The Retail Industry in Australia - Employment Relations - Case Study Example

Employment Relations Name Institution Employment Relations Introduction The retail industry in Australia has been growing for many years. The business has evidently experienced momentous transformation over the years. Retail outlets have almost doubled and the turnover has also increased as a result (Forbes-Mewett, Griffin, Griffin, and McKenzie, 2005). Takeaway food stores and supermarkets have increased replacing mixed business stores and corner grocery stores. Some of the retailing businesses that developed during the 19th and the 20th centuries were the motor vehicle retailing, cosmetics stores, chemist stores, bookstores and newsagents, clothing stores, and hairdressers. By the 20th century, the retailing industry in Australia saw the evolvement of photographic film processing, and video hire outlets. Since then, the industry has been growing because of the advancements in technology. In Australia, trolley collectors are viewed as employees because they are employed by a certain organization o provide their services. Nevertheless, the growth in the industry has been faced by many conflicts. The word ‘workplace conflict’ possesses an extensive spectrum through its meaning, types, and grounds. Conflict as cited by Anderson, Teicher, Griffin (2005) refers to a process that starts when a group or person distinguishes opposition and differences between him/herself and a different group or person regarding resources and interests, practices, values, and beliefs. Workplace conflict starts from various interests in the place of work between the employee and the employer. The origin of conflicts in the workplace can be connected to workers’ behaviour on their jobs, work conditions, salary disputes, and unfair treatment (Australian Industrial Relations Commission, 2005). The workplace conflict to be discussed in the paper is underpayment amongst employees. Underpayment of employees refers to a situation where employees obtain less payment than their appropriate payment (Goodwin and Maconachie, 2007). Underpayment amongst employees can be recognized by assess timesheets, online check registers, and online PTR/ETR Reports. This is a very bad situation for most middle class and young employees who focus on paying, rent, buying necessary wants, pay for their education, and other important things. Legislation that the Company Breaches A company that underpays its employees tend to breach several legislations. The first legislation is the Fair Work Act of 2009 that forms a fair workplace relations structure to working individuals, supple for businesses, and supports economic development and productivity (Fair Work Commission, n.d). The second Act that the company breaches is the Racial Discrimination Act and Sex Discrimination Act that it may be infringing for underpaying its employees because they are from a certain ethnicity and gender respectively (Underhill, 2006). The third Act that the company may be breaching is the Equal Opportunity for Women in the Workplace Act 1999 (Cth). The Act requires particular employers to uphold equivalent opportunities for all women in their workplaces (Mitlacher and Burgess, 2007). Additionally, breaching these Act lead to the formation of the Fair Work Ombudsman intended to regulate workplaces in Australia. Roles of Fair Work Ombudsman The minimum conditions or wages that employees are entitled to are given in awards also called modern awards (Fair Work Commission, n.d). These awards fail to apply in businesses with registered agreements that also cover employees. Apart from ensuring that employees obtain these rewards the Australian Fair Work Ombudsman has several roles that the government allows it to perform. They include (Fair Work Commission, n.d); a) Offering individuals timely and accurate information regarding the workplace relations structure in Australia. b) Educating Australians or other employees working in Australia regarding work, obligations, rights, and practices. c) Investigating suspected infringements or complaints of workplace regulations, agreements, and awards. d) Litigating to implement workplace regulations and deterring individuals from committing crimes in their respective communities. e) Building effective and robust relations with the stakeholders, unions, and their respective industries. There are several causes of underpayment in Australia despite the formation of bodies meant to prevent underpayment of employees. Causes of Underpayments in Australia There are several causes of underpayments amongst employees in the Australia. The first cause is image unconsciousness. Most organizations will pay an employee if they see intangible benefits. Employees play an integral part in the running and survival of a company (Maconachie and Goodwin, 2006). Therefore, every employee is expected o do his/her best during the daily duties assigned by the manager(s). For instance, some employees are very good at marketing or speaking at conferences. For the marketer, a company expects his/her to persuade consumers about the company products. Top officials will watch his/her progress as the days go by. Therefore, the employee should be able to use any proper means to increase the consumer base. Alternatively, the market may fail to perform his/her job properly. This may create more problems in the workplace because the company may start getting losses. Failure to increase proceeds could prompt an organization to pay less to their employees (Australian Government, n.d.). Staff underpayments could then lead to dissatisfaction amongst employees in the company. The second cause of underpayments is failure to engage in first negotiations. Most people finish their education with hopes and anticipation to get a job. Sometimes, people employment opportunities some in their companies or choice while others go for convenience. In spite of the place of work, some employees fail to engage their top officials with negotiations regarding their payments (TNS Social Research, 2010). This is why some employees are overpaid and others are underpaid. Some job seekers fail to understand that some employers are very keen at knowing what their first salaries would be. These job seekers then fail to discuss their projected first salaries. Therefore, even after receiving the job opportunity, the employer makes the decision to pay the employee equitably or underpay him/her. The third cause of underpayment amongst employees is their failure to understand their market and their place in it (Maconachie and Goodwin, 2006). Most employees trust their employers thinking that they will receive better pay. Some employers may not have the best interest of their employees at heart because they want to make increased profits. Employees too make a huge mistake of not investigating the market they work in. This ignorance is very detrimental because an employee may realize that he/she was earning a lower percentage than his/her actual worth. Sometimes, it would be beneficial for an employee to familiarize him/herself with the field he/she was to work in. It would also be important to talk to colleagues and friends about the market. This will also help an employee to plan his career moves wisely. The fourth cause of underpayment amongst employees is scarcity of skills. Employers can identify potential employee. Some employees may be assets to their respective companies because of the profits they bring in (Davidov, 2004). Therefore, an employee can command an increased salary if their think that their ideas can benefit an organization in the long run (Goodwin and Maconachie, 2007). Alternatively, employees with inadequate skills may be unable to convince their employers about their lasting roles in the company. Underpayment has become a form of exploitation amongst most employees in the Australia. Sociologists have failed to examine exploitation based on earnings inequality partly because the subject is not a clear area in classical theory (Maconachie and Goodwin, 2006). Weber did not create an exploitation concept neither did Durkheim in his functionalists analysis of stratification. Exploitation is the major topic in Marxist theory but he failed to consider exploitation in the allocation of labor payments. Weber’s standpoint on societal stratification is extensively attuned to microeconomics. His comprehension of class as “market situation” pictures a county that significantly varies from the description of “perfect competition” that is mostly assumed by economists (Yaniv, 2004). According to Weber, “market situation” normally entails market closure aspects that are directed against business rivals who share negative and positive features. His strategy assesses how organizations support the welfare of different social groups and classes in their attempts to enhance their employment situations by promoting market closure of numerous types. Weber’s perception on societal stratification allows the delineation of employees with different levels of power in their “market situation” to bear increased wages (Anderson, Teicher, and Griffin, 2005). He also identifies the fact that some employees may also be underpaid because of their levels of power and education. Underpayment amongst employees is an issue that occurred several decades ago is still happening in the contemporary world because of companies’ reliance on social classes and focus on level of influence amongst employees. Manifestation of underpayment Employee underpayment can be manifested on how employees perform their daily operations. Just like most individuals, employees are motivated by financial remuneration as a way of motivating them. Adequately paid employees have increased enthusiasm even for coming to work unlike underpaid employees who do not have anything to look up to based on their daily operations at work (Goodwin and Maconachie, 2007). Underpaid employees are unable to handle their consumers properly. An organisation may be affected negatively for failing to pay employees working under the customer care department. These employees are given a role to handle all clients coming to look fro services in an organisation. This means that those employees are the face of the company, such that they represent the organisation and its operation. When such employees are not well paid, they could give clients a bad image of the company. Sometimes, an employee may end up overcharging a client for products and services that he/she could have purchased at a cheaper price in another company. This could prompt the consumer to abandon the service of that particular organisation. Underpayment amongst employees according to Yaniv (2004) can have very detrimental effects in the daily operations of an organisation. Some employees do not understand the negative impacts of underpayment especially when employees feel that they are not receiving adequate pay. Most employees who fall under the level of being underpaid are those employees whose education levels are low. Other employees may have higher levels of education but ignore to negotiate about their salaries prior to staring their work. Impacts of Employee Underpayment The first impact of employee underpayment is job dissatisfaction. Job dissatisfaction amongst employees affects the operations of an organisation negatively (TNS Social Research, 2010). Most organisations with employees who are not satisfied tend to experience reduced production levels. The level of motivation amongst employees also reduces leading to reduced profits. An organisation may also be ejected from its own market share because the employees’ lack of motivation to work reduces the quality of products and services been produced. The second impact of underpayment amongst employees is court cases. Every employee is entitled to a fair pay and failure to that could prompt an employee to search for help in trade unions or courts. Trade unions ensure that employees are protected from unscrupulous companies and employers who fail to give proper pays. Most companies who get involved with court cases because of their failure to pay their employees equitably tend to reduce their levels of productivity because most money may be spent in hiring lawyers to represent them in court. Smaller companies may also be greatly affected by court cases that can even lead to closure The third impact of employee underpayment is theft. According to Yaniv (2004), underpaid employees may feel justified to steal in their companies because for perceived injustice. Some researchers discovered that some workers saw theft as an inappropriate act but an ethically validated addition to earnings. Underpaid employees believe that their companies do not acknowledge their importance in the company. Therefore, they find any loophole to gain additional cash. Nevertheless, employers are penalized for underpaying their employees. Penalties of Breaching the Fair Work Act 2009 Most legislation in Australian, such as Fair Work 2009 describes penalties for infringement of Act as ‘penalty unit(s)’ (Riley, 2006). The country’s penalty unit for the past 15 years is $110 as indicated under part 4AA of the Crimes Act 1994 though the penalty unit increased to $170. For instance, section 539 of the Fair Work Act 2009, the Right of Entry provisions, and the General Protections provision can draw a maximum fine of 300 and 60 penalty units for a single corporate and a person respectively. This shows that the utmost fine for a person has augmented $10,200 in one infringement while the fine fro a corporate is $51,000 per infringement. Therefore, a court will force a company to pay $10,200 to an employee for underpayment and $51,000 to an organization. Nevertheless, employers who often infringe legislative provisions or awards or those that fail to collaborate with a Fair Work Ombudsman’s investigation increase their chances of getting higher penalties. This also means that the employer will have incurred additional legal expenses by the time a court awards them with penalties. Recommendations on underpayments Therefore, organisations should understand that every employee is entitled to proper payment regardless of whether an employee is in a trade union or not (TNS Social Research, 2010). This will help the company to have productive employees. The motivation of employees working in an organisation that pays adequately is very high. Such employees also bring up happy families such that that happiness is reflected in the workplace. Secondly, employees should research about their respective market. They should also ask their colleagues and friends about the market (Australian Industrial Relations Commission, 2005). This will help them to understand whether they are receiving a salary worth their work. It is important to understand that some employers will try to negotiate lower wages for their employees. Therefore, it is important to have adequate information in the level of wages for a particular occupation. Conclusion In conclusion, underpayment amongst employees is a situation where staffs receive reduced wages when compared to the amount of work they have done. Employers who underpay their employees breach several Acts namely the Fair Work Act 2009, the Racial Discrimination Act and Sex Discrimination Act, including the Equal Opportunity for Women in the Workplace Act 1999. Underpayment occurs because of several reasons namely: image unconsciousness; failure to negotiate a first salary; failure to understand their market and their place in it; and scarcity of skills. Underpayment amongst employees has detrimental impacts on organisations. Staff underpayment could lead to penalties and unending court cases pressuring an organization to pay up unpaid dues. Consumers may also prefer to stay away from companies with issues. Small organisations may also be closed as a result of court cases by underpaid employees. They may be prompted to use increased resources to maintain their lawyers. These resources could have been invested elsewhere in the company. Therefore, companies should pay their employees equitably. They should also ensure that they create a good environment for employees to work in. Employers and employees should create a good rapport such that they are able to talk about issues when they arise in the organization. Adequately paid employees become good ambassadors of their organisations unlike underpaid employees. References Anderson, E., Teicher, J. & Griffin, G. (2005). From Industrial Relations to Workplace Relations in the Australian Taxation Office: An Incomplete but Strategic Transition. 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