Introduction: Theemployment relationship is the term used to describe the link between employersand employees in the formal workplace.
Historically, this relationship wasbased on the role and the influence of law which determined both the rights andthe responsibilities of both employer and employee. If one assumes this is allan employment relationship encompasses, the International Labour Organization’s(2003) definition of it being the ‘legal link between employer and employees’seems relatively straightforward and appropriate for the purpose of this essay. However, modern theories of human resourcemanagement such as collective bargaining have emerged, creating considerablechanges to the relationship that was once formally and primarily dependent onsolely legal regulations (Beardwell and Claydon, 2007). Nowadays, the employeerelationship incorporates all areas of human resource management that deal withemployees directly (Armstrong, 2003), those acting as second parties on theirbehalf (trade unions) and those providing a third party role, such as the stateagency. It is clear from this broad definition that the employment relationshipis one of great complexity, yet essential importance.
Employers tend to have alarge degree of control, and are able to influence employees through powers ofmotivation, reward and coercive persuasion (Tourish, 2009). However, nowadays,the balance of power between worker, employer and organisation have shifted dueto a change in demographic and technological change, as well as legislativedecisions that have increased or limited the role of different players in theemployment relationship (ACAS, 2011). Additionally, the role of third-partiessuch as the government, as well as Trade Unions, impact specific aspects of theemployment relationship. Within each employment relationship, there are termsand conditions that are set at the commencement of any role. This includes thewritten statement, including location, pay, working hours and holidayentitlement (ACAS, 2017) and the psychological contact, referring to mutualexpectations, beliefs and obligations (CIPD, 2017). This essay will begin bycritically analysing the extent to which employers control all aspects of theemployment relationship, looking at both a historical and modern outlook ofemployment.
It will then critically analyse the extent to which employers setthe terms and conditions of employment, ultimately concluding that due to achanging employment relationship, there has been a shift in power andauthority. Who controls the employmentrelationship? Thebelief that employers control all aspects of the employment relationship has along history, dated back to Karl Marx (Hogbin, 2006). His view has beeninfluential in consequent writings, concluding that the employment relationshipis based on an inequality of bargaining power between the competing interestsof labour, and capital (New Zealand Human Rights Commission, 2000). This is supportedby Sisson (2009), who states that the employment relationship involves theexercise of power, which is unequally distributed between employer and employee(Darligton, 2009,). Therefore, if one associates power with control, it is reasonableto conclude that employers maintain the control over employees in theemployment relationship as they have domination over a resource that is capableof being productive or transformative (Sisson, 2009). This idea is alsosupported by the Labour Process Theory (LPT), which holds a basic assumptionthat all kinds of paid work are marked by relationships of exploitation (Hold& Hvid, 2014).
This idea was introduced by Braverman (1974), who found thatexploitation was a basic necessity in a capitalist economy, leading toorganisation structures that control workers. This is due to the fact that eachorganisation has goals, and the process for achieving and coordinating outputto be able to achieve these goals must be organised, resulting in divisions ofaccountability, responsibility and labour (Bingham, 2016, p.30).
In traditionalworkplaces, it would be the employer who would hold this authority to managethe workforce who, in return for payment, consent to conform, thus enteringinto a relationship of subordination (Kahn-Fruend, 1972). However, despite Radicalismand Marxism stressing that this power is an inequality, control has long beenrecognised as an essential function of any organisation (Nair, 2010). As both afunction and ideology (Hatch, 1997), control is important for ensuringcompliance, cohesion and effectiveness among the workforce (Etzioni, 1961;Hatch, 1997). This is supported by the Unitariast perspective, which believethat it is a legitimate right for employers to hold authority through their managerialprerogatives. Therefore, in workplaces where employers hold this control andpower, they posses complete control over the aspects in the employmentrelationship. It couldbe argued that when employers control all aspects of the employmentrelationship, there is an existence of a power imbalance, specifically whenemployers use their power to act unethically towards employees. One of the mostprominent examples of this power misuse is gender discrimination.
This occurswhen employers consider an applicants sex as a factor when deciding whoreceives a job, promotion or employment benefit (Gary & Tan, 2006). Thisissue is often raised in current affairs, and can mostly be found in the wage gapbetween female and male employees. For example, a recent study found that anEasyjet female employee earns an average of 51.7% less than a male employee(Levine, 2018).
Gender discrimination is also often found in the technologyindustry, with a recent case being against Uber. In 2017, three femaleengineers that were employed by Uber in the United States, sued them on thegrounds that their performance evaluation mechanism, among others, is unfair towomen (Ang, 2017). They were also subject to a legal battle in the UK, after afemale driver issued sex discrimination proceedings after stating that theiroperations put women at risk (O’Connor, 2017).
Therefore, despite women, andother minority groups speaking out about the discrimination they face, itsexistence in the first place demonstrates the employer’s ability to controlspecific aspects of the employment. It is the employer who determines whichgender or race to employ and enter an employment relationship with and how totreat them. This also demonstrates how employers have the ability tounilaterally set the terms and conditions of employment, such as pay at theirown discretion. Despite evidence suggestingthat the employers hold a degree of power, it would be wrong to suggest that employeesare powerless (Bingham, 2016). Ultimately, the workplace relationship impliesthat the employer is dependent upon the services of the employee (Hyman, 1975),indicating that the relationship is interdependent. It goes without saying,that the employer has more power than the employee, but to state that thispower leads to complete control over all aspects of the employment relationshipis incorrect.
For example, theunitary perspective would suggest that both employers, and employees have equalcontrol over the aspects of the employment relationship. The perspective statesthat within each organisation, both management and other members of staffshould be integrated through a loyalty structure and common goal, emphasisingmutual cooperation (Naukrihub, 2007). Ultimately, the employment relationshipshould exist in perfect harmony, with conflict being unnecessary andexceptional (Salamon, 1992) and neither employer, nor employee should controlall aspects of the employment relationship, but rather the degree of control beequal. Organisationshave become increasingly dependent on the highly skilled workers within them,viewing them as assets that have arisen from the collective resources theygenerate (Rousseau and Shperling, 2003). This dependency tends to be moreprominent in organisations which are knowledge-based, or in competitiveenvironments where innovative thinking and practice is essential because of thescarce skills in tight labour markets (Hyman & Brough, 1975). This has ledto a power shift, granting these valuable employees with greater control overthe employment relationship (Leana & Rousseau, 2000). As the organisation relieson these individuals to succeed in the competitive market they run in,employees have greater ability able to determine, thus control aspects of theemployment relationship. Similarly, in the UK, as in other countries worldwide,the nature of employment has changed over the last decade.
There has been adecline in the share of traditional jobs coinciding with a rise inself-employment, zero-hours contract and flexible working practices (Mameritno,2017). For example, between 2008 and 2016, self-employment expanded by 15%(Office for National Statistics, 2016) and the UK had the largest increase inthe share of self-employed workers amount EU15 countries (Eurostat, 2016).Enabled by advances in technology, a number of new styles of companies havedeveloped, based on a ‘sharing economy’, which conduct their central businessthrough self-employed workers (Todol?´-Signes, 2017). Thischange in employment has led to a consequent transformation to the traditionalemployment relationship because the degree of control that a self-employedworker possesses is the key difference to an employed worker. An employee hasless control over their hours, job conditions and pay whereas a self-employedworker has more control over this aspect.
This has been suggested to erodecapitalism and the employment relationship that stemmed out of capitalism,because organisations have been forced to change their structures in line withthe modern day employee (Hodgson, 1999). This demonstrates a change in theemployment relationship, suggesting that in the modern relationship, theemployee has a greater level of control than the employer or business owner. Thereis a clear conflict between employee and employer needs and wants, and despiteeffort to work together in a symbiotic relationship, their opposing interestscan sometimes require the interference of external parties such as tradeunions. A trade union is ‘a group of employees who join together to maintainand improve their conditions of employment’ (Unison, 2017). Traditionally, theyhave acted as a force to ensure employers respond to the needs of theiremployees from basic concepts such as working conditions, to more contesteddebates such as wage (Bingham, 2016), with the overall aim of empoweringemployees.
Since a union comprises of a group of workers, it naturally has agreater voice than an individual employee trying to reason with their employer,providing them with a power known as collective bargaining (Williams, n.d.).Their impact on employee rights in specific industries such as education,public administration and defence and transport have been revolutionary andhave demonstrated that employers do not control all aspects of the employmentrelationship because trade union intervention can cause great change.
However,the concept of collective bargaining has reduced dramatically, corresponding withhow all unions in developed economies having lost membership in recent decades(ACAS, 2011). This decline has been caused by a variety of factors, including adecline in manufacturing jobs (The Economist, 2015), cuts to the public sectorworkforce (Topping, 2017) and labour market fragmentation (ACAS, 2011).Therefore, their ability to determine and control elements of the employment relationshiphas reduced. Nevertheless, their existence in society does prove that employerscannot control all aspects of the relationship and external forces can and willhave a significant influence when necessary.
Tradeunions are not the only third party that can influence the employmentrelationship. In fact, the government’s employment regulations that are imposedthrough employment laws can greatly contribute to the degree of control thatemployers have in the employment relationship. Despite the spread ofinternational business, it is the government of each specific nation-state thatcreates and passes laws that influence the relationship between employers,workers and unions (Dundon & Rollinson, 2011), with the aim of building afair workplace and environment (Williams and Smith, 2010).
One of the mostinfluential laws that was introduced was the Working Time Regulations (1998),which limits the number of hours an employee can work within one week. Prior toits implementation, a study found that employers paid little attention to theexisting regulations beyond minimal compliance, thus would exploit workers andforce them to work excessive hours (Neathy & Arrowsmith, 2001). All of therecent government legislations, including the National Minimum Wage (1998),Health and Safety at Work Act (1974) and the Equality Act (2006) have demonstratedtheir ability to impact the employment relationship through setting universalrights to protect employees (McKay, 2001). However, the government’s ability tohave a large influence on the employment relationship does not mean they havecomplete control over it. Despite effort to remove inequalities within theworkplace, many still exist, such as the aforementioned gender pay-gap. The gaphas reduced dramatically over the past decade, but it still exists, demonstratingan area in which the government have failed to prevent inequality and where theemployer has exhibited greater control over the employment relationship. The terms and conditions ofemployment:Theterms and conditions of employment relate to the elements of a contract thatdefine the employment relationship between an employer and employee (CIPD,2017).
These tend to be set in the written contract that determine conceptssuch as hours of work, pay and holiday allowance. Employers have the ability tounilaterally set these terms and conditions through their bargaining power overemployees. For example, if an employer chooses to decrease pay one year, theemployee cannot control this decision and would likely be dismissed if theychallenged it. Through this control in the employment relationship, the workeris in a much weaker position that the employer, thus the relationship could beconsidered to be unequal (Colling & Terry, 2010).
However, the extent towhich employers are able to unilaterally set these terms and conditions isquestionable as a result of economic, legal and social evolutions in theenvironment that have led to fundamental changes for organisations and theiremployees. Firstly, there are terms that will inevitably be impacted byexisting government legislation, such as wage, working hours and holidayallowance. Therefore, despite the employer making the final decision, the termswill be set with legislation in mind. Secondly, the individual bargaining powerof skilled employees in tight labour markets could allow them to possessgreater power to negotiate more desirable terms from employers (Williams andSmith, 2010).
Finally, the value of the psychological contract hasstrengthened, playing an important role in the contemporary employmentrelationship (Millward & Brewerton, 2000). According to Rousseau andWade-Benzoni (1994), the psychological contract refers to the beliefs that anemployee holds regarding the mutual expectations between them and theiremployer and the promised obligations. Despite it being the unwritten contract(Levinson, 1962), its impact on the employment relationship could be greaterthan the written contract because it has the ability to increase an employeessense of predictability, job security and control (Patrick, 2008). In addition,traditional employment contracts are becoming increasingly rare (Millward,2000) due to the introduction of a new workforce made up of subcontractors, self-employedworkers and part-time employees where the psychological contract has greaterimportance. Consequently, the modern employmentrelationship relies heavily on trust (Lowe, Schellenberg & Davidman, 1999),focusing greater strength on the psychological contract and weakening the valueof the written terms and conditions that the employer had set, suggestingemployers are unable to unilaterally set the terms and conditions ofemployment.
Conclusive Remarks:Thisessay began by attempting to define the employment relationship, concludingthat there is not one universally recognised definition because the concept isone of great complexity. Then, the essay explored ways in which the employercan control all aspects of the employment relationship, sometimes for thegreater good, to ensure control and organisational success, but sometimesthrough a power misuse of discrimination and illegitimate control. However,despite these argument suggesting that employers have the ability to controlthe employment relationship, Bingham (2016) raised crucial points to imply thatthe relationship is mutually dependent, proposing an equal degree of controlfor both employer and employee. Employer control is also limited by other influentialactors, such as trade unions and the government, who control aspects of theemployment relationship through forces such as collective government and directlegislation, preventing employers from acting unjustly towards their employees.Therefore, although it may appear that the employer has complete authority overthe employment relationship, the degree in which they exercise control isheavily determined by external intervention and the individual employee. Thusconcluding that employers do not have control over all aspects of the employmentrelationship. The second part of this essay aimed to identify whether employersare unilaterally able to set the terms and conditions of employment.
It foundthat despite their ability to determine features of the written contract, manyof these terms are influenced by existing government policy, such as wage,working hours and holiday allowance. Therefore, although it seems that theemployer has control, if the government decided to change elements ofemployment law, many of the terms and conditions in an existing employmentcontract would also change. This implies that the state sets and controls theterms and conditions of employment. Additionally, the psychological contractnow has a greater impact in the employment relationship, which is heavily influencedand set by the employee.
They have greater power to determine how to perform tothe mutual expectations created in the psychological contract, suggesting thatthey now have greater control over their employment and that employers areunable to unilaterally set the terms and conditions.