Labor Management Relations and Competitive Advantage

Running head: Labour Management Relations and Competitive Advantage in Singapore
Labour Management Relations and Competitive Advantage in Singapore
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1Labour Management Relations and Competitive Advantage in Singapore
Table of Contents
Introduction......................................................................................................................................2
Analyses on role of four key players of LMR.................................................................................3
Role of government.....................................................................................................................3
National Trade Union Congress..................................................................................................4
Management................................................................................................................................5
Employee.....................................................................................................................................5
Analyses on competitive advantage to Singapore through LMR....................................................6
GDP growth.................................................................................................................................6
Business growth in Singapore.....................................................................................................7
Industrial disputes........................................................................................................................8
Industrial Strikes..........................................................................................................................9
Conclusion.....................................................................................................................................10
Reference.......................................................................................................................................11

2Labour Management Relations and Competitive Advantage in Singapore
Introduction
Labours are one of the key factors that impact the growth of any organization operating
in any industry irrespective of its location and country of operation. Labours in an organization
are employed by its owners or responsible authority. Therefore, there exist relationship between
labour and owners. This relationship in an organization is termed as relation between employee
and employers. In an organization the representative of labours is labour union and that of
organization is the human resource department. Better is the relation between the human
resource department and labour union in an organization better is the employee and employer
relation. With better labour relations and organization is able to reduce internal conflicts and any
negative disruption in operation of the organization. This provides competitive advantages to an
organization and thereby assure its sustainable development. Thus, management of labour
relations is an important factor that should be taken care with proper policy implementation and
industry relation. The four key players of labour management relations are the government,
employer or management, employees and labour union. The report discusses about the labour
management relations in the context of Singapore. In the report the contributions of the
aforementioned key players on labour management relations is among the main focuses. The acts
such as employment act, industrial act trade union act and various acts related to the concerned
topic is part of the discussion in the report. Apart from these research study on gross domestic
product (GDP) growth, multinational corporation (MNC) number of strikes and industrial
disputes in Singapore is part of discussion of the report. Therefore, the report by discussing the
aspects of labour management relations (LMR) discusses how it helps Singapore to gain
competitive advantage in global economy.

3Labour Management Relations and Competitive Advantage in Singapore
Analyses on role of four key players of LMR
Role of government
The government of Singapore contributes to the LMR of the country through
employment act, trade union act, trade dispute act and industrial act. The objectives of the
employment act of the country is to provide minimum number of days as annual leave, timely
salary payment, statutory protection to employees such that the do not get wrongfully dismissed
and paid leave on public holidays and sick leave. The employment act fixed several codes for the
employers to follow such that no employees get exploited during period of employment or after
by the employer. As per employment act the employer need to provide Key Employment Terms
(KETs) within 14 days from first day of joining. There is fixed working hours such as 44 hours
of work per week, minimum payment structure of salary and salary should be paid within the end
of one salary period (Ministry of Manpower Singapore, 2020). Thus, these help in creating
transparency in the employment sector. On the other hand, Trade Dispute Act of Singapore is
formulated with and objective of solving and preventing an act of dispute in the trades of the
country that might cause due to ill relationship between employees and employers, employees
and employees and employers and employers that impacts the employment and labour conditions
of the country (Sso.agc.gov.sg., 2020). The act influence the LMR of the country by stating
legality of the industrial action of the country. Most of the actions are related to the lock outs of
the factories. Any such lock out or strike by the employees of a firm is illegal if it delays the
production or completely hampers in order to achieve any objective that is not related to trade
disputes and thereby hampers either of the employees or the employers (Taib, 2017). In the act
there is provision for punishing a person who is responsible of illegal industrial action. The
punishment includes fine up to $2000 or imprisonment for 6 months or less and for illegal lock

4Labour Management Relations and Competitive Advantage in Singapore
out the value of fine may increase up to $5000. There are punishment for every illegal industrial
action and lock out. The maximum amount of fine and imprisonment that can be implemented
according to Trade Dispute Act (revised 2014) are $5000 and 12 months respectively (Noe et al.,
2017). Additionally, trade union is a registered body which is an association of employees or
employers including both permanent and temporary. The main objective of the trade union is to
improve and sustain good relation between employers and employees, taking care of working
conditions of the employees and improves the employees’ productivity and in order to make
benefit for the economy of the country including both employers and employees. The laws
related to trade union is sated in the Trade Union Act of the country. At last comes the Industrial
Relations Act the objective of which is settlement and prevention of any trade disputes occurring
or may occur in the country ((Sso.agc.gov.sg., 2020). The process that leads to solution of
prevention of trade disputes are arbitration, conciliation and collective bargaining. This act tells
guides how the process of negotiation should be carried out lawfully. Therefore, plays a crucial
role in LMR in Singapore.
National Trade Union Congress
The National Trade Union Congress in Singapore (NTUC) was founded in 6th of
September 1961. It is comprised of 5 trade associations, 59 trade unions, 12 social enterprises
and 6 relevant organizations. Currently, the union has 0.9 million members (Mohan 2017). The
major objective of the organization is to improve the competitiveness of the country and along
with that assuring lifelong employment for the workers and thereby improving the welfare and
social status of workers ((Sso.agc.gov.sg., 2020)). The organization aims to build a responsible
and strong labour movement. It provides several services such as career activation programme,
career coaching, inclusive growth programme, helping centre for migrant workers, health and

5Labour Management Relations and Competitive Advantage in Singapore
safety programmes, training programmes and various projects for youth and women such to
improve the employment condition and thereby improves the LMR of the country.
Management
LMR of a country is influenced by core managerial rights and Singapore is no exception.
The core managerial rights are setting mission of the organization and based on it making budget
of the organization and formulating its strategies ((Sso.agc.gov.sg., 2020)). Thus, managerial
rights are important to gain healthy LMR in a country. Additionally, Singapore National
Employers Federation (SNEF) has more than 3000 companies as members and is the only trade
union of employers in the country. The objective of the trade union is to improve tripartism
among trade unions, government and employer’s organization. It is done to formulate effective
economic policy to enable the employers of the country to implement fair, efficient and
transparent employment practices.
Employee
Among all the resources used by an organization employee is the most important. Thus,
providing suitable working environment to an employee should be the first priority of an
organization. Any kind of pressure if forcefully imposed upon an employee or any exploitation
of an employee will eventually lead to reduction in productivity of the organization and thereby
it loses the competitive advantage. On the other hand, employees do have some responsibilities
too towards their organization. All the employees should fully utilize every resources provided to
them and in addition to that they should focus on improving their skills. Employees should not
tolerate any kind of ill practices or treatment by the organization but it is helpful for the
organization if the employees adapt to various types of working condition existing in the market

6Labour Management Relations and Competitive Advantage in Singapore
not including the ill conditions. More the flexible the employees become more will the
competitive advantage of the organization.
Analyses on competitive advantage to Singapore through LMR
Singapore has taken many measures to improve the LMR of the country. Government
and several employee and employers’ organization implemented many policies and projects in
order to increase the welfare of both the employees and employers and thereby tried increase the
competitiveness of country at the global stage (Quah, 2016). The organizations like NTUC and
SNEF conducts many programmes and formulate several economic policies such the LMR of the
country remains at good level assuring less trade disputes clashes between employees and
employers (Ntuc.org.sg., 2020). Hence, improvement in industrial sector means economic
development of the country and thus improves the competitiveness of the country. With
improved competitiveness the country should achieve good GDP value and along with that the
number of MNCs in the country should increase. In addition to that, there should be less
occurrence of industrial disputes and strikes in the country. Thus, to find the effect of LMR on
competitiveness of the country analysing GDP growth, condition of MNCs, industrial disputes
and number of strikes.
GDP growth
GDP is considered to be one of the major indicators of economic growth since it reflects
the total output produced in an economy in given period. Thus, GDP growth indicates how fast
the output of a country is growing every year (Giri, 2017). It can be thus inferred that of GDP
growth rate is high and increasing every year then the economy of the country is growing at a
high rate and there is significant amount of investment in the country can be expected especially
in the industrial sector.

7Labour Management Relations and Competitive Advantage in Singapore
Figure 1: GDP growth rate
Source: (Data.worldbank.org., 2020)
From figure 1, it is clearly visible that after economic recession of the GDP growth in
2010 shoot up very high but after that there was steep fall. Considering, te data of last ten years it
can be observed that the average GDP growth rate of tee country is below 4%. Thus, growth rate
is not much high. Therefore, it is evident that economy is not growing at a fast rate. However,
4% growth rate is not bad but from this data it is hard to tell about the competitiveness of the
country. It should be however noted that Singapore might have reached the developed stage and
thus is the reason of low rate of GDP growth.
Business growth in Singapore
In the recent times, Singapore is experiencing go inflow of investment as many MNCs
are showing interest in the country. The policies of the country has supported it to become
attractive to MNCs as a good place for aiming investment. Among 100 big tech firms in the
world 80 operates in the country as per Singapore’s Economic Development Board

8Labour Management Relations and Competitive Advantage in Singapore
(Forbes.com., 2020). The country was ranked 6 in Bloomberg Innovation Index. Apart from,
these factors there is another most important factor which is availability of skilled labour. The
industrial relations in the country is good too and there is opportunity of Research and
Development (Lin & Ewing-Chow, 2020). The trend in ease of doing business shown in figure 2
proves why MNCs are interested in the country to investment.
Figure 2: Ease of doing
business in Singapore
Source: (Tradingeconomics.com., 2020)
It is evident from figure 2 the country has maintained its ease of doing business index.
Singapore is ranked 2 in the world for ease of doing business (Rasiah & Xiao Shan., 2016). This
has increased the competitiveness of the country and that is why the MNCs are entering the
country for business. It is achieved by the country due to existence of good LMR.
Industrial disputes
Ten years ago the number of industrial disputes in the country was much higher than it in
the current period. The trend of industrial disputes in the country is shown in figure 3.

9Labour Management Relations and Competitive Advantage in Singapore
Figure 3: Number of industrial disputes in Singapore
Source: (Created by the Author)
Therefore, it is clearly visible that the industrial disputes in the country has decreased due
to good LMR.
Industrial Strikes
For many years there has been new rule and guide lines in the employment sector. The
country has not faced strike in many years but if looked at the last ten years data then it can be
observed that there was a strike in 2012. The strike was called by Chinese drivers of SMRT
buses. The reason for the strikes was the low pay structure of Chinese drives than that of
Malaysian drivers worked in SMRT. There were 450 Chinese bus drivers working in SMRT and
102 of them participated in the strike due to which significant amount of inconvenience occurred
in the transport system. According to the authorities the strike participants could have directly
communicate with the management but the aggressive step has hampered the smooth operation
of the transport system. However, after that no strikes occurred and it is thus evident that the
country has managed well to avoid any further strikes.
2006 2008 2010 2012 2014 2016 2018
0
20
40
60
80
100
120
140
160
180
Year
Number of disputes

10Labour Management Relations and Competitive Advantage in Singapore
Figure 4: Number of strikes in
Singapore in the last ten years
Source: (Created by the Author)
Conclusion
It is evident from the above discussion that LMR is one of the important factor of the
country because based on that the relation of the country it improves. However, effective LMR is
only achieved when if all the key players works efficiently with policing proper law and acts in
the country. The existing acts that deals with the LMR of the country are Employment Act,
Industrial Relation Act and Trade Disputes Act. Apart from that, the NTUC and SNEF plays
crucial role in improving the LMR of the country. At last comes the management and it is
equally important for the growth of the country. Looking at the trend of GDP growth, increase in
investment of MNC due to ease of doing business and declining disputes in the last ten years. It
has been also seen that in the last ten years there was only one incidence of strike in the country.
Therefore, it can be said that LMR played a crucial role in improving the competitiveness of the
country in the global platform.
2008 2010 2012 2014 2016 2018 2020
0
1
2
3
4
5

11Labour Management Relations and Competitive Advantage in Singapore
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