Morale Building at Work - Economic Security – A Study by Artur Victoria
In this industrial age the worker, of necessity, is interested in security. He is dependent upon the actions of others.
The need of security
The worker, of necessity, is interested in security. He is dependent upon the actions of others. He cannot be sufficient unto himself as he might be under a simpler economic system. He feels the need of security in his job, security in times of accidents, sickness, and in old age, and security for his dependents. For a number of years certain progressive concerns have pioneered in working with their employees to improve their economic security. Such measures have a practical as well as a humanitarian aspect, for the man who feels secure and who is not harassed by financial worries is a better worker. Some employees of their own accord reach a certain degree of security through the purchase of insurance, through home ownership and savings accounts, but many workers are either not in a position to make such preparations or they do not make them unless the ways and means are made easy for them.
Programs designed to assure the security of employees' pension plans, profit-sharing, and the like need serious study and consideration both from the immediate and the long-range viewpoint. Plans once put into effect are difficult to discontinue because employees count upon the benefits afforded, yet the requirements of social legislation and the costs involved may upset former calculations and make certain plans impractical.
A year-round job at a fair and equitable wage means security. Short hours, high wages, a voice in the management all attract the worker, but the average worker would pass them all up for assured steady employment in a job which he likes and which pays a fair wage in general harmony with the wages paid in that community for similar work.
Annual wage plans
Certain unions and some industrialists have advocated guaranteed annual wage plans under which the employer guarantees all or a percentage of his employees employment for a given number of weeks of the year, usually forty or more, or some other form of guaranteed year-round work, or annual earnings, or both. The guaranteed annual wage in theory has much to recommend it, for irregularity of employment is costly to both the employer and the workers. The plan, therefore, should be given a fair and unbiased appraisal. If the industry is, say, in the consumer goods field where demand is likely to be steady, and workers can be given some definite measure of security in their jobs, labor relations should be improved by such means, and the productivity of the individual worker should be increased, for he knows then where he stands and he has freedom from the thought of layoffs and loss of the job. On the other hand, if the industry is one in which fluctuations in volume of production are great and production cannot be stabilized, then the plan may involve undue financial risks on the part of the employer.
Experience with guaranteed annual wages has been limited. In the past, some segments of labor have opposed guaranteed annual wages on the theory that it would call for rate reductions and that many workers would rather gamble on seasonal employment with the hourly rate maintained at a high level than on a guaranteed annual wage based on a lower rate. Today, however, certain unions that have gotten their hourly rate of pay up to the point where they are fairly well satisfied are now making the guaranteed annual wage one of their major objectives.
Business concerns that are considering or which feel that workers may desire the adoption of a guaranteed annual wage plan should realize that this step is not as easy as it may appear on the surface. It should be undertaken only after due consideration and a thorough study of company conditions, going back a long period of years and including wages, length of employment periods, peaks and valleys in production, etc. A company deciding to try such a plan could do it on a fairly conservative basis if first it devised methods for stabilizing its business operations, set up such stabilizing measures as appeared feasible, and tried them out for a sufficient period of time to assure the results were as expected. Then, in the light of results, it can inaugurate a guaranteed annual wage plan for those workers who enjoy a fairly steady employment. Finally, "as" and "if" experience is favorable and business conditions warrant, the plan could be expanded to cover other workers.
Some plans involve a stabilization of the labor force. Extra help and overtime at peak periods is avoided by better planning of work in advance. Selected permanent members of the labor force are taught skills, in addition to those used in their regular work, to permit work in other departments when their regular department is slack.