Managerial prerogatives are the discretionary powers left at any moment in the hands of managers. Every act which a manager or his subordinates can lawfully do, without the consent of the worker organization, is done by virtue of this prerogative. Essentially, it is an area of managerial decision-making where managers believe they have exclusive rights to make decisions, and therefore resist any interference with that control.
Control was the essential managerial function in the time of industrialism in all countries and social systems. In the context of most modern employment relationships, there are large, hierarchical, and complex organizations where an element of subordination and discipline exists. The relationship between managerial control and worker resistance cannot be understood without considering the nature and distribution of power. Managerial prerogatives have been one of the most divisive factors between labor and management, due to the managed workers making an effort to challenge the authority of the manager, and the manager attempts to maintain control.
Management views on prerogative
The two streams of argument from management relate the primacy of market rationality. They are:
- Property rights, in that the rights that management has have over their capital assets incurs this level of control and;
- Economic efficiency, the argument that it is better to let management manage as they see fit for the benefit of all stakeholders.
Trade union views on prerogative
Many workers and their representatives do acknowledge part of management’s role to manage. They often do not describe it as a right of management, but as part of the job managers are paid to do. Management use this term to defend their role, but also trade unions use this time to place an element of responsibility upon management.
The industrial relations policies of the Howard government in Australia during its initial terms increased the exercise of managerial prerogative by reducing the scope and importance of awards, encouraging decentralized enterprise bargaining, and reducing the power of unions and promoting individual contracts.
- Storey, J (1983). Managerial Prerogative and the Question of Control. London: Routledge & Kegan Paul Plc.
- Perline, Martin M.; Poynter, David J. "Union and Management Perceptions of Managerial Prerogatives: Some insight into the future of co-operative bargaining in the USA". British Journal of Industrial Relations (Blackwell Publishing / London School of Economics) 28 (2): 179–196. doi:10.1111/j.1467-8543.1990.tb00362.x.
- Bray, Mark; Waring, Peter (2006). "The Rise of Managerial Prerogative under the Howard Government". Australian Bulletin of Labor 32 (1): 45–61. ISSN 0311-6336.
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