SOCIO-POLITICAL THEORY AND ETHICS IN HRM 29Liberal individualism represents the classic ‘laissez-faire’ economics of the
eighteenth century. This is the ‘pure’ unmodified acceptance of liberal theory,
which argues that individual contracts of employment are the main or only
social mechanism needed to ensure social and economic justice at work. A
legal framework will be necessary to support contractual rights, but other
forms of interventionist legislation should be minimal, and are not required
to regulate relationships between adults at work. Any collusion in the mar-
ketplace must not be tolerated. Therefore employees forming trade unions,
or employers forming employer associations to agree terms of employment in
an industry, must be prevented, as these will prevent the free and individual
working of the market. Liberal individualism is still used to justify the strong
anti-unionism of many companies in the USA, and to support calls for greater
labour market deregulation.
Opposition to, or modification of, the basic Western belief in liberal indi-
vidualism has come from those arguing for collective representation in the
workforce, or for a more interventionist state through legislation. The first
challenges to the pure laissez-faire individualism arose from the early ethical
concerns about the exploitation of child labour (well represented in the writ-
ings of Charles Dickens). Faced with evidence of the exploitation of children
and of health and safety abuses, the nineteenth century Britain saw the first
legislation to prevent child labour and the slow development of government
regulation to enforce some basic safety practices at work. Pressure to regulate
the employer’s use of labour in these ways came from the collective mobiliza-
tion of groups lobbying to represent employee interests. Unions developed the
argument that the individual contract of employment could not represent a
balanced bargain between two equal parties. Only collective representation on
the labour side of the equation would go some way to ensure that the liberal
market was liberal in a social and political sense. Slowly labour movements
gained support in Europe, building alliances and political power to press for
some government regulation of employment conditions. In the UK associ-
ations of employers began to establish pay rates, and eventually accept the
participation of trade unions in their regulation of standard hours, wages,
and conditions for their industry or region. As some employers’ associations
and trade unions began to establish collectively agreed terms of employment,
legislation slowly developed to recognize the right of employees to form trade
unions and employers to form associations, and both to act collectively in the
negotiation of collective bargains to establish contracts of employment. This
variant of liberalism has been labelled ‘liberal collectivism’. This was the social
theory that emerged after the Second World War as the solution to the need to
establish fair and equitable employment relationships. After the War, the allied
powers of the USA and UK introduced legislation into the defeated nations
of Germany and Japan to create free trade unions and collective bargaining.
This key element of liberal collectivism was introduced, not only to support