Impact of Employment Law and Corporate Governance on Business Operations

This report evaluates the impact of employment law on business operations and the responsibility of corporate governance. It covers various legislation under employment law and the benefits provided to employees. It also discusses the principles of corporate governance and its importance in achieving long-term success for a company.

FdSc in Business Management
BAM4011 INTRODUCTION TO BUSINESS LAW
Impact of employment law on business
and evaluation of the responsibility of
corporate governance on business
operations.
Semester 2
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Table of Contents
Semester 2 .........................................................................................................1
INTRODUCTION .........................................................................................................................3
TASK ...........................................................................................................................................3
Impact of employment law on business and evaluation of the responsibility of corporate
governance on business operations......................................................................................3
CONCLUSION..............................................................................................................................8
REFERENCES...............................................................................................................................9
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INTRODUCTION
The rights and duties of employees and employers are enforced under the contract
determined by Employment law. The employees are protected and safeguarded through the
contract of employment provided to employees during their employment. The workers of the
organization are protected and safeguarded under the Employment Rights Act 1996. There
are various rights provided to employees which includes paid leaves and holidays, maternal
leaves, rights of unfair and wrong dismissal and others. The ability to manage the company in
an effective and efficient manner by holding of company's integrity in order to accomplish
and gain competitive advantage over others. The manner in which a company can be
controlled and directed through processes, practices and rules relates to corporate governance
(Ali, Ismael, and Ahmed, 2020). A good corporate governance helps in ensuring legal
compliance and effective procedures in order to have stable and good relationship with
employees and shareholders. This report will cover the evaluation of corporate governance
responsibility and impact of employment law on operations of business.
TASK
Impact of employment law on business and evaluation of the responsibility of corporate
governance on business operations
Employment law is the legal obligation through which employees are protected
through a contract of employment. The interest and duties of employers are determined
through employment law. The relationship among the employers and employees is
determined under the implication of contract which helps in securing the rights and duties of
employees. There are various legislation covered under employment law through which the
legal obligations of employees are determined like the Equality Act, 2010 where there should
be equal treatment of every employee in the organization and also helps in preventing any
kind of discrimination in the organization. The Employment Relations Act, 1999 where there
is establishment of various rights for trade union recognition, nonrecognition and industrial
relations (Allam, 2018). The employees of the organization are provided minimum wages in
order to meet their financial needs under the National Minimum Wage Act, 1998. The wages
provided to employees are revised each year by the government in order to maintain the
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productivity of employees at work. There are various rights provided to employee under the
enforcement of employment law. These rights include the right to get sick leaves with
holidays and maternal leaves; right to equal payment through equal pay for equal work; rights
to fulfill the duties of completing the tasks on required time that are provided through the
employer; right to claim for unfair dismissal and redundancy after completing 2 years in an
organization. The employees of the organization are required to be treated equally
irrespective of caste, creed, color, religion, gender, etc. It is very necessary to maintain a safe
and healthy environment for the employees of the organization. The facility of neat and clean
environment with sanitized washrooms and clean areas helps in maintain a clean
environment.
There are three basic rights provided to employees in consideration of their health and safety
at workplace that includes Right to know where the employers affirms the safety of
employees by making them aware of all the hindrances or inconvenience that may be
provided through environment or people (Basuony, 2021). The employees are provided
training in order to be aware and be prepared for the upcoming danger or miss-happenings.
The employees are also provided Right to participate where they can identify or recognize the
risks before in order to maintain the operational functioning of the company. The Right to
deny unsafe work entails the meaning of protection of employees as if there is any kind of
danger or miss happenings, then an employee can refuse or deny to work. The main aim of
employment law is to maintain the code of conduct in an organization with protection and
safeguarding of their rights and duties through the contract of employment.
Impact of employment law on business is that it protects the rights of employees
through various legislation that may help in regulating the operational activities in an
organization. It is very essential to regulate the activities of business in an organization. The
regulation of rights and duties for the employees increases the costs of organization where a
huge sum of money is used for training, recruiting and paying the employees. The employees
are the asset of an organization and it is very necessary to satisfy the needs of employees in
an organization (Freedland, and Dhorajiwala, 2019). There are various facilities provided to
an employee which includes equipment for working, restroom facilities with availability of
clean water which are considered as basic facilities for working in any kind of workplace.
Businesses have to use additional costs for the welfare and well being of employees. The
employees must be provided a safe place to work in order to protect them against unreliable
activities of wrongful and unfair dismissal. It even prevents the employees from all kinds of
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discrimination in order to maintain equality at work. It also prevents the disputes among
employees in order to maintain a cordial relationship among employees and employers of the
organization. It mainly helps in protecting the employees against any discrimination in order
to protect their rights and duties. The employees of the organization are bound by the contract
of employment which in turn ensures their health and safety at work. Employment law sets
out various rules and regulations that are necessary to be followed in order to conduct
business in a legal manner (Haines, 2018). There are various legislation which affects the
operational functioning of business and that includes employment law, contract law and
consumer. Under Contract law, the parties are bound through an agreement that is
enforceable by law. It is required from parties in a contract to fulfill all the legal obligations
and duties in order to execute a contract. If any of the party does not follow the contract then
various kinds of charges can be imposed upon them such as compensating through penalty,
imposition of fines and completing of all terms and conditions mentioned in a contract. There
are mainly two kinds of contracts which includes valid and void contract. When there is
presence of all legal elements for commencing a contract then it refers to valid contract.
When there is absence of any kind of legal elements then it refers to void contract. The
consumer law allows a consumer to use the products and services in an appropriate manner.
If the consumer is not satisfied with the products or services then he can institute a suit
against the dealer or owner of any organization. An individual is bound by various legal
obligations in order to commence the activity of business in an organization. There are
various legal factors that affects a business where the operational activities of business are
affected. The factors of manufacturing of products with generation of revenue for profit are
affected through the legal obligation of business.
Corporate governance is the manner or way through which the companies are
directed and controlled. The owners of the company as Board of directors are mainly
responsible for managing and governing a company (Lansbury, and Bamber, 2020). The
members of an organization such as owners, directors and shareholders of the company are
responsible for controlling or managing the company. The main role of the shareholders is to
recruit the directors of the company in order to maintain a structural framework for the
conducting of operational functioning in an organization. The main aim of corporate
governance is to practice various activities that may help in growth and development of the
organization. These activities include enforcing of code of conduct among the employees,
following and respecting of human rights in a company, to maintain transparency in salaries
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or wages provided to the employees and to evaluate the carbon footprint of the company. It
is the principle through which the operational activities of business are conducted in an
appropriate and effective manner.
The main purpose of corporate governance is to maintain transparency in the activities of
business in order to conduct the business for a very long term (Morrison, 2019). The
management of the company should be so effective that it can help in achieving long term
success for the company. The activity of corporate governance involves creating of strategies
in order to be prepared for any inconvenient activities or miss-happenings so that risks can be
prevented beforehand for benefit of company. It also includes skills of effective leadership in
order to implement effective strategies through leadership. The management of organization
is also managed and controlled through corporate governance. The relationship among
employees and shareholders are also maintained and promoted through corporate governance.
It also involves reporting to the directors or shareholders in order to be updated about the
activities, rules and regulations of the organization.
Corporate governance is based on five principles that includes accountability, transparency,
independence, fairness and social responsibility. It is necessary to be responsible towards
each others actions in order to be accountable and answerable towards the conduct of
business activities. The principle of fairness also helps in maintaining a stable and fair
environment in the organization and it also allows the members of organization to raise their
issues in order to solve the disputes among parties in an efficient and effective manner. The
information about the policies and practices of company help in maintaining transparency in
the system of business of the company or organization (Ong, 2018). The members of
organization are able to make or take their decisions in an independent and effective manner.
There should be no pressure or personal interest in the order to maintain the factor of
independence in the company. The organization should also be aware of the issues that are
happening in the society in order to solve such issues in an effective manner with the
principle of social responsibility.
An evaluation of the responsibility of corporate governance on business operations
allows to accomplish a good corporate governance. There are various factors through which
corporate governance can be achieved that includes ensuring of independence of directors
and auditors in order to balance the composition of board members and to regulate the
activities of board in timely manner or regular basis. The act of transparency helps in
achieving confidence with the transparency of managing the account which in turn can help
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in maintaining financial stability in the company. The risks can be managed in an effective
manner and even beforehand by following the rule of corporate governance and can even
help in preventing any inconvenient activity in the company (Sharma, and Warkentin,
2019). A good corporate governance can help in achieving long term success and growth for
the company. There are various areas that are covered through corporate governance that
includes having awareness of the surrounding environment, constituting of strategies, conduct
of ethical behavior, managing of unnatural activities through risk management. These
responsibilities help in maintaining and ensuring a good corporate governance through which
long term success can be achieved for the company. There are different ways through which
corporate governance can be achieved which includes the process of recruitment through
interviews in order to analyze the conduct of duties in an appropriate manner, surveys can
help in gaining a record of the operational activities conducted in an organization. Research
can help in analyzing the activities of business happening in an organization in order to have
a clarity of the different functioning happening in a company. The members of the company
can also improve their work with the activity of group discussions, meetings and workshops
which can also help in improving the productivity of members of the company.
The evaluation of corporate governance is important as it help in controlling the activities of
business in the company in order to define the responsibilities of directors and shareholders.
It also helps in meeting the targets through control and direction of board of directors. The
upcoming risk can also be evaluated through the system of risk management. The
enforcement of corporate governance helps in increasing the values of shareholders and
stakeholders which in turn helps in increasing the performance of members of the
organization. The directors and officers of the company play a significant role in maintaining
of standards of the company. It also helps in establishing am effective system for benefit of
the organization in long run. The image of the company is also improved with the activity of
corporate governance. An effective corporate governance can help in improving the culture
of company which may help in creating a positive environment for the organization. This
may further help in enhancing the performance of employees with maintaining of a
sustainable environment for the growth and development of a company (Themistocleous,
2019). The practice of good corporate governance helps in increasing and enhancing the
accountability of every member of organization in order to prevent the risks or hindrances
which may occur in the future. It also helps in decreasing the cost of capital with
improvement in the process of decision making which further helps in increasing the internal
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functioning of the company. Overall, a good corporate governance acts to be beneficial for
the growth and development of a company.
CONCLUSION
From the above report it is concluded that, the employees of the organization are
protected and safeguarded under the enforcement of Employment Act. The employees of the
organization are provided various rights through which they are protected. There are various
benefits provided to the employees which includes paid leaves, holidays, maternal leaves
with rights of wrongful and unfair dismissal. There is a huge impact of employment law on
business as it increases the costs of their functioning with the process of recruitment, training
and payment for the employees. The rules, regulations and proceedings through which the
operational activities of the company are directed and controlled is known as corporate
governance. It is very necessary to involve corporate governance as it serves in the best
interest of a company. A good corporate governance helps in increasing the overall
performance of employees of the organization with the availability of new opportunities for
enhancing growth and development of the company.
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REFERENCES
Ali, M.A., Ismael, H.R. and Ahmed, A.H., 2020. Equity incentives, earnings management and
corporate governance: Empirical evidence using UK panel data. Corporate Ownership &
Control, 17(2), pp.104-123.
Allam, B.S., 2018. The impact of board characteristics and ownership identity on agency costs
and firm performance: UK evidence. Corporate Governance: The International Journal of
Business in Society.
Basuony, M.A., 2021. Corporate governance: Does it matter for corporate social responsibility
disclosure via website and social media by top listed UK companies. Corporate Ownership
& Control, 19(1), pp.84-93.
Freedland, M. and Dhorajiwala, H., 2019. UK response to new trade Union strategies for new
forms of employment. European Labour Law Journal, 10(3), pp.281-290.
Haines, A., 2018. UK considers closer links between employment and tax rules. International
Tax Review.
Lansbury, R.D. and Bamber, G.J. eds., 2020. International and comparative employment
relations: National regulation, global changes. Routledge.
Morrison, K., 2019. HR Theory and Employment Law. In Management for Scientists. Emerald
Publishing Limited.
Ong, A., 2018. Financial reporting and corporate governance: Bridging the divide. Journal of
Management Research, 18(1), pp.37-43.
Sharma, S. and Warkentin, M., 2019. Do I really belong?: Impact of employment status on
information security policy compliance. Computers & Security, 87, p.101397.
Themistocleous, C., 2019. Employment status in the UK: implications for business
owners. Journal of Aesthetic Nursing, 8(2), pp.92-94.
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