Reference no: EM132821975

Brief case: The difference in salary

Salleh Haron is an industrial engineer with Malfen Manufacturing Sdn Bhd. He has been working in Malfen since graduating with an industrial engineering degree from the United Kingdom six years ago and is now earning a monthly basic salary of RM3200.

Recently the company hired Rosli Hamid, another industrial engineer, to replace a person who had resigned two months ago. Salleh was introduced to Rosli, and asked to show him around. Salleh found out that Rosli had graduated from a local university with a mechanical engineering degree but had been working as in industrial engineer for about three years in a multi-national manufacturing company. In the course of their interactions, the question of salary was brought up. Rosli said, "I think the company has a rather low salary scale. When they interviewed me, they asked what salary I expected and I mentioned at least RM3500, but they only offered me RM3200. I thought of rejecting the offer but then I wanted to move from Penang to Shah Alam, so I took the job." Salleh did not say anything but was feeling rather upset at the company because here is a newcomer with just three years working experience earning exactly the same salary and Salleh had a real industrial engineering degree with six years experience.

The next day, Salleh confronted Rahim Ahmad, the human resource manager and asked him whether it was true that Rosli was getting the same salary as him and that it was not fair. Rahim said, "Actually you should know that salaries are confidential and you fellows had no business discussing salaries. But I won't lie to you, and so, yes, it is true that Rosli is getting the same salary as you. But you must understand, he was already earning nearly as mush in his former job and we only gave him a small increase, we did not give him what he asked for. Also, there are very few people with industrial engineering experience and we thought he was a good candidate."

Salleh then asked Rahim, "If that is the case, then I am underpaid, so would the company be adjusting my salary to reflect my six years of working experience?" "I am sorry, Salleh, but our company policy does not allow for ad hoc salary adjustments. You will have to wait until the next performance appraisal and I am sure the industrial engineering manager will recommend a big increment for you, so you just have to be patient," replied Rahim.

Questions

1. Explain whether Salleh is satisfied with the explanation given by Rahim. Justify your opinion.

2. Discuss whether the company should have adjusted Salleh's salary or not.

3. Explain whether action should be taken against both Salleh and Rosli for discussing salaries which are supposed to be confidential.