The Republic Of Mauritius Country Profile Commerce Essay

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The Republic of Mauritius or the little giant of the Indian Ocean is widely known for its Sea, Sun and Sand. It is situated in the middle in the Indian Ocean and surrounded by the African, Asian and Australian continents. It is surrounded by a group of islands in the south West of the Indian Ocean, consisting of the main islands of reunion, Rodrigues and several outer islands. Mauritius is considered as a hub to the region and also acts as a link between Asia, Africa and the Eastern regions. Mauritius is a former British colony, obtained its independence on the 12 March 1968 after much struggle and later rose to the status of Republic on the 12 March 1992. The country has a total population of approximately 1,268600 inhabitants (CENTRAL STATISTICS OFFICE,2008.------ Under the aegist of the Ministry of Finance And Economic Empowerment). Mauritius is characterized by many cultures, religions and ethnic groups. It is known to be a bilingual country. The official language is English though French is commonly used. This plurality of languages is so because it has a deep and profound link in the our history. Our heritage endowment dates from our past colonization days when Mauritius was firstly occupied by Dutch settlers, secondly French settlers and later on British ones.

Over the past decades, the Mauritian has seen unprecedented developments. The economic situation of Mauritius has evolved and become stronger over the years. The main pillar in the country has been extended and this has considerably boosted the socio - economic situation of the country. During the past thirty years, Mauritius has always been aiming at diversifying its monocrop economy once predominant in the 1970s to giving rise to a more diversified one. Today others sectors of activity have emerged, besides the sea reefs and the blazing sun lies a thriving economy coupled with tourism, textile, information (ICT) and financial sector namely the ICT and other service sectors.This fair degree of diversification has placed a key element towards this development. As a result of the economic paradigm shift, a Mauritian model of labour was needed to govern the labour structure in Mauritius. By consequence, the industrial relation model was therefore implemented and this model took its roots from multiple sources. With industrialization and urges from globalization, a new enlightenment has given birth to employee relation which was former known as Industrial Relation. Going deep in the premise, the sugar industry was at the origin of the development of the industrial law. The history of labour relations and labour involvement in Mauritius dates back to as far as in the 1920.

The structure of the labour market in Mauritius has evolved overtime with the advent of fundamental structural changes in the economy over the past three decades. This change can be attributed to the rapid development of the manufacturing sector in the 1970s and to the emergence of new sectors in the late 80s and early 90s, namely in the field of tourism and financial services.

1.2 New Challenges

Since the industrial revolution in Britain, industrialization has been perhaps the most profound change in the socio - economic activities. Industrialization has been the centre of development. Following industrialization and the setting up of several private enterprises, the relationship between the management and the employees has been rendered more complex. There has always been fundamental divergences of interest between employers and employees, which has contributed to a conflictual relationship. Employers have always been seen as a direct menace towards the interests of employees as the former trying to extract maximum effort and in return giving minimum to employees in terms of rewards. Therefore it was imperative of the setting up of a platform where the key players namely the employees, the state and the management would interact and align their interests at the workplace. Industrial relation was thus seen as the ideal platform where the key players at the workplace would embark on with a view to a conflict free workplace but however it has always been characterised by conflicts.

Industrial relation does relate to the relationship between the unions and the management. This relationship does encourage negotiation and agreements. Industrial relation as a concept has achieved its aim in strikes redundancies but however industrial relation has now given birth to employment relation. This is because now in this modern era, environmental factors are also being brought into this equation aiming towards the relationship of the main key players at the workplace. Employment relation does not operate in a vacuum and therefore the environment in which it does operate is influenced by environmental factors which are namely Political, Economic, Legal and Social factors ( employee relations mgt 2222- Assoc Prof A Ramgutty-Wong Dr P Baguant july 2008) . Employment relations as compared to the industrial relations can be defined as the relationship as the relationship between the workers and management but however employment relation does encompass some factors that industrial relations did not take into account which are namely legal framework, work rules and culture.

This change from industrial relations to employment relations has been possible due to changes in management practices at the workplace. The main factors that have eased this transition can be attributed to some management approaches such as motivational theories and leadership styles. The concept of treating employees as assets and that they contribute value - added to organisations have influenced the behavior of employees.

In this perspective, the shift from industrial relations to employee relations have been characterised by (employee relations mgt 2222- Assoc Prof A Ramgutty-Wong Dr P Baguant july 2008) :

Emergence of Human resource Management as a concept

Changes in the legal framework

Individualism of the work practice

Decline of Union.

Globalisation and cut - throat competition have rendered most countries across the globe to re-dynamic their traditional work practices and to adapt themselves to new challenges at the workplace. Work and employment have been subject to many academic researches. Problems regarding jobs and employment relations are some major concerns for workers, managers and government representatives across the globe. Viewed in this perspective employee relations ought to move towards the evolution of work and thereby adapting to geo - political, technological and economic - social patterns.

With regards to challenges facing Mauritius, the Government came up with a battery of measures to keep any potential impact of the global economic downturn at bay. Working along with the World Bank which is getting stronger and mqore forceful, the Government in the 2006/2007 Budget Speech presented some measures in the form of a 'Reforms' program to curb the economic downpour. Some measures pertaining directly to the employment relation framework were taken. The aim was to make the labour market more flexible, increase productivity and to create competition. All these were to achieve through the setting up of a National Pay Council, the replacement of the Industrial Relation Act 1975. Though all measures taken, it was believed that it would attract foreign investors and thereby contributions to direct investment

Literature Review

2.1 Introduction

Employee relations as an inherent characteristic in the industrial life do not operate in a vacuum. Consequently, due attention should be given to the world of work where employee relations does evolve. The relationship between man and work has always attracted the attention of philosophers, scientists and sociologists. The interest of psychologists in this issue dates back to the early twentieth century where much research works were carried out and published. Every society accepts the need of work as it plays a pivotal role for its survival and its has to conform with. At some point in time, people from different age groups, sex and even from different social background do constitute the Labour force.

A brief and a commonly used definition for this socio - economic phenomenon is that "Work is the exertion of effort and the application of knowledge and skills to achieve a purpose '' (Armstrong M 2005). Work tends to be an activity that transforms nature and is usually undertaken in social situations. Working is so common that normally people do not even ask why people work. If it is even asked, why they work? People would probably give a simple answer. They work because there is work to be done; because they like to work or because the need for a living made them to comply with it. Some people pursue work with an aim for money and thus earning a living. But work also brings some intrinsic add - ons to any individual. Work does bring satisfaction, a sense of achievement, of accomplishing a task, of recognition, status in society, contribution brought in the process and feeling being part of a process. All these factors do help individuals to develop their competencies and abilities.

Today the world has become very complex, challenging and sensitive to external factors. The period of industrialisation had taken its roots from the soft approach of human resource most practices. Two elements namely division of labour and specialisation were the main engines in achieving efficiency and effectiveness towards productivity. The work of place and the environment were much different compared to today's era. As compared to the industrial era lifelong career prospect and permanent jobs were prevalent but nowadays the world's work structure, content and purpose are being characterised in the listed variables:

More cognitively complex.

More team-based and collaborative.

More dependent on technological competencies.

More time pressured.

More mobile and less dependent on geography.

( Juduth Heerwagen, PhD, J.H Heerawagen & Associates Kevin Kelly and Kevin Kampschroer 2006. The changing nature of organisation, workplace, U.S General Services Administration.

http://www.wbdg.org/resources/chnggorgwork.php[Accessed 17 January 2010]

Globalisation in the 1990s has pushed employers for less industrial relation. Now they are going for more employment relation where the main focus is on the workplace. This is so because with the phenomenon of globalisation, cut throat competition whether locally or at international level, the availability of cheap labour, the need for highly skilled personnel and the level of technology have rendered the workplace more competitive as ever. Therefore, measures were required to face all these challenges. Employee relation as compared to industrial relation is perceived as the development of more diverse employment patterns and thus enabling the growth of employment in different fields and sectors. This enlightened platform, employee relation, does enclose many parties such as employees, employer, trade unions and Government. They all have a crucial part to play to enable smooth communication among them and also to maintain the very existence of the framework. The four stakeholders can also be subdivided into two main parties namely Government and employers seeking for flexibility whilst on the other part trade unions and employees seeking to maintain their achieved privileges and also with an aim of improving their working conditions.

Though it was relatively easy to describe work but however many authors based upon sociological perspectives have given many different definitions to this socio - economic phenomenon. Work does encompass a lot of issues which make us think about this particular issue. Work cannot be described as a task we have to do or whether we like it or not. Thousands of people around the world olive on begging but this cannot be classified as work. Secondly, Work cannot be defined as employment because there are tasks for which both employed and non - employed people do such as women ironing, cooking but some do earn money and some do not.

Therefore irrespective of any definition that may be attributed to work, it can be argued that work shared different meanings to different scenarios at different points in time. Undoubtedly, employment relations arise in the work context which is becoming challenging and complex in nature. In so much so, much emphasis should be laid upon this framework to give a new employment relation dimension and at the same time keeping at bay some threats from globalisation.

2.2 Industrial Relations as a field of study

Organisational practices and philosophies evolve overtime; the orientations they take reflect the needs and the urgency of the specific context within which they are operating. The environment today is characterised by the search of competitive advantage and flexibility. Work has always been related to employment and as a result both of them have been subject to many academic researches. Past trends show that some strategic areas such as work had been transposed into a different context and this had led to a dimension called industrial relations.

Industrial relations are as old as industry and will always remain as an integral feature of industrial life. Many academics have tried to give proper definitions to industrial relations. No proper, concise and universally accepted definitions have been put forward due to its complexity by nature. In fact, it is very difficult to define this term. Any definition must lay emphasis on the nature and purpose of industrial relations. Industrial relations broadly deal with the relationship encountered by people at the workplace. The subject is indeed broad, it takes its origin from subject matter namely economics, law, sociology, psychology, organisational theory and so forth (GD Green industrial Relation, 4th Edition). Many authors have tried to shed some light on this very feature in industrial circle (HT graham, Roger Bennet Human Resource Management 4th edition 1998) defined this very issue as " Industrial Relation may be regarded as all the rules, practices and conventions governing interactions between management and their workforce, normally involving collective employee representation and bargaining.

On his part, (Michael Salamon Industrial Relation Theory and Practice 4th Edition) puts forward " Industrial Relations encompasses a set of phenomena, both inside and outside the workplace, concerned with determining and regulating the employment relationship". He also states that "industrial relation is perceived as being concerned with more full time, unionised, manual workers in large manufacturing units involving restrictive practices, strikes and collective bargaining.

At its simplest, Industrial Relations refer to the processes by which human beings and their organisations interact at the workplace. Inherent in every definition is the idea of employment relationship at the workplace between the management and employee. During the last three decades, Industrial Relations have been at the centre of industrial activities and have found a place in the heart of people of the working class. According to Green (1994) Industrial Relations consist of elements which make up this framework. These elements are as follows:

Institutions

Trade union is defined as any organisation, whose membership consists of

Employees which seek to organise and represent their interest both in the workplace and society. Trade union seeks to regulate the employment relationship through the direct process of collective bargaining with management. It forms an integral component in industrial relations.

Characters

Industrial Relations cannot operate by itself; this framework need people who have their say and specific role to play to ensure the smooth running at the workplace.

As a fitting example, they can be officials from the trade unions, managers, arbitrators, human resource personnel and others

Procedures

Industrial Relations is binded by procedures which give specific code of conduct

to people involved in industrial activities. Procedures have been put forward for the smooth handling of issues pertaining at the workplace such as bargaining power, grievance procedures, conflict resolution, policy making and others.

Topics

Industrial Relations deals with a lot of issues which are normally at the very outset of work related issues such as working conditions of employees, termination of contracts, taking disciplinary actions and so on.

2.2.1 School of thoughts of Industrial Relations.

Industrial relations can be viewed from different horizons. Environmental factors do contribute the way it is perceived. It can be viewed from political, sociological, economical to the legal perspectives and every approaches are different from each other but however there is no recommended view though every perspectives try to give an insight view to this subject ( GD Green).

Enumerated below is a list which reflects those ideologies and approaches:

Unitary Perspective.

Conflict Theory.

Systems Approach.

2.2.1.1 Unitary Perspective

The unitary perspective opines that both management and labour have identical values, interests and objectives. In simpler words, it is understood that everyone in the organisation ought to cooperate and work as a team in achieving the firm's aims. This approach also suggests that the organisational system is in harmony with employees, therefore conflict resolution is excluded. The main assumption which is made is that all employees are dedicated to the aims of the organisation and the relationship between the management to employees is more of a partnership. The unitarist enables the management to be accepted as the sole source of authority. In this situation, the very existence of trade union is questionable. Normally, trade unions represent employees before management but however in this scenario, both employees and management are collaborating. In a nutshell, trade union has no role to play.

The main characteristics of a unitarist perspective are:-

Team building between employees and management, both key players work towards a common goal.

Management holds power and is regarded as the only source of authority.

Conflict resolution is seen to be an irrational scenario as both management and employees are sharing same interests and goals.

Trade union is seen as a third party into the organisation.

2.2.1.1.1 Advantages of Unitarist perspective.

1. Enables team building.

2. Encourages a healthy employee realtions as both management and employees have

mutual respect for each other.

3. Eases the integration of functions and activities within the oraganisation.

2.2.1.1.2 Drawbacks of Unitarism.

1. People do not always share the common goals of management and therefore cannot be

on the same mindset.

2. Fails to recognise that conflict cannot be always avoided.

3. It can jeopardise the efficiency of dispute resolution.

4. Management freedom to take decision without consulting any party.

Fox ( GD Green) put forward that this perspective " has long since been abandoned by most social scientists as incongruent wuith reality and useless for purpose of analysis"- Fox( 1966). To be fair enough and realist this theory doses not reflect the real world, how things do really work, it is indeed a utopia. It does not take into account dispute and conflict. Conflict is not always a negative sign, it can be constructive and it promotes quality with a view to reduce negative feedback.

2.2.2. Conflict Theory

This theory recognises the fact that conflict is inevitable and even in industrial life , it does exist. Conflict can be as negative and as constructive as well. It often arises due to differences in views, interests or vested interests. In industrial relations, normally trade unions would represent the employees, would fight for their due rights if they are being jeopardised. The trade union would then be in conflict with the management which has different view at the workplace. The conflict theory can furthermore be seen in two views:

2.2.2.1. Marxist view

The oldest and probably one of the recognised one is the Marxist view. This very theory concentrates on the nature of the capitalist society surrounding the organisation. Marx in his different studies, argued that the class system is made up of two classes and they also exist at the workplace. These two conflicting classes, the capitalists who own the means of production and the workers who offer their labour to capitalists try to cohabit at the world of work. Through this perspective, Marx has tried to give an insight on the class conflict industry and also to the extent to which the latter is a mere reflection of conflict in society. At the workplace, the unions would represent the workers. Unions offer a protection against the owners and managers. Trade unions do not believe that collaborating with management would settle industrial problems, as they perceive employers always inventing and devising ways and means to exploit workers where their drive to continuously struggling for their rights. Proponents of thr Marxist view argue that employee relations processes, namely collective bargaining, do not really help in modifying the wealth distribution pattern within society.

The Marxist puts forward the following ( GD GREEN) :

Class conflict arises primarily form the disparity in the distribution of, and access to, economic power within the society-the disparity being between those who own capital and those who supply their labour.

Class conflict is the source of societal change. It states that conflict has both constructive and a negative aspect.

Social and political conflict in whatever form is merely an expression of the underlying economic conflict within the society.

The nature of the society's social and political institutions is derived from this economic disparity and reinforces the position of the dominant establishment group through differential access to education, the media, employment in government and other establishment bodies and so on.

2.2.2.2 The Pluralist perspective - Post Capitalism

This theory takes into account the very existence of conflict in society and organisations. Society has to accept that there are a range of people sharing different beliefs, values and interests. This viewpoint puts forward that negotiations and management have different views and values but they still negotiate to reach an agreement with a view to move forward. It is presented as a more realistic and effective alternative to the unitarist philosophy ( FOX 1966). Having different people from different social background and interests suggest that the organisation is multi-structured and therefore needs styles of management practices and authority. Based on this argument, conflicts of interests and disagreements are seen to be normal and inevitable.

Fox 1966, defined pluralism " as the organisation being a miniature democratic State composed of sectional groups with divergent interests over which government tries to maintain some kind of dynamic equilibrium". From an organisational point of view, the most likely example where divergence of interests might prevail might be between employees with their managers. This very divergence of interests might be at the source for potential conflict at the workplace. But if matters were to be left as they were then this conflictual relationship would prevail and the stronger would have survived at the expense of the weaker sides. Fortunately, mechanisms and procedures have been out forward to mitigate such scenarios. Good communication, good negotiation processes and ability to reach compromising solutions are likely some of the mechanisms set up.

Collective bargaining has therefore a central role as a process in resolving conflict and in reaching an agreement. Trade unions are important as their representation of workers before employers are seen as a major boost from the workers. Each party within this framework try to keep a certain balance and ensuring harmony exists. There are both the 'hard' and the 'soft' variants of pluralism. The former seeks to collective bargaining for dispute resolution and the soft one tries to use collaboration to problem solving approach.

2.2.2.2.1. Advantages of pluralism

Encourages discussion for the two parties.

It increases the flow of information from the workforce.

Constructive conflict can enhance efficiency.

Compromises between the two parties can enhance stability.

It is a realist approach in dealing with unions and give rise to proper planning, effective arrangements for resolving disputes.

2.2.2.2.2. Criticism of Pluralism

The attitudes of two classes at the workplace create red tapism and inefficient procedures leading to stagnation.

The ever presence of conflict and grievance procedures could itself encourages 'them and us' attitudes and leading to disputes.

Commitment from employees might be endangered.

Pluralism argues of an even balance of power but in reality there is a dominant party suppressing the weaker side.

2.2.3. Systems Model.

Another different approach in providing an understanding to industrial relation perspective is the Systems Model. It was put forward by Dunlop in the late 1950s. Dunlop, more precisely in 1958 applied this theory to give an insight view to the understanding of industrial relation and has tried to segment the essential elements of the environment into four broad categories namely:

Actors,

Context,

Ideology,

Rules.

The model has been altered overtime taking into account new emerging factors while at the same time retaining the key components. To be able to have a good understanding of industrial relation and its development, the Dunlop's four components need to be well defined according to the situation.

Actors.

These are the people and organizations involved in the system. When we speak of people, here emphasis is laid on the hierarchy of managers, hierarchy of employees, their representatives at the organizations and industrial agencies operating within the systems.

The Contexts.

These are the main elements of the environment within which the framework operates. These consist of the technological aspects, market constraints, the balance of power in society and financial stability. Technology is said to be highly primordial as many profound changes in the structure of the industry have been attributed to it. All organizations work within at several levels of the economic framework and therefore the latter has an impact of the industrial relations. However, the budgetary economic factors do not have the same weight in every organizations as there is the presence of both public and private sector. The balance of power shows how power is distributed among the key players within the industrial relations.

Ideology of the System.

It is the set of beliefs held by the participants that allow them to operate the system. It is at the very existence of defining the rule, function of each actor and which ideas actors hold towards the system. Individuals within the system may well have diverging ideas but there is a common ground to establish a working relationship.

Rules.

They are defined as the regulatory framework expressing the terms and nature of the industrial relationship and as well the rule- making process.

2.3 The Pariticipants.

Industrial systems and practice operate in a tripartite system and are therefore shaped by three main key players:

a) Government,

b) Employees/ Unions and

c) Employers' organizations.

2.3.1 Government

The State of any country is always a significant employer of labour in its own right. It is obliged to ensure the security of the nation, to uphold law and administer the system of justice, to run schools, colleges and hospitals, to operate a civil service and to maintain essential services. The State is the only actor who can change the rules of the system by virtue of its law-making role.

Apart from its role in enforcing laws, the State may become involve in industrial relations in the following capacities:

1. Acts both as a regulator or deregulator of labour markets.

2. In the provision of job creation programs for young workers or the long-term unemployed.

The State can act as a model of good employment practice by applying equal opportunity polices, codes of practice. The lists of policies that the State could do to demonstrate to the private secor how workers should be treated are listed below:

1. Recognizing trade unions and encouraging union memberships.

2. Paying above average wages.

3. Operating occupational pension schemes.

4. Implementing fair grievance procedures.

5. Employing physically disabled workers.

6. As a participant in tripartite arrangements.

7. In the provision of arbitration services of arbitration services to settle industrial disputes.

2.3.2. Employees Union.

Trade union is defined as any organization whose membership of employees seeking to organize and represent both in the workplace and society and, in particularly seeks to regulate the industrial relationship through the direct process of collective bargaining with management. Trade unions are set up to improve the status, pay and condition of employment of their members.

The history of the trade union movement abounds with examples of struggles not only against employers over pay and conditions of work, but also against the State, for the right to exist. Such struggles, and resultant victories and defeats, have shaped and been shaped by the political, economical and social context of each particular era.

It is possible to identify six distinct aspects of trade union function:

1. Power

To protect and support the individual by providing a collective strength to act as a countervailing force to the employer and a pressure group within society. Trade union is a medium of power. Without an organization to represent employees, the latter are at a serious disadvantage in the relationship with management.

"R.Hyman industrial relations; a Marxist introduction 1975"

2. Economic regulation

Mulvey, 1976 argued that a trade union ought to behave in a rational economic manner by maximizing some aspects of wage / employment relationship.

"C. Mulvey, the economic analysis of trade unions, Martin Robertson 1976"

3. Job regulation

To establish a joint rule making system which both protects their members from arbitrary management actions and allow them to participate in decision making within the organization for which they work.

4. Social change

To express the social cohesion, aspirations or political ideologies of their membership and seek to develop a society which reflects this view.

5. Member services

To provide a range of benefits or services to the individual member.

6. Self-fulfillment

To provide a mechanism whereby individuals may develop outside the immediate confines of their jobs and participate in decision making processes.

Chapter 3 Research Methodology

In this chapter the following will be discussed,

The research philosophy that has been subscribed to for the purpose of the dissertation.

The research method selected.

This chapter outlines the research objectives of the project and highlights the research methodology used to gather data. A well-devised methodology was used to cater eventual constraints met while gathering data.

There are two major philosophies namely the positivist and interpretivist. ( galliers 1991; cited by Davison 1998). Positivists are of opinion that reality is stable and can be observed and described from an objective viewpoint ( Levin 1988; cited by Davison 1998), i.e. without interfering with the phenomena being studied ( Davison 1998). Predictions can be made on the basis of the previously observed and explained realities and their inter relationships. On the other hand, interpretivists opine that only through the subjective interpretation of and intervention in reality can be fully understood( Davison 1998). There are many interpretations of reality and they are in themselves a part of the scientific knowledge they are pursuing ( Davison 1998).

As the objectives of this dissertation have to do with the impact of labour legislation on employment relation in Mauritius, it is essential to have gain an in-depth understanding of how industrial relation and its legal aspect has evolved. Hence, it is believed that a positivist philosophy is the most appropriate for this research.

Background of the Research Study.

The growth of employment relations at the workplace is due to a number of factors:

Organisations have changed from the small family concerns to huge multinationals corporation.

The economy now has a large public sector element, comprised of civil service, local government and nationalized industries.

Large organizations have harder to manage and demand a greater attention to employee relations. This was evidenced in the 1970's when the dockers went on strike because there was a poor employment relations and the whole economy was stagnated as a result this particular picture showed how employment relation is important and how bad management have negative repercussions.

Industrial relations has been much given weight and considered as a sensitive issue. Whether or not the companies recognized trade unions, they all had to work along side. All high- performing companies need to have a policy agenda to create relationships with their business objectives.

Research Problem.

Employment Relations at the workplace are important for many reasons. If relations between workforce and management are good, then the enterprise has a good chance of being successful. The opposite is also true that if the relations are poor, the organization is far less likely to succeed.

What produces good employment relations depends broadly in correctly attitudes like trust, confidence and good personal relationship between the people involved and above all, a willingness to work together. Academics have prescribed collaboration as the way forward and it is quite obvious that the only way organizations can survive in the competitive market by overcoming the inherent conflicts to the organization, thereby maximum use of resources. Employers and employees being two distinct stakeholders, have different needs, values, interests and objectives hence it is difficult to consolidate all these, especially, if the historical evolution of the employment relationships have been torn by disputes and conflicts.

Importance of the Study.

This study will contribute to the exploration of employment relations in Mauritius. Following our country historical background about slavery period, indentured labourer, the feeling of the existence of exploitation, the changes in the micro and macro environment, the outcomes of the study would be useful to pave the way for a successful implementation of appropriate employment relations and in a way in this often turbulent world.

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