Labor Relations Of The Private Enterprise: Faith

With the rapid development of China’s private economy, the labor-management tensionsproblems in private company still exist.Although there are are many reasons attached, the missingcredibility between employers and employees is serious. Both employers and employees have themotivation to pursue personal interests to the maximize. This not only increases the transactioncosts between employers and employees, but also seriously hampered the team to improveproduction efficiency. Currently, our private sector employers and employees’ missing credibilityhave occurred in the labor remuneration issues, the work environment and intentional laziness inwork. At present, China is in a period of economic transition, the legal system is not perfect yet.The paper aims at the reputation mechanism of harmonious labor relations in private company.Its meaning and value is: to enrich the theoretical research in the private company labor relations, toexplore new ideas to build the private harmonious labor relations; The second is to build areputation mechanism to achieve and harmonious labor relations in the private company that canreduce the additional cost to both employers and employees the information asymmetry.The paper is based on the New Institutional Economics contract theory, transaction coststheory and property rights theory. The research methods include logical deduction, the game modeland case analysis. The main contents are: first, to analyze the performance of the lack of credibilitybetween employers and employees and its negative effect; Second, by building the game mode toanalysis the establishment of the credibility; Third, analyze how the credibility contribute to theformation of harmonious labor relations from two aspects; Fourth, analysis the disadvantaged andprotection of the reputation mechanism.The main conclusions: First, credibility means trust and reputation, both employers andemployees come to understand more information through several rounds of the games and givingtrust to the other people. Psychological trust will gradually evolve into a trust behavior. Second,reputation mechanism as a constraint factor on the mechanism of the economic moral hazard hasoperability and low-cost advantages. But in the long run, this so-called healthy skepticism is alsoconducive to the generation of efficient management system. Third, the credibility of themechanism as an informal rule can serve as a strong complement of legal regulation, but it isundeniable that reputation mechanism failure phenomenon occurs in the process of operation performed. The innovation of this paper is to study ways to realize the private sector harmoniouslabor relations, from the perspective of the credibility of the mechanism. The inadequacies of thisarticle: the credibility of the mechanism defined to be perfect, reputation mechanism as an informalrule is not specific enough analysis of how to promote harmonious labor relations.