INDUSTRIAL RELATION AND ORGANIZATIONAL PERFORMANCE (A CASE STUDY OF ZENITH BANK PLC, BENIN CITY, EDO STATE)

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

It is commonly seen that the field of industrial relations deals with the people at work place in an organization, firm. In industries, collaboration of men having various interests often results to tensions and conflicts. Each interest tries to maximize its share from the enterprise. Their orientation towards work is additionally sure to show a discrepancy from another. Establishment and maintenance of harmonious relations between worker and management could be a pre-requisite for the organization's performance. When good and smart understanding prevails between them, every party tries to serve the other to the simplest of their ability. Employee tries to improve productivity. In a complete sense, complete harmony can is elusive. Trade unions, to guard their interests, would try to register protest in an organized way. In the absence of sound industrial relations in a corporation, it is reasonable to expect workers to face many serious disputes. Employment conditions in industry are not regulated just by workers and employers, though each has a serious role to play in it. State intervention within the regulation of employee- management relations has been on the increase and therefore, the role-played by the state and its interaction with employers and workers legally forms part of industrial relations. The concept of industrial relations is not new in human resources management and it has generated a lot of debate among group of historians, economists and scholars. Globally, continentally and nationally industrial relations have to some extent been of relevance to the economic growth. Different opinions have emerged due to the protracted definitions of what industrial relations field is all about and this instigated more research on how and why such a field is important in organisations and nations as a whole. Certain conditions around the system of industrial relations (political, ecological and technological environment) are alleged to be the causes of the decrepit nature of the organisational performance countrywide. Trade union activities, resistance, adversarial labour relations, and grievances have been discovered to be highly costly to many firms as they would affect productivity and quality of products or services. Most organisations are at halt, could this be because of Industrial Relations? Recent trends and statistics reveal that Industrial Relations management was not recognised as a useful tool. Cooper, Johnson and Holdsworth (2012) studies show that there in the UK and United State of America there is a high rate of employees’ ill-treatment as witnessed by an increased number of awards given to organisations from 2007 to 2009. Olson (2013) posits that, law makers have long attempted to control what goes on in the workplace, but the new laws differ greatly from what came before. Kaufman (2000) argues that, non-union employees’ representation plans fell into disrepute in the 1930s in the United States, and were many were effectively banned in the decade. (Katz, Kochan and Weber, 1982) pinpoints that the slowdown in productivity growth and sluggish macro economic performance in recent years has drawn increasing attention to the U.S. system of industrial relations and various strategies for improving its performance. owing to the predominance of the white settler economy and the need for the State to meet settler’s desire for cheap labour, the colonial state enacted several laws such as the Master Servant Act 0f 1901 to the Industrial Conciliation Act of 1959, the colonial sate aimed to suppress labour rather than develop trade unions among black works. In the, recent years the many African counties economies were shattered down due to the closure of some organisations. In support of the above, Armstrong (2009) posits that, the decline in relations and collaborations between employees and employers threatens the survival of an organization. In support of that (Matombo and Sachikonye 2010) argues that, it stands at 173 out of 187 on the Human Development Index (UNDP 2011), and the social, economic and political rights of its population have been repeatedly disregarded. Zimbabwe’s entrenched economic crisis saw inflation peak at 231 million per cent in 2008; poverty is endemic and approximately 3 million people, or a quarter of the population, have emigrated abroad. With a country running under poverty, (94%) unemployment rate and entrenched economic crisis, it is hard to balance the industrial relations. The Financial Gazette of 12 February (2015) has it that, thousands of people working in small fast food outlets were pushed out of employment abruptly without pay or benefits as companies abruptly terminate jobs and close shops. Murray (2013), Zimbabwe used to feature in all southern African overland itineraries but virtually all of the companies ceased operations in the country with the exception of a few tentative forays into Victoria Falls. In light of the above Elliot Hotel being in the same macro-economic environment has a lot, considering the harsh economic conditions which have succumbed the nation as a whole. The seasonal business type, have been blamed of its unbearable long recessions. This has become the prickling pear in an eye of the researcher to solve the unfavorable conditions of outputs. It is against this background that this research should be done.

1.2 STATEMENT OF THE PROBLEM

For there to be an efficient and effective performance in an organization, there has to be a mutual satisfaction and dedication of the group that constitute the human side of the organization, unfortunately most organizations fail to achieve this mutual satisfaction and peaceful co-existence thereby leading to their employees performing below expectation. Similarly, when the organizational and individual goals are not compatible, it brings about conflict and disharmony within the organisation which can possibly lead to industrial action. Industrial actions bring frustration to management and causes unnecessary waste which may interfere seriously with the total organizations accomplishment. Zenith Bank Plc is perceived as successful organization within the banking industry because of the large assets and the market share it commands. However, Zenith Bank Plc is being characterized by increased cases of staff complains. As it was often reported  that over 3000 staff of the bank went on picketing action that led to the bank being unable to attend to their customers nationwide. This they did by accusing management of failing to honour the agreement it reached with the workers’ representatives. However, the then Bank management asserted that the bank’s union had impoverished rather than improve the fortunes of the bank. This particular scenario had helped bring to fore the effect that labour management relations can have on employee performance. The nature of work in the banking industry is quite hazardous. For instance, the process of counting notes produces dusts coupled with the unfavourable operating temperatures and harsh work and environmental conditions in addition to the harsh words the employees are exposed to have resulted into frustration amongst the employees which is affecting the overall performance of the organization. This is worsened by the fact that employees feel that management seem not to be bothered by this neither are they seen doing anything to improve their relationship with the workers’ representative. This study therefore is necessitated by the need to research the effect of labour management relations on the performance of Zenith Bank Plc.

1.3 AIMS OF THE STUDY

The major purpose of this study is to examine industrial relation and organizational performance. Other general objectives of the study are:

1. To examine the causes of poor industrial relations.
2. To examine the roles of the core industrial relations actors.
3. To examine the impact of industrial relations on organisational performance.
4. To examine the difficulties associated with industrial relations and industrial conflict.
5. To examine the relationship between industrial relations and organisational performance.
6. To examine ways of overcoming challenges to industrial relations.

1.4. RESEARCH QUESTIONS

1. What are the causes of poor industrial relations?
2. What are the roles of the core industrial relations actors?
3. What are the impacts of industrial relations on organisational performance?
4. What are the difficulties associated with industrial relations and industrial conflict?
5. What are the relationship between industrial relations and organisational performance?
6. What are the ways of overcoming challenges to industrial relations?

1.5 RESEARCH HYPOTHESES

Hypothesis 1

H0: There is no significant impact of industrial relations on organisational performance

H1: There is a significant impact of industrial relations on organisational performance

Hypothesis 2

H1: There is no significant relationship between industrial relations and organisational performance

H1: There is a significant relationship between industrial relations and organisational performance.

1.6 SIGNIFICANCE OF THE STUDY

This research work will be beneficial to the employers, employee’s future researcher in such areas as well as the government as reflected below:

1. The management and employers will benefit because it will save them losses and cost associated with industrial conflicts and strike actions
2. The employees and workers will benefit especially through the collective bargaining mechanism which will afford them opportunity to participate in decision making of the organization.
3. This research work will serve as a platform, a foundation for future researchers to build upon towards achieving academic goals.
4. This research work will serve as a guide that can be used by government to minimize and prevent future industrial dispute and conflict.

1.7    SCOPE OF THE STUDY 

The study is based on industrial relation and organizational performance, a case study of Zenith Bank plc, Benin City.

1.8 LIMITATION OF STUDY

Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.9 DEFINITION OF TERMS

Industrial Relations: These are complex interrelations among the state, employer and the employees’ representatives, working towards achieving the same goals, mission and values with the state being the regulator of the relationship.

Organisational Performance: The term depicts the output or results as measured against the effort, input, capital, leadership and all other organisational processes.

Productivity: A combination of organisational effectiveness and efficiency; it can be quantitative or qualitative

Organisation: The term refers to a comprehended group of people who combine their efforts to produce goods and services that are valuable to the society and organisations.

Employment Relations: The term refers to the broad spectrum of interaction between the employees and the management regulated by government legislation so as to achieve the organisational goals.