Employment systems consist of complex arrays of formal and informal
rules that structure the relationships between employees and employers.
There are many different types of employment systems. Some are specified
in considerable detail in collectively bargained quasilegal employment
contracts, while others are left to discretion. This book describes the
latter type of employment system-one in which there is an active market
for knowl- edge and skills. This is the salaried employment system of
ForestCo-a large multiplant manufacturing company in the forest products
industry. Here, supervisors and managers actively adjust the jobs and
persons under their authority to meet the market, social, and
institutional forces that influence the activities and performance of
their departments. The study of employment systems is a relatively
recent phenomenon, and few prior studies or theories were found to guide
this investigation. Neither the scope nor the components of employment
system studies are yet established. The field is confused and contested.
Nevertheless, there is related literature which can be used to focus
attention on different features of employment systems. One emerging body
of work that holds the most promise for the study of employment systems
is internal labor market (lLM) theory.