and motivation (Ahmad & Shahzad, 2011). According to Onyango (2014), employee relations can be seen primarily as a skill-set or a philosophy, rather than as a management function or well-defined area of activity. Despite well-publicized instances of industrial action, the emphasis of employee relations continues to shift from 'collective' institutions, such as trade unions and collective bargaining, to the relationship with individual employees. The ideas of 'employee voice' and the 'psychological contract' have been accepted by employers and reflected in their employee relations policies and aspirations. Employee relations skills and competencies are still seen by employers as critical to achieving performance benefits through a focus on employee involvement, commitment and engagement (Tepper, Moss, Lockhart, & Carr, 2017). Employee relations is seen as strategic in terms of managing business risk: both the downside risk of non-compliance with an expanded body of employment law, and the upside risk of failing to deliver maximum business performance (Ahmad & Schroeder, 2013; Tepper et al, 2017).

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