Personnel management in the public and private sectors

Industrial Relations journal ISSN 0019-8692 S3.00

Personnel management in the public and private sectors

Leslev Mackav. J J

Little comparative work on personnel management in the public and private sectors in the UK has been attempted. From evidence obtained in a recent survey personnel management practice, the author identifies

some differences and similarities between the two sectors.

In the courses, textbooks and articles in which ‘personnel management’ is discussed and taught, there is little attention paid to the differences which patently exist between public and private sector organisations in management practices. Yet it is the existence and recognition of those differences which have militated against comparative work between the two sectors. At the same time, interest in personnel management has often been a by-product of investigations into industrial relations which tended to focus principally on manufacturing industry. When attention is directed to both public and private sectors, it is done uneasily or at least not as a central concern[l]. There are good reasons for this. There are major dif- ferenees within each sector and obvious difficulties in comparing the two sectors in aggregate terms. In some instances, the public sector completely dominates some areas of economic activity while it is absent from others. Similarly the differences of size between small private sector organisations and huge public sector bodies with branches in every town and city in the UK make comparisons difficult. To attempt to make comparisons between the two sectors may, therefore, appear somewhat over-ambitious.

0 Lesley Mackay is Leverhulme Research Officer in the Department of Sociology, University of Lancaster

However, while the type of activity and size of organisation undoubtedly affect some aspects of the activities of the personnel function there are many similarities in the activities undertaken by personnel specialists in both sectors. The differences between them can, as the Griffiths Enquiry into the National Health Service noted, be greatly over- stated[2]. Both sectors operate within the same broad national economic context and there are at least some similarities in their criteria of effectiveness[3]. Concepts such as effort and efficiency suggest that the per- ceptions of those who work in charitable bodies can share some similarities in outlook with the most entrepreneurial of spirits in say, manufacturing industry[4]. The differences therefore, fall within certain limits. There are also probably as many differences within the private and public sectors as between them. Thus, for instance, the private sector encompasses both huge multi-national corporations and tiny local co-operatives. In the public sector the range of organisations encompasses large nationalised industries and magistrates’ courts. In relation to the personnel function, it has been found to be less well developed in some public services than in others and more highly developed in some areas of manufacturing than others[5].

Despite the manifest differences within the categories the research revealed some sig-

304 Industrial Relations journal

nificant differences between the two sectors in some aspects relating to the work of the personnel function. The personnel specialists interviewed certainly felt that the public and private sectors diverged in a number of ways. Ownership is only one possible variable which can be used to compare organisations, but it was one which respondents felt to be important and which the data reveal to be interesting.

Research methods A sample of 350 completed questionnaires was obtained by approaching over 50 colleges and polytechnics in which Institute of Per- sonnel Management (IPM) courses are run. The college tutors, who had already agreed to participate in the research, asked their students (mainly IPM but also some Diploma in Management Studies students) to admin- ister a questionnaire to the most senior personnel person at the establishment where the student worked[6].

The response rate was around 30%-given the way the questionnaire was distributed, the figure cannot be more exact than that. This response was considered high given the extremely large size of the questionnaire: a 35-page booklet containing over 165 questions* (many of which involved over 20 responses). The aim was to find out, over the whole range of activities of the personnel function what policies, techniques and practices were being followed, in an attempt to identify how the ‘nature‘ of personnel management has been changing in recent years. As the questionnaire was so long and detailed, these respondents must be some of the hardier souls in the world of personnel, certainly the most co-operative and to whom we are most grateful for their help!

Some nine months after the questionnaire survey was carried out, interviews were conducted with 62 of the respondents, drawn from 56 organisations. The interview sample reflected the questionnaire sample both in composition and in seeking to interview the most senior personnel specialist at each establishment.

Because the investigation was confined to organisations where an employee was study-

$ Unless otherwise indicated, all ’significant’ findings are significant at the ,001 level, ie there is less than 1 in a 1000 probability that the findings are due to chance.

ing to become a member of the IPM or to obtain a Diploma in Management Studies, the sample may give a rosier picture of personnel management practice than a random sample. However, this feature was common to both the private and the public sector organisations covered, so that any bias is likely to be equally reflected in both.

The sample The questionnaires were returned from all parts of mainland Britain and cover all the major sectors of economic activity. The private sector produced 61% of the questionnaires (213) and 39% (137) came from the public sector. This means that the public sector is slightly over-represented in our sample compared with the distribution of employment in the two sectors. The sample composition is given in detail in the appendix.

The word ‘establishment’ has been used to refer to the place at which the respondent actually worked. The use of the word ’organisation’ has been reserved to refer to the whole enterprise or undertaking of which the establishment was a part.

Hypothesis relating to the public and private sector

There are a number of general factors which might suggest that personnel practices and policies would differ between the public and private sectors.

1. Accountability Public sector bodies are required, to a greater or lesser degree, to be publicly accountable. Expenditure in such organisations, especially in non-trading bodies, is public expenditure. Their actions should be open to, and able to tolerate, close scrutiny. Of course, in reality the degree of openness varies, eg an organisation involved with defence is less likely to be open to scrutiny than a department in a local authority. This public accountability and potential scrutiny can give rise to pres- sures for administrative uniformity and consistency. Public sector organisations need to be seen to be even-handed and non- discriminatory. Special cases, ad hoc arrangements, unorthodox solutions are perhaps less feasible in public sector organisations. The private sector has fewer such constraints on

Personnel management in the public and private sectors 305

its activities. While the private sector may be publicly accountable in matters such as environmental pollution, it is rarely sub- jected to the degree of scrutiny (actually or potentially) given to public sector organisations. The affairs of private sector organisations can remain largely private. Employ- ment practices are, therefore, likely to be more formal in the public sector than in the private, with less scope for informal or ’one- off‘ arrangements.

2. Visibility Closely linked with the notion of accountability is that of visibility. All members of the public, informed or uninformed feel they have a right to comment on the activities of public sector organisations.

The audience of private sector organ- isatons tends to be more restricted, eg shareholders, and to have a narrower focus of interests (pace environmentalists) than its public sector counterparts. At the same time, shareholders have a concrete way of showing disapproval of Board policy or practices-by selling their shares. Thus squabbles between shareholders and the Board are rare and, when they do occur, tend not to excite wider interest. Insensitive and discriminatory remarks by members of senior management in the private sector seldom lead to the hue and cry which could await their public sector colleagues. The threat of public outcries means that practices in the public sector, in comparison with the private, have to ‘go by the book’ and be seen to give no special favours. This visibility is used by governments for their own purposes, such as attempting to encourage low pay settlements in the private sector through examples set in the private sector. Similarly, employment practices are likely to be more formal in much of the public sector than in the private sector.

3. Size and the centrality of decision- making The private sector includes many organisations which are smaller than those typical of the pubtic sector. In smaller organisations decisions can more easily be taken and effected quickly. Similarly, unsuccessful decisions can be reversed speedily minimising any negative effects[7]. Even when private sector organisations are large, the relatively limited degree of public accountability

and visibility means that different policies and practices can be followed in different plants or regions. Unlike the public sector, equivalence of treatment of employees is not a necessary method or goal. The generally larger size of public sector organisations can inhibit such flexibility, seeking as they do higher levels of consistency and uniformity in their treatment of employees throughout the entire organisation[8]. Thus decision- making in the public sector is often more centralised, The generally more ponderous pace of public sector decision-making, as opposed to that of the private sector may mean that difficulties and problems can become more intractable while the ‘proper’ procedures are followed. Due in part to this difficulty in responding quickly to devel- oping situations, the hypotheses suggest that employee relations would be more ’difficult’ in the public sector than in the private. There are other reasons for this, see 6. below.

4. Labour intensity Public sector organisations are in general more labour intensive than private sector organisations (there are some notable excep- tions). Pay is, therefore, often a greater proportion of total costs in the public sector than in the private. As a result, it could be argued, employment costs (in whatever form) are more likely to be closely monitored and/or controlled in the public sector than in the private sector.

5. Bureaucracy Taking the balance of the above factors into consideration, our hypotheses would lead US to expect the public sector in general to be more bureaucratic in its personnel practices than the private sector. There would, for instance, be greater need for written procedures and formal rules. Following on from this, there is also likely to be (and is!) a higher level of trade union membership-both possibly, in part, cause and effect of bureaucratic organisation. Account must, of course, also be taken of the active encouragement of public sector employers to their employees to join trade unions[9]. The bureaucratic nature of many public sector bodies would also suggest that members of the personnel function in the public sector are likely to have more ’paper’ qualifications and to have specialist rather than generalist responsi-

306 lndustrial Relations Iournal

bilities within the personnel function. In other words, there is likely to be a greater division of labour and a higher level of tech- nical qualifications among personnel practitioners in the public sector than in the private.

6. Autonomy Not only does the public sector, like the private, have to cope with fluctuations and changes in demands for goods and services, but it has also to cope with interventions of a political nature. A range of controls can be exerted such as: wage-settlement levels, cost- cutting exercises, freezing capital investment plans or supporting socially beneficial but economically dubious enterprises. These interventions can limit the ability of the public sector to adapt to, or meet, changes in demand. The public sector could be seen to enjoy relatively less autonomy and freedom of action in comparison with the private sector. We would expect this factor to act against the use of innovative or experimental techniques in the public sector. The private sector, substantially unaffected by such interventions, is likely to be able to use greater initiative and adopt more innovative or risky personnel policies.

Public sector organisations have to act as the instruments of governments’ policies. This means that where there is any resistance from the workforce to government policies, it is the management in public sector organisations who bear the brunt of such oppo- sition. In lacking freedom to manoeuvre and remedy grievances, public sector management is likely to face escalating unrest amongst its employees at the same time as being able to do relatively little to remedy the situation. The hypotheses would, therefore, suggest that in recent conditions, a more troubled employee relations climate could be expected in the public sector than in the private.

7. Number of years the personnel function has been in existence The personnel function as a specialised activity is a fairly recent arrival in some parts of the public sector. This late arrival may be due in part to the large proportion of white collar employees, many of whom are professionally qualified. There has been, and to some extent still is, an assumption that

professionally qualified employees have little or no need of the services of a personnel function. The relatively recent arrival of specialised personnel functions in such organisations may be one result of a growing amount of political or governmental intervention. Thus, professionally qualified employees, to the extent that they find government policies unacceptable and seek to resist them, may increasingly be seen as human resources which have to be ‘managed’ rather than as professionals ‘who manage themselves’.

To the extent that the personnel function is less well established in the public sector, it is likely to have less influence and status amongst colleagues than the personnel function in the private sector. Similarly, the personnel function is likely to be less well established or influential in the activities of other functions. The possibly less developed role of the personnel function in the public sector may also mean that less sophisticated techniques or innovations are being tried.

The differences between the public and private sectors should not be exaggerated- there are many similarities. The problems of employee control and management in growing organisations finds its solution in more formal management methods. Thus, the presence of a personnel function may itself indi- cate a formalisation of the relationship between employer/manager and employee. The relationship becomes less immediate and less personal: it is less particularistic. Specialists are introduced to undertake a variety of tasks relating to the staffing of an organisation. Conditions of service and reward are administered more bureau- cratically. The type of ownership does not change the nature of the task which personnel specialists have to do, which is to help maxi- mise the contribution of the workforce and, where possible, to minimise disruption to the aims of the organisation. The type of ownership may disguise this role through notions such as public service, but criteria such as the effective and efficient use of resources are concerns whatever the ownership of organisations.

The survey found differences and similarities between public and private sector organisations in a number of areas of personnel activity.

Training Public sector organisations are generally more labour intensive than those in the pri-


Table 1 "1s there a specialist Training Depart- ment in this Establishment?"

0% N

Yes 50.0 175 N O 48.6 170 Don't know1n.a. 1.4 5

100.Oo/o 350

Private Sector Public Sector % N Yo N

Training

Training Officer (but no department) 15.0 32 19.7 27 N o training department or officer 35.7 76 25.5 35 Don't know1n.a. 1.4 3 1.5 2

Department 47.9 102 53.3 73

100.0% 213 100.0% 137

vate sector, as well as being more visible. With the workforce being a relatively larger asset in the public sector than in the private it seems likely that the resources available for, and the commitment to, training that workforce would be substantially greater in the public sector. However, Training Depart- ments and Training Officers were to be found fairly equally in both sectors. The public sector appears to do little more regarding training than the private. Neither labour intensity nor size of public sector organisations seems to be influential. What is surprising is that a quarter of public sector establishments had neither a training department nor a training officer. There are three further findings which, while not statistically significant* are worth men- tioning as they all reflect a less positive view of training in the public sector. Training was seen to be increasing in importance to a greater extent in the private sector than in the public (47% and 36% respectively). Similarly, the amount of training given in the public sector has increased Iess (for aII empIoyees) than in the private sector. Private sector respondents more frequently saw training as the central activity of the personnel function compared with the public sector (13% and 9% respectively).

'See footnote on p. 305

308 Industrial Relations journal

It should be remembered that much of the training undertaken in the public sector is professional training and the personnel function would only be peripherally involved in this. Similarly, the late formation of separate personnel functions in many parts of the public sector means that responsibility for training may often rest with the 'line' functions.

Nevertheless, these findings are not easy to explain. While training is not rated very highly in either sector, it does appear to be viewed more positively in the private sector than in the public. The abolition of many Industrial Training Boards may have led to some private sector managers pursuing training more keenly because it is now both voluntary and self-directed rather than being externally imposed and approved. Perhaps attitudes towards training are changing in the private sector, away from the traditional British view of training[lO].

In the public sector, on the other hand, one of the responses to searching cost-cutting exercises may be a reduction in training activities and, given the prevalence of no- compulsory redundancy agreement, savings may more easily be made in less apparent areas like training. The public sector may find it cheaper to 'buy-in' trained people rather than training their own and having them poached by the private sector, ie poach- ing rather than being poached! The findings might, again, quite simply reflect a less positive attitude towards training in the public sector than in the private.

If it is in the area of training that organisational 'fitness' for survival is best pursued the public sector does not, on this evidence, appear to compare well with the private sector[ll]. However, the low priority given to training by respondents in both sectors should be remembered. This low priority may reflect the present state of the labour market and generally low labour turnover. But it also suggests that a static, 'non-devel- oping' view of employees is being taken. A view which may have long term organisational and individual repercussions[l2].

Overall, the predictions that the public sector would be more concerned with, and give greater commitment to, training than the private sector are not borne out by the findings here.

Recruitment and selection There is a potentially powerful role in organisational change for the personnel function

Table 2

Private Public Sector Sector Significance

'/o N '/o N level Is internal advertising undertaken in this Establishment for:

Blue collar employees White collar employees Management

Is internal advertising undertaken in this Organisation for:


51.6 110 72.3 99 .01 75.1 160 84.7 116 .05 50.7 108 77.4 106 ,001

21.6 46 61.3 84 .001 56.3 120 81.7 112 ,001 51.2 109 78.1 107 .001

Are personal recommendations from existing staff used as a method of recruitment for:

Blue collar employees 41.3 88 26.3 36 .01 White collar employees 47.9 102 16.1 22 .001 Management 15.0 32 3.6 5 .01

Base = 213 Base = 137

in relation to recruitment. Through the type of employees recruited, the personnel function can influence the way the organisation develops. Similarly, it is through recruitment that discrimination in employment can be overcome. Thus, it is to be expected that the public sector would be more likely than the private sector to pursue recruitment and selection policies which were fairer and less discriminatory.

Personal recommendations by existing members of staff are a less often used method of recruitment in the public sector than in the private. Smaller establishments were more likely to use personal recommendations whilst the larger organisations used them much less often. Yet, at the same time, internal advertising within the organisation and, to a lesser extent, the establishment, is fav- oured more in the public than the private sector. This finding is related to size: the larger the establishment or organisation, the greater the pool of potential recruits. This is also a cheaper method of recruitment than others, trained employees are not lost to the organisation and less training has, therefore, to be undertaken.

Although personal recommendations are significantly less used, it is surprising that they are still used by over a quarter of public

sector establishments for recruiting blue collar employees. Although the advertising of vacancies internally is not discriminatory in itself, it does not address problems of existing racial imbalances in the workforce.

It appears therefore that the predicted effects of accountability and visibility do not operate with regard to recruitment practices in the public sector. Nevertheless, in comparison with the private sector, the public sector does seem to pursue more policies designed to reduce discrimination in employment.

In line with the need to be seen to be fair and to go 'by the book', it was found that applicants' references are much more frequently taken up before interview by the public sector than the private, for all categories of employees. There is some evidence to support the argu- ment that the personnel function is less well developed in the public sector than in the private. Rather than devolving responsibility for certain tasks within the personnel function, it appears that in the public sector, tasks are more often the responsibility of another department. For instance, the personnel function in the public sector less often draws up the shortlist for interview candidates for selection (for all employees) than in the pri-


Table 3

References taken up prior to interview: Blue collar employees White collar employees Management


References taken up prior to appointment:

Private Sector

' lo N

10.3 22 10.3 22 12.7 27

55.9 119 74.6 159 70.4 150

Base = 213

Public Sector

'/o N

33.6 46 48.9 67 54.7 75

42.3 58 43.1 59 35.0 48

Base = 137

Significance level

.001

.001

.001

,001 .001 ,001

Table 4

The Use of Panel Interviews for: Blue collar employees White collar employees Management

The Use of 'One Line Interview and One Personnel Interview' for:


~~ ~

Private Public Sector Sector 'I0 N '/o N

1.9 4 27.0 37 5.6 12 54.7 75

15.5 33 70.8 97

48.4 103 10.9 15 59.1 126 19.0 26 13.1 28 5.1 7

Base = 213 Base = 137

Significance level

.001 ,001 .001

.001

.001

.001

vate sector. This was strongly significant for all employees but less strong for senior management (.05 level). In the public sector it is commonly the supervisor or departmental head who draws up shortlists, especially for the skilled manual, supervisory and senior management grades. Personnel is more frequently used to draw up shortlists for all employees in the private sector, in all sizes of establishments.

Panel interviews are a common practice in the public sector. In the private sector greater reliance is placed on one line interview and one personnel interview for all employees: (There are, of course, a variety of other selection methods used.) Overall, personnel specialists in the public sector have a lesser role than the private sector in selection activities. This is an important difference. The

personnel function may potentially change the organisation through the type of employee recruited. If personnel practitioners do not act as one of the 'gatekeepers' to their organisation, their power base is correspondingly decreased. Thus, in following procedures and practices which meet the demands of accountability and visibility, the personnel function in the public sector may be prevented from expanding its power base. It may, therefore, be unable to achieve a position equivalent to its counterparts in the private sector.

Trade unions and employee relations

From our hypotheses it was predicted that there would be substantial differences between the public and private sectors with

310 Industrial Relations Iournal

Table 5: Establishments where more than 75% of employees were members of a trade union

Blue collar workers White collar workers Management (All significant at the ,001 level)

Private Sector Public Sector 0% N a/" N

55.9 119 81.0 111 22.1 47 68.6 94 12.2 26 59.8 82

Base = 213 Base = 137 ~~ ~ ~ ~ ~

Table 6 : Trade unions not recognrsedlno members

Blue collar workers White collar workers Management (All significant at the ,001 level)

Private Sector Public Sector YO N 943 N

28.6 61 3.6 5 41.3 88 7.3 10 74.6 159 15.3 21

Base = 213 Base = 137

regard to employee relations. We found greater trade union 'density' in the public sector. Similarly, there were significant differences between the public and private sectors regarding the numbers of establishments in which there were no trade unions (or membership was not recognised).

The higher trade union density and larger size of public sector organisations were associated with many more procedures, written, agreed or both-for all categories of employees. Thus, there are significantly more procedures in the public sector than the private covering: manning/productivity levels; negotiating pay and conditions; collective disputes; redundancy/redeployment; and, new technology. However, the differences between the two sectors are less striking in relation to discipline/grievance (significant for the three categories of employees at .02, .001, .001 respectively) and the disclosure of information (.02, .01 and .001 respectively).

Employee relations climate

The public and private sectors were found to be experiencing upheavals in regard to restructurings and major reorganisations. Both sectors are facing difficult and turbulent environments. Large numbers of respondents in both sectors reported reductions

in workforce size in the last three years. However, the employee relations climate appeared to be more strained in the public sector than in the private. As the hypotheses suggest, the reduced amount of autonomy in the public sector through increasing government intervention appears to have negatively affected the employee relations climate.

It was found that relationships between management and trade unions were dis- proportionately more strained in the largest organisations (over 5,000 employees) where, of course, most of the public sector (96%) organisations are to be found. Similarly, relationships are less often strained in the smaller establishments where the private sector predominates.

Time spent on various employee relations matters

Reflecting the above findings, the public sector reported a greater increase in the amount of time spent by respondents on discipline/ dismissal, negotiations, disputes and new technology. The difference between the two sectors was not significant in relation to grievances or redundancy. Again there has been a greater increase reported in the largest establishments and organisations, in the time spent on the above activities with the


Table 7. " H O Z D have relationships changed be tween n ianaxement and trade unionslstaff associations over the last 3 years?"

Private Sector Public Sector (from those with trade union

members)

Better than before 28.1% 41 25.9% 34 Stayed the same 45.9% 67 38.9'10 51 More strained 12.3% 18 29.0% 38 Unable to sayiunsure 13.7% 20 6.1% 8

(significant at the .01 level) (differences due to rounding) 100.0% 146 99.9'/0 131

Table 8: " H a s the anzourzt of time sper-it by t h e personnrlfutzction on the following matters increased in the last 3 years?"

Yes, as regards: Discipline/dismissals Negotiations Disputes New technology Grievances Redundancy

Significance level

.01

.01

.02

.001 -

Private Sector

O/O N

31.7 65 34.6 71 12.7 26 48.3 99 19.5 40 51.7 106 Base = 205

Public Sector

YO N

52.6 71 58.5 79 26.7 36 80.7 109 27.4 37 62.2 84 Base = 135

exception of new technology which is less affected by size.

The respondents generally perceived employee relations to be the central activity of the personnel function, and by extension, the one to which most prestige is attached. As personnel in the public sector appear to be devoting a greater part of their time to employee relations matters and face a more difficult employee relation environment, i t could be argued this may lead to an enhance- ment of their status.

Reductions in workforce size

In the last three years 74% of public sector establishments had had a reduction in workforce size compared with 56% in the private sector (significant at the .01 level). However, of those 184 respondents who supplied figures, the percentage reduction in workforce size shows that the level of public sector reductions was much lower than that in the private sector.

The sizes of the cuts imposed on public sector bodies by government thus appears to have been lower than those which have been found necessary in some parts of the private sector.

Methods used to reduce workforce size

There are two marked differences between the sectors in the methods used to reduce workforce size. The greater use of early retirement in the public sector reflects the larger pool of employees, and therefore, the larger proportion of employees who can be retired early, but also trade union density which may result in a larger number of 'no compulsory redundancy' agreements. While voluntary redundancy is equally used in both sectors, enforced redundancy is used more frequently in the private sector than in the public. The greater possibility of enforced redundancy in the private sector may cause employees to mute any complaints/dissatisfactions to which their more secure peers in the public

312 lndustrial Relations Iournal

Table 9

Private Sector Public Sector YO N YO N

Workforce reduced by: 1-9 '/O

10-19% 2&29'/0 Over 30%

20.2 21 53.7 43 35.6 37 31.3 25 21.1 22 10.0 8 23.1 24 5.0 4

100.0% 104 100.0% 80

Table 10: Method used to reduce workforce size

Transfer to other parts of

Stopped recruitinghot

Greater use of part-time labour Shedding casual or part-time

labour Shedding workers over

retirement age Voluntary redundancy Early retirement Enforced redundancy Other

organisation

replacing leavers

Private Public Sector Sector

'/o N '/o N

56.5 70 64.8 70

89.5 111 90.7 98 8.9 11 15.7 17

32.3 40 25.0 27

30.6 38 44.4 48 73.4 91 75.9 82 71.8 89 91.7 99 71.0 88 15.7 17 3.2 4 3.7 4

Base = 124 Base = 108

Significance level

-

- -

-

- -

.001

.001 -

sector can give expression. Trade union density can be seen to have

a range of effects on the activities of the personnel function. Trade union density itself is likely to be a response to many of the features of public sector ownership (includ- ing recognition policies) which have already been outlined. For instance, the need for more formal employment practices, the perceived need for centralised decision-making, the labour intensity and more bureaucratic practices (when compared with the private sector) all act as encouragements to employees to unionise. There are of course other contributing factors. But there does appear to be a symbiotic relationship between trade union membership and public ownership of organisations-one reinforcing the other so that, for instance, high trade union density requires formal and centrally

coordinated (personnel) management practices. It is also interesting that there appears to be a symbiotic relationship between the personnel function and the level of 'industrial unrest" 131,

Personnel specialists and the personnel function

The place of women Given the constraints of accountability and visibility the expectation was that more women respondents would be found at all levels in the personnel function in the public sector than in the private. Many Metropolitan Councils, for example, have widely declared their non-discriminatory employment policies. We were surprised to discover that we had female respondents in only 17% of public


Table 11

Female Respondents by size of:

1-99 employees 100-199 200-999 1000-4999 5000 +

Establishment 010 N

27.3 12 47.2 17 21.9 32 16.5 17 5.5 1

Base = 345 Signif. .01

Organi sat ion 010 N

27.3 3 47.1 8 23.5 8 3.3 16

18.8 45

Base = 347 Signif. .05

sector establishments compared with 27% in the private sector (significant at the .05 level). (76% of our questionnaire respondents were male; 23% female; while 1% did not wish to give personal details).

Female respondents were most likely to be found in establishments and organisations in the 100-199 group. This finding could reflect the 'growing into' personnel officer jobs by women who are secretaries or personal assistants. The hurdle of formal recruitment and selection is thereby avoided. This would suggest that formal processes of recruitment and selection in both sectors may work against the entry of women into personnel jobs. The findings also suggest that women are often found in underdeveloped personnel roles in these medium and small establishments. These roles are less likely to have been planned than to have gradually emerged. Lacking an accredited position in the management hierarchy such roles are unlikely to offer their incumbents further career advances.

The proportionately greater presence of women in smaller establishments and organisations underlines the absence of women from senior personnel roles in the largest establishments and organisations-both public and private. Thus, the position of women in the personnel function in large establishments and organisations does not appear to be improved by the presence of equal opportunity policies (where these exist). When asked the question 'Is there an equal opportunity policy for this establishment?' only a moderate difference was found between the sectors.

A prediction from the hypotheses was that the public sector would be more likely to go 'by the book', that it had to be seen to operate without favour, to keep up with present and

impending legislation and to act, to some extent, as a model employer. To find so many public sector establishments with no equal opportunity policy is curious. However, the public sector does boast more systems of formal and informal flexible working hours than the private sector for white collar job+ where women predominate-and for management jobs. Systems of flexible working, both formal and informal for white collar employees, were to be found with greater frequency the larger the size of the establishment and organisation (significant at .01 level). However, flexible systems of working for management were proportionately more likely in medium and large organisations, and slightly less SO in the largest organisations.

A greater proportion of public sector establishments reported having a job sharing scheme than the private sector (21% compared with 7%). Again, this was closely associated with size: the larger the establishment or organisation the greater the likelihood of a job sharing scheme.

Thus, as predicted, the public sector has a greater number of policies which could potentially help women in employment. Yet why are more women not to be found in the more senior positions in personnel in the public sector? The 'public' sector covers a wide range of enterprises many of which are male dominated, eg the railways, water authorities, where it is likely that the possibility of women even applying for jobs has not, even in their worst nightmares, been contemplated! Yet there are other public sector organisations which are not so overtly male dominated and it can only be assumed from the 31% of public sector establishments with no equal opportunity policies, that attempts to perpetuate, consciously or other-

314 Industrial Relations Journal

Table 12: "Is there an Equal Opportunity Policy for this Establishment?"

Yes No Don't knowlnot given

(Not statistically significant)


56.3 120 67.9 93 40.4 86 30.6 42 3.3 7 1.5 2

100.0% 213 100.Oo/o 137

Table 23: " I s there a flexible working hours system in operation for the various categories of jobs?"


For blue collar employees: Yes 10.8 23 5.1 7

For white collar employees: Yes 31.9 68 73.7 101

(not statistically significant)

(significant at .001 level)

(significant at ,001 level) For management: Yes 24.4 52 52.5 72

Base = 213 Base = 137

wise, domination by men in the upper reaches of the hierarchy are being made. That these attempts are often successful is evident: less than 4% of the membership of the local government Society of Chief Personnel Offi- cers are women (figures supplied by the SOCPO).

Watson suggests that male personnel specialists feel the need to distance themselves from women and their associated 'welfare' image in order to maintain credibility within the management team(l4J. This may be felt most strongly in the public sector where the personnel function may be newly established and where incumbents are more likely to feel they lack status. Yet the influence and standing in the establishment of the personnel function, as reported by the respondents, was stated to be equally high in both sectors. It is not encouraging that the public sector with its greater visibility has not managed to recruit andfor promote more women to the more senior grades in the personnel function.

Of course, appointments of senior personnel people are made by those outside the personnel function as well and the importance of their attitudes should not be forgot- ten. Yet, if women are not well represented

and perceived within the personnel function, there must be scepticism about their commitment to their equal opportunity policies.

The findings do not augur well for the future employment prospects of women generally, especially as personnel is often seen as the management function into which women can more easily enter. It is interesting that the relative 'cheapness' of female employees has not been of great help in breaching the walls of the male dominated managerial ranks[l5]. There appear to be motivators other than the economic operating here!

It is of course possible that the equal opportunity policies of previous years have not yet had time to work through the system and that in a few years' time more women will be found in senior positions in personnel. That may indeed happen. But some of the most senior male respondents were in the 30-39 age group which suggests that if the equal opportunity policies of a few years' standing had been effective, a larger proportion of our respondents would have been women.

Despite predictions from the model to the contrary little difference was found in the profiles of the respondents or in the number of 'paper' qualifications they held. Similarly,


having someone at the top of the organisation who was responsible for personnel and/or employee relations was equally found in both sectors. The respondents in the public and private sectors said that they felt the influence and standing of the personnel function were at a similarly high level in each sector. Given that the personnel function has been felt to have made less headway and to have a less firm power base in the public sector, these findings are unexpected[l6].

In line with the hypotheses on bureaucracy, it was expected public sector organisations would tend to have more specialist than generalist respondents when compared with the private sector. However, when the interviewees were asked 'Do individual members of the personnel function have specialist responsibilities?', 79% of the public sector and 49"/0 of the private sector respondents said personnel tended to operate on generalist rather than specialist lines.

Employee benefits*

The public sector can in stereotype appear more 'employee-centred' than the private but the findings suggest otherwise. Someone with sole responsibiity for welfare was reported more frequently in the public sector than in the private (31% and 20% respectively, significant at .05 level). However, this difference seems to reflect the greater number of employees in the public sector organisations. Less than a quarter of all establishments had a Welfare person but the proportion rose as the size of establishment or organisation increased.

The benefits given in the public sector tend to be cheaper, or at least a less visible cost, than those given in the private sector. The findings show the public sector is more likely to give: service related holidays; paid time off for trade union duties, public duties and job interviews; leave on compassionate grounds and 'company' (sic) owned housing. The private sector more often give: Christmas bonuses; employee discount on products; miscellaneous gifts and awards; savings schemes; share option schemes; private medical insurance as well as the ubiquitous company car. Similarly employees in the private sector are more likely to receive house magazines,

The term employee benefits is used to include both fringe benefits and the provision of welfare benefits to employees.

annual reports to employees and 'company' outings. There is little difference between the two sectors as regards: counselling services; benevolent funds; sports facilities; social clubs; subsidised transport services; finan- cial services, etc. All these employee benefits are more likely to be available in the largest organisations.

Looking at the fringe benefit costs as a proportion of total costs, it appears that the private sector has increased its expenditure more than the public. It may be that the greater labour intensity in the public sector contributes to a closer control of employment costs.

Allocation of time by personnel specialists

The public sector respondents spend much less time on pay administration and fringe benefits than those in the private sector due to a number of factors. Pay administration is less frequently handled by the personnel function in the public sector. Prior to the formation of separate and distinct personnel functions, the finance department undertook pay administration (hence the often uneasy and territorially aware relationship between the finance and personnel functions in the public sector). Secondly, the predominance of JIC/multi-employer pay negotiations in parts of the public sector means less time is spent on annual pay negotiations than in the private sector. As a result, in the public sector there is less scope for the personnel function to negotiate fringe benefits or levels of pay with employees individually. In the private sector, on the other hand, much more time- consuming organisational, sub-group, and to a lesser extent, personal negotiations with employees are possible. Similarly, large private organisations may seek to encourage local negotiations (possibly within limits and guidelines) which will affect the amount of time spent on such matters by personnel people.

As fewer 'tangible' fringe benefits are available to employees in the public sector, there is simply less work to do in the public sector regarding fringe benefits.

From the hypotheses it was expected that the public sector might seek to act as a model employer as regards employee benefits, set- ting a good example to the private sector. In the event, while both sectors offer a substantial number of benefits, the public sector

316 lndustrial Relations Journal

Table 14: "Has the proportion of emyloynrent costs devoted to fringe benefits increased in the last 3 years?"

Yes, in respect of: blue collar workers white collar workers management

Private Sector Public Sector Significant '/o N % N

29.6 63 14.6 20 .001 32.4 69 16.8 23 .01 34.7 74 22.6 31 .05

Base = 213 Base = 137

gives benefits which may ease the burdens of employment, while the private sector give tangible trade-offs for such benefits. . The other major difference in the allocation of time by personnel specialists related to changes in work organisation. Nearly twice as many public sector respondents spend a substantial proportion of their time (between 10 and 24%) on changes in work organisation compared with their private sector colleagues (significant at the .01 level). This is partly due to the frequent inclusion of work study in the reponsibilities of the personnel function in the public sector. The lesser amount of time spent by public sector respondents on 'maintenance' activities such as pay and fringe benefits means that more time can be spent in the potentially proactive and innovative role of changes in work organisation. This finding suggests, contrary to the prediction, that the personnel function in the public sector may well occupy an influential position within the organisation.

Further evidence from the interviewees

The personnel specialists in each sector have a surprising concordance in what they identify as their central activity: employee relations. Neither sector could be said to be 'employee-centred'. From what the interviewees have told us, personnel people in both sectors appear to be seeking to perform similar functions: minimising disturbances, maximising output and ensuring the survival of the organisation. This finding echoes that of Watson who discovered a far greater coher- ence within the personnel occupation than he had expected[l7]. The similarities should not be surprising. Personnel specialists in either sector operate under similar criteria of effectiveness and efficiency. It would perhaps

be more surprising to find differences between them.

Where differences have been found, they are seldom great and the disparities which exist are not always in the expected areas, eg women. Many of the differences are directly attributable to the nature of the controls exer- cised over the personnel function both inside and outside the organisation rather than to the attributes of respondents or the activities which they pursue. Overall, the similarities between the two are surprisingly high.

However, the personnel practitioners interviewed do not appear to recognise these similarities. Most of the interviewees in response to the question "What, if any, differences are there between personnel work in the public and private sectors?" felt there were differences between the two sectors affecting the work of the personnel function. (The four responents who felt there were no differences all worked in the public sector.)

The perceived differences were mainly negative, focusing on both the work of the personnel function and the distinctiveness of either sector. Thus to private sector respondents the personnel function in the public sector was low level; poorly developed; a welfare function with slack personnel policies and staffed by private sector rejects. The private sector respondents, on the other hand, saw their own sector as being more flexible, more involved in the running of the business, enjoyed a greater amount of responsibility and autonomy than the public sector and had a better employee relations climate.

Respondents in the public sector saw the private sector as having more room in which to manoeuvre; they were better paid; had an easier employee relations climate, and were less caring towards employees. They saw the public sector as offering greater scope to


develop new ideas; a healthier employee relations environment but as being con- strained by government restrictions of one kind or another.

The perceived differences-real or imagined-were reflected in the activities of these personnel specialists. Nearly three quarters of the 39 interviewees, who said that they maintained contact with personnel people in other organisations, specifically mentioned that their contacts were limited to their own industry or sector. Only occasionally would personnel people in the private sector have contacts in the public sector or vice versa. Of course, much of the value of contacts is in comparisons of pay, practices and policies with those in similar situations. The perceived differences which respondents felt existed between the public and private sectors militated against such comparisons being made.

Conclusions There are curious contradictions in the way in which the public and private sectors are seen. Thus many commentators in the 60s and 70s felt the difference between the two sectors should and could be minimised[l8]. The benefits of interchanges in practice between the public and private sector have recently been extolled and acted upon by government, eg in the health service. However, in popular stereotype and in the eyes of the personnel respondents there are real differences between the two sectors. Both often eye the other with scepticism.

While the personnel respondents may appear isolated from their peers in the other sector, they may well have or have had contact with those peers when studying to become members of the Institute of Personnel Man- agement. And, in the teaching of personnel management in both classroom and textbook, little if any cognizance is paid to differences in personnel practice between the public and private sectors. Students of personnel are not taught different techniques. The ascription of differences relates to how, and the environment in which, personnel people work. The findings lend support to this. Although there are many similarities in what these personnel practitioners do and even in their priorities and practices, the influences of their organisational environment do fundamentally affect their work.

As regards accountability this appeared

influential regarding the greater number of procedures, equal opportunity policies, the use of panel interviews and the taking up of references prior to interview in the public sector than in the private.

As regards visibility this was found to be influential regarding the greater number of instances of flexible working hours, job sharing, in the provision of 'universal' employee benefits, and in the reduced use of personal recommendations for recruitment in the public sector was influenced by this factor in relation to women in senior positions in the personnel function or in the attitude and approach taken to training.

As regards size and centrality of decision making, it was found, as predicted, that the public sector had more strained employee relations than the private sector.

As regards labour intensity, this appears influential regarding the costs of fringe benefits which increased less in the public sector than in the private sector. However, it did not seem that employees were seen as a more valuable resource, at least in relation to the approach taken to training, in the public sector when compared with the private.

As regards bureaucracy this may be influential regarding trade union density in the public sector and in turn affect other areas such as the method used to reduce workforce size. However, it was not found to be influential with regard to the profiles of the respondents. Similarly, it was not found that public sector respondents were more 'specialist' than their private sector counterparts.

As regards autonomy the public sector appeared to have a more strained employee relations climate with the result that more time was spent on it. It was, however, found that the public sector was more likely to be involved in changes in work organisation than the private sector.

The number of years the personnel function has been in existence is longer in the public sector. There are more specialists in the personnel function in the private sector. It was also found that line management was more likely to compile shortlists for selection in the public sector than in the private. How- ever, it was found that there were similar numbers of top level personnel people in both sectors, and that respondents felt their level of influence and standing to be equally high in their own sector.

318 lndustrial Relations Journal

Acknowledgements The author wishes to thank John Goodman, Derek Torrington and Laura Hall for com- ments on earlier drafts of this article. It is based on research conducted at UMIST between 1983 and 1985. The research project entitled ’The Changing Nature of Personnel Management’, was supported by a grant from the Leverhulme Trust. The project director was Derek Torrington and the research assist- ant was Laura Hall.

References

1. Daniel, W. and Millward, N., Workplace Zndus- trial Relations in Britain, Heinemann, 1983.

2. Griffiths, R., NHS Management Enquiry, DHSS, 1983.

3. Watson, T.J., The Personnel Managers, RKP, 1977.

4. Baldamus, W., Efficiency and Effort, Tavistock, 1961.

5. Brown, I., Personnel Management in Five Public Services: its development and future, Birmingham, Institute of Local Government Studies, 1982 and Watson, T.J., op. cit.

6. In formulating the questions, use was made of earlier questionnaire studies such as those reprinted in Brown, W. (1981), Daniel and Millward (1983) as well as Watson’s (1977)

interview study of personnel managers. 7. May, B.R., Personnel PractitionersActivities,

Problems and Changes in a Time of Recession, MSc Thesis, University of Salford, 1983.

8. Hesmondhalgh, S., ’Diagnosing Management Ills in the National Health Service’, Personnel Management, 10, 3, March, 3741.

9. Bain, G.S., ’The Employer’s Role in the Growth of White-collar Unionism’ i n McCarthy, W.E.J. (ed.), Trade Unions, Penguin, 1972.

10. Coleman, D.C., ’Gentlemen and Players’, Econ- omic History Review, 26, XXVI, 92-116.

11. National Economic Development Office, Com- petence and Competition: Training and Education in the Federal Republic of Germany, the United States and Japan, NEDO/MSC/Institute of Manpower Studies, 1984.

12. For an extended discussion on our findings on training, see the Journal of European Industrial Training, Spring, 1986.

13. Batstone, E., ’What have personnel managers done for industrial relations?’, Personnel Man- agement, 12, 6 , June, 36-39.

14. Watson, T.J., op. cit. 15. Long, P., Personnel Professionals: a comparative

study of male and female cureers, Institute of Personnel Management, 1984.

16. Brown, I.M., op. cit. 17. Watson, T.J., up. cit. 18. See Pitt, D.C. and Smith, B.C., Government

Departments: an organizational perspective, RKP, 1981.

Appendix

Sample composition by Sector using the SIC Groups taken from the CSO Standard Industrial Classification (Revised 1980) HMSO 1979.

Sample

Division 0. Agricultural, forestry and fishing 1. Energy and water supply industries 2. Extraction of minerals and ores other than fuels,

3. Metal goods, engineering and vehicle industries 4. Other manufacturing industries 5. Construction 6. Distribution, hotels and catering, repairs 7. Transport and communication 8. Banking, finance, insurance, business services and leasing 9. Other services

manufacture of metals, mineral products and chemicals

N 1 2 6 22

O/O

7 23 19 65 11 38 1 5 8 29 7 24

10 36 30 106

100% 350


Sample composition by Establishment size: Private sector

Number of employees: YO N 1-99 9.2 33 100-199 8.7 30 200-999 28.9 100 1OOCM999 12.4 43 5000 + 1.7 6

(Missing 3; Base = 347) 60.9 212

Sample composition by Organisation size: Number of employees:

1-99 3.1 11 100-199 4.9 17 200-999 9.2 32 1000-4999 13.0 45 5000+ 30.7 107

(Missing 1; Base = 349) 60.9 212

Public sector YO N 3.2 11 1.8 6

13.2 46 17.4 60 3.5 12

39.1 135

- - .6 2 .8 3

37.7 132

39.1 137

Totals O/O N

12.4 44 10.5 36 42.1 146 29.8 103 5.2 18

100.0 347

3.1 11 4.9 17 9.8 34

13.8 48 68.4 239

100.0 349

320 lndustrial Relations journal

Documents

Personnel management in the public and private sectors