Employee Participation

Employee participation means many things to many people. Essentially it is about involving non-
managerial staff in the decision-making process of an organisation. It is, however, the EXTENT
of involvement in decision-making that is problematical.

Choices in Employee Participation

Consultation – Participation occurs when employees are consulted about decisions affecting
their working lives.

Job Enrichment – The employee is given more discretion to make decisions affecting his own
job.

Participative Management Style – The initiative for participation rests with open management
who employ an ‘open’ approach to managing people where plant level councils may be set up where
managers/employee representatives discuss and jointly decide a wide range of strategic issues.

Collective Bargaining – Many people feel that collective bargaining should be extended to
include forward planning issues. The adversarial nature of the process may militate against its
use as a form of participation.

Works’ Councils – This idea is based on the West German approach that confers on employee
representatives the legal right of access to information from management on a wide range of
issues and the right of joint decision-making on all personnel matters.

Board Representation – This is participation at ‘policy-making level’. Employees can elect worker
directors whose power and influence will depend on the number of such directors on the board.
In Germany, Supervisory Boards include employee representation but there are no such
members of the Management Board (Executive Board). The EC is a firm believer in employee
participation at Board level.

Quality Circle – This is a work group of 8-10 employees and supervisors who have a shared area
of responsibility. They meet regularly – typically, once a week, on company time and on company
premises – to discuss their quality problems, investigate causes of the problems, recommend
solutions, and take corrective actions. They take over responsibility for solving quality problems,
and they generate and evaluate their own feedback. But management typically retains control
over the final decision regarding implementation of recommended solutions. Part of the quality
circle concept includes teaching participating employees group communication skills, various
quality strategies, and measurement and problem analysis techniques.

Employee Stock Ownership Plans (ESOPs) – Employee stock ownership plans are company-
established benefit plans in which employees acquire stock as part of their benefits.
Approximately 20% of Polaroid, for example, is owned by its employees. Research has shown
that ESOPs increase employee satisfaction. In addition, they frequently result in higher
performance. ESOPs have the potential to increase employee job satisfaction and work
motivation.