Different Stakeholder Perspectives on the Regulation and Negotiation of Reward - Case Study Example

Different Stakeholder Perspectives on the Regulation and Negotiation of Reward Name Course Name and Code Instructor’s Name Date Introduction In any institution, employment relations form a fundamental basis in the smooth running of affairs within and outside. It is important that the manner in which the employer conducts his dealing with regard to the employee should form a cohesive and interactive workforce. The productive performance of this work force will most probably be realized by the presence of incentives and innovative strategies that will always capture the interests and motivation of the workforce. Employees need a constant captivating mechanism that will make them put and hence endeavor to work with utmost due diligence in every undertaking. The aspect of reward management deals squarely with the decisions made by the employer in contradistinction to those applicable as a result of external market forces (Perkins & White, 2011). It is on this pedestal that this work is meant to examine the role played by reward management taking into consideration the different stakeholder views in Australia on the regulation and negotiation of reward. Australian Council of Trade Unions The approach taken by this institution in arriving to the minimum wage requirement is based various factors as envisaged by the Fair work Act 2009 which is specifically based on fairness (ACTU, 2012). Well it would go without say that what actually addresses the concerns of pay is the living standards of the people in a country. If the socio-economic factors are on the positive ranking then it should reflect the manner in which the workers ought to be treated, which is on a positive note. It is on this basis that the sentiments of providing “safety net rather than the promotion of economic prosperity” was postulated (ACTU, 2012). The needs of the worker in terms of their welfare then become paramount in this approach. In this mechanism various factors such as social inclusion, reduction in wage disparity as well as reduction of working poverty is enhanced (ACTU, 2011). Based on recorded evidence the assumption created is that NMW should therefore be increased to $ 26 per week with an all award rates including those in C 10 category rate on the other hand those of higher award in rates of pay to have an increase of 3.8% (ACTU, 2011). In doing the foregoing, the maintenance of conducive living standards would be predicated on workers on lower pay scale and this would aid boost their daily living needs. The same balance would aid in promoting the economy at that level. What would be a matter of concern is the promotion of the living standard to those languishing in the lower scales in wages since the current status of affording goods and services has also sky rocketed (ACTU, 2011). To realize this aspect ACTU has devised scheme as enunciated above which basically means that those who are in greatest need are given priority. When it comes to Annual Wage Review process it is virtually applied to every sphere and hence does not single out any particular sector. It is carried on a horizontal plane (ACTU, 2011). In its entire endeavor the ACTU tries to reflect on the overall economy of the country in increasing the minimum wage. Australian Chamber of Commerce and Industry The Australian Chamber of Commerce and Industry is a gigantic institution that caters for employers within a network mechanism involving 300,000 of them and more. It follows suit that the number of employees involved with these employer is enormous ranging from 4 million and above (ACCI, 2012). Therefore in order to address any shortcomings or challenges in dealing with such huge work force especially when it comes to the negotiation of work terms, this institution plays a paramount role. The Australian Chamber of Commerce and Industry is statutorily mandated to take part in the formulation of the Annual Wage Review in every financial year as succinctly stipulated under the Fair Work Act 2009 (ACCI, 2012). On this basis the organization has the obligation of monitoring the effects of the formulated wage framework to the industry in specific sub-sectors (ACCI, 2012). One of the major roles played by this organization is in the sphere of regulating the minimum wage entitled to an employee. The development of such has always been the preserve of the organization under the auspice of the Australian Industrial Relations Commission’s (AIRC), Australian Fair Pay Commission’s Reviews (AFPC) and National Wage Cases/Safety Net Reviews (ACCI, 2012). Based on the above exposition the Australia Chamber of Commerce and Industry has put forth submissions touching on minimum wage in the financial year 2012 to be an increase of $ 9.40 per week to the National Minimum Wage and modern award minimum wage (ACCI, 2012). Specifically this institution was not of the option of increasing any wage based on percentage. But had embraced an increase on pro-rata basis to subsidiary minimum rates that sound relevant and on the other hand it has deferred any consideration made for those employees involved some form of disaster (ACCI, 2012). Exemptions from increase are made to specific employers in other industries and allow any increase to continue being absorbed into the existing over award rates of pay (ACCI, 2012). This institution also conforms to the safety net principle espoused in the statute as a requirement. Decision of the Minimum Wage Panel The Minimum Wage pane is statutorily mandated to carry out annual wage review. Its decision normally comes into operation on 1 July, next financial year. Some procedural mechanisms are used to cater for reasonable chances for other institutions to air their grievances and make submissions on the same and this is an opportunity for the institutions to take part in the decision making. Now in arriving at its ultimate decision the panel has to take into account certain aspect such as the living standard of the employee and also the needs of those at the lower cadre in pay system. Therefore it has come up with a decision that the increase in modern award minimum wage is 2.9 % while weekly wages will be rounded approximately to 10 cents. On matters of deferral no exceptional situation was advanced to facilitate the same and it could not be sustained as recommended by some institutions. Again the aspect of granting general exemptions was not persuasive enough for the modern awards since the industries were not suffering from economic crisis to warrant the same (FWA, 2012). Contemporary Approach to Reward Management When it comes to the sphere of Human resource management, one of the strategies used in enhancing the basic mandate of the institutions is by employing elements such as reward management as a dimensional unit in order to create and facilitate an efficient and effective work force (Perkins & White, 2011). To make an excellent organization the motivation of the employees must be taken into consideration. For a productive work force an institution need to keep an efficient and quality work force that deliver the intended results and hence the goals of the institutions are achieved with ease (Armstrong, 2011). These attributes comes along the plane of providing incentives to the employee (Perkins & White, 2011). At the end of every work undertaken the employee has some understanding that he shall receive a reward for work done (Wright, 2004). On this basis reward is an encompassing term that goes beyond the normal pay system. It entails other benefit that enables one to be at par with the essential basic needs of an individual. The needs of an individual (employee) must not be disappointed in the wake of advancement in literature and emergence of socio-economic institutions which can provide a stellar portray of truly underlying principles that reflects a welfare society (Perkins & White, 2011). When it comes to matters of reward practices it is prudent to embrace a mechanism that will adhere to decisions which are derived from firsthand experience and result approach. This will ensure that the implementation of any scheme to deal with reward management is fully based on research background and evaluated based on the management undertaking within the context (Armstrong, 2011). On this basis the policy framework of the organization should be reflection of the sphere of international standard in managing the reward views (Wright, 2004).Therefore the contemporary reward management which is based on this approach deals specifically with recognizing the efforts and values that each employee has contributed towards achieving the organizational goals (Armstrong, 2011). How well does the decision of Fair Work Australia and the approaches of the ACTU and ACCI respond to the requirements of contemporary reward management? In my opinion the decision arrived at by the Fair Work Australia is not better. It has taken into account the relevant factors to be considered through submissions for interested institutions and as a result based its decision on the evidence before it from previous undertaking as well as a reflection of the current status of the needs of the people and the economy in general. The contemporary reward management dictates that decisions made ought to reflect firsthand experience. The approaches used by ACTU and ACCI have been influence by the status of the employees in relation to the employer. The 2.9 % rate afforded is below par compared to what had been submitted by these institutions. Conclusion From the foregoing, the decision from the Fair Work Australia was not fair enough taking note of what had been submitted by the ACCI and ACTU. It is prudent that organizations in Australia should come into terms with the modern practices as regard reward management. It is high time that an underlying philosophy be put in place to provide a framework design from which every organization can derive from it formulation of policies and resolutions in adding value and welfare to the employee in particular. It is high time that investment in employees is employed such as to provide in the long run an efficient and effective reward practice. References Armstrong, M, 2011, Evidence-Based Reward management: Creating Measurable Business Impact from your Pay and Reward Practices, Kogan Page Publishers. Australia Chamber of Commerce and Industry, 2012, Fair Work Australia, Annual Wage Review. Australian Council of Trade Unions, 2012, Submission to the 2011-12, Annual Wage Review. Fair Work Australia, 2012, Decision, Annual Wage Review. Perkins, S & White, G, 2011, Reward Management System, CIPD Publishing. Wright, A, 2004, Reward Management in Context, CIPD Publishing. Read More