Efficiency, Equity, and Voice as the Objectives of the Employment Relationship
Through models of the employment relationship, one can understand how employment works in organizations, with individuals, and in society. However, in order to understand why (or to what purpose) employment works, one must look to objectives of the employment relationship. John W. Budd, who conceptualized the employment relationship in terms of four models, also introduces three objectives of the employment relationship in his book Employment with a Human Face, which is part of his larger project to highlight the ethical components of human resources management. It is valuable to look at these three objectives—efficiency, equity, and voice—in order to learn more about work and labor.
Efficiency is a core component of neoclassical economic thought; it is the effective use of scarce resources. In the case of efficiency, no one can be made better off without making someone else worse off in a zero – sum game. In order to create economic prosperity, efficiency in the workplace is an essential goal of organizations. The efficient use of scarce labor resources, in order words, is the goal of employment.
Equity is the setting of fair employment standards that respect human rights and dignity through the achievement of material outcomes. Equity is driven by the desire for laborers not to be subjected to problematic work conditions and to be protected against arbitrary policies. The equity objective is grounded in deontological ethical theories, such as the philosophy of Immanuel Kant, that urge moral agents to treat others as ends, not means. For equity to be achieved, people must be treated with inherent value, not as a kind of asset and their labor not as a kind of commodity.
Voice is the ability for employees to make meaningful input into decisions. Voice is grounded in the right to self-determination in the form of industrial democracy as well as the importance for autonomy to human dignity. Having voice signifies that employees have input in the decisions that affect their lives. Advocates of voice urge that it is a necessary objective of the employment relationship, equal in importance to efficiency and equity.
Voice, equity, and efficiency by themselves do not adequately express the complexities of the employment relationship. Budd offers this categorization scheme as a way of classifying moral theories along a triangular axis. From the Preface of his book The Ethics of Human Resources and Industrial Relations, Budd writes, “Since the field of human resources and industrial relations is ultimately about people and quality of life, there is a pressing need to develop applications of business ethics for the employment relationship in the context of research, practice, and teaching.” Budd’s project of highlighting the ethical components of human resources management benefits tremendously from this paradigm, allowing him to classify moral theories along the triangle of efficiency, equity, and voice.
For HR managers, it is important to figure out what moral system is being used in their organization. Is there a tendency to focus too much on efficiency, without giving individuals much autonomy or say in what is going on? On the other hand, is there a tendency to focus too much on catering to the needs and wants of employees at the expense of achieving outcomes? Every decision a HR manager makes is inevitably based in some value system that reflects his or her idea of what objective the employment relationship is trying to achieve. By changing one’s concept of the employment relationship and acting upon that moral philosophy, an HR manager can make a profound change in the culture and orientation of a business.