Charles Handy article on the necessity of a proper employee minimum wage and how workers should be treated as assets rather than financial liabilities. Handy begins the article explaining how Chrysler traditionally operated on a policy of work training that yielded easy preparation in exchange for a high turnover rate. When Chrysler hit hard and rough times because of, in part, poor productivity, low quality standards, and lack of morale, the company was able to improve its business practices and disowned its earlier operations. Handy uses the precedent of Chrysler to claim that a philosophy based on keeping costs of labor and training down is not sustainable over the long term. As Handy understands Chrysler’s example, by keeping costs low, there is no need to ensure that any worker adds very much, no point in spending much on training, and, thus, no need or way to enlarge or upgrade the job. Handy recommends raising minimum wages over the long term in order to increase morale and dedication of the workforce, even though, in the short term, it would result in fewer jobs. Handy then reflects on laborers in Jakarta and how the introduction of technology would negatively impact the number of workers employed in manual labor. However, Handy recognizes that imposing harsh work requirements onto laborers, without more training and better pay, would eventually put companies out of business in Jakarta. He therefore recommends a statutory minimum wage, set lower for the young, and the promise of increasingly higher wages for seniority, in order to bring about good employee and industrial relations. Adopting such policies would allow workers to effectively become assets.
Institute of Directors Handy, Charles B Chrysler automobile Jakarta (Indonesia) Minimum wage Industrial management Industrial productivity Industrial relations Employee loyalty Employee retention Employee selection Employees - Training of Employees Recruiting Employment (Economic theory) Organizational effectiveness Organizational change
Source
Charles Handy article on the necessity of a proper employee minimum wage and how workers should be trested as assets rather than financial liabilities, 1995; Charles Handy Papers; Box 20, Folder 9; 1 page
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