The bare minimum: restoring the dignity of work through compensation policies

Human capital as a concept has made several improvements over the years – from employees being viewed as mere tools for the completion of work to being a valuable element within the organisation. This has been the change from the mindset of exploitation to one of collaboration. However, in recent times, this argument has crept back into the economy. While on the surface it appears that human capital is more valued and respected, a deeper analysis demonstrates that this is still an issue, in varying degrees. Many organisations will agree that employees are the backbone of the business and without them there is no business. However, this sentiment is not always expressed in terms of the compensation the workers receive. This is a common theme across various industries. There seems to be an imbalance between the value that employees bring to the organisation and the value they are compensated. This brings into light issues of unfairness and the ethical considerations surrounding a workforce that is subjected to these poor working conditions. Businesses operate on a give-and-take basis even with their employees. Therefore, if they cannot provide the suitable working conditions, then it is reasonable for employees to look elsewhere. However, sometimes it not as easy as this. Pinto and Scalzo (2024) investigated the concept of poverty salaries and minimum wage as elements in restoring the dignity of work.The dignity of work is something that is not often discussed or even considered when dealing with human relations. However, it does play a significant role in the ethics of work. Dignity in this regard is not just a matter of personal pride but rather survival as well. In many cases, employees cannot satisfy basic living standards with their compensation. There is an unfair exchange in this instance. The level of minimum wage is something that is still up for debate. Whether it is sufficient or not is usually in the eye of the beholder. The principles of fairness in compensation policies are dependent on factors that may not be as objective. The complexity of this makes it even more difficult to resolve. In many cases, any changes are always met with dissatisfaction from one party or the other. It is not as simple as salary increases, as these can have impacts on the business as a whole in other aspects. The reality of the matter is that these conditions may sometimes be beyond the capacity of the organisation to handle without negatively impacting a few or more individuals. However, this does not absolve organisations from the responsibility of still ensuring that working conditions are optimal for their workforce.It is in the best interest for the firm to ensure that employees are satisfied, and this may mean making decisions that are not directly beneficial. When employees are not satisfied, this is evident in their motivation levels, work ethic and even productivity. All these can contribute to poor business performance. So in some sense, it is a lose-lose situation. This is even more so when organisations have limited financial capacity to cater to the needs of the employees. This is how strategies such as restructuring and redundancies become necessary. In terms of fairness, it is difficult to take any one side as there are compelling reasons for the actions of each. Applying fairness principles in practice is more complicated than the theory suggests. Some organisations hide behind regulations to justify their actions. For example, those that offer the minimum wage solely to satisfy that criterion without considering the individual needs of the employee. In extreme cases, some firms can even abuse this by making employees carry out more work than their pay reflects. Several scenarios exist where employees are mistreated within the confines of the laws. This is not an organisation that many would want to work for; but sometimes many do not have a choice in the matter.Work is a major component of people’s lives, and therefore, it is only natural that it impacts the livelihood and quality of living for individuals, even beyond the pay factor. Dignity of work is ensuring employees are treated well and fairly for the effort they exert. Their individual contribution should be acknowledged, and organisations can do this in many ways. While financial compensation is a common element, it is not the only way that human capital can be acknowledged. Firms that rely solely on this still view employees as output mechanics that respond based on their inputs. However, employees are more complex than that. The responsibility is on the organisation to ensure that the working conditions they provide are suitable for their human capital. This will look difficult for each individual, so firms need to be proactive in addressing these needs. This can be the difference between a workforce that is satisfied and one that is not.This review is based on “How much (more) is fair to pay? The ethics of merit in assessing poverty wages in organizations” by Javier Pinto and Germán R. Scalzo, published in the International Journal of Ethics and Systems.