Low Wage to South African Workers

This paper discusses the impact of low wage on South African workers and organisations. It highlights the detrimental effects of low wage on employee morale, performance, and health, and how it ultimately affects the productivity and revenue generation of multinational companies. The paper suggests that paying legitimate compensation and adopting employee-centric policies can boost motivation and productivity.

Running head: LOW WAGE TO SOUTH AFRICAN WORKERS
Low Wage to South African Workers
Name of the Student:
Name of the University:
Author Note:

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LOW WAGE TO SOUTH AFRICAN WORKERS
Introduction:
The human resource policies have great implications on the employees and the
organisations altogether (Bamberger, Meshoulam and Biron 2014). The paper would deal it one
such failed HR policy which inflicted damage to the manpower in South Africa. The
multinational companies operating in the country exploit their South African employees by
paying less compensation compared to employees in the other overseas subsidiaries. The
researcher would point that failure in HR policies to benefit the employees does not only hit the
latter but also proves fatal for the organisations in the long run.
Discussion:
The multinational companies undoubtedly create employment opportunities in South
Africa but practice an HR policy which is antagonistic to the welfare of the South African
workers. The policy of paying low wages to the South African employees is one of the most
devastating and unjust human resources policies the multinational companies follow while
utilizing the human resource of the country (oecdobserver.org 2018). De Vito et al. (2018)
mentions that this low wage have several detrimental impacts on the employees. First, low wages
have negative effects on the morale of the employees and ultimately eats into their performances.
Secondly, the outcome of these two effects (low performance and motivation) results in conflict
between management and employees. An analysis of the situation would show that this renders
the entire human resource policies ineffective. The business organization aim to align their
human resources with the organizational goals and pay them legitimate salaries. These
companies officially profess high degree of organizational culture. However, this practice of
payment of low salary to their South African employees compared to their foreign counterpart
actually jeopardizes the entire organizational image and culture.

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LOW WAGE TO SOUTH AFRICAN WORKERS
The practice of payment of low wages was detrimental to the staff and ultimately to the
business organizations though at first the latter seemed to profit above the former. The
multinational companies paid low wages to the South African employees and saved a large
portion of the expenses in the short run. There have been reports of protests by worker union
leaders and thousands of workers against the national minimum wages which is reflected by the
low wages the MNCs pay to these workers (reuters.com 2018). It can be pointed out that these
protests hampered productivity in the firm, thus preventing smooth revenue generation.
Moreover, Kobersy et al. (2016), point out that low wages result in low standard of lifestyle
among employees which leads to poor health. This leads to absenteeism among employees due
to ill health which once hampers productivity in the multinational organizations. Thus, it can be
summed up that though payment of wages hampers both employees and organizations.
Relevant literature:
One can point out that the multinational companies exploited the economic backwardness
of South Africa and its human resources intentionally. This is evident because these companies
paid more wages to their employees located in Asia, Europe and North America (De Vito et al.
2018). These companies in fact maintained subsidiaries in these bigger markets which are public
limited companies and thus raise their own capital to pay their employees with high
compensations. The human resource departments of the multinational business organization
should adopt comprehensive and dependable methods to form more employee centric culture in
the South African branches. The need for an employee centric organizational culture is becoming
more necessary in order to ensure that the employees are aligned to the core business of the
organization which would ultimately profit the organizations in the long run (Bamberger,
Meshoulam and Biron 2014). Thus, payment of high salary would ultimately profit the

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LOW WAGE TO SOUTH AFRICAN WORKERS
companies by motivating their employees. The business organizations can also provide the
employees with better working conditions along with high salary to boost their motivation. The
business organizations as an alternative to their exploitative low wage policies in South Africa,
pay more salary legitimately to ultimately boost their own productivity (reuters.com 2018). The
multinational companies should also establish a strong communication with the stakeholders like
directors and gain their support in increasing the salary of the South African employees (Gill and
Meyer 2011).
Conclusion:
It can be concluded from the discussion exploitation of employees by multinational
companies may profit them in the short run but ultimately hit their productivity and revenue
generation. They must train their employees in order to boost their skills and improve their
productivity. They should also pay legitimate compensation to these employees at par with the
overseas counterparts.

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LOW WAGE TO SOUTH AFRICAN WORKERS
References:
Armstrong, M. and Taylor, S., (2014). Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Bamberger, P.A., Meshoulam, I. and Biron, M., (2014). Human resource strategy: Formulation,
implementation, and impact. Routledge.
De Vito, L., Brown, A., Bannister, B., Cianci, M. and Mujtaba, B.G., (2018). Employee
motivation based on the hierarchy of needs, expectancy and the two-factor theories applied with
higher education employees. IJAMEE.
Gill, C. and Meyer, D., (2011). The role and impact of HRM policy. International Journal of
Organizational Analysis, 19(1), pp.5-28.
Kobersy, I.S., Khasiyeva, L.G., Yakhina, V.D., Ignatyeva, O.V., Goloshchapova, L.V.,
Shkurkin, D.V. and Sadykova, L.R., (2016). Approaches to implementation of motivation as the
complex conditions of increase of efficiency of social and labor relations: International
experience. International Review of Management and Marketing, 6(1S), pp.208-217.
Oecdobserver.org. (2018). Do multinationals promote better pay and working conditions? -
OECD Observer. [online] Available at:
http://oecdobserver.org/news/archivestory.php/aid/2767/Do_multinationals_promote_better_pay
_and_working_conditions_.html [Accessed 20 Jul. 2018].
U.S. (2018). South African unions protest over minimum wage in test for Ramaphosa. [online]
Available at: https://www.reuters.com/article/us-safrica-protests/south-african-unions-protest-
over-minimum-wage-in-test-for-ramaphosa-idUSKBN1HW1D0 [Accessed 20 Jul. 2018].