Going Abroad: HR Policies,National IR Systems,and Union Activity in Foreign Subsidiaries of U.S. Multinationals

Abstract

Previous research is limited regarding the effects of the HR policies of foreign subsidiaries of U.S. multinational companies on union activity. An important topic is the extent to which multinationals employ practices that can be used to reduce unionization in parent company domestic operations and whether they have the same effect in foreign subsidiaries. In this study, the authors examine the effects of a subsidiary's implementation of high-performance work systems, its greenfield site status, and its usage of contract or temporary workers on union activity within the subsidiary. Results from a survey of a number of geographically dispersed foreign subsidiaries of U.S.-based multinationals show that greenfield site status has a strong, negative effect on subsidiary union activity, whereas high-performance work systems have a more modest, negative effect. The authors also show that national IR system characteristics moderate the effect of HR policies, especially if enterprise unionism plays a dominant role in the host country.