Equal pay for equal work newspaper critique


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Equal Pay for Equal Work

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Equal pay for equal work newspaper critique

  2. 2. 1.0INTRODUCTION Equal pay for equal work and equal pay for work of equal value is common sentences that keep pop-up among the workforce. It is sound easy right? Unfortunately, as a result of new challenge and technology it influences the payment decision that has been made. Government also plays prominent roles in setting the right regulation and policies to ensure the pay equity is match with the job position. Based on News Strait Time dated 30th April 2013, it stressed on the firm who put an interest to hire foreign employee, at first they must set the wage of local employee that currently employed at least RM2500. According to Hlongwane (2004), in his journal he defined clearly what is equal pay for equal work and equal pay for work of equal value as follow. The concept ‘equal pay for equal work’ is based on gender equity and it is implies that women and men who perform substantially similar work within the same job setting must receive similar wages. While, the concept ‘equal pay for work of equal value’ refers to if a woman is employed in a female working environment, her work has the same value as that of men working in a male environment. So here, issues of discrimination of payment should not be existed and why the government set at least RM2500 salary paid to the local employee before the firm can start hiring the foreign worker, why it is not set higher than RM2500? Matching job with pay is very important to differentiate the worth of the job. Generally, it can be determined by job evaluation. So, how much is the job worth? Employer might use a variety of technique such as through pay structure, ranks its value in the organization or assign number to the compensable factor such as education, skill, ability and knowledge. According to Weiler, comparable worth makes that employer pay a comparable wage for different job that are comparable in value or worth. So, job evaluation is important role in determining the wage paid by the employer to the employees. Hay is the developer of the Hay Job Evaluation System that most widely used by large corporations and he claim that job evaluation establishes the relative value of jobs based on their content, independent of a link to the market. So, the issues of minimum requirement for enable the firm in hiring the foreigner as their employees is because it is depend on the worth of the job and it is can be measured by job evaluation. As defined by Macgraw in his book, job evaluation is the process for linking job content and internal value with the external market. The aspect of job content for example like skills required and customer contacts and it take on value based on their relationship to market wages. This is because higher skill level will influence the wages paid and thus lead to differentiation among the job worth. Highly skilled worker may give the organization a value added instead of just focusing on the profit. Thus, based on the cited news in the News Strait Times, the government who set the rules to
  3. 3. the firm in hiring foreign worker is way to ensure the fairness toward the local employees. Then, to know the worth of the job it can be done through the job evaluation method. 2.0LITERATURE REVIEW In annual survey for hour and earning in Scotland College (2009), it is stated that there are three main factors causing the pay gap in term of gender which is Occupational or job segregation, lack of flexibility in working practices and pay structures that have a different impact on women and men. For example, include pay structures that allow employees to negotiate their starting salary. According to Ali (2011), consistency of pay towards the employees is an important and complex issue. It is for the purpose of satisfaction and as a factor of motivation to ensure that the employees have a better performance. Hence, the factor that contributes to the consistent pay is internal and external consistency. Ali (2011) defined internal consistency as a hierarchy of value among jobs and that pay is determined according to the worth of each. The rate of pay should be proportionate to the worth of the job as compared to the other job within the organization. It is because the pay structure is varying among the organizations. As defined in Mcgraw International Edition, pay structure refer to the array of pay rates for different work or skills within a single organization. Then, the structure is describe when there is existence of number of level, the differentials in pay between the level and also the criteria used to determine those differences that describe the structure. First factor that contribute to the wage consistency set by the government is internal consistency. It is also refer to the internal worth of the job. Although the position of job offer is similar but the determined relative value for a job in an organization is inconsistent with other organization or their competitors. Basically it is depend on the employer perceptions about the work performed by the employee. Although the government set the minimum requirement, the organization should first determined the job-related factor in which will be the base for the compensation level of the job. However, the job-related factor or known as compensable factor will differentiate between the job for highly skilled worker and low skilled worker. A job evaluation approach can be applied in order to determine the internal worth of the job for example through job ranking, classification and point method. Second, external consistency also affects the pay level decision in an organization. It exist in the external environment consist of labor market including the competitor, the level of unemployment and the opportunity to get a job (Ali, 2011). External consistency can be referred as to the external competitiveness. As defined by Milkovich, G.,
  4. 4. Newman, J., and Gerhart, B. (2011), external competitiveness refers to the pay relationships among organization or the pay relative to its competitors. In setting the pay level there is three strategies which is above, below and match with competitor. Although the government set new rules of hiring foreign worker, organization can used any of the strategies of pay as it follow the minimum requirement. As a result both internal and external consistency reflect the employee payment level through job evaluation but basically it concerned more on internally than external relationship between jobs. 3.0SUGGESTION There must be a reason why government proposed new rules of hiring foreign worker to the firm. So, the firm who want to build a good image of their organization, they should pay more than the going rate for the purpose of having a good reputation as a high paying company. Then, it will attract more local and foreign employees to work in the organization. Besides that, it is necessary to view the individual consistency before view it in a broad aspect. This is because this will greatly affect the employee motivation as they tend to compare their pay with the other co-worker within the organization. Thus, the organization should not ignore the pay equity and consistency in the organization. In order to ensure fairness toward the employees, the firm should firstly focusing more on the local employee before the foreign employees. Some firm may use foreign employees for the purpose of cutting their labor cost. Employing foreigner as their contingent employees will reduce the cost of hiring because the foreign employees get less benefit packages as they is not a citizen of the country. Some firm should not take the advantage of the opportunities because sometimes it will affect the local employees’ level of motivation and job satisfaction. This is a reason why employee tends to have an illegal industrial action.
  5. 5. 4.0CONCLUSION Wage payment is very important to all categories of workers. Their life, social and status is depend on the wage payment. Job evaluation is a systematic approach to measure the consistency of pay within the organization. Basically a lot of factor has been studied by scholar in determining the pay level but actually it is depend on the organization decision on how the will pay their employees. It is important to align with the government policies and regulation as it will greatly affect the employees’ welfare especially to locally employ. According to Brown (2001), he found that a sense of fair and consistent administration together with good internal relations is an important determinant of the perceived equity upon when the employee satisfaction resulted in pay that they received. Hence, the organization should provide all of the employees with equal monetary and monetary benefit and also a detailed of pay statement to ensure that the employees have an evidence once there is arising problem due to the employment. Lastly, the organization should ensure that the sources of fairness in pay including both procedural justice and distributive justice are existed within their organization.