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There are multiple bases of power and the employment relationship embodies what is known as legitimate power.

Employment is a contract between the employer and the employee where the employee agrees to perform a specified work and the employer agrees to compensate the employee (i.e. money, stock options, and benefits).

In an ideal world the employee would live up to his responsibility to provide the service that he was contracted to provide. We do not live in an ideal world so the following happen:

  1. The employment contract is vague therefore the employee does not know what they are supposed to provide
  2. The employment contract is well defined but the employee does not understand what they are supposed to do
  3. The employee for whatever reason provides less than the minimum service required by the contract

When an employment contract is poorly specified or when an employee takes actions that exceed a well specified contract then the employer needs to invoke power to regulate this. When the contract is poorly specified they have the obligation to provide clarity on the contract and work with the employee to define all vague areas and make sure that both parties are still in agreement with the contract. When employees exceed well specified contracts then the employer needs to reign them in and establish why there is a misunderstanding of the contract.

A well defined employment contract will specify concreteand measurable targets that the employee must provide; an example is a union contract where productivity is very explicit.

When the employee fails to provide the required performance then the employee has breached their contract and the employer can seek remedy. This is where the employer has the right to regulate an employee but only where it concerns the employer.

For example, you may have an employee that is chronically showing up late on Monday morning because they party late on Sunday night. The employer can talk about being on time but the employer can't comment about how the employee spends their Sunday night.

Even though an employer clearly needs to be able to regulate their employees the real problem is that as humans we have biases and poor interaction skills. This makes it difficult for people to execute employer/employee relationships properly.

To make matters worse, no two people (ok, maybe identical twins :-) see the world the exact same way. So unless an employment contract is as explicit and measurable as a union contract (e.g. employee will work 40 hours a week and produce at least 100 widgets) then it is a guarantee that both the employer and the employee interpret the employment contract differently.

So in summary, employers have the right to use power regulate an employee only as far as it concerns the employment contract and does not break any laws at any point in the process.

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Q: What is the role of power in regulation of employment relationship?
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