Race to the East,race to the bottom? Multi-nationals and industrial relations in two sectors in the Czech Republic

Abstract

The article addresses the issue of multi-national employers’ effects on employment practices and industrial relations through the findings of 12 case studies of multi-nationals in the Czech Republic, in the automotive and finance sectors. It is found that in the automotive sector, where product markets are international, there is more transnational organizational co-ordination, but companies avoid transferring their employee participation practices, preferring unilateral management and leading to vertical segmentation between Western and Eastern European sites. In finance, companies from liberal market economies transfer sophisticated direct participation practices, also for anti-union purposes, as firm-specific advantages. The industrial relations outcome shows enduring gaps with Western European practices.