Labour Relations, Ethics & Institutional Frameworks
Who sets the rules of the workplace — and how much room does HR actually have?
Lukas Wallrich · Birkbeck, University of London
Visiting Lecturer · SWUFE · June 2026
Today, in three parts
Who sets the rules
The institutions, not just culture, that decide what HR can(not) do.
Same move, 4 countries
One restructuring decision in four very different systems. What can HR do in each?
Where’s the line?
The ethics HR might wish to standardise: gifts, audits, and “respecting local culture”.
Chunk 1 of 3
Who sets the rules?
Laws, unions, and the state shape the workplace too — and they decide what HR can and cannot do.
Discuss讨论05:00
· in pairs/threes
One move
A company is losing money at one of its factories and wants to cut 20% of the staff there — next month.
Talk it through
In China, can HR just do that — or does something have to happen first?
Would your answer change in the US, or in Germany?
Varieties of capitalism
Liberal market
US · UK
Markets coordinate. Flexible hiring and firing; weaker unions; shareholder pressure.
Coordinated market
Germany · Japan
Relations coordinate. Strong unions, works councils, long tenure, patient finance.
State-influenced hybrid
China
Market competition plus state direction and relational expectations.
HR differs because of law, finance, training, and unions, not national character. Use a type as a question to ask, not simply a label to fix on a country.
Three ways workers get a voice
Trade unions
Bargain pay and conditions. Strike-backed in pluralist systems.
Works councils
Elected staff who must be consulted on workplace changes, alongside the unions that bargain pay.
Collective consultation
Employer and worker reps agree rules and wages, without independent bargaining power.
Each gives HR a different counterpart to deal with.
The ACFTU, on its own terms
The legal mandate. Under China’s Trade Union Law, the All-China Federation of Trade Unions (ACFTU) must represent and safeguard workers’ legitimate rights and interests.
How it works. Improving labour relations through equal-footed consultation and collective contracts at the enterprise.
The scale. The All-China Federation of Trade Unions is the largest union federation in the world.
This is the legal mandate; how much independent influence the union has in practice is debated.
The same move, three reflexes
German manager
Consult first
Reflex: the works council must be asked before any shift change or headcount move.
US manager
Act first
Reflex: decide and move now; deal with any fallout afterwards.
Chinese process
Consult, differently
Collective consultation and contracts, not independent, strike-backed bargaining.
Each can misread the others: how fast a change can happen, who must agree first, what recourse workers have. The gap is in the expectations, not in anyone’s “character”.
The ILO floor
A global baseline. The International Labour Organization’s (ILO) fundamental conventions cover freedom of association and collective bargaining, no forced or child labour, no discrimination, and safe and healthy work.
Ten of them, and only a floor. A tenth (safe and healthy work) was added in 2022. They are the minimum, not a high standard — and signing up is not the same as enforcing: usable inspections and complaint channels decide whether a right is real.
There is a floor below which “respect local culture” stops being a defence.
You’ve met the rule-makers: laws, unions, councils, the floor.
Now take one HR decision into four of these systems and see what HR can and cannot decide.
Chunk 2 of 3
Same move, four countries
One restructuring decision, four institutional settings. How much can HR really decide?
The move on the table
One decision, the same everywhere. Your company wants to close a loss-making plant of 300 people quickly, and bring in individual performance pay where work continues. The pressure comes from head office abroad.
Restructuring is where institutional differences matter most, and where HR has the least freedom to improvise.
Open your card — the four settings, with the rules that matter:swufe-cchrm.pages.dev/s8inst
Group Task小组任务15:00
· groups pick 2 settings
Pick two settings — read both, then answer for each
Can HR just act — or what is legally required first?
Who must be consulted, and who has to sign off?
What is the worker’s realistic recourse or voice?
One thing a manager at head office abroad would get wrong.
Your card is here:swufe-cchrm.pages.dev/s8inst
Report-back反馈
Your setting
What is required first, who signs off, the worker’s recourse, and the HQ manager’s wrong assumption.
As we go
What are the differences between settings?
How are they related to culture?
Institutions decide what HR can do
Same decision, very different freedom. Routine in one country, near-impossible in another. That is institutions at work.
Voice channels decide who you must bring along. A council, a union, a consultation process — or nobody. Each changes the sequence and the speed.
“We’ll just apply the same policy everywhere” is how multinationals get caught out. (Walmart in Germany, once more.)
Culture still shapes the conversation (and institutions) — but some (legal) constraints bite harder.
Institutions tell you what you must do and can’t do.
But much of HR lives in the grey zone between: legal in one place, a bribe in another, fine on paper but wrong in the room.
Chunk 3 of 3
Where do you draw the line?
Legal in one place, inappropriate in another. The ethics HR can’t standardise away.
Ethical standards: a floor and a ceiling
Below the floor (law and the ILO core), “local custom” is no defence: that is complicity. Above the ceiling, imposing every home-country standard everywhere is overreach. HR’s real work is the band between, where debates happen.
Gift or bribe?
UK Bribery Act.Facilitation payments are bribes everywhere, with no exception.
US Foreign Corrupt Practices Act (FCPA). Bans bribing officials, with a narrow exception for small payments that only speed routine paperwork.
China enforces too: GlaxoSmithKline (GSK, 2014). A roughly ¥3 billion fine (about US$489m) for paying doctors to prescribe their products.
“Everyone does it” is not a compliance test.
Group Task小组任务15:00
· in groups
Sort the scenarios
Clearly OK · Legally risky · Ethically risky · Needs more facts. A scenario can be risky in both ways.
On your laptops/phones
Classify every scenario.
For the hard ones, note the exact extra facts you’d need before deciding.
Be ready to say where your group disagreed, and why.
The scenarios are here:swufe-cchrm.pages.dev/s8ethics
Report-back反馈
Disagreements
Which scenario did your group argue about most? Where did it land, and why?
Then
A scenario you put in ”needs more facts” — what single fact would move it?
Where might a colleague from another country disagree with you most?
“Respect local culture” — when is it an excuse?
The discrimination request (no women in the room) sits at the floor, but it is the hardest call under commercial pressure.
The guanxi instruction sits in the grey zone: legal until it buys a decision it shouldn’t. Beware.
Proportionate hospitality is genuine adaptation, but crossing the line can be very costly.
Respect is right until it crosses the floor. Then “that’s just how it’s done here” becomes a cover story.
Who is responsible down the supply chain?
The law now reaches the buyer. New rules make big firms answer for conditions at their suppliers (France, Germany, an EU-wide law coming). Courts have even let workers sue the parent company itself.
Audits are the main tool, and they have limits. They catch safety gaps, but miss coercion and blocked unions . After Rana Plaza (2013, 1,134 killed), a binding agreement with worker complaint channels did better .
An audit with no way for workers to speak up measures paperwork, not real conditions.
Looking ahead
Next
Block 9: your group presentations. Bring this labour-relations and ethics lens into your case.
Reflection
An easy start: a disagreement between workers and employers you’ve seen settled — how much freedom did HR have? Full prompt on the assessment page.
After
Block 10: AI in CCHRM, including the surveillance ethics we set aside today.
Open your card — the four settings, with the rules that matter:
swufe-cchrm.pages.dev/s8inst
The scenarios are here:
swufe-cchrm.pages.dev/s8ethics