Werner Nienhueser

Coordinated market economy/liberal employment relations: low cost competition in the German aviation industry

This paper examines the German low cost airline industry by analysing how the growth of low cost competition has influenced the industrys pattern of employment relations. The paper highlights the role of Lufthansa, as both the traditional flag carrier and the leading site of employment relations within the German aviation sector. The paper explains how Lufthansa has positioned itself to face low cost competition by, among other initiatives, creating its own low cost subsidiary (Germanwings). Competitive pressures, stemming from the liberalization of European aviation and demand for low cost travel, have produced a marked divergence in this industry from the typical pattern of German employment relations. The paper explains this divergence by situating the case study within the varieties of capitalism literature.

The Effects of Different Types of Works Councils on Bargaining Outcomes: Results of an Empirical Study

This article looks at the effects that different types of works councils have on the results of bargaining between a works council and management. It investigates, in particular, how the works council type has an influence on the use of company or works agreements and the assessment of such agreements by 1000 interviewed human resource managers. The typology combines two dimensions: power and willingness to cooperate. The resulting four types of works councils show different effects, controlling for other variables: overall, works agreements are widespread and highly valued by the majority of human resource managers. However, firms with a works council that the management perceives as being more powerful and less willing to cooperate have a higher number of works agreements. In this constellation, one also finds the worst assessments of works agreements by the human resource managers — they perceive such agreements as reducing flexibility and having fewer advantages. A more detailed analysis shows two more results: first, it is the power or strength of a works council, rather than the willingness to cooperate, that influences the frequency of works agreements. Second, the perceived willingness to cooperate has an effect on the assessment of works agreements, but not on their frequency.

Empirical Research on Human Resource Management as a Production of Ideology

The article argues that empirical research on Human Resource Management creates a one-sided, distorted image of the reality of work and thus generates ideology. Such an ideology legitimises HR practices and favours the interests of entrepreneurs and managers. This assertion is illustrated and discussed using the case of empirical research in HRM in German-speaking countries, although the ideology assertion should also be valid for Anglo-Saxon countries. It is shown that HRM research mainly follows employer objectives; it primarily analyses performance-related variables. The surveyed HR practices focus on “High Performance Works Systems”, while other HR practices are largely ignored. Mainly organisational elites (managers, experts and other highly qualified employees) are surveyed as personnel and provide information about the situation in companies. Empirical research paints a unitaristic picture; depicting the employer and the role of HR management positively. Deviations from an employee-friendly HR strategy are overlooked or seen as relatively rare anomalies.

The Effects of Trust on the Preference for Decentralized Bargaining

This article looks into the question of whether trust between works councillors and managers affects their preferences for plant-level negotiations compared with industry-wide or multiemployer bargaining. The main hypothesis is that when a high degree of mutual trust exists, both parties are more likely to show a preference toward the plant level. When the level of trust is low, the bargaining parties rely more on supraplant-level bargaining and collective bargaining power. This article uses data from a survey of 1,000 German companies of at least 100 employees, including 1,000 personnel managers and 1,000 works councillors, that is, those persons responsible for negotiating working conditions at the plant level. Logistic regression analyses show that trust has no significant effect on the managers’ preference for decentralized bargaining, whereas it can be found to affect the works councillors. The authors finally discuss the question of why the effect of trust is different for the bargaining parties.

Socio-economic Research in Personnel versus Personnel Economics

This paper argues that personnel economics is still dominated by the assumptions of orthodox microeconomics, and also that newer fields such as transaction cost theory are far removed from socio-economics. Personnel economics is characterised by assumptions of unbounded rationality, stable preferences and functioning markets; power differences are seen as unimportant for explanations. By contrast, a socio-economic perspective works with the assumption of bounded rationality; it takes preferences into account, assumes that markets are characterised by ‘non-equilibrium’ states and power differences. The paper outlines a socio-economic mode of explanation and suggests that any explanation should include assumptions about three theoretical mechanisms: pursuit of utility, power and sense-making.