Employee vs Employer: Difference and Comparison

Healthy communication between employees and employers makes a workplace very efficient and optimistic. Though there are several factors based on which an employee is different from an employee.

But, respect and friendliness should be from both sides as they are mutually dependent on each other for flourishing. 

Key Takeaways

  1. Employees provide services or perform tasks for a company, while employers hire and manage employees.
  2. Employees receive compensation in salaries or wages, whereas employers pay the salaries and provide benefits.
  3. Employees follow company policies and report to supervisors, while employers create policies and oversee the business.

Employee vs Employer

An employee is an individual who works for an organization or a person in exchange for wages, salary, or other compensation, working on a full-time or part-time basis, whose duties are defined by an employer. An employer is an individual or organization that hires and manages employees.

Employee vs Employer

An employee is offered a job, and along with that, he/she has to sign agreements (vary for every company) and abide by them. They are offered a fixed CTC that includes bonuses, healthcare facilities, travel allowances, etc.

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Test your knowledge about topics related to business

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Wages and taxes that a company pays are examples of:

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When an existing company offers its shares for sale to the existing shareholders, it is known as ___________.

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A Company is called an artificial person because _________.

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Economic activities are related to ___________.

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Whose liability is limited to the extent of value of business assets and his private assets?

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The method of evaluating the efficiency of workers is termed as _________.

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_________ is an important consideration for setting up an office.

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Modular furniture __________.

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Small scale firms are ____________ flexible in their functioning.

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An employee is expected to stay loyal to the company he/she is working for. 

An employer is a person who offers a job to an employee and lays out the terms and conditions for working in the company.

Employers also have the authority to fire an employee if he/she is underperforming or other unacceptable behavior. An employer must provide a healthy and safe work environment for the employees. 

Comparison Table

Parameters of ComparisonEmployeeEmployer
Job DescriptionAn employee is a person who works/offers services at an organization in return for a specific payment. An employer is a person who hires employees for an organization and offers them compensation (monetary and other benefits). 
GoalThe main goal is to work and build a strong professional portfolio and earn a good salary. The main goal is to steer up the employees for maximum productivity and efficiency and achieve the target before the deadline. 
AuthorityAn employee doesn’t have authority over the employer but can resign if they face difficulties. An employer has power over his/her employees and can give them a warning or fire them.
PaymentEmployees receive a fixed monetary compensation every month for their services. An employer is responsible for providing CTC to his/her employees which includes bonuses and other benefits. 
ResponsibilitiesThe main responsibility of an employee is to stay loyal to the company, work will full devotion, and abide by the rules. The main responsibility of an employer is to offer monetary compensations regularly, provide healthcare facilities, and a safe working environment. 
CommunicationEmployees should be vocal if they are facing any difficulties in the work environment. Employers should try to be friendly so that employees can reach out to them during any problem.
ControlAn employee only has control over the people who are at lower designations. An employer has control over all the employees. 

Who is an Employee?

 An employee is a person who is hired in an organization for a specific position. He/she has to go through the selection process (application, exam, interview, etc.) and then be offered the job.

An employee can do a part-time or full-time job, but those are clarified at the time of hiring. 

Employees get a specific monthly payment, and they are expected to stay loyal to the company and work diligently.

Based on work quality and productivity, an employee is promoted to higher positions, which means highly salary and more benefits. 

An employee should maintain a healthy relationship with his/her colleagues and boss as well. He/she should try to follow the order of the senior employee and, at the same time, speak up if feels manipulated.

Employee Responsibilities

Fulfillment of Tasks

As an employee, one of your primary responsibilities is to fulfill the tasks assigned to you by your employer. You should complete your work accurately, efficiently, and within the given deadlines. You’re expected to maintain a high level of productivity and contribute effectively to the overall goals and objectives of the organization.

To achieve this, be proactive in managing your workload by setting priorities, organizing your tasks, and staying focused on your objectives. Don’t hesitate to communicate with your superiors or colleagues if you encounter any challenges or difficulties in your work or need additional resources to complete tasks.

Moreover, it’s essential to stay updated with the latest trends and developments in your industry and continuously improve your skills, knowledge, and abilities to adapt to any changes in your professional environment and to perform to the best of your capabilities.

Adherence to Policies

Another crucial responsibility as an employee is to adhere to your employer’s policies, procedures, and regulations. This includes compliance with company rules, participation in mandatory training programs, and maintaining confidentiality of sensitive information.

Ensure you are aware of and familiar with your company’s policies, such as workplace safety, anti-discrimination, and data protection. You must follow these guidelines and abide by the company’s code of conduct, ensuring a healthy, safe, and respectful work environment for yourself and your colleagues.

In addition, adhering to policies also means showing up on time, dressing professionally, and exhibiting ethical behavior in all your dealings with coworkers, clients, and partners. Failing to comply with company policies and rules can lead to disciplinary actions, affecting your job performance and professional reputation.

Remember, as an employee, following through on your responsibilities is essential, always trying to achieve the best possible outcomes for you and your employer.

Employee Rights

As an employee, you must be aware of your rights in the workplace. These rights protect you from unfair treatment and ensure a more equitable working environment. This section will discuss two important aspects of employee rights: Privacy Rights and Right to Fair Pay.

Privacy Rights

Your privacy is important, and you have certain rights in this regard. These include:

  • The right to keep your personal information confidential, such as your home address, phone number, and social security number.
  • The right to know what personal information your employer collects, how it is stored, and who has access to it.
  • The right to be free from unlawful workplace surveillance, monitoring, or eavesdropping.

Remember that privacy rights may vary depending on your employer’s policies, the nature of your job, and applicable state and federal laws.

Right to Fair Pay

Earning a fair wage is one of your essential rights as an employee. This encompasses the following:

  • Equal pay for equal work: Your employer must provide equal pay to employees performing the same job, regardless of race, color, religion, sex, national origin, age, or disability status.
  • Minimum wage requirements: You can be paid at least the federal or state minimum wage, whichever is higher in your location.
  • Overtime pay: If you work more than 40 hours a week, you are generally entitled to overtime pay, at a rate of one and a half times your regular pay rate.
  • Paycheck deductions: Your employer cannot make unlawful deductions from your paycheck, such as for personal expenses incurred by the company.

Remember, your rights to fair pay may vary based on your employment status, industry, and the specific laws and regulations in your area.

Employee Benefits

As an employee, you are likely to receive various benefits from your employer. These can include health insurance, retirement plans, and paid time off. Some companies also offer additional perks such as wellness programs, discounts on products or services, and flexible working arrangements to improve work-life balance. Employee benefits serve several purposes, including attracting and retaining talented candidates, motivating team members, and encouraging engagement.

When evaluating a job offer, it’s essential to consider the entire compensation package, including both financial and non-financial benefits. Analyze how the offered benefits align with your professional and personal needs and weigh their significance against the stated salary or hourly wage.

employee

Who is an Employer?

 An employer is a person who hires employees in an organization for a specific position. He/she has to judge the applicants on various factors and hire people appropriate for the job.

An employer has to offer the employees a fixed salary or CTC that includes order benefits except for money. 

An employer has many functions.

They are stating the terms and conditions of employment for the employee, developing a healthy work culture and safe environment, setting targets for the employee and pushing them to maximum efficiency, etc. 

An employer has the authority to fire employees he/she thinks cannot do their job well or for other reasons. But at the same time, they should try and be easily approachable so employees can talk about their problems.

Employer Responsibilities

Provision of Salary

As an employer, one of your primary responsibilities is to provide your employees with an agreed-upon salary. This includes ensuring that you pay them regularly and on time and providing transparent information about tax deductions, benefit deductions, and any other relevant adjustments. Maintaining consistent communication with employees about payment terms and conditions helps build trust and foster a professional work environment.

Workplace Safety

Another essential responsibility of an employer is ensuring the safety and well-being of your employees within the workplace. This includes:

  • Conduct risk assessments to identify potential hazards and implement measures to minimize or eliminate risks for all employees.
  • Providing training to enhance employee knowledge of safety practices, emergency procedures, and the appropriate use of any required safety equipment.
  • Maintaining a clean and organized work environment reduces the likelihood of accidents, injuries, or illnesses.

By prioritizing workplace safety, you not only fulfil your legal obligations but also demonstrate commitment to the well-being of your employees, which ultimately leads to higher job satisfaction and productivity.

Employer Rights

Decision Making

As an employer, you can make decisions regarding your business operations. This includes hiring, firing, and promoting employees and setting work schedules and tasks. You are also responsible for establishing employee performance standards and evaluating their performance accordingly. Remember that these decisions must be made within the bounds of applicable labor laws and regulations to ensure fair treatment of your employees.

Setting Company Policy

Another important aspect of your rights as an employer involves setting company policies and procedures. You can establish rules and guidelines for your employees to follow in day-to-day operations. These policies may cover a range of topics, such as:

  • Workplace safety
  • Employee conduct and behaviour
  • Time off and leaves of absence
  • Employee benefits and compensation

When developing company policies, be aware of federal, state, and local regulations that may affect your business. Ensure your policies comply with these laws to protect employees’ rights and minimize potential legal disputes.

Remember to communicate your company policies clearly and consistently to your employees and provide training and support when necessary. Maintaining a professional and well-organized work environment benefits you and your employees, fostering a more productive and successful company.

Employer Tax Benefits

As an employer, offering a competitive benefits package helps you attract and retain skilled employees and provides you with valuable tax advantages. When providing employee benefits, many expenses are considered deductible for tax purposes. Examples of tax-deductible benefits include:

  • Health Insurance: Premiums the employer pays for group health plans can be deducted from taxable income.
  • Retirement Plans: Employer contributions to qualified retirement plans, like a 401(k) or a pension plan, are tax-deductible.
  • Education Assistance: Many educational assistance programs, such as tuition reimbursement or professional development opportunities, can be excluded from taxable income for employers.
employer 1

Main Differences Between Employee and Employer

  1.  An employee is a person who works/offers services at an organization in return for a specific payment. In contrast, an employer is a person who should hire an employee and pay monetary compensation for his/her services.
  2. The main goal of an employee is to work and build a strong professional portfolio and earn a good salary. In contrast, an employer focuses on steering up the employees for maximum productivity and efficiency and achieving the target before the deadline. 
  3. An employee doesn’t have authority over the employer but can resign if they face difficulties, whereas an employer has the authority to fire the company’s employees.
  4. Employees receive a fixed monthly monthly compensation for their services, whereas an employer offers CTC to the employees.
  5. The main responsibility of an employee is to stay loyal to the company, work with full devotion, and abide by the rules. On the other hand, the main responsibility of an employer is to offer monetary compensation regularly and provide healthcare facilities and a safe working environment. 
  6. Employees should be vocal if facing any difficulties in the work environment. At the same time, an employer should also be open to discussions and solve problems whenever the employees reach out to him/her.
  7. An employee only controls the people at lower designations, whereas an employer controls all the employees.

Legal Considerations

Labor Laws

As an employer, it is crucial to understand the labor laws that govern your relationship with employees. For example, under the Fair Labor Standards Act (FLSA), employees must be paid at least the federal minimum wage. Also, overtime pay must be provided for employees working more than 40 hours per week.

Some other key areas to consider in labor laws include:

  • Workplace safety and workers’ compensation
  • Ensuring compliance with anti-discrimination laws
  • Adhering to family and medical leave requirements
  • Proper classification of employees and independent contractors

By familiarizing yourself with these laws, you can effectively maintain a legally compliant work environment and minimize the risk of litigation.

Employment Contracts

Employment contracts are a key aspect of the employer-employee relationship. These contracts outline the rights, responsibilities, and expectations of both parties. They may include provisions detailing compensation, job duties, termination procedures, and more.

When drafting an employment contract, consider the following elements:

  • Job title and description: Clearly outline the employee’s role, duties, and performance expectations.
  • Salary and benefits: Specify the employee’s compensation, including salary, bonuses, and benefits such as health insurance, vacation days, and retirement plans.
  • Employment duration: Indicate whether the employment is permanent, temporary, or for a fixed term. Include probationary periods, if applicable.
  • Termination clauses: Detail the grounds for termination and any applicable notice periods.
  • Non-compete and confidentiality agreements: Include provisions to protect your company’s proprietary information and business interests.

By carefully crafting your employment contracts, you can promote your and your employees’ interests while clearly defining expectations and avoiding potential legal disputes.

Conflict Resolution

Workplace Disputes

It’s essential for you, as an employer or manager, to address and resolve employee conflicts as they arise. This includes understanding the nature of the conflict and familiarizing yourself with your company’s harassment and discrimination policies. If the conflict relates to these behaviors, you’ll know how to respond appropriately.

Begin by addressing the employees involved in the conflict separately and privately, informing them that their conflict affects the workplace. Encourage open communication and listen to both sides of the story. Focus on finding common ground and developing a mutually agreeable solution. This process could involve mediation or negotiation between the affected parties.

Obligations in Termination

In cases where employment termination is necessary, you must understand your obligations and follow the appropriate legal procedures. It’s important to have a valid reason for termination, which may include consistent poor performance, violation of company policies, or unethical behavior.

Before terminating an employee, ensure you have:

  • Provided written notice of the termination, documenting the reasons and any necessary warnings
  • Complied with any termination notice periods as outlined in your employment contracts or local labor laws
  • Calculated and provided the appropriate severance pay as required by your contracts or labor laws
  • Handled the termination professionally and respectfully

Adhering to these guidelines and treating conflicts with care can maintain a healthy work environment and avoid legal disputes. Remember, your role in conflict resolution is crucial to the success of your organization.

Difference Between Employee and Employer
References
  1. https://www.jstor.org/stable/1927237
  2. https://journals.sagepub.com/doi/abs/10.1177/009102609001900408

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