In its most basic terms, the Dunlop Systems Theory in Industrial Relations is about the structure and development of relationships among the three integral members of labor relations (labor, management, government) and about resolving labor-management problems based upon agreement on a common set of facts that affect or are affected by labor, management and government.
In his industrial relations system (IRS), Dunlop defined industrial relationships as an analytically sub-strata of industrial nations. He defined the sub-strata as operating under the same logic as the discipline of economics; since Dunlop was primarily an economist, this is a significant element of his definition because he is positing that labor relations problems can be resolved through a system of logic, not chance, and that the development of labor relationships over time can be guided through logical steps and by logical means, with nothing left to disruptive chance.
Dunlop's definition and system centralized the rules and norms--the agreements--of industrial relations at the heart of analysis. This diverged from the previous system, which made labor-management conflict and resultant collective bargaining the heart of industrial relations, which left a good deal to chance and to the illogical emotions of conflict.
Dunlop's definition and system identified what he called a "web of rules" that are the elementary components that govern industrial labor relationships. He identified the institutions and norms that constitute the framework within which industrial relations are carried out and which govern the outcomes of these relationships.
- substantive norms: wages and wage rates, working hours, OSH regulations, etc
- procedural institutions: governmental regulating agencies, conciliation and arbitration boards, etc
As Walter Mullen-Jentsch says in "Theoretical Approaches to Industrial Relations":
[T]he IRS was conceptualized in terms of both process and product: as a rule-guided process generating as its product other rules governing the actors and administered by the systems of industrial relations at the national, industry, or plant level.
Dunlop identified the "actors" he referred to in his system as:
- workers and their labor union representatives,
- government institutions that oversee labor-industrial relations.
According to Dunlop, these actors are active in what he identified as the three "contexts" of industry: (1) technologies, (2) industry markets and (3) power distribution (e.g., labor unions and corporate organization). Finally, Dunlop posits an "ideology" that "binds" an industrial relations system together, binding them with a common set of beliefs about society, human worth, and government oversight.
While Dunlop's IRS does not account for the means or mode by which rules come to be made, it might be assumed that the rules devolve from the ideological commonality between actors. Because of Dunlop's IRS foundation in economics and logic, he developed a formulation representing all these components: rules (R), actors (A), contexts (T, M, P) and ideology (I): R = f(A, T, M, P, I).
What Dunlop is saying relating to actors and ideologies is, as briefly stated above, that all actors (managers, workers, governing bodies) share a common society, thus share a common ideology.
Ideology is defined as the set of beliefs common among members of a society in relation to philosophy, religion, politics, culture, art, etc.
While our societies are more complex, especially Western societies, Dunlop's post-World War II society was far more homogenous with less divergent roots in religion, politics, culture, art and philosophy than ours today. Still, it might rightly be said that there is a common ideology that governs the premise of how management, labor and government is expected to, ought to, should and/or must relate among one another.
John Dunlop, labor economist and Harvard economics professor, who served, among other positions, as the United States Secretary of Labor (1975-76), developed a model of industrial labor relations that provided a framework for understanding industrial labor relations and for identifying and implementing improvements in industrial labor relations.
Dunlop's model identified the actors in industrial labor relations, the interaction between them and the rules derived as a result of the interactions. His model represents what he defined as a system because their intimate associations affects each and all of the actor and create a real situation of shared responsibility.
There are three key actors in Dunlop's model: (1) the workers and labor unions; (2) the employers and their organizations; (3) the government and governing, regulatory bodies. These can be restated as the workers and their formal or informal ways of being organized; as the employers and their management organizations; and as the governments laws, regulations and administrative agencies, like OSHA and EPA.
The interactions between these three actors (and the agencies and organizations they comprise) act within the defining structure of an environment on the micro- and the macro-levels. Micro-level environment is the industrial environment itself while the macro-level environment is the entire social environment, including the political layer of society; this is the layer where ideologies are significant.
The interactions between actors in these environments derive from power distribution, negotiations, and power implementation: those with power negotiate activity and productivity and implement regulation through exertion of that power, for which there may be contests. These interactions determine the rules that define the output amongst actors within labor relations.
For Dunlop, ideology comprises the environmental political, economic, legal, technological and social dynamics at work in the actors' environment. He includes in their environment their market and the distribution of power. This model makes clear that workers, employers and government share an ideology that defines the rules of interaction between them and that lends stability to the systems comprising industrial labor relations.
... management, labor, and the government possess a shared ideology that defines their roles within the relationship and provides stability to the system. (naukrihub.com)