The Multinational Man (RLE International Business) by Aitken Thomas;

Author:Aitken, Thomas;
Language: eng
Format: epub
Publisher: Taylor & Francis Group

1 Coping with the Complexities of Marketing, Conference Board Record, January 1969.

2 Vision, February 1972.

Chapter 7

Labour Pains and Issues

In allocating responsibility for the different functions of management, parent companies are usually content to assign personnel matters and labour relations to their managers abroad who, for their part, are satisfied to accept the charge. The exception occurs at management and submanagement levels. Here the home office claims authority regarding terms of employment and it reserves the final word on employing men who may eventually aspire to replace the field manager.

Only recently has this noncontroversial arrangement been challenged, albeit inadvertently, and the paradox is that the challenge comes from the ranks of labour itself. The thrust of unions towards international confrontation with multinational companies may well soon return responsibility for industrial relations to the home office. Centralization will then be injected into international business where it is least wanted. The movement is under way. Some years may pass before it reaches its climax and when it does there may be a new alignment of interests between multinational management, labour, and the nation state. Host governments already suffer some discomfort in harbouring the growing power of multinational corporations. When these firms are accompanied by multinational labour organizations, or when governments see their domestic labour unions responding to directives from abroad, they may become even more disconcerted. Indeed, in those nations whose labour unions are categorized as political entities, the international labour movement may be seen as an intolerable invasion of sovereignty. It is not inconceivable that government reactions may well come down on the side of the multinational corporations, at least on this issue, or they may join with local labour against both the multinational firms and the international labour organizations that pursue them. At present the challenge is incipient but there are enough solid instances of international labour action to require that in this area, as in others, the field manager observe and report the situation carefully.

Meanwhile, the manager abroad is still pretty much master in his own house in matters concerning his workforce. The exceptions to this statement usually act to reinforce its validity. Two notable cases are those of American companies who gave orders to their managers in France to shut down their plants with all possible haste. The dismissal on immediate notice of hundreds of workers infuriated French authorities, whose policies include a concern for employment which they expect employers to share. Furthermore, they expect employers to assume the costs of shifting labour when it is made redundant. Finally, they abide by the unwritten expectation that the government will be consulted regarding any plans which include serious cutbacks in employment. In the cases cited, local management was forced to accept orders from home. There are other occasions, too, when local management must accept a bitter pill from the parent company and ask its workforce to share it. This will occur when a local branch has been doing its job well but because the parent company’s books reflect a poor

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