One instrument of improving employee-management relations is by using employee empowerment method. By empowering you mean that you delegate more authority to them and give more power to subordinate. This way they can come up with new ideas and cost cutting methods and firms might not only cut costs but it might also benefit from good relationship with employees.
2. According to a book written by John Gennard on employee relations, employee-management relationship suffers because of different aims of both management and employees. For example, management wants higher profits which includes lowering costs and could lead to downsizing and loss of job for labor. On the other hand, labor wants the security of their jobs and higher wages. The book further states that during recession these aims become more conflicting and the need to maintain cordial relations become more vital. The book recommends that this relationship could be improved by bilateral negotiation between management and labor union and by joint consultation by the both parties before decision making. For example, in recession due to slump in demand your organization cannot pay high labor costs and firing is inevitable. But this can be avoided if management decides to involve labor union in the decision making process.