Employee Expectations (VCE SSCE Business Management): Revision Notes
Employee expectations
Introduction to employee expectations
Every employee has unique expectations from their workplace. These expectations differ because people have diverse cultural backgrounds, abilities, experiences, attitudes and learning styles. What motivates one employee may not motivate another.
For a reward or incentive to be effective, it must meet two criteria:
- It must be attainable (realistic to achieve)
- It must be worth attaining (valued by the employee)
Understanding these two criteria is fundamental to creating effective reward systems. An incentive that is too difficult to achieve will demotivate employees, while one that doesn't align with employee values will fail to inspire performance, regardless of how attainable it may be.
Modern employees value working for respected and successful businesses that offer opportunities for personal development and career advancement. They want to feel their work contributes not only to business profit but also has a positive impact on the broader community.
The modern workplace is viewed as a place of meaning where employees can gain respect, recognition and fulfilment, rather than just a location to complete tasks.
Conditions of employment
Conditions of employment are the specific remuneration or benefits that an employee receives from an employer in exchange for work.
Legal protection of employment conditions
Employees can expect their employment conditions to be contained in either:
- An industry award, or
- An enterprise agreement negotiated for their workplace
Both awards and enterprise agreements must be checked and verified by the Fair Work Commission (FWC). The National Employment Standards (NES) acts as a safety mechanism, ensuring minimum standards are maintained.
Employers cannot negotiate conditions below the NES minimum standards. This provides a crucial safety net for all employees, ensuring that basic protections are maintained regardless of individual agreements or industry-specific arrangements.
Employment contracts
The employment contract between the employee and employer outlines the nature of the employment relationship, specifying whether the position is:
- Permanent (full-time or part-time), or
- Casual
Role of the Fair Work Ombudsman
The Fair Work Ombudsman provides protection for workers who feel their employment conditions have not been met or that they have been treated unfairly by their employer.
Remuneration
Remuneration is the amount a person is paid for performing work tasks. It can take the form of cash and/or fringe benefits and may be referred to as a wage or salary.
Employees expect to receive fair remuneration in return for the work they perform. Remuneration can take several forms:
Wages
Wages are monetary rewards for labour, paid on a weekly basis and calculated by multiplying the hourly rate by the number of hours worked.
Key features:
- Calculated on an hourly basis
- Structured around a working week (typically 38 hours per week in Australia)
- Employees expect to receive overtime pay if hours exceed nominal hours, usually at 1.5 times the normal rate
- Additional penalty rates may apply for Sundays or public holidays
- Payment is typically made weekly
Worked Example: Calculating Weekly Wages
An employee works 42 hours in a week with an hourly rate of $25 per hour.
Step 1: Calculate standard hours pay
- Standard hours: 38 hours × $25 = $950
Step 2: Calculate overtime hours
- Overtime hours: 42 - 38 = 4 hours
- Overtime rate: $25 × 1.5 = $37.50 per hour
- Overtime pay: 4 hours × $37.50 = $150
Step 3: Calculate total weekly wage
- Total = $950 + $150 = $1,100
Salary
A salary is an agreed amount of money paid to employees for their labour during a year, expressed as an amount per annum.
Key features:
- An annual figure paid on a monthly or fortnightly basis
- Employees receiving a salary typically do not receive overtime payment
- Additional hours worked are often compensated with time off in lieu
Salary package
A salary package is the total value of an employee's remuneration, comprised of both cash and fringe benefits.
This form of remuneration is typically used for more senior positions. Employees would expect to receive:
- A base salary component
- Performance-based pay (bonuses)
- Additional superannuation entitlements
- Company car
- Share options
- Other fringe benefits
Salary packages allow businesses to attract and retain senior talent by offering a comprehensive compensation structure that goes beyond base pay. The flexibility to include various benefits can make packages more attractive while potentially offering tax advantages for both employer and employee.
Benefits
Benefits are financial rewards that are not paid directly in cash to an employee.
While employees may not necessarily expect additional benefits, they do value them when provided. Benefits can include:
- Care assistance programs (family care, paid parental leave)
- Alternative work arrangements
- Sick leave
- Holiday leave
Job security
Job security refers to the assurance that an employee has gainful employment for as long as they desire. It has become a significant concern for many Australian employees.
Impact of job security
The level of job security significantly impacts:
- Employee motivation levels
- Feelings of loyalty towards the business
- Commitment to the organisation
- Overall employee wellbeing
Changes in job security expectations
Historical perspective: In the past, employees believed securing a position with a large organisation (such as a bank, insurance company, large manufacturer, or government department) meant job security for their entire working lives. They were content to start in entry-level positions and progress up the hierarchy over time.
Modern reality: Changes in economic circumstances have meant this expectation can no longer be met. For example:
- Closure of automotive manufacturing companies in Australia
- Scaling back of the mining industry
The traditional expectation of lifetime employment with a single organisation has fundamentally shifted. Employees must now be prepared for multiple career transitions, making continuous skill development and adaptability essential attributes in the modern workforce.
These changes have resulted in significant job losses, with many workers struggling to find new employment in the same industry.
Employment transitions
Australian Bureau of Statistics (ABS) data indicates that many displaced workers have found alternative work through:
- Changing industries
- Updating their skills
- Using redundancy payouts to establish their own businesses
- Changing employment mode from permanent employee to contractor
Casual workforce and job insecurity
Approximately 2.3 million Australian workers are classified as casual employees. Key characteristics:
- No job security (can lose employment at the end of a shift)
- Receive a casual loading (typically 20-25% on top of hourly wage)
- Casual loading compensates for lack of paid leave entitlements
- No access to holiday leave or sick leave
Recent surveys indicate concerning trends about job security in Australia:
- 88% of Australians believe job security is a problem
- 27% are concerned about losing their job within the next 12 months
- Workers over 50 feel less confident about finding new employment compared to younger workers
These statistics highlight the widespread nature of job security concerns across the Australian workforce.
Impact of COVID-19
The COVID-19 pandemic in 2020 created major job security issues. Many businesses had to close or suspend operations due to restrictions, leading to widespread job losses and uncertainty about future employment.
Work-life balance
Work-life balance refers to the relationship between a person's work and the commitments in the rest of their life.
Employees are increasingly demanding greater flexibility from employers to accommodate family and other responsibilities.
Fair Work Commission recognition
The FWC recognises changing expectations for working parents responsible for child care. The Commission encourages employers to make arrangements to modify:
- Employee hours of work
- Pattern of work
- Location of work
These modifications allow employees to fulfil family responsibilities alongside work commitments.
Family-friendly work practices
Flexible work practices are conditions that allow employees to balance work and family responsibilities more effectively.
Businesses creating work-life balance may offer:
- Family and parental leave (paid or unpaid)
- Childcare facilities (subsidised, on-site or off-site)
- School holiday programs
- Flexible working hours
- Part-time work or job share arrangements
- Home-based work options (telecommuting)
Implementation considerations
When introducing flexible work practices, businesses should:
- Consult with employees about proposed changes
- Discuss arrangements with directly affected staff
- Ensure compliance with workplace agreements
- Manage digital connectivity carefully to prevent negative impacts
While flexible work practices offer significant benefits, they must be implemented thoughtfully. Poor management of flexible arrangements, particularly around digital connectivity expectations, can actually worsen work-life balance by creating an "always-on" culture where employees feel pressured to be constantly available.
Benefits to businesses
Implementing flexible work practices provides several advantages:
- Reduced recruitment costs through lower staff turnover
- Employee retention of valued workers who might otherwise leave
- Diversity and fairness promoted throughout the organisation
- Improved wellbeing and positive effects on employee health
- Enhanced staff morale leading to better workplace culture
- Increased productivity as employees are more focused when at work
Digital connectivity considerations
Cloud-based computer systems enable a digitally connected mobile workforce, supporting flexible work arrangements. However, borderless connectivity must be managed carefully as constant availability can negatively impact work-life balance if not properly controlled.
Exam guidance
When answering questions about employee expectations:
- Identify questions: Name specific expectations (remuneration, job security, work-life balance)
- Describe questions: Explain what the expectation means and provide characteristics
- Explain questions: Show why the expectation matters and its impact on employees and businesses
- Discuss questions: Present multiple perspectives, including benefits and challenges for both parties
Common command words you may encounter:
- Analyse: Break down employee expectations and examine their relationship to business performance
- Evaluate: Make judgements about the effectiveness of meeting employee expectations
- Assess: Determine the significance or importance of particular expectations
Key Points to Remember:
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Employee expectations vary significantly based on individual values, cultural backgrounds, experiences and attitudes—what motivates one employee may not motivate another.
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Legal protection exists through awards, enterprise agreements, and the National Employment Standards (NES), ensuring minimum employment conditions are maintained.
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Remuneration takes multiple forms: wages (hourly rate, paid weekly), salary (annual amount, paid monthly/fortnightly), salary packages (comprehensive benefits for senior roles), and additional benefits.
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Job security concerns are increasing in modern workplaces, particularly affecting casual workers (2.3 million in Australia) and those in changing industries, with significant impacts on motivation and loyalty.
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Work-life balance expectations are growing, with flexible work practices (flexible hours, remote work, job sharing) benefiting both employees (improved wellbeing) and businesses (reduced turnover, increased productivity).
Key terms:
- Conditions of employment: Specific remuneration or benefits received in exchange for work
- Remuneration: Payment for work (cash and/or fringe benefits)
- Work-life balance: Relationship between work and other life commitments
- Flexible work practices: Conditions enabling balance between work and family responsibilities
- Benefits: Non-cash financial rewards (leave entitlements, care programs)