1. CHAPTER TWO EXTERNAL FACTORS AND THEIR IMPACT ON THE EMPLOYMENT RELATIONSHIP

2. Objectives of this chapter Explore how the external environment impacts on employment relations Outline the political impacts that can affect employee relations Outline the economic impacts that can affect employee relations Outline the social impacts that can affect employee relations Outline the technological impacts that can affect employee relations Outline the legal impacts that can affect employee relations Outline the ethical/environmental impacts that can affect employee relations

3. The external environment Stability Complexity Dispersion

4. External environment and employee relations Buffer departments Accountability Boundary-spanning roles

5. Political factors Development of legislation Winter of Discontent 1978/79 Conservative government 1979–97 Social Chapter Labour government 1997–date

6. Political manifestos Diversity Productivity Skills

7. Economic factors Employment Inflation Taxation and spending Interest and exchange rates Price stability Economic growth Balance of payments surplus

8. Fiscal policies Tax and spending 1970 – increase disposable income Or increase spending Or increase social benefits

9. Monetary policies Conservative government 1979–97 Excessive demand for goods and services led to price inflation Manage demand by financial instruments rather than tax and spending Use of interest rates

10. Social factors Unemployment Immigration Emigration Family-related issues

11. Women in employment Stereotyped jobs Parents Flexibility Aptitude Discrimination

12. Technological factors Flexibility to learn how to use new technology Remote working Monitoring of performance Change in methods of communication

13. Legal factors Growth in employment legislation Impacts on individualism Alters the balance of power between the employer and employee

14. Ethical/environmental factors Corporate social responsibility Globalisation Moving operations overseas