Business Ethics and Employee Rights in Islam

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People in our community often depend on verbal agreements when close friends or relatives are involved in business. But Islam has put a very strong emphasis on having written agreements and contracts, even when you are doing business with your own brother. 

In this era of deception and moral degradation, one must keep in mind that organizations and businesses cannot thrive without ethical values and some basic rules and regulations. For the same reason, Islam has stated certain rules upon employee and business rights which every Muslim must abide by.

Islam instructs us to respect the rights of our employees, and workers such as the boss have no superiority over his employees and is expected to deal with them fairly. 

No employee must be discriminated on the basis of his colour, race, caste, creed, or gender. Our workers are like our helpers. We need them; we rely on them for a lot of things we can’t do for ourselves. Hence, they must be treated on the basis of justice and equity. 

Employees should not have to work beyond their capabilities. They should have a  healthy and safe environment for work. They should also receive adequate compensation if they are injured at work. They should be given a proper work-life balance. Children and minors are not to be employed. Special emphasis should be given to women’s safety and comfort in the workplace. 

Additionally, women should have an appropriate environment without compromising their hijab and privacy rules. They should not be given tasks that are unsuitable to their gender, and they must be ensured maternity benefits and childcare facilities in their employment, etc. 

According to narrations, one day Imam Ali (a.s) went with one of his workers, Qambar, to the marketplace to buy a shirt for himself and the worker. Upon reaching the market, they realized that there was only enough money to purchase one expensive shirt and one cheaper shirt. 

Even though Imam Ali (a.s) was head of the Islamic State and had a high status, he insisted that his worker take the more expensive shirt while he takes the cheaper one. Imam Ali (a.s) responded by saying that his worker was younger than him and that better clothes were better for his worker than he himself who was much older. 

By doing so, Imam Ali (a.s.) has set a perfect example for us on how to treat our workers. 

Let’s have a quick glance at the employee rights and business ethics in Islam.

Fixed Wage

Generally, the employer and the employee must arrive at an agreement based on fairness and equity. The Holy Prophet (S) prohibits the use of the services of a worker before he is informed of his wage. 

To stress on this issue, Sulayman bin Ja’far says that one day he went with Imam Reza (a.s) to his place. When they reached the house, they saw the servants of the Imam busy in doing their work. The Imam noticed a stranger among his workers. 

Imam Reza (a.s) asked: “Who is this man with you?” 

The servants replied: “He is helping us in our work and at the end of the day we will give him something as wages for his work.”

Imam (a.s) asked: “Have you talked and agreed with him on his wages?” The servants answered in the negative. He then said:

“Know that even if you pay three times more than the average wages to someone who works for you without a prior agreement, he will still think that you have underpaid him. 

But if you have agreed about the salary, and then you pay him that salary, he will thank you for the fulfillment of your agreement; and if you add even a little upon it, he will recognize it as your generosity and know that you have  paid him more.”

Timely Payment of Wage

Islam also emphasizes paying the worker on time. 

Imam Sadiq (a.s) said: “You should pay his wages before the sweat of his forehead dries up.” 

According to the Holy Prophet (S), one of the unforgivable sins is the denial of your employee’s salary. The Holy Prophet (S) has also said:

“A man who wrongs a worker in his wage, Allah will annul his worship and prevent him from smelling the breeze of Paradise, which can be smelled from a distance of five hundred years.”

Honesty and Truthfulness in Work

A Muslim must be honest with his work and must always give his workers/coworkers their due credits. Muhammad bin Muslim reported from one of the Imams (a.s), that he was questioned about a man who accepts work and before doing any work, he passes it on to someone else and profits from it himself, to which he replied, ‘No, it is not allowed unless he does some work on it.’ 

Similarly, Muslims must be truthful in their dealings. They must not deceive their stakeholders in any way – whether it is in terms of selling poor quality or adulterated stuff to them, or in terms of charging very high prices for their products and services.

Agreements and Importance of Written Contracts

People in our community often depend on verbal agreements when close friends or relatives are involved in business. But Islam has put a very strong emphasis on having written agreements and contracts, even when you are doing business with your own brother. 

All agreements, whether oral or written, must be clear and transparent. The agreements must be just and lawful. Employees should be aware of their duties and responsibilities and they should be told their rights in terms of vacations, leaves, compensations, etc.

Rights of the Business Partner

Imam Zainul Abidin said that it is the right of your partner that you should: 

“Take his burden upon yourself if he is absent.

Work equally with him when he is present.

Do not decide anything without his consent.

Do not enforce your view without consulting him.

Protect his wealth for him.”


Islamic Business Ethics by Sayyid Muhammad Rizvi

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