Throughout the precedent years, labour relations were habitually taken by the Asian governments as a means of reducing conflicts through dispute prevention and settlement mechanisms which were usually externalized, and union confrontation through conciliations, arbitrations etc. Conversely a number of South-Asian countries, unionization were prohibited because of the perception that they lead to negative IR, therefore there was inconsistent two-way communication and no negotiation of the employment relationship. Japan however, encouraged unionism dominated industrial relations in the organization.
Another example from UK regarding entities like trade unions and the parliament comes from the Thatcher regime in the late 1970s where trade unions were considered to be entities with unwarranted powers over organisations. The conservative party’s visualization ignited a programmed break up of this superfluous power of trade unions. Such as, the organization executed this scheme on municipal grounds, especially organizations that are government-controlled as they are similar to private companies. It has implemented these reforms to improve relations in both public and private sector like the one for pays and salaries of the government where a Pay Review Body (PRB) has been created to set criteria of determining wages and salaries of employees (Howell, 1998, pp 295).
If ever a change is brought in by the state, it is likely to lead to lesser bargaining between employers and employees and will require employees to make their own employment contract with the employer. The unions, as per the Employee Contract Act 1991, will become the third-party bargaining agent only. This will create an imbalance and have an incremental effect on the negotiating powers of the employer and lower employee/union bargaining position (Wattignar, 2008). According to Wattinar (2008) the affect however of these changes to bargaining power will not fall on the union rights but on 80% of the non-union employees in the private sector.