SWAPPING EMPLOYMENT RIGHTS FOR EQUITY - A GOOD WAY OF CHANGING MANAGEMENT STRUCTURES?



We will all need to broaden and democratise our management structures - but not at the expense of our employment rights

The need to incentivise employees is critical, now more than ever before, so it was interesting to see George Osbourne's proposals for employees to swap some of their employment rights for an equity share in the organisation they work for. Is this a good idea? Would the former worker end up being sacked but at least retaining some shares in the organisation he used to work for? This needs to be properly considered and thought through.

There will not be much scope to have future pay awards in the public sector and elsewhere but an option to share in the future benefits of an organisation on a risk basis needs to be examined. Such an approach would act as an incentive for employees to try harder and think more deeply about the way they wish their particular organisation to move forward and how they might be able to contribute to that progress. One would only sacrifice a set of rights if one had a good chance of obtaining greater future rights to compensate for the rights one has sacrificed or else it would not be worthwhile.

 

Spreading ownership of an organisation amongst the team of co-workers would have greater incentive effects to generate more wealth and spread that between these new owners of the organisation. Perhaps co-operation is the way forward for groups of individuals who wish to work together to generate a common approach. The year 2012 has been designated the international year of co-operation and the following points are given by Co-operatives UK as the key advantages of co-operation;

 

Allowing communities and groups to take responsibility for their own needs.Advantages are created by allowing groups with a common interest or aspiration to work together.

 

Trusted values and principles. Every co-operative benefits from a commitment to international Co-operative Values and Principles, the blueprint for a successful co-operative that has existed for over 150 years.

 

A commitment to ethics, community and governance means that co-operatives are trusted to provide sensitive services to vulnerable people.

 

Creating value for business and members. Co-operatives create value for their members. When co-operation is the priority, it enables provision for the best possible services for members and allows the advantages of co-operation to shine through.

 

Increased commitment and drive from the members of the workforce are priceless and in a world of restrained resources the move to increase the stake of workers in their organisation is a good way forward in ensuring that organisations can progress and that staff will feel and care for the organisation and its future. Existing organisations are not always in favour of moving in such a radical direction because they are frightened to abandon the top down status quo.There is always a fear of doing something but there is less of a fear of doing nothing. Doing nothing is just as dangerous as doing something -- Doing nothing and not responding to a radically changing environment can be doubly dangerous. Evidently, one must do the "right" thing and move in the right direction.

 

Greater levels of democratisation in the management of services especially those in the public and not for profit sectors will need to be addressed because with the lack of future resources this democratisation will be the only real incentive for the workforce to produce service outputs that will delight service users.

 

New management models will be developed,but please Mr Osbourne, not at the expense of our employment rights