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University of Hull

Hull Business School

Comparative and International Human Resource Management

HRM and Trade Unions in the Czech Republic, France and Kenya

Academic year 2006/2007 February 2007

1. Introduction

We live in a world of changes, thus, we have to adapt quickly to ever changing contextual conditions. Massive changes driven by globalisation or growing competitive pressures, start up new forms of organisations, work and careers. This has created an increasing interest in the international management coordination and control.

First aim of my work is to analyse Human Resource Management in three different countries. I focus on the dilemma of my tutorial presentation and continue to deal with HRM practices in the Czech Republic, France and Kenya.

The importance of trade unions strengthen with their differential structures, strike patterns, levels of bargaining and rights of presentation. I recognise the role of collective bargaining and collective agreements, the influence of trade unions in the political system and their importance for management decisions. From this reason, in second part of my work, I identify the role of Trade Unions and their impact on Czech, French and Kenyan HRM.

The Czech Republic is my country of birth. I evaluate the culture and previous political regime which largely influenced current Human Resource Management in this country. France is a member of the European Union and a democratic state and Kenya is a developing country. So, I set second aim of my work, to compare the culture and historical base of these countries and analyse how it influenced these countries and try to find the similarities and differences among them.

My assessment also contains reflective report on the tutorial presentation and is in the end of this work.

2. Culture

Findings by Trompenaars (1993) and Hostede (1991) proclaim that management theories and practices are modified by national cultures.

According to Johnson (2003) “culture is the combination of acquired experience and values that feed into and influence behaviour and responses of distinct groups”.

Culture is unstable and non-adaptive, the cultural mix is changed through experience. Culture is occasionally subject to transformational change through traumatic events such as the collapse of the Soviet system in 1989 and 1990 which affected not only the Soviet Union but also its satellite states in Eastern Europe (the Czech Republic). The sudden collapse of a whole political, economic and social system put into question long held views, values and practices underpinning political, economic and commercial life (Johnson, 2003). Human resource management practices in one of the Soviet Unions satellite state the Czech Republic is further elaborated in second part of this work.

A key essence of culture is the feeling of a sense of belonging or identity. Language is often an important symbol of belonging to a group and frequently coincides with national boundaries but when it does not, it can be a diverse factor for example in African countries with multiple tribal allegiances, many of which have their own language (Johnson, 2003).

Professor Geert Hofstede conducted the most comprehensive study, in which he described how can cultural factors of each nation influence the values in the workplace. In this section I evaluate cultural dimensions in the world and compare my chosen countries with the world average.

1) In category of power distance, African nations are ranked among the highest power distant cultures. It is the degree to which the less powerful members of society expect the differences in the levels of power (Wikipedia, 2007a). For purpose of this work, to high power distance culture I can subsume also France.

2) Individualism refers to the extent to which people are expected to stand up for themselves, or alternatively act predominantly as a member of the group or organisation. I can bring in that France is an individualistic country in comparison with the rest of the world and Kenya is a collectivistic country. The Czech Republic is essentially a social democracy where consensus and collectivism are culturally embedded in the region in a federalist tradition.

3) Masculinity vs. femininity refers to the value placed on traditionally male or female values. Masculine cultures value competitiveness, assertiveness, ambition, whereas feminine cultures place more value on relationships and quality of life (Itim International, 2007). My chosen countries are moderate feminine in comparison with the world average.

4) To explain appraisal interview behaviour, Hostede (1980) use uncertainty avoidance, reflected in higher differences in formal power and higher tolerance of inequalities of power. People in uncertainty avoiding countries are more emotional, and motivated by inner nervous energy (Itim International, 2007). Uncertainty avoidance is primary in the Czech Republic and France. In table n.1 you can see accurate data.

Table n. 1: Dimensions of culture

World average France Czech Kenya

Uncertainty Avoidance 60 74 80 52

Individualism 40 58 70 27

Masculinity 50 45 40 41

Power distance 52 35 65 64

Source: Itim International, 2007

3. HRM in the Czech Republic

By the outbreak of the Second World War, Czechoslovakia was the largest industrial nation in the Danube area and the sixth largest in Europe. It has a highly skilled population (Kaldova, 1978).

This bright and hopeful development was interrupted by formation of communist regime and its planning economy. Johnson (2003) mentions, the restructuring of organisations in 1989 has been an integral component of institutional change. It had the economic resources and infrastructures to effect a rapid transformation away from socialist institutions, subject to being able to effect the organisational and social changes which are assumed to be necessary. It has been assisted in this latter respect by its historical, cultural and geographical propinquity with neighbouring European countries (particularly Austria and Germany).

In the Czech Republic there are different philosophies of HRM among newly established foreign-owned subsidiaries, foreign owned or joint venture privatised enterprises and domestically-owned privatised companies. The companies which are foreign-owned adopted very clear screening policies for recruitment and had developed very strong corporate HRM policies. In the domestically owned businesses, the notion of HRM as a concept tended to lag behind marketing and accounting functions and policies as enterprises determined strategies for survival.

On the heels of the previous Communist regime, employees were asked to adopt new values and practices, and to unlearn old ways. Investors entry Czech market with expectation of access to well-educated and less expensive work force. Czech employees are eager to learn new skills, to demonstrate their competence, and to reach a standard of living similar to that of their western neighbours (Cyr and Schneider, 1996).

There is evident strong influence from Western countries in the Czech Republic, namely the USA and the UK, and thanks to increasing investments, also from Japan and other Asian countries. Foreign investors have an influence on the way in which the management of human resources develops within our country.

Because of there was a lack of management skills after years of passive resistance against central planning injunctions (King, 1993), Czech managers had to develop their skills quickly to compete with their competitors in other countries.

I think that their endeavour is satisfy, and whatÐ’Ò‘s more, young managers that grew in democracy, are skilful, qualified and high efficient in running businesses. They are doing well, they are asked even abroad and are successful.

Trade Unions in the Czech Republic

In 1990, there was only one Trade Union in former Czechoslovakia called Revolutionary Labour Movement (ROH). After the splitting of the Czechoslovakia in 1993, Czech-Moravian Confederation of Trade Unions (ДЊMKOS) became the biggest trade union headquarters of the Czech Republic and in 1995 was accepted as a member of European Trade Union Confederation. It has nowadays 32 members, associated on the basis of voluntariness. Their member foundation has 570 000 members.

Bilateral associations of Czech-Moravian Confederation of Trade Unions with foreign trade unions are focused on broad range of activity such as payments and income systems, union education, informatics, women and youth in trade unions etc.

Czech trade unions focus on direct solution of problems, and have the same priorities as their western partner, France, because their trade unions are in one Confederation- European Trade Union Confederation.

In the Czech Republic trade union is first of all an interest organization, which is created to promote and protect law and member's interests, and to improve material and working conditions.

Bohemian labour regulations place trade unions into role of patron for all employees, no matter if they are members of trade unions or if they are not. This is concerned with one of the basic function of labour law namely protective function. The labour law theory results from the hypothesis, that there is not equal position of members in labour-law relations. As a result, it is necessary to give employees certain competences, which should despatch this disparity.

Trade Unions took part on regeneration of democracy after the Velvet revolution in 1989, hence one of the main objectives for them is protection and advocacy of democratic principles, protection of constitution and body of laws, ratified international documents about human rights and freedoms and rights and freedoms of unions.

Trade unions in the Czech Republic are independent of political parties, government, employers, religious and other institutions.

Since Czech trade unions are independent on government and political parties their power remains limited, their power is much greater in private sector i.e. negotiating working conditions and other issues related to employment.

4. HRM in France

The French Republic is a democratic state and the sixth-largest economy in the world. France is one of the founding members of the European Union and the United Nations.

Management in France represent an identity known by the term les cadres. It is a position from which authority, delegate by the employer, is legitimately exercised over subordinated (Bournois and Roussillon, 1992), and therefore are job advertisements in France asking for qualities of powers of analysis, evaluation and mental agility. Particular attention is given to charisma, pugnacity, capacity to communicate and motivate.

HRM developments in France have been strongly influenced by small size of organisations, the late process of industrialization, and a preference for centralization (Poirson, 1993).

French model of HRM would involve, according to Filella (1991), lower authority for HR departments, extensive line management involvement in HR issues and legal support for collaboration with trade unions.

France prefers according to Sparrow (1994) centralised decision making, rigidly obeyed structures and authority-based communications.

French model of human resourcing apply a professionalized personnel function and agencies, low levels of tutoring, a wide range of recruitment techniques to accommodate skills shortages, and international resourcing.

I classify highly developed France among Western leaders, which influenced human resource management of new EU members from Central and Eastern Europe.

Trade Unions in France

There are five largest confederations in France (Wikipedia, 2007b):

1) General Confederation of Labour (CGT) is the oldest of the five representative trade union confederations. It is the leading trade-union in general strikes in France. It takes first place among the confederations in terms of the number of votes won in workplace-level elections.

2) ”Force ouvrière”- Workers' Force (FO) nowadays embodies the total rejection of all ties with political parties.

3) French Democratic Confederation of Labour (CFDT) is a continuation of the French Christian Workers' Confederation.

4) French Christian Workers' Confederation (CFTC) was originally formed in 1919, whose name has been preserved by the minority of its members who were opposed to the elimination of the religious connotation.

5) French Confederation of Management - General Confederation of Executives (CFE-CGC) is the only one of the five confederations possessing recognized representative status at national level which is intended for a single occupational category.

Trade unionism carried out many conflicts and gained much victory, for instance in duration of the work. In spite of the historical decline of the rate of unionisation, there are always great social movements in France. Presently unions in some sectors, such as public transportation (e.g. SNCF and RATP) are likely to enter well-publicised strikes.

Table n.1: Unionization in the world

Source: Wikipedia, 2007c

As you can see in table n.1, France is thought to have one of the lowest union densities in Europe, with only about 12% of the workers inside unions.

Generally, several unions are represented inside large companies or administrations, normally with one from each of the main national confederation of unions and possibly independent unions.

French trade unions are often capable of exerting great political influence. They wield a surprisingly great influence concerning issues related to the Welfare State and public sector.

Trade unions in France are according to Marks (1989) formed generally for the betterment of workers; they got together so as to gain collective capacity and with that they would be able to build strategy to tackle workers issues, such as to defend or improve their working lives as well as employment conditions.

In France, organisations are constrained at a national level by culture and legislation and at the organisational level by trade union involvement and consultative arrangements.

Trade unions and employers associations have the capacity to represent powerful interest groups at a macro level, in relation to their influence on government, and at a micro level in relation to their influence on alternative sides of the employment relationship.

5. HRM in Kenya

The Republic of Kenya is a country in Eastern Africa. It is a developing country and a former colony of Britain. Kenya was formed under difficult socio-economic and political conditions i.e. fighting for independence, slavery, exploitation and colonialism.

According to Kiggundu (1991), management theories and practices in Kenya have been shaped and influenced by colonial ideology and capitalist modes of production. Of course, pre-colonial Kenya had its own management systems that were typically small sized and homogeneous. The systems had their own mode of selecting recruits, inducting them, maintaining discipline and rewarding employees (Akinnusi, 1991). However, in certain parts of Africa, these exclusive traditional African management systems had ceased to exist even before the arrival of European colonialism.

At the end of the First World War, Kenya was a source for capitalist development started on the colonial power. Cheap labour presented a new dimension. Britain and France saw Africa as the source of new economic initiatives for the recovery of their empires from the destruction and indebtedness of war (Cooper, 1990).

The history of employment management in Kenya as well as in the Czech Republic, therefore, is not simply the history of the economic relationship between business and labour. In Kenya it is also the history of the socio-cultural conflict between Western capitalism and African society. In that respect, the employment problem is a social problem that requires sociological analysis and understanding (Cooper, 1987).

The British objective was to create an African working class that was cut off from the commitments and social relationships of African society, but not equal with the colonial expatriate worker (Cooper, 1987).

State-organized trade unionism was considered to be a potentially viable structural replacement for the “traditional African system of family or tribal mutual aid” (Cooper, 1987).

In the absence of alternative know-how or, perhaps, for purposes of political and economic expedience, post-independence governments simply continue in colonial management systems (Jackson, 2002).

Kiggundu (1989) attributes Africans management problems to the social environment that gives “preference” to “cultural and religious values and practices that emphasize the influence of the past on the present rather than the independent planning of the future”.

To understanding the issues involved in HRM in Kenya we need to understand the informal influences, and their manifestation in the attitudes and behaviours of African workers (Jackson, 2002), this also requires a more fundamental rethink of notions of organizational reality.

Kenyan culture is a melange of sub-cultures and linguistic groups (Kamoche, 2000). There is hardly an African country with a homogenous population. In addition to the diversity within countries, there is also significant cultural diversity between countries. As a result, there are differences in educational systems, social stratification and legal and institutional arrangements between countries (Tayeb, 1995). This cultural diversity suggests that conceptualizing a specific African culture, values and contexts requires a high degree of vigilance, posing practical and theoretical difficulties for the adaptation of foreign models to the African context (Kamoche, 2000).

Kenyan incline to autocratic styles of leadership. Large power distance, collectivism and ascribed great importance to social relationships described Hofstede (1980) and Takyi-Asiedu (1993). African culture is by nature collectivist (Hofstede, 1980) not in terms of the simple aggregation of people but in terms of “communalism and kinship”.

As a result, the average African values tends to be more comfortable as part of a group (Beugre and Offidile, 2001). This communal orientation is potentially useful for work organization and decision-making. Although African political leaders and managers are described as generally autocratic (Kiggundu, 1989), “the pre-eminence of the group” requires that decision-making in traditional African society is often based on consensus (Beugre and Offodile, 2001).

In terms of work organization, there is potential for team building and teamwork as long as these work designs are consistent with the values of “groupism, familysm and communalism” (Kamoche, 2000).

TU in Kenya

Kenya is a former colony of Britain, which influenced the formation of the Trade Union movement during its colonial governance, to defend the employer’s interest.

Trade Union in Kenya is dependent on membership contribution, levied fees and donations. It is an independent body and not inclined to any organisation, political party or government.

The umbrella body of all TU is The Central Organisation of Trade Unions (COTU). COTU was established in 1965 and has 27 unions in Kenya, representing 330,000 workers in all sectors of the economy (ICTUR et al., 2005).

COTU’s mission is to promote the social, economic, political and other interests of Kenyan workers. They try to improve the economic and social conditions of all workers in all parts of Kenya, organise the structure and spheres of influence and amalgamation of trade unions affiliated to COTU, encourage the principles of the development and maintenance of good relations between employees and employers, and establish and maintain funds by means of membership fees, monthly contributions, donations, subscriptions, levies and by borrowing on such security and such terms as may from time to time be arranged by the Executive Board (Central Organization of Trade Unions – Kenya, 2007).

Trade unions strength is supposed to be the workers, but they are weak, scared and divided, making it difficult to unite and fight for unfair treatment of the employees.

6. Conclusion

Since the USA is the technological pilot, US management practices represent current best practice, which other nations would eventually seek to emulate as they sought to adopt US technology (Lock et al., 1995). This thesis is evident in the current Czech HRM model and culture.

On the other hand there is strong convergence among members of the EU under impact of the institutional power of the European Union and its approaches to employment practices (Mayrhofer, 2005).

Results of this assessment make it clear that cultural and political factors have strong impact on HRM in particular countries. Despite the increasing internationalization of European organisations, many national differences in institutional system such as social, legislative and welfare still exist. Thus elements which distinguish two members of the European Union France and the Czech Republic are previous political regime and different cultural base. There are evident divergent forces which shape the individuality of each region in the Europe, e.g. the heritage, culture, degree of industrialisation, the influence of religion and the post-communist reformation of the political framework. On the other hand, I describe forces promoting some convergence in the development of HRM (survival in market economy, mass privatisation, globally integrated organisations).

Cheap labour presented a new dimension both in the Czech Republic and Kenya. Kenya is seen as the source of new economic initiatives for the recovery of their empires (Cooper, 1990). And Western investors drive to the Czech Republic with intention to develop their branches on under saturated market.

Trade unions have a beneficial influence in the collective bargaining. They are essential actors in the prevention and the regulation of the conflicts. They always take part in the socialization of the individuals because they produce a social bond with their members.

The trade unions represent the principal institution of the world of work in the industrialized countries. They act on the wages, the organization of work, and working conditions. Mission of Trade Union is to defend rights and interests of people, for who is payment the main resource of their living. Trade Unions are carriers of idea of solidarity and support among people, also international solidarity with everybody against oppression, discrimination and violence.

In the Czech Republic the process of EU integration introduced new pressures for convergent labour market policies with Western Europe, as all new member states have been developing national policies to implement the European employment strategy and EU Directives. Recent legislation, as well as policy statements and the national employment action plans have been in terms of calls for flexible work contracts and flexible working arrangements (EIRO, 2003).

Similarities

In all three countries trade unions have a history of being �Problem Causers’/ interference with an organisation’s HRM strategy - Crisis of adhesion. They monitor and identify employee problems, including fight for worker’s rights, enter into dialogue with employers, can cripple an industry, cause closedown to organisations.

Bilateral associations of Czech-Moravian Confederation of Trade Unions with foreign trade unions are focused on broad range of activity such as payments and income systems, union education, informatics, women and youth in trade unions etc.

Czech trade unions focus on direct solution of problems, and have the same priorities as their western partner, France, because their trade unions are in one Confederation- European Trade Union Confederation.

Both Kenya and France have power distant cultures.

Kenya and the Czech Republic are both collectivistic countries.

All three countries are moderate feminine in comparison with the world average.

Uncertainty avoidance is primary in the Czech Republic and France.

Kenya and the Czech Republic are both cynosures of Western investors.

Differences

Men and women in the Czech Republic work much longer hours than their counterparts in France (Fagan and Rubery, 1996). Nevertheless, an important difference between the Czech Republic and France is the sectored distribution of workers between services, industry and agriculture. The service sector is far less developed in the Czech Republic compared with the French average.

According to Nzelibe (1986), Western management is Eurocentric, individualistic, and modernistic, on the other hand African management is ethnocentric, traditionalistic, communalistic, and cooperative in team work.

In the case of developing Countries i.e. where Trade Union power and pressure is diluted, organisations must exercise ethical and responsible processes.

The trade unions should not be confined any more with the collective claims. Today, it is necessary to hold account of the individual concerns.

Ranking score for Kenya is power distance, while the power distance is the lowest in the Czech Republic. Individualism is low in Kenya but quite high in France.

France is the Western leader, which influenced Czech human resource management.

Czech trade unions power is much greater in private sector i.e. negotiating working conditions and other issues related to employment. Union membership in France tends to be concentrated especially in the public sector.