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Analysis: Employer/employee divide constraining growth

Adam Zuchetti
Adam Zuchetti
19 April 2018 3 minute readShare
Divide, battle, line, chess, game, division

There is a concerning divide between how both employers and workers view their lot in life. And with each accusing the other of unfairness, little is being done to solve the root problem.

Every morning, I start my work day by reading through the headlines from the day before and moderating comments that come from readers. And what has been becoming increasingly apparent is a real divide between how employers and workers view each other.

Read any story on the My Business site about modern awards, leave entitlements, productivity, overtime or employee wellbeing and the comments that follow are almost always very emotive and passionate, and presenting the opinion that the other side has it much easier than they do.

Employees feel hard done-by. Wage growth is currently sitting around a record low of 2.1 per cent, with some industries tracking below inflation (currently 1.9 per cent), putting strain on their personal budgets amid soaring energy and insurance costs. And a recent study suggested that almost half of workers are not always paid for overtime.

On the other hand, employers – particularly SME operators – feel overburdened by industrial relations rules. Many are exasperated, wondering why workers have generous rights while they struggle to make ends meet. Even the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) recently noted that a surprising number of business owners themselves fail to earn the minimum wage.

Personally, I can empathise with both sides.

Workers feel that every minute they are working for their employer should be paid for – afterall, their employer should be making financial gains from these minutes (at least in theory).

Australian employers, meanwhile, particularly smaller ones, do operate in a complex environment. Those reliant on modern awards are dictated the minimum rate and conditions at which they can pay employees – regardless of the financial situation of the business.

Add to that the sometimes conflicting compliance requirements and business needs, productivity concerns and constraints, genuine concern for their employees, skills shortages in many industries, policy backflips as different governments and opposition parties publicly duel, and it is no wonder employers are feeling strained.

So while workers generally appreciate having mandated rates of pay entitlements as a guaranteed minimum, particularly if they don’t feel confident negotiating directly with their employer, it is the employer that can be squeezed by this lack of flexibility in recognising the ebbs and flows associated with business growth and cash flow cycles.

However, surely this resentful divide is good for no one – not the employer, not the worker, and not the broader economy.

In my role as editor of My Business, I am lucky enough to speak with a vast number of business owners from across the country, representing every size and industry imaginable. And one of the things that stands out to me is the power of transparency in bridging this divide.

Those employers who are openly transparent with their staff, about everything from profitability and operating conditions, to compliance rules, pay equity/disparity and internal performance across divisions, are almost always achieving higher growth and better productivity rates than those who don’t. And at their most basic level, these people also tend to come across as being the happiest, most well-adjusted, least stressed and least tired.

The era of bosses dictating to workers and workers begrudgingly obeying for fear of losing their job is undeniably behind us. These days, it is business leaders who openly and honestly collaborate and consult with their staff who are achieving the best results, for their business and for themselves. And it is the workers within these businesses that are the generally the most loyal and satisfied.

To this end, I encourage all employers to open up with their staff about how the business is going; be forthright about the contribution each worker is making to the business; and actively discuss why the business can or cannot afford to implement certain things such as pay rises, training opportunities, leave requests, bonuses and other incentives.

Flexibility is a two-way street, but neither party is likely to give ground if they feel it won’t be returned when needed.

Ultimately, we are all humans, and we all appreciate a sense of belonging. Working with, rather than against, one another can only lead to better outcomes for all.

Analysis: Employer/employee divide constraining growth
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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