employee voice

Employee Voice: A Transaction Costs Perspective

Whether it is better to adopt voice or exit depends on the  nature of the transaction for both parties. The strongest voice-sustaining equilibrium is where both parties see voice as preferable to exit. This is likely where both parties have substantial sunk costs. In other circumstances, there is no voice-sustaining equilibrium. We apply insights from transaction cost economics to voice and exit in the employment relationship.

Employee Voice and Private Sector Workplace Outcomes in Britain, 1980-2004

Non-union direct voice has replaced union representative voice as the primary avenue for employee voice in the British private sector. This paper provides a framework for examining the relationship between employee voice and workplace outcomes that explains this development. As exit-voice theory predicts, voice is associated with lower voluntary turnover, especially in the case of union voice. Union voice is also associated with greater workplace conflict and poorer productivity. Non-union voice is associated with better workplace financial performance than other voice regimes.