Managerial prerogatives are the discretionary powers left at any moment in the hands of managers. Every act which a manager or his subordinates can lawfully do, without the consent of the worker organization, is done by virtue of this prerogative. Essentially, it is an area of managerial decision-making where managers believe they have exclusive right

Exclusive right

In Anglo-Saxon law, an exclusive right is a de facto, non-tangible prerogative existing in law to perform an action or acquire a benefit and to permit or deny others the right to perform the same action or to acquire the same benefit. A "prerogative" is in effect an exclusive right...

s to make decisions, and therefore resist any interference with that control.

Control was the essential managerial function in the time of industrialism

Industrial Revolution

The Industrial Revolution was a period from the 18th to the 19th century where major changes in agriculture, manufacturing, mining, transportation, and technology had a profound effect on the social, economic and cultural conditions of the times...

 in all countries and social systems. In the context of most modern employment relationships, there are large, hierarchical, and complex organizations where an element of subordination and discipline exists. The relationship between managerial control and worker resistance cannot be understood without considering the nature and distribution of power. Managerial prerogatives have been one of the most divisive factors between labor and management, due to the managed workers making an effort to challenge the authority of the manager, and the manager attempts to maintain control.

Management views on prerogative

The two streams of argument from management relate the primacy of market rationality. They are:

1. Property rights
   Property
   Property is any physical or intangible entity that is owned by a person or jointly by a group of people or a legal entity like a corporation...
   
   , in that the rights that management has have over their capital asset
   Capital asset
   The term capital asset has three unrelated technical definitions, and is also used in a variety of non-technical ways.*In financial economics, it refers to any asset used to make money, as opposed to assets used for personal enjoyment or consumption...
   
   s incurs this level of control and;
2. Economic efficiency
   Efficiency (economics)
   In economics, the term economic efficiency refers to the use of resources so as to maximize the production of goods and services. An economic system is said to be more efficient than another if it can provide more goods and services for society without using more resources...
   
   , the argument that it is better to let management manage as they see fit for the benefit of all stakeholders.

Trade union views on prerogative

Many workers and their representatives do acknowledge part of management’s role to manage. They often do not describe it as a right of management, but as part of the job managers are paid to do. Management use this term to defend their role, but also trade unions use this time to place an element of responsibility upon management.

Australian perspective

The industrial relations policies of the Howard government in Australia during its initial terms increased the exercise of managerial prerogative by reducing the scope and importance of awards, encouraging decentralized enterprise bargaining, and reducing the power of unions and promoting individual contracts.