Challenges of Multinational Corporation to Trade Unions
Multinational corporations refer to business entities that operate in more than one country.
Such companies usually have a head office which co-ordinates the works of its branches in different parts of the world. Others may just be subsidiaries that are connected by mergers to the parent company. Although these multi-national corporations take into consideration the economic and social policies of a particular country before settling, they are often faced with technical challenges. These challenges are equally faced with by trade unions both in the parent country of the company and by those in the foreign country in which the company operates. Some of these challenges that trade unions face as a result of Multinational Corporation include inconsistency of labor regulation occurred globally.
The international organization of trade unions is yet to establish binding universal labor regulation structures. As such, labor policy in the company&rsqu;s parent country may contradict those of the foreign country it’s settling in. This will negatively impact the activities of trade unions in the both countries. For example, trade unions in the destination country may be forced to consider re-negotiating terms of service for its employees to suit those of the multinational’s parent country. Additionally, trade unions will be required to come up with favorable bilateral agreements with the management of the multinational corporation without causing any breech to existing regulation of the national government.
This would require immense investment of both financial resources and time by the trade union in the host country. As it may turn out, a viable agreement may not be reached yet resources have been already used.Why do some foreign countries present greater roadblocks to “one big global union” than others, explain? Despite the numerous efforts to unite the world into a global village, there exist major economic and political policy rifts among the nations of the world. Theoretically, each country has expressed the will to reduce trade and labor mobility restrictions. However, in practice, each country is immensely concerned with the welfare of its population. All policies by individual country governments put the economic welfare of their companies first.
Priority is given to its own workforce to an extent of restricting geographical labor mobility even when available foreign labor forces are cheaper and more qualified. Interestingly though, some countries like Australia with low birth rate is actively promoting immigration to fill up its labor needs.In conclusion therefore, countries with high supply of trained labor restrict immigration of labor and are against one big global union. On the other hand, those with deficient labor force are all for the one big global union.