Transnational Industrial Relations

The purpose of this symposium¹ is to examine the prospects for transnational industrial relations—that is, the prospect that the processes for making decisions about work rules, incomes and the other subject matter of industrial relations will increasingly flow across national boundaries and will therefore overflow the national institutions which have been dealing with them until they become restructured internationally.

There is some evidence that the leaders of three key institutions of our world society, the nation State, the trade unions and the firm, have begun to take cognisance of the world scale of events. While the earth is hardly a ‘global village’ as Marshall McLuhan would have it, the nature and pace of scientific and technological advance in aerospace, in communications and transportation, have revolutionised concepts of distance, and imposed a sense of political and economic interdependence the planet Earth has never known. Raymond Aron called our age ‘The Dawn of Universal History’, which Lord Acton explained as:

‘... distinct from the combined history of all countries, which is not a rope of sand, but a continuous development, and is not a burden on the memory but an illumination of the soul.’

‘It moves in a succession to which nations are subsidiary. Their story will be told, not for their own sake, but in reference and subordination to a higher series, according to the time and the degree in which they contribute to the common fortunes of mankind ...’

This paper will seek to explore some of the factors that shape the industrial relations policies of management within the central and peripheral undertakings that together comprise a multi-national corporation. The factors involved can be classified into two groups:

This chapter sums up the progress made towards integration through the Latin American Free Trade Association (LAFTA)¹ and proposes multinational public corporations as one of the means by which that integration may be further promoted.

The socialist countries of Eastern Europe are making substantial changes in the management of their national economies. These changes are usually called ‘economic reforms’ or ‘new economic systems’.¹ They are also accompanied by changes aiming at a better functioning of the socialist society as a whole, thus contributing to further promotion of democracy in all areas of social life.

The Pythagorean cosmos was threefold, as is, from a speculative point of view, the contemporary world economy — East, West and South pursuing sometimes parallel, frequently divergent, paths of development. The most powerful integrative force, whether of systems of ideas or of institutions, tends to be the advance of compatible knowledge. In contemporary international economic relations the compatibility of scientific and technical progress in the Eastern and Western systems is leading to the multiplication of new forms of productive and trading links These new forms — which go under the name of ‘scientific, technological and industrial co-operation’ — owe their origin to the fact that modern techniques of industrial production have tended to impose similar patterns of industrial organisation on enterprises within each set of countries. In the Western developed economies, the tendency has been for big enterprises to grow still bigger by means of mergers, fusions, etc., so that the share of total manufacturing output provided by, say, the hundred largest enterprises has roughly doubled in recent years. The striking growth of the multinational companies has been due to the internationalisation of this process, as enterprises have sought to protect themselves from the competitive pressures, and to seize the competitive opportunities, generated by the creation of larger, sometimes regionally integrated, markets.

One of the Rome Treaty’s^l main objectives is social progress. In the Preamble of this Treaty, the signatories declare that they direct ‘their efforts to the essential purpose of constantly improving the living and working conditions of their people’. According to Article 2 of the Treaty, the Community is to promote ‘an accelerated raising of the standard of living’.

Surprisingly enough, for some observers of the European industrial relations scene, economic integration through the creation and operation of the European Coal and Steel Community (E.C.S.C.) and the European Economic Community (E.E.C.) has apparently had a relatively small impact on the relations between trade unions and employers. In particular there has so far¹ been no collective bargaining at the Community level, even though the similarity of organisational structures and of the roles of the social partners in the E.E.C. member countries, as well as the Community’s basic supra-national legal framework,² would have seemed propitious for such negotiations. Furthermore, the diversity in national labour legislation cannot be regarded as an insurmountable obstacle.³

Experts in international economics often emphasise the asymmetrical nature of trade between industrial countries.¹ The explanation involving the role of the product cycle in international trade stresses the time lag in demand for new products according to the country as a reason for changes in trade patterns from the point of view of time.² This theory is generally supported by an explanation based on an examination of technological gaps between countries³: at a given time in their historical and technological developments, some countries are unable to turn out goods for which advanced technology is required.

As suggested in a discussion outline prepared by the Institute, the purpose of the proceedings was to consider prospectively the impact of the multi-national corporation and of regional economic integration upon the future of industrial relations and, conversely, how the pattern and trends in industrial relations might influence the growth of the multi-national corporation or regional integration. In both cases the particular focus was to be on the prospects for transnational industrial relations.

As transnational industrial relations are a new field of study it has been thought useful in the first subsection of this concluding section to put forward some preliminary ideas concerning the analysis of this phenomenon. They are the basis on which several tentative hypotheses will be developed regarding the propensity of industrial relations to become transnational under the impact of multi-national corporations.¹