Employees vs. Employers: Understanding the Key Differences

An employee works for an employer, while an employer hires employees. Employees are individuals hired by a business or organization to perform designated tasks. For example, you could work for companies like Target, Apple, or Netflix. In contrast, an employer is an entity that hires employees. The employee’s primary role is to execute the tasks given to them by the employer, while the employer is responsible for compensating the employee and ensuring a safe and respectful work environment.

• Employers are not the same as bosses. An employer refers to the company itself, while a boss is usually a manager employed by the company.
• For instance, you may work at Starbucks and report to your manager, Jess. Starbucks is your employer, while Jess is your boss.

An employee is someone hired by a company or an individual to perform specific tasks. Employees are contracted by an organization to carry out particular duties, in return for compensation. This contract defines the work the employee is expected to do and offers protection, including safeguards against discrimination and the right to a safe working environment.

• Employee contracts may be written or verbal. Some companies provide written documents outlining expectations, while others communicate them verbally.
• In some cases, employee agreements are implied, based on behavior and spoken terms that both parties agree to.
• Employees often receive additional benefits such as health insurance, paid time off, sick leave, and retirement plans.
• Compensation for employees is typically categorized as either nonexempt or exempt. Nonexempt employees are entitled to overtime pay for work beyond 40 hours per week, while exempt employees are not.

Employees can be hired on a permanent or temporary basis. Typically, when referring to employees, we mean permanent staff who enjoy full rights and benefits. These employees are responsible for carrying out their duties indefinitely, according to company guidelines. In contrast, temporary employees work for a specified period and are released once their contract ends.

• Employees may work either full-time or part-time. Generally, full-time employees have longer hours than part-time workers, but specific hours are decided by the company.
• Contract workers, while seemingly similar to employees, are different. Independent contractors are hired for specific outcomes, not tasks, and are not managed by the hiring company in terms of how they perform their work.

An employer is any individual or organization that hires someone to perform a job. Employers can be individuals, businesses, government agencies, educational institutions, or non-profit organizations. These employers form contracts with their employees, outlining duties and expectations. In return for the employee’s labor, the employer compensates them and may provide additional perks.

• For instance, if you run a business and hire others to work for you, you are considered the employer of your staff.
• Employers also hold the authority to terminate employees. Most employment relationships are 'at-will', meaning an employer can dismiss an employee at any time for any reason, as long as it's not discriminatory or otherwise illegal.
• Similarly, employees are at-will and can choose to quit their job at any time, for any reason, without facing repercussions.

Responsibilities The primary role of an employee is to execute the tasks they were hired to perform, in accordance with the employer's rules and guidelines. Meanwhile, the employer is responsible for ensuring that the work environment is safe, inclusive, and respectful. Employers must also compensate employees fairly and provide the necessary resources and training to help them succeed.

• For example, an employer might set an expectation that their employee starts work at 8 am and maintains confidentiality. If the employee fails to meet these standards, the employer may impose disciplinary actions.
• Employees are also responsible for their own safety and the safety of their colleagues. They must adhere to workplace safety policies and treat others with respect.
• Employees: If your employer fails to meet their obligations, contact your company’s Human Resources department. If that doesn’t resolve the issue, you may file a complaint with the U.S. Department of Labor or the Equal Employment Opportunity Commission.
• Employers: If an employee isn’t performing well, arrange a private meeting to discuss the issue. Address your concerns kindly and offer constructive feedback to help them improve.

Authority Employers hold authority over their employees. They determine the job responsibilities, pay, and the tasks employees perform daily, as well as how those tasks should be completed. While employees may hold positions of leadership, such as managers or department heads, they ultimately report to an employer who sets the overall direction and guidelines.

• Employees: If you aim to rise within your organization, demonstrate your commitment to your work by volunteering for new projects and offering to mentor new employees.
• Employers: A great employer creates a positive and approachable environment. Even if you're in charge, let your employees know you're open to feedback and willing to improve the workplace atmosphere.

Goals Employees often set personal goals that align with their job performance and responsibilities. These might include completing a specific project, improving performance to earn a raise, or obtaining a certification or license that qualifies them for a promotion. Employers, on the other hand, generally have broader objectives related to the success and growth of the company. Most employers aim to maximize profits and boost productivity, motivating their employees to be as effective and efficient as possible.

• Employers typically set goals to expand and grow their businesses, which includes hiring and training new staff.
• Employees: Set realistic goals that are actionable and attainable. For instance, if time management is a focus for you, aim to create to-do lists, prioritize key tasks, and focus on one task at a time.
• Employers: Gather feedback from your employees to help expand your business. Understand what’s working for them, ensuring they feel happy and valued at work. If there are issues, hold meetings to find solutions together.

Relationship The relationship between employers and employees is mutually dependent, with each relying on the other to achieve business goals. Employers depend on employees to complete their tasks and contribute to the success of the company, while employees rely on employers for compensation and job-related perks.

• When you're self-employed, you essentially become both the employer and the employee. If you're thinking of starting your own business, begin by writing a business plan that outlines your goals and services.
• Employees: Stay motivated by taking regular breaks throughout the day. Reward yourself with something special after completing significant tasks or projects.
• Employers: Keep your employees engaged by encouraging continuous learning and development. Provide clear training materials and offer workshops to help them sharpen their skills.

Income Employers compensate their employees using the revenue generated by their business operations. As employees receive their pay, the company’s profits decrease. However, employers plan ahead, knowing how much income they need to earn in order to pay their employees while maintaining profitability.

• Employees: If you believe you deserve a raise, ask for one. To make your case, research what other companies pay for your role and highlight the additional value you bring to the company.
• Employers: Recognize the efforts of your employees. Small gestures like complimenting an employee after a successful presentation or organizing monthly team lunches can boost morale and keep your team motivated.