Are the different theoretical models that attempt to provide a general Essay - 1

Are the different theoretical models that attempt to provide a general theory of employee relations in small and medium sized firms (SMEs) reliable, or is the sector to divergent Critically discuss - Essay Example SMEs provide new flexible forms of employment which is not an inferior form of work organization but necessitated by supply and demand forming an additional basis for new segmentation in work and employment relations in the labour market (Thurman 1993). Official statistics on the incidenceof SMEs provide valuable information stating that these SMEs employed a total of 8.66 million employees i.e. 36 percent of all UK employees and accounted for 47 percent of private sector employers’ turnover. This makes it apparent why employee relations are important in small and medium sized firms apart from innovation and economic growth (Forth, Bewly and Bryson 2006). The above statistical records for SMEs make it vital for the involvement of employee relationship in these firms and whether industrial relations theory or model are reliable in the context of their operations and management. According to Bolton Report ‘Committee of Inquiry on Small Firms† (cited in Forth, Bewly and Bryson, 2006), it was concluded that â€Å"although physical working conditions were generally inferior to those found in larger firms, industrial relations in smaller firms were distinctive in conflict prone economy as being predominantly harmonious. Arrowsmith et al (2003) further elaborate the report of Bolton Committee characterizing about the size of SMEs and observe that there is a close proximity between manager and workers in SME which promotes mutual and informal ‘give and take’ that undermines collective organization and conflict. While industrial relations or employee relations is necessary to so as to maintain a balance at bargaining for the purpose of which unions are formed, putting forth their demand in front of the employer in case of large firms (Farnham, 2000). The three main competing sets of theories are classified and explained by Farnham and Pim lott (cited in Farnham 2000) which depict the nature of industrial conflict between employers and employees and between