Top human resources managers views on trade union action in Brazilian Corporations.

AutorNeto, Antonio Carvalho
CargoReport

Abstract

This article presents the perception of human resource (HR) top managers at strategic level in Brazilian corporations regarding labor union activity. It is a quantitative study about the perception of 354 experienced HR top managers on the unionization of employees, influence of the union on the organization, recognition of the union for labor negotiations and the existence of an advisory committee (workers' council) within organizations. The theoretical approach addresses both the fields of study on HR and Industrial Relations (IR). The research shows low unionization and management perceptions that unions have little influence on organizations. On the other hand, the HR managers recognize the union influence for collective bargaining purposes and for defining general terms of employment. These contradictions are related to the fact that collective bargaining is mandatory in Brazilian legislation. In general terms of employment, Brazilian legislation is too rigid, prescriptive and detailed. This strong state of regulation reserves to the union an automatic participation in the negotiation process with employers, although this trade union action is somehow inefficient. In this scenario, the perception of HR managers of a relative union influence, although inefficient, is an expected consequence.

Key words: human resources; industrial relations; Brazilian industrial relations system; unions.

Introduction

This article presents an overview about the perception of human resource (HR) managers at the strategic level in Brazilian companies regarding labor union activity within their organizations. It is a very comprehensive study, providing an overview of how HR departments see several important aspects of industrial relations (IR) systems. Data of flexible scheduling and employment contracts are also presented in these enterprises.

This contribution is based on a quantitative study about the perception of 354 experienced HR managers from organizations in all sectors of the Brazilian economy, 79% from the private sector and mostly large-scale enterprises. These managers' perceptions on the unionization of employees, influence of the union on the organization, recognition of the union for labor negotiations and the existence of an advisory committee/workers' council within organizations are presented and analyzed.

These perceptions are linked to aspects of what can generically be referred to as flexible scheduling and employment contracts at these companies, such as overtime, weekend work, flexible scheduling, reduced work week, work from home, telecommuting and temporary work, considering that often temporary contracts are part of the outsourcing processes.

The existence to a greater or lesser extent of such flexible scheduling and employment contract models, combined with turnover rate, enables a discussion on the degree of influence of the union on the daily lives of workers, given that flexible scheduling and outsourcing have posed enormous challenges for union action and have been met with notorious resistance from the unions, not only in Brazil but also abroad (Amorim, 2015; Camargos & Serrao, 2011; Chaison, 1996; Ferreira, 2016; Guimaraes, Hirata, & Sugita, 2009; Weller, 2007).

The turnover rate allows for insight into whether workers are more or less satisfied with general compensation and working conditions, especially in periods of lower unemployment, as was the case until late 2014.

In addition to contributing by discussing HR managers' perceptions of influence of the union on major companies in the country, which in and of itself is unprecedented for literature on the field of administration, this article takes an approach that addresses the fields of HR and IR studies in a more juxtaposed manner, in line with U.S. authors on IR (Colvin, Batt, & Katz, 2001; Kaufman, 2002; Kochan, 2000).

The following theoretical framework looks at the Brazilian industrial relations system and how labor unions have reacted to the challenges of this scenario, including flexible scheduling and employment contracts. Specific comparisons to other international IR systems are drawn throughout the theoretical framework.

Union Action in the Brazilian Industrial Relations System

The restructuring of productive relations and deregulation of labor relations all over the world have been fostering significant changes in the roles of collective social actors for more than thirty years, creating major challenges for unions such as setbacks to former labor and social achievements; increasing proportion of workers employed in the service sector (with lower unionization rates); more heterogeneous and fragmented workforce; and for almost all sectors, flexible scheduling and employment contracts (Camargos & Serrao; 2011; Carvalho, 2001; Conceicao, 2009; Ferreira, 2016; Leite, 1997; Merrien, 2007; Neves, 1998; Piccinini & Oliveira, 2011; Piore, 2011; Santana, 2002; Singer, 1999; Weller, 2007). In this topic, characteristics of the Brazilian industrial relations system are discussed from its genesis to the present day, and how labor unions have responded to these challenges.

The emergence of an industrial labor market in Brazil began in the first decades of the twentieth century, when the first consumer goods companies set up shop in urban centers like Sao Paulo and Rio de Janeiro (A. F. Barbosa, 2008). However, it was only from the 1930s onward that an IR system with greater institutional complexity was established in Brazil. During this period, remarkable changes began to take place in Brazilian society, starting with economic policies aimed to development and, as part of these policies, official incentives to promote industrialization. The Brazilian IR system, from the second half of the 1930s and especially since the 1940s, when the Brazilian Labor Code (Consolidacao das Leis do Trabalho [CLT]) was implemented, has been characterized early on by strong intervention from the state as a regulatory agent of the relations between companies and workers.

Even during the first Vargas government administration (1930-1945), which was dictatorial in nature, core labor legislation began taking shape, outlining the general rules that define aspects such as individual hiring of labor, organization of workers and employers into unions and associations, structuring and financing, collective bargaining, and government participation through Labor Courts and the Ministry of Labor (Amorim, 2015).

Unlike the voluntary nature of the US and British industrial relations systems, the Brazilian system has always been guided by greater government regulation, similar to France and Germany (Bamber, Ryan, & Wailes, 2004; Carvalho, 2001).

Among its key aspects, Brazilian labor legislation guarantees trade unions, federations and confederations an automatic yearly influx of funds. These funds come from union dues--a deduction equivalent to one day of work each year from any worker registered at companies. On the employer side, the union structure--trade unions, federations and confederations--is also financed by a contribution proportional to the company's capital. These dues make Brazilian unions independent on funds from voluntary worker membership. For this reason, many trade unions have little motivation to seek out new members. On the other hand, the guaranteed extension of collective bargaining agreements to non-members prevents many workers from seeking out the union as a representative body. This also happens in other countries, as in France. In the United States, only union members benefit from the gains associated with a collective bargaining agreement (Kaufman, 2002). In short, Brazilian labor laws discourage both trade unions from pursuing new members and workers' interest in becoming members.

At the base of the trade union structure--the union itself--there is a monopoly of representation in terms of territorial coverage. If a city already has a metalworkers' or bankers' union, for example, no other union can represent these workers in the same territory.

Another relevant fact is that the Brazilian legislation does not guarantee the right to the workers in order to form a company-wide union, as it is the case in Germany and Sweden. In light of this, the Brazilian IR system is characterized by union action that almost always occurs outside the company. Although there are some major enterprises with worker councils recognized under a collective bargaining agreement, their small number in relation to the total universe of companies only reinforces the general impression that the union organization should take place outside the organization (Carvalho, 2009).

This article does not aim to provide a more detailed history of how this system evolved over the subsequent decades. However, it is clear that labor laws were implemented in Brazil even before the emergence of organized demands from Brazilian workers. Interference from the State has been a significant factor since the promulgation of the Brazilian Labor Code (Decreto-lei n. 5.452, 1943), during the populist regimes between 1950 and 1964 and also during the military dictatorship after 1964, by both the executive branch and the labor courts. From late 1970s onward, while the Brazilian economic model entered into a crisis and the military dictatorship saw its gradual decline, the union movement reemerged as a relevant player.

Despite the heralded union independence provided by the 1988 Federal Constitution, the model still shows strong lingering aspects from the corporatism of the Vargas Era (mandatory union dues and exclusivity of trade unions) (Araujo, 2008; Cardoso, 2002; J. A. Rodrigues, 1979).

In general, Brazilian IR system does not differ significantly from other Latin and Latin American countries (Visser, 1997) such as Spain and Mexico. Common features are: mandatory union representation; low competition between unions to represent workers; heavy dependence on funds...

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