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Family dynasty in the workplace – Atty JBJ

Source: DIRECT FROM THE LABOR FRONT By Atty Josephus Jimenez

It is not only in politics but also in the workplace that family dynasties do rule in our country and anywhere in Asia and the world. Business corporations that are owned and managed by family members present an interesting area of study and inquiry in human resource management and labor relations. Based on empirical data and anecdotal evidence gathered by this writer in various conglomerates and group of companies that are owned and controlled by families, there are significant patterns of leadership and management styles that do affect human behavior in business organizations.

Human resource managers, personnel directors and other HR practitioners, as well as labor leaders and DOLE administrators and their staff, may be interested to know why workers are finding it more difficult to cope with work and management pressures that are unique only to family corporations. Higher education students and professors may likewise want to conduct scientific researches on the patterns of grievances and workplace conflicts in such business organizations. Of course, we hasten to make a caveat that not all family-owned companies suffer from this emerging phenomenon. There are a lot of professionally-managed businesses, albeit they are also being led and managed by only one family.

The workers’ main sources of gripes and complaints in family businesses are many but, for purposes of this column, we summarize them into five factors. The first is the absence of clear management policies and standard operating procedures and systems. Everything is ad hoc, hodge podge, topsy turvy, at times, knee-jerk reactions. Some family managers do not want to spend on researches and scientific studies, or in strategic planning. They do not want to put rules in writing. They want to solve problems based on “oido.’’ That is why business judgments are often impulsive. Well, if they have track records of business success using such approach, how can one argue against their styles?

The second factor that causes difficulties to rank-and-file and front-line supervisors are the propensity of many factions of the same family to give different, often conflicting instructions. For instance, the marching order from the President, who is the husband, is to buy supplies before the advent of Christmas season in order to take advantage of lower price and in bulk in order to gain from the economy of scale. Meanwhile, the wife, who is the Financial Controller does not want to release funds because she wants you to save on inventory costs. This kind of conflicts is stressful and may even find you pulled in two opposing directions, when a daughter’s marching order collides with the son’s and so on ad nauseam.

The third factor is the inclination of some (not all) to avoid or even evade taxes, save on labor costs, violate the laws on environmental protection, and to keep two or three books of accounts. There are many who are prone to committing unfair labor practices, union-busting and illegal dismissals. They cut corners insofar as remittances of statutory benefits are concerned, like Philhealth, Pag-ibig, SSS and Employees Compensation Commission. They do not listen to the recommendations of professional human resource managers and legal consultants. Their main consideration is to save on costs.

The fourth factor is that wages and benefits in family corporations are not competitive. As long as they can save, they would even defer the payroll dates or the day of remitting withheld taxes and premiums for insurances. The fifth and last factor is lack of a career path and promotion opportunities. Important and higher-paying posts are reserved for the sons, daughters, grandchildren or nephews and nieces. Well, the owners can always tell any complaining worker to pack up their bags and go somewhere if they don’t like it here. They govern their own company based on the Golden Rule: He who own the gold, rules.

Well, the law gives employers the right to hire and fire, as long as they don’t violate the law, nor step on the human rights of workers. On the other hand, the workers have a choice, of course. They can leave and find another employer who will treat them with respect, if not with affection. That is if there are vacancies, and they are qualified. If none, then they must find a way to cope. If they cannot have the job they would love, then they must learn to love the job that they currently have. Given the fabled resiliency and flexibility of the Filipino workers, for sure, they can, and they will survive.