Identify an employment relations issue in your current workplace (or an organisation you have recently worked in).
Employee relations dates back to the 1800s .This was a period characterized by industrial revolution which hit Europe and America and saw a rise of a great deal of industries which subsequently led to the rise in demand for human labor to work in these industries. In effect the increase in the demand of labor came with a number of challenges touching on the lives of employees. These included poor working conditions, bad employee employer relations where by employees were treated as objects without feelings in the industries and were unfairly remunerated which largely affected the lives of the working class.
In the Australian context Industrial relations concept was first .introduced in the early 1860s and 1870s.The passage of the trade unions act in the 19th Century enabled employees to engage in collective bargaining with their employers regarding their pay and working conditions. With various legislations being put in place and the Trade unions bargaining on behalf of the employees, their working conditions have continued to improve.
The issue of pay and employee benefits has been an issue of great concern in many parts world. Any country can experience this issue irrespective of the regulations put in place to govern the employee employer relations. So basically pay and benefits related concerns are issues of concerns worldwide and are not a preserve for any country.
Employee pay or remuneration denotes the amount of compensation that an employee receives from the employer regarding the work that they offer. It is a compensation for their efforts .Employees remuneration should be reasonable and fair and in accordance to the work performed by the employees. According to various labor regulations employees should not be underpaid for the services offered to the employer. But rather they should be fairly to motivate them yet further.
On the other hand employee benefits are those benefits that accrue to an employee for being part of a given business entity or organization. They are monetary or no monetary compensation packages offered to employees. Employee benefits vary from firm to firm and may depend on factors such as the financial strength of a firm. However there those that are a requirement under various laws and regulations such as paid leaves. Employee benefits play a great role in the motivation of employees for them to perform their duties efficiently.
With the rise of more legislation safeguarding the employees against unfair treatment by the employers, employees are bound to rise up and demand for their right guaranteed by the law. They can achieve this trough legal action or other means that are allowed under labor laws.
Employee remuneration paly significant role in the success of business and any business entity that remunerates its employees and offers then competitive benefits will have a competitive advantage over its competitors unlike those that do not.
In Particular sound employee compensation and benefits have a great impact on the productivity of the employee. According to the various motivation theories any form of motivation will have a significant positive impact on an individual so if these employees are provided with various benefits and are well remunerated they are likely to be positively motivated which will mean that they will do their assigned tasks whole heartedly which will have a significant impact on their productivity and the productivity of the company as a whole. Without these put in place, a company can significantly deteriorate in its operations.
Various labor laws have been developed to guide the conduct of the employer towards the employee; among them are those that regulate the compensation and the various benefits that are guaranteed to the employees by the law. If these requirements are not met by the employer, the law allows the employee to take a legal action against the employer by presenting the labor dispute to an industrial court. This is never healthy for any business enterprise as it has a significant impact on the reputation of the organization in the public eye, a company should take care of the employee remuneration and other benefits to avoid any legal hurdles that are likely to have an impact on its reputation.
Employee turnover denotes the rate at which employee move from one employer to another in pursuit for better employment terms. Employees will often be on the move as they search for personal fulfillment career wise with regard to competitive benefits. Better compensation and other work related benefits will ensure that employees do not move from one organization to another. Companies that have high employee turnover usually have a bad reputation in the minds of the public and that will negatively impact on their operations.
On the other had retention of employee plays a significant role in the success of organizations. It denotes the process by which qualified and experienced employees are retained in their present organizations for long duration of time. An organization that provides competitive remuneration and benefits for its employees will face less employee turnover which means that they will be able to retain the best talents which will work to their advantage over their competitors and their performance and overall output will not be affected. It is significant therefore those employees are provided with good working terms including competitive salaries and other benefits for them to remain with their present employers.
An organization that has good and effective working relations with its employees will have a good image among the members of the public and among the potential qualified employees out in the market. This means that it will be in a position attracting the most qualified talents in the market as employees will always want to associate with the nest employers in the market. Its Significant therefore that an employer provide fair wages and other benefits to their employees to maintain a good public image and be in a position of attracting the best candidate in the market which will have a significant impact in its operations.
In the workplace unfavorable or unfair compensation packages can be manifested in a number of ways on the part of the employees. Based on the case of 7 Eleven, It was quite possible to identify an employee who was not paid well or denied other benefits based on how employees were conducting themselves in the various tasks assigned to them or generally in their places of work.
This was manifested in a number of ways that were quite explicit. Among them was trough low productivity of employees. Unmotivated employees will often lack the zeal to perform the tasks assigned to them to the best of their abilities. This will have a negative impact on their output which will be witnessed also in the overall reduction in the productivity of the organizations that they work for this also has the potential of bringing down organizations which hitherto had been thriving in their operations.in the case of 7 eleven low productivity was a real issue which threatened the survival of the company and had it not been handled in a timely manner it could have been disastrous.
Another manifestation was through a decline in the profit margins of the organization. The profitability of organizations to a large extent depends on the human resources working for it. If various legal regulations guiding their works are met these employees will often have a high driving force in their undertakings. The profitability of the organizations prior to encountering pay related issues with its employees had been relatively steady, however with the emergence of these issues the profitability went down considerably. This signifies the fact that if employees are paid well and provided with other benefits, their performance levels will remain high meaning that the profitability margins of any organization will not be affected.
Due to the problems experienced a number of employees who were demotivated and quite unsatisfied with their working conditions, left the organization for other organizations with better employment terms. So the issue was manifested through employee turnover which left the organization without some of its best talents. This had a significant impact on its competitiveness which worked to the advantage of the competitors.
Employees grievances related to their pay and other matters pertaining their employment can also be manifested through their work output. Motivated employees will display high levels of performance. However in the case of employees who are dissatisfied with their working conditions, go slows are one of the ways of expressing their dissatisfaction .In the case of 7 Eleven, there was a considerable intentional decline in the performance of employees. Employees chose to work at slower rates than before which affected the amount of output.
Another way in which employees’ lack of better salaries and employee benefits can be manifested through an increase in the absenteeism case among the employees .Employees just like any other human beings need something to drive them to act .If a positive action is positively and fairly rewarded it be repeated often while if a positive action is repeated and there is no positive rewards for the action it will be avoided. If therefore employees are not paid well even after putting all their efforts into their assigned tasks and including their coming to work every day, they will be demoralized in such a way that they will occasionally avoid reporting to work because they lack a motivating factor. A couple of employees working for 7 eleven recorded high cases of absenteeism which kept on increasing until when they decided to quit the organization.
Remunerations and employee benefits differ from organization to organization. There are those organizations that have very attractive compensation packages for various positions as well as other employee benefits while to others these employees’ benefits and attractive salaries are lacking. However there are quite a number of reasons why there exists lack of uniformity in the compensation rates among different business entities. These are some of the factors that prohibit some organizations from compensating their employees competitively. These factors can be either external or internal to the organization and can be within or out of the control of organizations. Such causes include:
Ability to pay. This is basically the company’s or organization’s financial muscle or the amount of wealth owned by the organization. A company’s financial strength can be attributed to a number of factors among them the size of the market that it covers. Companies serving large geographical areas will in most case have a large customer base which in effect will result to increased profits for the company which means it can pay its employees well. It can also be determined by the company’s industry. There are those business ventures that are quite profitable to venture into while others are not that profitable. For example a communication service providing company or a company that deals with gold products can make more money than a company manufacturing chicken feeds.
Losses. Losses can also be another cause of poor employee remunerations in some organizations. Specifically if a company or organization continuously makes losses for a long period of time, this can attribute to its inability to pay its employees well because of lack of adequate finances to run its operations. Consequently if as a result of employee’s negligence the company makes huge losses there could be a necessity of revising the employees’ salaries for the organization to be able to cater for these losses.
Availability of Labour: Just like goods and services, Labour is also affected by the forces of demand and supply, this means that the compensations for Labor will also be affected by these forces of demand in that the higher the supply or the availability of labor in the market, the lower the compensation rates, consequently the lower the supply of labor into the market, the higher the compensation rates. So, poor employee remunerations alongside lack of or poor employee benefits could be attributed to these forces to a great extent.
Organizations compensation policies: Some organizations have set policies in such a way that employees’ salaries should not go beyond certain set limits, these policies apply to all employees. On the other hand employees expect salary increment from time to time and incase it reaches to a point where the employees do not expect any further increment in their salaries issues could arise which could jeopardize the operations of an organization. Therefore low salaries and benefits for employees could be as result of these policies.
Employee’s skills and experience: In most cases employees’ salaries will be directly proportional to the level of competence and the level of experience. In most case you will find employees doing the same tasks but earning different salaries. This is because they possess different skills and capabilities. If therefore a company has employees who possess low skills or who are not quite competent, and particularly if this is reflected in their performance levels, where they are quite low or do not meet the required standards, this could be a cause of low remunerations and lack of other benefits.
Increase in the Cost of direct inputs: An increase in the cost of direct inputs into the production process such as raw materials could have an impact in on the employees’ salaries. Particularly if the increased cost cannot be catered for by an increase in the price of goods and services, the management could result to reviewing of employees in order for it not to occur losses. This would also include withdrawing of other employee’s benefits like paid holidays and leaves.
Unfulfilled employee expectations such as poor wages and lack of other employee benefits can affect the work place in a number of ways.
First there is likely to be poor coordination of activities because most of the employees will not pay so much attention to the work that they will be performing. This means that some tasks will not be done satisfactorily or others will be left undone. Consequently antagonism is likely to result among the employee and their supervisors especially where the supervisors require the employees to perform certain tasks and the employees are not willing to or they defy these orders. This Will have major impact in the operations of the organization in those tasks will not be performed in a timely and effective manner.
Consequently it will lead to an increase in the customer related complaints attributed to poor services offered by the organization .This will lead to a loss in customer confidence in the organization as well, as loss of customers who will shift their allegiance to other organizations where they feel that that the services offered are worth their money.
The Society is the immediate beneficiary or loser in case an organization becomes productive or unproductive. Where by an organization is progressing well business wise, it will play its corporate social responsibility role effectively by sponsoring various community based programs that are aimed at improving or making better their lives. This could be through the creation of social amenities provision of water services among other important social services. It could also sponsor educational programs by providing scholarships to needy students within the community’s. In case of a situation where there is instability within such organizations, the society will be the biggest loser because these services will be withdrawn because of lack of adequate finances to support them. Also they will be affected the company’s role of environmental conservation may be neglected.
A company involved in pay related tussles with its employees should adopt a negotiation technique where they bring the employees and the management on a negotiation table and try to create an understanding based on the prevailing circumstances. Consequently they can look for a mediator to mediate over the issue to ensure that it does not get out of hand.
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