Importance of maintaining a sound employer-employee relationship

Friday, 4 February 2011 00:01 -     - {{hitsCtrl.values.hits}}

By Tharanga Thilakasiri

Maintaining a sound employer-employee relationship is essential for the ultimate success of any organisation considering the prevailing highly complex business context in today’s business world.

No doubt, if there is a sound relationship existing between these two parties, there will be good working conditions and a good working environment in any organisation. That means happy workers, who will make your customers happy too.

Hence, it has become an important task of managers attached to various organisations irrespective of their business to maintain and improve the sound relationship between these two parties with a view to derive excellent results for the organisation. Thus, the intention of this article is to discuss some of these benefits and the importance of the above topic briefly.

Definitions for employer and employee

At the outset, I thought it would be best to define both ‘employer’ and ‘employee’ before we move forward. Hence, I would like to quote two definitions extracted from the Oxford Advanced Learner’s Dictionary of Current English and from a reputed web site,, for a wider understanding of the same.  According to the dictionary, the meaning of ‘employer’ is a person or a company that employs people, while an ‘employee’ is a person who works for a company in return for wages. However, the web site has described the above two terms in wider detail.According to the website, employer means the legal entity that controls and directs a servant or worker under an express or implied contract of employment and pays (or is obligated to pay) him or her salary or wages in compensation.

The very same web site has defined ‘employee’ as an individual who works part time or fulltime under a contract of employment, whether oral or written, express or implied, and has recognised rights and duties and is also called worker.

Importance of a sound relationship

So, the question before us is why a sound relationship between employer and employees is vital. Hence, in order to understand the importance of the above, I would like to quote an interesting proclamation by Andrew Carnegie (Scottish-American industrialist, businessman, entrepreneur and a major philanthropist), which I feel is appropriate to describe the importance of employees in an organisation: “Take away my people, but leave my factories, and soon grass will grow on the factory floors. Take away my factories, but leave my people, and soon we will have a new and better factory.”

The above statement clearly emphasises how employers should think of their employees. Accordingly, employers should have trust in their employees and most importantly they should be able to convince the employees of this. Here, the proper communication system between these two parties is vital; employers should especially always promote two-way communication for mutual benefits.

Hence, managers of any organisation (be it a profit-oriented organisation or a non-profit oriented organisation) have to understand the importance of their human capital as a prime resource and should treat them accordingly.  However, it is quite unfortunate that many mangers/decision makers have not understood the importance of their human capital; they just want their work to be done somehow. But such improper processes will not last for long as employees will react soon and such reactions may have an adverse effect on the progress and reputation or goodwill of the organisation. Therefore, such a trade union act could cause numerous problems for the management and the organisation in many ways.

I also find the following proclamation of Edwin J. Thomas (the former Chairman and CEO of Goodyear Tire & Rubber Co.,) contains very vital thoughts on employer-employee relations. It emphasises the importance of a proper communication system between employers and employees in an organisation: “A well-informed employee is the best salesperson a company can ever have.”

As mentioned earlier, if an employer treats his employees well, they will certainly tend to treat the employer in the same manner because they tend to think that they are also a part of the business (sense of belonging). Nevertheless, creating such an environment in an organisation is not an easy task. This may take years but it has been proved that the benefits are enormous.

Good cooperation between employers and employees is essential. If such cooperation does not exist in an organisation, it will not be able to realise its goals and expected targets.

It is also important to understand what the duties of both employers and employees are. Some of them can be given as follows:

Duties of an employer

  • Pay the employee the agreed amount of salary/wage
  • Protect and respect employee rights
  • Protect the health and safety of employees by respecting health & safety regulations
  • Provide your employees correct and accurate information
  • Provide a reasonable opportunity to have their grievances looked at
  • Provide them ample opportunities to develop their career paths

Duties of an employee

  • Employees must respect their employer
  • They should cooperate with their employer
  • Work/render your service for what you are paid for

A Buddhist perspective

I find that there are many things we can learn from the various teachings preached by Lord Buddha and especially find that the ‘Singalovada Suttra’ has more relevant facts regarding how the relationship between an employer and employee should be.

According to this Suttra, Lord Buddha has clearly explained how an employer should treat his employees and vice-versa. As per the Suttra, employers should treat employees in the following manner:

  • By assigning them work according to their strengths
  • By supplying them with food and wages
  • By tending them in sickness
  • By sharing with them extraordinary delicacies
  • By relieving them at times

Similarly, employees too should treat their masters accordingly and they can perform their duties in the following manner:

  • They should rise before him
  • They should go to sleep after him
  • They should take only what is given
  • They should perform their duties satisfactorily
  • They should spread his good name and fame

Some of the above teachings of the Lord Buddha can be applied to an organisation even today. Most importantly, these duties/obligations of both parties were discussed by Lord Buddha almost 2,500 years ago. However, they are still relevant and can be followed easily even in this modern word. Therefore, we should not hesitate to learn from such teachings and practice such activities for mutual benefits.

 Improving the employer-employee relationship

It is always important to improve and strengthen the sound relationship between employers and employees. By doing so, companies can derive a number of benefits, such as:

  • By motivating employees in a proper manner, it will certainly improve their efficiency in work; hence the company’s productivity will increase.
  • Improve or encourage two-way communication, this will enable the company to reduce internal conflicts and disputes, hence improve harmony amongst staff members.
  • Encourage teamwork always so that the organisation’s efficiency and productivity will improve.

Benefits of proper employer-employee relationship

There are a number of benefits that an organisation can enjoy as a result of the improved relationship between employers and employees and some of them can be listed as follows:

  • Improving motivation amongst employees
  • Improving efficiency amongst employees and hence finally at organisation level as well
  • Increasing productivity of both employees and finally organisation wise too
  • Improving teamwork
  • Strengthening harmony between employer and employees
  • Increasing the sense of belonging amongst employees
  • Increasing loyalty of employees
  • Reducing absenteeism amongst


  • Lesser attrition
  • Improving commitment
  • Lesser internal conflicts and disputes
  • Improving understanding between employer and employees
  • Increasing job satisfaction amongst employees


In conclusion, it is understood that maintaining a proper and sound employer-employee relationship will enable organisations to derive a number of benefits and such a sound relationship finally enables the organisation to prosper in many ways.

Thus, society too will benefit as a result of such positive moves by organisations as they are a part of society as well.

Therefore, organisations should focus more on improving and enhancing their relationship with staff members for the ultimate benefit of the organisation and in order to realise organisational goals and targets.

(Tharanga Thilakasiri M.B.A (International), AIMM, AIM (SL), ACPM, can be reached via [email protected].)