Question 3 – Human Resource Management 2013 Exam

‘The objective of the employment relationship is to achieve a balance between efficiency, equity and voice’. Discuss.

Answer
Employment relationship also known as industrial relations or employment relations is a link between an employer and an employee. The International Labour Organistaion defines the employment relationship as “ a universal notion which creates a legal link between a person, called the ‘employee’ (frequently referred to as ‘the worker’ with another person, called the ‘employer’, to whom she or he provides labour or services under certain conditions in return for remunerations.” (ILO 2003:2) Another definition by the popular business website ‘Entrepreneur’ defines an employment relationship as “An agreement entered into between an employer and an employee at the time the employee is hired that outlines the exact nature of their business relationship, specifically what compensation the employee will receive in exchange for specific work performed.” The aim of human resource management is to ensure that through the employment relationship organisations should achieve competitive advantages

and employees on the other hand, should receive a fair treatment in the workplace. In this light, many human resource management writers like John Budd have agreed that balancing efficiency, equity and voice should be the focus of organistions in order to have a more productive workplace. Budd (2004) cited in Marchington and Wilkerson (2012:318) argues that the objective of the employment relationship is to achieve a balance between efficiency, equity and voice, and the extreme positions are both undesirable and unsustainable. Budd further suggested while employers are more interested in economic performance, economic performance has to be balance with equity and voice as meaningful input into decisions.