Union suppression and union substitution strategies of multinational enterprises in Ghana

• Date: 01 July 2019
• DOI: http://doi.org/10.1111/irj.12264
• Published date: 01 July 2019

Union suppression and union substitution

strategies of multinational enterprises in

Ghana

Desmond Tutu Ayentimi, John Burgess and

Kantha Dayaram

ABSTRACT

This article complements the literature by furthering the understanding of an ‘African

dimension’of multinational enterprise (MNE) union avoidance. The evidence sug-

gests that MNEs engaged in both union suppression and union substitution strategies

by (i) exploiting young employees’apathy to promote opposition and indifference for

union organisation (evil stuff), (ii) implementing union member-centred employee re-

trenchment (fear stuff), (iii) using enterprise-level collective bargaining arrangement

to suppress union bargaining power (fear and fatal stuff), (iv) exploiting the

fragmented labour union environment to suppress union organisation (fatal and evil

stuff) and (v) promoting individual employee voice and involvement mechanisms

(sweet stuff). Although MNEs in Ghana engaged in both union suppression and

union substitution strategies, they appear to particularly favour the adoption of

‘union suppression’strategies and what might be termed as ‘corridor tactics’. Our ar-

ticle highlights four transitional issues underpinning the emerging success of ‘corridor

tactics’in union suppression in a less developed host country.

1 INTRODUCTION

This article contributes to the understanding of an ‘African dimension’of multina-

tional enterprise (MNE) union avoidance literature as there is a dearth of research

that examines the processes of union substitution and union suppression in develop-

ing economies in sub-Saharan Africa. Ghana provides a rich research context to ex-

plore the mechanisms and the extent to which MNE subsidiaries employ union

substitution and union suppression as strategies for union avoidance. The literature

on industrial relations (IR) and the labour movement in Africa is generally limited.

While there is extensive research supporting the potential productive role of employee

voice and involvement towards realising organisational objectives (Tüselmanna et al.,

2014; McDonnell et al., 2014; Cullinane et al., 2012; Budd et al., 2010; Dundon et al.,

2004; Flood and Toner, 1997), there have been calls for analysis of the contribution of

❒Desmond Tutu Ayentimi, Tasmanian School of Business and Economics, University of Tasmania,

Hobart, Private Bag 84, Hobart, TAS Australia, John Burgess, School of Management, RMIT

University, Melbourne, GPO Box 2476, Melbourne, VIC 3001, Australia and Kantha Dayaram, School

of Management, Curtin University, Perth, Kent Street, Bentley Campus, Perth, WA 6102, Australia.

Correspondence should be addressed to Dr Desmond Tutu Ayentimi, Tasmanian School of Business and

Economics, University of Tasmania, Hobart, Private Bag 84, Hobart, TAS, Australia; email: desmond.

ayentimi@utas.edu.au

Industrial Relations Journal 50:4, 379–398

ISSN 0019-8692

© 2019 Brian Towers (BRITOW) and John Wiley & Sons Ltd

alternative voice and involvement mechanisms and individual performance manage-

ment practices to union substitution and union avoidance (Collings, 2008; Dundon

and Gollan, 2007; Marchington et al.,1992). Union avoidance or employers’resis-

tance to unions and its forms have a long history in developed economies (Fiorito

and Maranto, 1987; Gunnigle et al., 2015). Union avoidance has become a coherent

and embedded strategy employed by firms and more specifically by MNEs, where hu-

man resource management (HRM) substitution strategies have been identified as the

non-aggressive form of union avoidance (Machin and Wood, 2005; Barbash, 1987)

and acts of intimidation and oppression have been labelled as the aggressive form

of union avoidance (Gall, 2004). The decline of union representation globally is at-

tributed to the many actions within and outside of the labour regulatory framework

designed to undermine employee organisation and activism, and management resis-

tance to the advancement of collective bargaining and collective representation

(Dundon and Gollan, 2007; Gall, 2004). Researchers have argued that HRM

provides an important managerial space to address individual employee needs and

creates the support systems for management to bypass unions (see Kochan, 1980;

Fiorito and Maranto, 1987; Gall, 2004). Barbash (1987: 170) suggests that ‘instead

of confronting the union head-on, HRM strikes at the sources which breed unionism

to begin with’.

The strategies of union substitution and union suppression were outlined by

Kochan (1980) after observing the steady growth in union avoidance processes in

the United States. He argued that union substitution was a reflection of personnel

management advancement, whereas union suppression is driven by anti-union inten-

tions and attitudes. Fiorito and Maranto (1987) and Barbash (1987) also note that

union substitution appears to be comparatively indirect in nature, while union sup-

pression constitutes a direct attack on unionism. Employer practices such as employee

involvement and better working conditions that are intended to mitigate employee

dissatisfaction could be perceived as union substitution measures (Machin and Wood,

2005). This is in consonance with Roy’s (1980) conceptual framework for classifying

employer union recognition and resistance to unionisation, which involved a wide-

ranging web of defensive operations such as fear, evil, sweet and fatal stuff (see also

Gall, 2004). Roy (1980) defines ‘fear stuff’as an act of oppression and intimidation

by the employer, while ‘evil stuff’signifies propaganda and ideological acts to create

hatred for union organisation. ‘Sweet stuff’constitutes acts of union substitution

aimed to avert the need for trade union organisation, and ‘fatal stuff’aimed at

interrupting the recognition for collective representation and collective bargaining

(see also Gall, 2004).

The concept of union substitution and union suppression in this research context

provides a valuable and novel analytical frame to examine the strategies engaged

by MNE subsidiaries to undermine trade unions, collective voice and union survival

within the union avoidance literature through the lens of comparative capitalism—the

segmented business system and the diverse variety of capitalism (see Wood et al.,

2014; Wood and Frynas, 2006). To further the understanding of union suppression

and union substitution, we use in-depth interviews and documented evidence to ex-

plore strategies employed by MNE subsidiaries in a less developed host country.

The evidence suggests that MNE subsidiaries in Ghana engaged in both union sup-

pression and union substitution strategies; however, the evidence points towards a

tendency for union suppression strategies, which we refer to as ‘corridor tactics’. Cor-

ridor tactics are undocumented means used by employers and are typically directed at

380 Desmond Tutu Ayentimi, John Burgess and Kantha Dayaram

© 2019 Brian Towers (BRITOW) and John Wiley & Sons Ltd