Impact of Factors of Employment Law on Employment Relationship - Essay Example

?IMPACT OF FACTORS OF EMPLOYMENT LAW ON EMPLOYMENT RELATIONSHIP The employment law has a highly considerable impact on the relationship of employee and employer. The organizations that have a focus on long term strategic formulation of business give a lot of attention on the employees’ retention for a long term. There are various factors in the employment law that has a significant impact on the employer and employee relationship. These factors are divided into two categories i.e. internal factors and external factors. Internal factors include the company policy about the employee rights and external factors include the application of law in the company. INTERNAL FACTORS 1- DISCIPLINE AND GRIEVANCES Discipline and grievances are the guidelines that are incorporated in the company’s policy and have a great significance in shaping the behavior of employees in the company. These guidelines are the rules that teach the individual about the company’s culture or way of conducting operations. Policies design the structure and that structure shapes the behavior of individuals in the company. (CIPD, 2013a). The law facilitates the resolution of the grievances and maintenance of the discipline conducts. For example, Employment Relations Act provides the opportunity for the resolution of the personal grievances and other options are also present by law for dealing with issues. Importantly, for maintaining effective relationship since the start of the employment relationship everyone the organization is required to behave in good faith. Additionally, simple measures of developing contract and informing rights along with responsibilities etc save the ER from being affected by grievances and result in maintenance of the discipline (MBIE, 2013). 2- EQUAL PAY Equal pay should be given to both men and women for the same job. None of the employer is allowed make biasness in giving equal salary or wages to men and women. Another perspective to analyze the injustice in equal pay is the comparison of pay with the market wage rate. If the company is paying low wage rate then it will negatively affect the employment relationship. (CIPD, 2013d). The law mandates employers to develop their pay structures in accordance to the Equal Pay Act. For the effective implementation and adoption Code of Practice and Equality Human Rights Commission (EHRC) is also available. Such facilitation by law results in the bridging of gap between the employees and employee on wage bargaining as things are determined by law and not by the personal consideration of employers (CIPD, 2014a). EXTERNAL FACTORS LAW Policy and law on the state level is one of the most important factors that drive the labor market and human resources management at the organizations. State laws are incrementally concerned for taking up measures that in turn contribute in the national exchequer. On the other hand, the state laws are also required to ensure the societal balance. These factors and their impact are also reflected in the laws regulating the labor market. Every year various developments in the laws are made in order to achieve the right balance between the country, exchequer and the employees and employers. All these also impact the employee relationship as the any burden of tax or any other contribution that state requires from the organizations results in squeezing the benefit that would have otherwise been used to expand the employee benefit. For example, Government’s Employment Law Review for allow greater flexibility in the labor market (CIPD, 2014b).Increasing flexibility for the labor market will contribute effectiveness for the two parties as both will be able to contribute their best with comfort working zone. ECONOMIC CONDITIONS Economic conditions have a significant impact on the relationship of employer and employee. If the economy is moving towards growth then the organization would possibly follow the same trend and it economy goes downwards then the organizations would possibly go with the economic trend. In affect from such economic factor employment law has also adapted to certain things to improve the smooth working employee relationship. For example, UK has also been keeping its doors flexible for the immigrants. One factor that drives the immigration policy is the economic conditions of the economy. Another factor under affect due to economic conditions is the increase in the penalties on not abiding minimum wage rate. This has resulted in the new equilibrium of employee relationship with increased power of employee and demand of improved services from the employer (CIPD, 2014b). IMPORTANCE OF EMPLOYMENT STATUS Three types of employment status are stated along with their importance in employment relationship. 1- EMPLOPYEE The status of employee is defined as the person who is enjoying a proper regular salary and benefits from the organization in return of its performance for the organization. It is very important to clearly define the rights, responsibilities and authorities to the employee category by which they would not be allowed to attempt any activity that will breach the employee laws in the company. The description of their responsibilities, authorities and rights keep them in the control of a company. The limitations on the employees contain them on the company policy and procedures and also shape their practices according to the company’s requirement. 2- WORKER Worker has distinguished position then employee. The rights of worker are different from the employee. Workers are usually hired by the company for the accomplishment of some specific project. The workers and labor are commonly paid on the basis of their working hours. No permanent contract is given to the workers. If a worker gives good performance then company pays according to his/her efforts and this is a part of law. The clause of worker individually defines in the employment law to ensure that no worker has the right to ask for extra benefits from the employer in return of the given performance. 3- SELF-EMPLOYED Self-employed is another category of employment in which employee is directly connected with the profit and loss of the company. Company hires such employees in the company and put them to deal with the clients individually. Self-employed people have some benefits of the company like insurance and medical. But they are not provided the complete package of benefits that is given to the permanent employees of the company. High risk is associated with this job because if the employee does not give the productivity then he/she would not be paid by the company. The clause of self-employed is mentioned in the employment law so none of the employer and self employed person is allowed to disobey the conducts (CIPD, 2013e). IMPORTANCE OF KNOWING EMPLOYMENT STATUS The well defined status is important as it provides clear guidance by law to employees (of any status) and employer for their respective rights and duties. All the regulations are developed in context of the employment status of employee such as contract, working hours, and hourly wage and so on (ACAS, n.d.). The limitations in the relationship generate a positive behavior from both the sides and the employment relationship stays positive (CIPD, 2013e). For example, recent law was introduced for the “employee shareholder” who was formally known as employee owner. The employee shareholder contracts will require employees to forgo certain rights in exchange of the company share. For the effective implementation of this regulation, it is mandatory for the employee as well employer to be well aware of their respective status (CIPD, 2014b). Hence, understanding of the employment status is critical in order to take benefit of respective rights. EMPLOYEE RIGHTS DURING THE EMPLOYEES RELATIONSHIP THE IMPORTANCE OF WORK LIFE BALANCE Workers in UK are among those working for highest working hours with limited public holiday and even short duration for lunch breaks. In such case, the rights given to employees as well as management tactics to improve productivity of employees are reduced considerably. Also the changing dynamics of the workforce with increased women and single parent etc have increased responsibilities (PCS, n.d.). Holidays and leaves along with the obedience of taking care of their daily working hours then result in the pleasant and the productive relationship between employee and employer. It is also important for stress management as excessive work can cause a great stress in the life of employees. Therefore, it is importance to strike the right balance with regulation. According to the UK law of work life and families act, 2006 there are can utilize in the defined circumstances in the law. The types of leaves include annual leaves many types of leaves that employee, maternity leaves, medical leaves and paternity leaves, etc. Some other regulations that facilitate the employee and employer with the due work life balance that is in the mutual benefit of all includes Working Time Regulation that determines the total working hours, Work and families Act, Employment act, Part-Time workers Regulation for the employees who work part time due to any other engagement, Temporary Workers are also provided the regulation shelter for effective and productive Work-life balance etc (PCS, n.d.). Importantly, alongside the development of regulation to improve work life balance it is also important to improve the perception regarding the flexibility of the working hours. For example, Civil Service Diversity Survey revealed that there is negative assumption about the commitment of employees who ask for the flexible working times (PCS, n.d.). FAMILY/PARENT RELATED LEGAL SUPPORT According to the UK regulation, parents have some responsibilities towards providing home and protecting child (Gov.UK, n.d.). This responsibility begins from the point of when the child is about to born. In order to meet these responsibilities, it is important for the parents to earn accordingly. Facilitation to employees on these factors results in the effective and loyal working relationship as employees value employers’ consideration as important. Moreover, the regularization of these factors is important in order to have healthy and uniform facilities for all the employees and there shall be no discrimination on the basis of rich and poor or employees on the basis of their position. According to the UK law of work life and families act, 2006 Maternity leave, paternity leave, adoption leave and dependants leave are a part of Family/parent related legal support (Legislation, 2006). Laws such as Employment Rights Act 1996, the Employment Relations Act 1999, the Employment Act 2002 and the Work and Families Act 2006 are some of the laws to address the required details in the . Additionally, Children and Families Bill will also be enforced by 2015 (CIPD, 2013h). In addition to these factors, the other benefits such as risk assessment, returning on same job, non-dismissal during such period and statutory pays also given to employees (CIPD, 2013h). Maternity leave is for the pregnancy and delivery period of women, paternity leaves are applicable when the wife of an employee is pregnant or at the time of delivery, and adoption leave are applicable when a child is adapted in the family. Non-availability of these factors can also cost the life and mental health of the child or the parent etc. If any employer found in the disobedience of this law then he/she will be panelized by the government. REASONS FOR FAIRLY TREATMENT WITH THE EMPLOYEES According to the equality act 2010, UK, it is the responsibility of the employer to protect employees from all kind of discriminations age, gender, race, disability etc. According to the law of equal pay of UK, 1970 it is clear that all the employees will be paid according to their performances. No one will be given less wages amount in return to the employees. Discrimination in the wage rate system is highly discouraged by the government. Pay is the return of human efforts for the company and every person works with the purpose of earning money. Employees’ productivity and motivation is highly associated with the pay. So it can be perceived that fair pay is strongly bonded with job satisfaction. Another important outcome of giving a fair pay to the employees is the employees’ motivation. Employees motivation is directly associated with the pay. MAIN POINTS OF EQUALITIES LEGISLATION The Equality Act 2010 has replaced the anti-discrimination laws which were separately defined for different discrimination complains. For example, Sex Discrimination Act 1975, Race Relation Act 1976 and Disability Discrimination Act 1995 etc (Gov.UK, 2013a). This has reduced the confusion and has also strengthened the protection for direct and indirect discrimination. Also the law provides security to all from the victimization or the harassment. The discrimination protection is not only facilitated at work, but also to consumer, educational institute, public services etc (Gov.UK, 2013b). Equalities legislation is based on the four main discrimination laws that are made by the government of UK. In the consideration of Equality Act of UK 2010 there are four types of discrimination or unequal behavior that is found at the workplace (Find Law, n.d.). 1- Direct discrimination Section 13 of the Equality Act explained the factor of direct discrimination as follows: ‘An individual (A) discriminates against another individual (B) if, because of a protected characteristic in the employment law, A is treating B less favorably than others. Hence, giving less favorable treatment to the person with protected rights is accounted as discrimination. For example, rejecting candidate due to religion or other ethnic belonging despite complete merit qualification for any job is form of direct discrimination. 2- Indirect discrimination The indirect discrimination refers to the situation where practice appears to be neutral and according to the law on the face of it; however, it still become disadvantageous to the person with the protected rights. Such situations fall under the discrimination unless justified with legitimate reason by the person doing it. For example, requiring employees to work late night in while knowing the women in the employees set are not able to do so 3- Harassment Section 26 of the Equality Act defines that ‘an individual (X) harasses another individual (Y) if X involved in unnecessary behavior ‘related to the relevant protected characteristic of employees’ which is doing with the reason or effect of violating dignity of individual Y then it will be against the law of discrimination. Harassment can have effect of degrading, intimidating, and/or sexual nature. 4- Victimization Victimization is the situation where person receives less favorable treatment or threat due to fact that person has taken legal rights as described in the equal rights act. It can also be the situation where someone is threatened for supporting someone else for taking legal rights. The discrimination both direct or indirect, victimization and harassment can arise in due to age, in case the person belongs to transsexual person, if discriminated for being married or have any civil partnership, any kind of disability, basis of race, ethnicity, sex, religion etc. All these are accounted in the protected right and any action that is violates the rights or entitlement of person for any above reason than it will be accounted ass the discrimination (Gov.UK, 2013b). Protecting such rights is critical for the healthy working environment as well as the society. Any such discrimination can also lead other person feel deprived of rights and have potential to translate into criminal. Different legal protection such as Acas, Citizens Advice, and tribunal are present for dealing with issues and facilitating solutions. Hence, employees’ relationship has strengthened as a result of support from such laws. THE CONCEPT OF THE ‘PSYCHOLOGICAL CONTRACT’ ALONG WITH EXAMPLES OF POLICIES AND PROCEDURES WORKING OF GUESS MODEL OF PSYCHOLOGICAL CONTRACT Psychological contract is distinguished from the employment contract that is presented by the government. The main points included in the psychological contract are: 1- Psychological contract is basically the perception of both parties’ employer and employee. It can be viewed as the mutual perception of both parties. 2- From the perspective of employees psychological contract is distinguished for the employment contract in the context of promises and expectations. 3- Employment contract is responsible to fulfill all the promises that have committed with the employees. Whereas, psychological contract is responsible for the fulfillment of employee expectations form the company. 4- The consideration of psychological contract is the responsibility of human resource management of the company. Human resource management has the responsibility to analyze all the facts and figures regarding the psychological contract between employer and employees of the company. The policies pertaining to the part-time and the flexible timing (CIPD, 2014b) is one the example that has led employees to take the psychological contracts more seriously. As the human capital is gaining increased importance therefore, policies such as maternity, paternity leaves, and caste discrimination to be introduced under Equality Act 2010 also endorse the importance of psychological contract (CIPD, 2014b). THE TERMINATION OF THE EMPLOYMENT RELATIONSHIP DIFFERENCE BETWEEN FAIR DISMISSAL AND UNFAIR DISMISSAL Fair Dismissal Unfair dismissal Proper investigation of matter is required. Give proper justification with sufficient proves in hearing. Inconsistent approach used and spotlight on fault rather than explanatory circumstance. Give employee opportunity to be represented. If more the one employee is involved the treat all as same. Consideration of warning is important. Misdemeanors v competence The whole procedure should be conducted same as the standard procedure. Un reasonable response from the employer If more the one employee is involved the treat all as same. Consideration of warning is important. Failure to give sufficient notice of the dismissal EXIT INTERVIEWS Exit interviews are conducted when the employment comes to an end for any reason. Exit interview is taken with the purpose of identifying the original reasons that why employee left the job and what are the difficulties he/she faces during the period of employment. This is beneficial for the employer. Example is incorporated to get a better understanding of importance of exit interviews for both employer and employee, Female employee is terminated by the company for the high rate of absenteeism. After the notice period when an exit interview is conducted to find out the reasons and asking about her experience then she gave the original reasons of her absenteeism in the company. She told that she was passing through the issue of sexual harassment and she was forced by her supervisor in the duty timings that’s why she did not came regular to the office. The exit interview panel considered her concerns and took an immediate step for the confirmation of this complaint. The management asked other female employees about that supervisor and one of them also complained about that issue. This example justifies the importance of exit interview for the company. If the exit interview was not conducted in the discussed case then company lost a productive employee and might many more in future (CIPD, 2013h). MANAGEMENT OF REDUNDANCY IN THE ORGANIZATION According to the CIPD the redundancy should follow a properly managed process to maintain the reputation of the company and to make people satisfied with the decision of redundancy by giving them proper justification of redundancy. The principals that should be followed in case of redundancy are defined by CIPD. The rules states that there are some steps that should be followed while the program of redundancy in UK. The steps are as follows: 1- At the first place, it is required to make selection. The selection must be made on the basis of certain criteria which has certain defined objective instead of opinion. 2- Discuss or consult with employees jointly or separately through meeting and give reasons for the redundancy. It is important for the employer to give information such as reason, method, number of employees, procedure etc pertaining to the reason of redundancy to all the related people. 3- Statuary Redundancy Pay shall be given to employees. It is important to establish support for the employees in accordance to predefined calculation. Also the support shall be established so that respective employees can look out for the other job. 4- This stage requires to give due attention and care for the people who are losing their job. Importantly, careful handling is important in order to ensure the stability of the employees. All these factors are to be dealt with care for the implementation. Importantly, well defined program and policy is important for the redundancy implementation. IMPACT OF REDUNDANCY ON THE ORGANIZATION Redundancy has a negative impact on the overall organization. But still if it is done with proper management as defined in CIPD then company would be able to reduce its impact on the remaining employees of the company. Redundancy directly impact on the job security of the remaining employees. The remaining employees feel unsafe after the redundancy program and some of them become highly unsecure and search for the employment in other companies. But in some cases redundancy highly beneficiates the organization financially and the remaining employees enjoys more bonuses for their performances. Therefore, it can be perceived that the impact of redundancy depends on its reason of occurring. But in the consideration of Corporate Social Responsibility, redundancy has a negative impact on the reputation of the company in the society (Think people, 2012). 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