Strike and Its Effects on Organizational Effectiveness (a Case Study of Health Care Product Nigeria Limited)

Strike and Its Effects on Organizational Effectiveness (a Case Study of Health Care Product Nigeria Limited)


Strike and Its Effects on Organizational Effectiveness (a Case Study of Health Care Product Nigeria Limited)


Chapter One of Strike and Its Effects on Organizational Effectiveness (a Case Study of Health Care Product Nigeria Limited)



This chapter gives a brief discussion of the general description of the study, problem statement, purpose of study, research questions and hypotheses, definitions of terms, scope and limitation of the study, as well as the significance of it.


Most earn their living as employees, employers or self-employed workers. The employees in the proper meaning of the term are people who work for compensation in cash and/or kind under the direction of employers.

The employers, whether acting collectively or individually, are interested in production and distribution, trade practice, efficiency, cost, prices, buying, selling and maximization of profit while the employee’s scope and character of collectivism centre on the quest, not only for economic benefits of increasing salaries and wages and other fringe benefits but also for psychological and social motives so as to be able to participate actively in making decisions that vitally affect them in their work and community life and hence, seek to advance the cultural and social status along with occupation and economic status of their members and the interest of the labour group.

At this point, it is imperative to know that for there to be a labour group, there must have been a Trade Union. A Trade Union is a combination of employees who share common statutory objective in relation to regulations between employers and employees as to the benefits and welfare of their members (Ola, 1987). The activities of employers and employees in an organization centre on not only how to produce goods and services but also how to form Unions to protect and promote collectively their respective interests and to regulate, in particular, management-labour relations.

In an attempt to achieve this common objective by both the employees (workers) and the employers (the management), Unions respectively base on the identified differences in their interest thus necessitate the need for both parties to reach an agreement through a collective bargaining process.

A modern view of collective bargaining is that it must be recognized as an institution for regulating labour-management as well as the labour market. Dunlop identified one of the major activities of collective bargaining as involving the determination of priorities with each side in the bargaining process, it involves the process of compromise and assessment of priorities with each side, the rejection of some claims and the assessment of priorities to others within the Union and the bargaining across the table, it involves the processes of administration and application of the agreement.

The success of any organization depends not only on the ability to effectively and efficiently coordinate and control the available resources or profitability but largely on its ability to enhance good relation within or among individuals and groups in the work environment. As a result, the inability of the management to ensure peace and harmony in the working environment may lead to misunderstanding which if unresolved will eventually lead to industrial conflict.

Conflict is defined as the disagreement of organization members of groups over means or ends and an attempt to establish their views in preference to others. In other words, it means dissatisfaction arising from the interaction between labour and management in the work place as against the cordial industrial relations of the organization.

Three major factors have been identified in Nigerian organization as the cause of industrial conflict in the working environment. Among others are the inadequacy of agreement, that is, where certain issues are left unresolved during the cause of agreement, relation of agreement which may be deliberate and interpretation problem i.e. a situation where agreement has been signed but the two parties give different interpretation to it which eventually led to industrial actions.

Strike is one form of industrial action commonly used by Nigerian Workers and their Unions as pressure method in the employers to win their demands. Trade Dispute Act (1976) defines strike as the cessation of work by a body of persons employed acting in combination or a concerted refusal or a refusal under a common understanding compelling employers to accept or body of persons employed to accept terms of employment and physical condition or work. Strike in any organization will either disrupt or reduce the productivity which will eventually affect the overall performance of the organization.


The problem of persistent strike actions in organisations, apart from causing organizational ineffectiveness results in loss of recognition (goodwill), decrease in productivity, high labour turnover and lack of credible image towards members of the society. This in effect ushers in other problems such as inflation, mass unemployment, increase in crime rate and corruption.

Proper management of these problems will in turn ensure the achievement of the organization’s objectives as well as increasing employees’ working condition, morale, growth on the job, high level of motivation, job security and improvement in the living standard of members of the society.

Most organisations fail to realize all these and as a result face a lot of problems in organizational management. This becomes an issue of great concern with backfiring effect on the whole organizational environment and economic development of the entire nation.


The purpose of this study is to determine the effect of strike, the causes and to evolve means of avoiding, minimizing or managing strike in organisations and to make useful recommendations and conclusion for better and viable means of ensuring industrial peace.


The relevant research questions of this study are as follows:

(a)   To what extent will strike affect the net profit of an organisation?

(b)   Can strike correct organizational mismanagement?

(c)   Does strike bring about high labour turnover?

The following are the relevant hypothesis to be tested:

1)      There is no significant relationship between maximum resources utilization and strike frequency in an organization.

2)      There is no significant relationship between labour turnover as a result of strike and returns on investment.


This study aims at looking into strike and its effect on organizational effectiveness as a result of good working condition, job security, fringe benefits and productivity. This study will use Health Care Product Nigeria Ltd. as a case study. All the data for this study is obtainable from the organization.

The study is prone to some limitations by cost, time and the participants or management bias in administering the questionnaire. Therefore, the generalization of the findings is limited. It could only be applicable to any organization with similar case.


This study will reveal the negative and positive effects of strike and how the negative aspect can be managed, avoided or minimized while mazimizing the positive effect in the organization.

The findings are to help organization in dealing with strike in order to enhance employees’ performance as well as the organizational effectiveness. In other words, the findings of the study will be used as a secondary data for other researchers conducting work on similar or related topic.


Employees – These are persons who work for another person in return for wages/compensation in cash and in kind.

Employers – These are persons who engage others by using their services in an organization to achieve an objective and pay them in return for their service.

Work – This is a creative assignment for our corporate existence necessary for our economic independence.

Trade Union – This is an organization of workers whose main purpose is to maintain and improve the conditions of their members’ working life.

Collective Agreement – This is an agreement in writing for the settlement of dispute and relating to terms of employment and physical condition of work.

Collective Bargaining – This is defined as negotiation of working conditions and terms of employment between an employer or group of employers and one or more representatives of workers in an organization.

Industrial Conflict – This is the dissatisfaction that arises from the interaction between labour and the management in the work place.

Strike – This is the temporary refusal by workers to work in accordance to the prevailing employment contract or other conditions that may not have been specified or implied in the contract.

Management – This can be defined as those people occupying the position of authorities and responsibility in an organization.

Morale – This is the state of a person’s or group’s spirits and confidence.