Improving Employer-Employee
Relationships: A Biblical and
Talmudic Perspective on
Human Resource Management
Gordon Cohn, Ph.D. and
Hershey H. Friedman, Ph.D.

Improving Employer-Employee Relationships:
A Biblical and Talmudic Perspective
on Human Resource Management

by

Most organizations realize that principled human resource management (HRM) is good business practice and pays in the long run. To be ethical requires treating others -- employees as well as customers -- properly and fairly. A company that is interested in growth and profits must establish relationships with employees based on trust. Improvement of the employer-employee relationship is important to both parties for several reasons. First, employee productivity increases when employers treat their employees with more respect. Second, employees may find that increased ethical behavior on their part actually results in higher compensation. For example, many companies are involved in relationship marketing, which is the process of creating and maintaining long-term relationships with customers. Relationship marketing, which can help a company increase its profits, requires the cooperation of employees. Employees who perform their jobs conscientiously and diligently are frequently rewarded with higher wages.

Noreen (1988) uses agency theory to explain how everyone’s utility can be maximized by good ethics in areas such as HRM. Agency theory suggests that dysfunctional behavior can be controlled through designing a system of rewards and punishments. However, this solution is problematic in situations where activities and their outcomes are not observable. Noreen claims that the optimal solution to this predicament occurs when the participants can be trusted to adhere to a set of ethical codes. This principle applies in the well-known Prisoner’s Dilemma game which is presented in Table 1.

Table 1

Player 1 Actions

The highest overall payoffs (ten for each player) occur in situations in which players can all rely on each other to choose the mutually beneficial solution (C1C2). According to Noreen, given enough trials, players eventually arrive at the C1C2 solution. In his view, however, ethical HRM can lead to a beneficial solution much more quickly than learning by attempted exploitation, i.e., each player trying to achieve the payoff of 15 even though it results in a payoff of -10 for the other player. He notes that one of the challenges of the organizational designer is developing systems that can help organizational members quickly achieve optimal solutions. Cultivating a veneration for principled HRM could assist in such endeavors.

The Bible is replete with precepts that deal with business ethics and can therefore be used as a starting point for those interested in developing moral standards for employer-employee relationships. This paper will describe principles that can be derived from the Bible and serve as a guide to HRM. The allegories and philosophy contained in the Bible provide insights which transcend religious denomination. Even in our pluralistically directed culture, those who seek moral direction can find it from exposure to the positions of the ancient and modern sages (Reich, 1971; Marcuse ,1967; Gouldner, 1975). Furthermore the fact that many modern social sciences have sources in centuries old religious discourses offers evidence of the traditional doctrine’s usefulness. Weber, Maslow, Freud, and Jung are a few examples of modern thinkers who utilize religious concepts

This paper draws from the Hebrew Bible (specifically the Pentateuch), Talmud, and Midrash as sources of knowledge regarding workplace attitudes. The Bible is replete with precepts that deal with business ethics. It is an appropriate source for gaining insights into this subject. The Talmud, which is the compilation of Jewish oral law, explains the meaning behind the verses in the Bible. The Talmud consists of the Mishna and Gemara. The Mishna, originally an ancient oral tradition, was compiled and redacted about 1800 years ago. The Gemara, consisting of commentaries and discussions of the Mishna, was put into written form about 1500 years ago. There were academies in Israel and Babylon independently studying the Mishna. Thus, there are two versions of the Talmud: the Jerusalem Talmud, a product of the academies in Israel, and the Babylonian Talmud, a product of the academies in Babylon. The Babylonian Talmud is considerably larger than that of the Jerusalem Talmud, and it is more authoritative. The Midrash, a separate scripture, recorded the views of the Talmudic sages and is essentially devoted to the exposition of Biblical verses. Thus, Jewish law is based ultimately on the Hebrew Bible by way of Talmudic exegesis (these laws were codified by scholars such as Maimonides and Rabbi Joseph Karo) and thousands of responsa (legal decisions handed down by Jewish authorities).

Although the Bible was written at a time when individuals mainly lived in an agricultural society, many of its ideas can be easily extended to HRM in a modern industrial workplace. Furthermore, it serves as a basis for societal laws and norms. Moreover, welfare capitalism, the idea that corporations should protect workers from the abuses of industrialization, was partially motivated by religious beliefs (Jacoby, 1997, pp. 13-14). A significant number of firms were influenced by welfare capitalism: Jacoby (1997, p. 13) notes that: "By 1914, the National Civic Foundation counted twenty-five hundred firms pursuing a gamut of welfare activities, from cafeterias, gardens, and profit-sharing plans to company housing, magazines, and athletic facilities." Of course, self-interest also played a role in welfare capitalism: Companies were trying to weaken trade unions and quiet the public clamor against the concentration of so much wealth in the hands of the few. The importance of religion, however, should not be minimized.

It is well known that employees have more opportunity than non-employees to steal from their employers without being detected. Continual scrutiny of insiders’ activities is usually not practical. Video cameras cannot observe employee activities with the same thoroughness that they examine customers. Furthermore, it is easy for employees to rationalize the theft of small supplies such as pens, computer disks, notebooks, etc.

The Bible makes clear in various places that stealing is prohibited (e.g., Exodus 20:13; Leviticus 19:11) . Few employees would rationalize that stealing office equipment is acceptable behavior. What about small office supplies? The Talmud discusses whether the theft of an object worth less than one perutah (the copper coin of the smallest denomination in Talmudic times, roughly equivalent to one penny) constitutes theft (Babylonian Talmud, Sanhedrin 57a). The strict opinion, that this constitutes theft, would prohibit employees from even taking one paper clip or one sheet of paper. The Midrash (Midrash Rabbah 31:5) claims that one major sin of the antediluvian generation involved stealing objects worth less than one perutah. An individual would come to town with a basket of lupines for sale and everyone would come and steal only one lupine (worth less than a perutah) so that the merchant had no possibility of restitution through the legal system.

The Bible does allow one type of worker to partake of an employer’s product. The Bible gives a field worker the right to eat of the produce with which he works. The Bible states (Deuteronomy 23:26-27): "When you come [as a worker] into your neighbor’s vineyard, you may eat as many grapes as is your desire, to your fill, but you may not put any into a receptacle. When you come into your neighbor’s standing corn, you may pluck ears with your hand, but you should not lift a sickle on your neighbor’s standing corn." These laws ensure that a field worker has a right to eat a small amount of the crop he or she is working on while harvesting. These laws, however, also protect the field owner from a rapacious worker who will take too much. The Bible does not allow the worker to place any of the produce into a receptacle. The Talmud makes clear that the phrase "to satisfy your hunger" limits the worker from gorging himself, even without placing any of the food into a container (Babylonian Talmud, Bava Metzia 87b).

The reason for this law is obvious. Most agricultural workers were very poor and it would have been very cruel to prohibit them from eating, say, a few grapes while picking grapes. The Bible is also fair to the employer and does not give laborers carte blanche and allow them to bring home a sack of their employer’s grapes. An ethical employer, especially one in the food business, should allow workers to take a reasonable amount of food for themselves or provide employees with a subsidized cafeteria. According to the Talmud, other types of employees are definitely not allowed to take anything, no matter how small, belonging to their employers.

The Talmud tells the story of the son of Rabbi Yochanan b. Mattia who once hired workers and agreed to supply them with food, without specifying the quantity or type of food. When his father heard about this, he said: "My son, even if you would prepare for them a banquet as majestic as those of Solomon in his grandeur, you would not fulfill your undertaking, for, after all, they are the children of Abraham, Isaac, and Jacob" (Babylonian Talmud, Bava Metzia 83a).

All employers should have the attitude that their employees are special and must be treated well. This, of course, fits in very nicely with the whole concept of welfare capitalism. There is also a very practical reason for treating employees well. Jacoby (1997, p. 264) indicates that "there is plenty of evidence that the practices associated with modern welfare capitalism -- such as employment stability, profit sharing, single-status personnel policies, and employee involvement -- are positively related to corporate performance."

The Bible places ethical obligations on employees. An employee is obligated to work to the best of his or her ability and not malinger. Not providing an honest day’s work is also a type of theft and would fall under the Biblical prohibition against stealing. Homiletically, one sees this principle in the following Bible passages.

Jacob arrived in Haran, after running away from his brother Esau, and noticed some shepherds idling around the well. He remarked to the shepherds (Genesis 29:7): "Look, the day is still long; it is not yet time to bring in the cattle. Water the sheep and go on grazing." Normally, a stranger does not question the work habits of others. This can be very dangerous. Apparently, Jacob was surprised that these shepherds appeared not to be doing an honest day’s work. Many years later, Jacob described the kind of work he had done for Laban. Jacob told Rachel and Leah (Genesis 31:6): "You know that I have served your father with all my strength." Jacob also described to Laban the kind of work he did for him (Genesis 31: 38-41): "These twenty years that I have been with you, your ewes and your she-goats have not miscarried their young, and I have not eaten the rams of your flocks. That which was torn of beasts I did not bring to you; I bore the loss of it... In the day, scorching heat consumed me, and the frost by night, and my sleep fled from my eyes."

Evidently, Jacob worked to the best of his abilities for Laban even though he was deceived by him when he substituted Leah for Rachel. An employee should work as hard as possible and do an honest day’s work.

The Talmud (Babylonian Talmud, Taanith 23a) discusses the importance of employees faithfully performing their duties. A story is told of a committee of distinguished sages that went to Abba Chelkiya, an individual known for his righteousness, to ask him to pray for rain during a serious drought. Abba Chelkiya was extremely poor and was being paid for hoeing a field. He was so scrupulous about not wasting time that he ignored and did not even return the greetings of the committee. He later explained that he did not wish to waste time that was not his own. Abba could have easily rationalized that his employer would not know and would certainly not care if he took off a few minutes to talk to the committee of sages. From this story one can deduce that an employee has a responsibility to avoid personal phone calls and conversations while working.

The Talmud had great respect for honest work. Laborers were exempted from the Biblical obligation of standing up for elderly individuals and scholars while working (Babylonian Talmud, Kiddushin 33a). The following law, discussed in the Talmud (Babylonian Talmud, Berachos 16a), further demonstrates the importance of not wasting time that belongs to one’s employer. Laborers may recite various prayers while on top of a tree or on the top of a scaffolding. The worker was not permitted to climb down the tree since it would waste time that belonged to the employer. The employer, on the other hand, was obligated to climb down the tree in order to recite the prayers with more feeling. One is obligated to perform religious obligations at one’s own expense, not at the expense of the employer.

The Talmud does not state explicitly how to motivate employees, but Jewish law is based on the Talmud. Rabbi Joseph Karo (1488 - 1575), one of the codifiers of Jewish law, wrote the Shulchan Aruch, the authoritative code of law for observant Jewry. In it, he explicitly states (Shulchan Aruch, Choshen Mishpat 337: 19-20) that employees must work to the best of their abilities and should not waste time. They are not permitted to afflict themselves, starve themselves, or moonlight on a second job if this will affect their performance.

The Bible also places ethical duties on employers. McGregor (1957) claimed that employers could have more success with their employees if they treated them humanely rather than mechanically. He claimed that workers’ antagonism, militant unionism, and various forms of sabotage were the result of management mistreatment. Hackman and Lawler (1971) developed the idea that workers perform better when they work on a whole task and when they see themselves as doing something meaningful. Adams (1961; 1965) claims that performance was higher when employees felt that they were being fairly compensated for their efforts.

The Bible requires that employers even treat slaves humanely. The Bible (Leviticus 25:43) states regarding a freeman sold into slavery: "You shall not rule over him through rigorous labor." Furthermore, his family has to be provided for (Leviticus 25:41), and his master is not permitted to make him perform debasing tasks (Leviticus 25:39). Although, strictly speaking, these laws apply to a slave, logic dictates that they should also apply to any employee. Employees, as noted above, are obligated to work to the best of their abilities and not waste time. This does not give employers the right to abuse workers. Righteous employers make sure that their employees are not overworked or asked to perform degrading tasks. Indeed, Wagschal (1990, p. 37) stresses the importance the Bible places on treating employees well. He asks: "Is an employee worse than a slave?"

The Midrash (Sifra, Leviticus 25:39) provides examples of demeaning work which is not permitted. In Biblical times, slaves often followed their masters with a chair. They also carried their master’s clothing to the bath house. These types of tasks are considered humiliating and thus one is forbidden to order his servant to perform these jobs. The Talmudic interpretation (Babylonian Talmud, Kiddushin 22a) of the verse (Deuteronomy 15:16), "because he fares well with you" is that the servant must have the same living standard as the master. In the words of the Talmud: "He must be equal to you in food and drink. You should not eat refined bread and he eat coarse bread, you drink old wine and he drink new wine, you sleep on a mattress and he on straw." The Talmud concludes that one who procures a servant acquires a master for himself! The welfare capitalists who set up cafeterias for employees are abiding by the spirit of this law. This is especially true if there is one cafeteria for both management and labor. The egalitarianism implicit in modern human resource practices may be said to have roots in ancient Judaic law.

A worker observing his boss maintaining a standard of living much higher than his own will harbor feelings of resentment. His productivity may even fall. Presumably, many management-labor conflicts have been caused by workers noting the unbelievably huge disparity between the salaries of management and labor. One can argue that the Talmud would disapprove of the widening disparities in salary due to executive compensation practices in recent years.

It is also arguable that modern theories about work redesign have Talmudic roots. Hackman and Lawler (1971) proposed that work should be purposeful and have a beginning and end. The Rabbinical interpretation of the above-cited verse in Leviticus (Sifra, Leviticus 25:43) is that a master should not assign his slave work that is not purposeful. For example, the master is not permitted to tell his servant to heat up a cup when he does not need it or ask the servant to hoe the vineyard until he returns. Work has to be finite and the master is only permitted to assign work until a specific time or hoe until a particular place. Providing meaningless work or vague and unspecific job requirements takes away a job’s meaning and is therefore not allowed. Clearly, the Bible considers it inappropriate to give an employee work that does not have a degree of intrinsic satisfaction. Such an approach is similar to Hackman and Lawler’s suggestion.

Tamari (1996, pp. 87-91) makes it clear that treating employees well is an integral part of Jewish law. The Bible states over and over that one should not mistreat the orphan, widow, or stranger. Tamari makes the point that "employees stand in relationship to their superiors in exactly the same social and psychological status as the widow and orphan." The Bible motivates individuals and employers by making it clear that those who mistreat the helpless will be punished by God (Exodus 22: 20-23; Isaiah 1:23-25; Proverbs 22: 22-23) and those who help them will be blessed by God (Deuteronomy 15: 7-11; Isaiah 1:17-19; Proverbs 19:17). The Talmud adds that the reward for honesty in business dealings is wealth (Babylonian Talmud, Niddah 70b).

The Bible states (Leviticus 19:13): "You shall not oppress your fellow and you shall not rob; the wages of a worker shall not remain with you overnight until morning." This is the law that an employer must pay employees on time. Withholding payment due workers is a violation of Biblical law. The Talmud (Babylonian Talmud, Bava Metzia 111b) extends this law to all kinds of payments owed including various types of rental fees. Firms that are late in paying their landlords or suppliers have also violated this law. Many organizations violate the spirit of this law by not completing a new contract with their employees when the old contract expires or by terminating or reducing employee benefits such as health insurance, pension, etc. The importance of paying workers can be seen from the following episode related in the Talmud.

Some porters hired by Rabba b. Huna were negligent and broke his cask of wine. Not only did Rabba not get restitution, but Rab required that Rabba pay the workers. Rab felt that since the porters were quite poor, one must sometimes go beyond the strict letter of the law. Rab, somewhat cryptically, quoted a passage from Proverbs (2:20) to demonstrate that an ethical person sometimes must do that which may not be necessary on purely legal grounds. The verse in Proverbs states: "That you may go in the way of the good and keep the ways of the righteous" (Babylonian Talmud, Bava Metzia 83a).

In our own time, Aaron Feuerstein, President of Malden Mills, displayed an unusually high level of ethics after his textile company burnt down. Feuerstein could have taken the insurance money and not rebuild his company. Not only did he choose to rebuild, primarily in order to save the jobs of 3,000 employees, but he paid his idled workers for 90 days and took care of their health-care benefits for 180 days. The total cost of his generosity was about $10,000,000. Apparently, Mr. Feuerstein chose to "keep the ways of the righteous."

The Bible requires the master to give his or her slave a severance gift known as hanakah. The Bible states (Deuteronomy 15:13-14): "Do not send him away empty-handed. You shall give him a severance gift from your flocks, from your threshing floor, and from your wine cellar ..." An ethical employer should realize that if the Bible demands that a slave be given a severance bonus after six years of labor, it is certainly appropriate for employers to reward loyal workers who have been with a firm for numerous years.

The negotiations between Ephron and Abraham over the Cave of Machpelah (Genesis 23) provides interesting insights into proper and improper ways to negotiate. Abraham’s wife, Sarah, had died and Abraham needed a place to bury her. Abraham was desperate for a burial plot. Ephron, knowing this, realized that he could overcharge Abraham and probably still get his asking price. Ephron, however, was also interested in posturing before his countrymen and looking generous. He said to Abraham (Genesis 23:11): "No, my lord, listen to me! I have already given the field to you, and as for the cave that is in it, I have given it to you; in the sight of my countrymen, I have given it to you. Bury your dead." Abraham certainly had the opportunity of saying to Ephron: "Thank you very much for this nice gift." However, Abraham probably suspected that Ephron was only offering the land because his countrymen were watching and was not sincere in his offer. Abraham replied: "If only you would listen to me! I am giving you the money for the field..." Ephron said: "My lord, hear me! Land worth four hundred silver shekels, between me and you what is it? Bury your dead." Ephron still pretending that he wanted to give away the land slyly mentions its value. Abraham understood what Ephron really wanted and ended up paying him the grossly outrageous sum of 400 silver shekels (Jeremiah paid 17 shekels for property that was better, and probably larger, than the Cave of Machpelah).

The Bible could simply have stated that Abraham paid Ephron 400 silver shekels for the Cave of Machpelah and left it at that. One reason this chapter is in the Bible is possibly to teach us the proper way to negotiate. Abraham did not want to take advantage of Ephron, knowing very well that Ephron was simply posturing. Abraham desired to pay a fair price. Ephron’s behavior, on the other hand, was reprehensible. Knowing that he had the upper hand, since Abraham had a spouse to bury, he proceeded to ask for an outrageous sum. From Ephron’s conduct, the Talmud derives the principle that: "wicked people promise much and do not even do a little (Babylonian Talmud, Bava Metzia 87a)."

Negotiations are quite common in business. In particular, there are employer-employee and buyer-seller negotiations. The story of Abraham and Ephron demonstrates the importance of being straight. Ephron comes across as a sleazy character because he promises much and then ends up overcharging for his property. Ephron was more concerned with grandstanding than in being honest and straightforward. "Hard bargaining" is something that is not encouraged in Jewish law, being upright and forthright is.

The Talmud (Babylonian Talmud, Bava Metzia 75b - 78a) provides many rules about hiring laborers. For instance, an employer cannot coerce employees to start working earlier than the norm or to stay later than the norm (Babylonian Talmud, Bava Metzia 83a). In general, Jewish law makes it easier for workers to retract from a verbal agreement to do a job than employers. The reason given for this is because workers cannot be treated like slaves (Shulchan Aruch, Choshen Mishpat, 333: 1-3). Thus, the Talmud does not support employment at will.

Even when the courts cannot do anything to protect the rights of workers, there is moral suasion based on divine authority. Thus, the Talmud discusses the case in which an employer authorizes the foreman to hire workers for four zuz per day. The foreman went and hired the workers at a rate of three zuz per day. Jewish law cannot do anything for the workers since they agreed to the lower wage, however, the workers have a right to "harbor resentment" against the foreman (Babylonian Talmud, Bava Metzia 76a-76b); this is another way of saying that the foreman has acted in a very reprehensible manner. The Talmud notes that the workers can criticize the foreman for not abiding by the verse (Proverbs 3: 27): "Do not withhold good from the one who needs it." The Talmud thus supports "principled negotiation" (Fisher and Ury, 1983) and frowns on hard bargaining. Principled people have to do what is morally correct, not only what is legal. This is why the Talmud offers regulations for those who desire to follow the "way of the righteous." Moreover, one unique aspect of Jewish law is that every individual is expected not only to abide by the strict letter of the law but also to go beyond it (Friedman, 1985; Kirschenbaum, 1991). The Talmud notes that Jerusalem was destroyed (by the Romans) as a divine punishment for judging strictly according to the law and not going beyond the boundary of the law (Babylonian Talmud, Bava Metzia 30b).

Ethics in HRM is Bible ethics and should be observed as scrupulously as other laws of the Bible. Historically, the Talmudic sages considered business ethics so important that they stated that the first question an individual is asked in the next world at the final judgment is "Were you honest in your business dealings?" (Babylonian Talmud, Shabbos 31a).

When both management and labor are primarily concerned with their own self-interest, it is likely that both will be delayed in reaching the optimal solution that maximizes social welfare. However, when both subscribe to a mutually held higher value system, they can more quickly reach a mutually maximizing payoff. The philosophy of the Bible is an example of such a system.

A simple rule of business ethics can be derived from Hillel’s philosophy (Babylonian Talmud, Avot 1:14): "If I am not for myself, who will be for me? And if I only care for myself, what am I?" An organization must achieve its goals (e.g., profit) but must also care for others, especially its employees. Whether or not entrepreneurs wish to see themselves as welfare capitalists is less important than understanding that employers have a Biblical obligation to help those that are weak. This is especially true for at-will workers who have no unions to protect them. Taking advantage of helpless employees is as reprehensible as taking advantage of widows, orphans, and strangers. This is a two-way street. Strong labor unions should not take advantage of weak firms. Employees with tenure should not slack off and find ways to minimize their productivity.

It is no accident that the Hebrew word for work, avodah, is the same as the word for divine service/worship. Both employers and employees have to treat honesty in the workplace as seriously as divine service in the Temple. The Avodah Institute (http://www.avodahinstitute.com) is a Christian organization whose primary purpose is to "help leaders integrate the claims of their faith with the demands of their work." The importance of God in the workplace has grown so much that Fortune Magazine (July 9, 2001) dedicated a cover headline to "God and Business: The Surprising Quest for Spiritual renewal in the American Workplace."

Gunther (2001) claims that "the core principles of spirituality -- the belief that all individuals have dignity, that we are all interconnected, and that a transcendent being or force defines purpose in human affairs -- dovetail with contemporary management thinking about what drives great companies. These companies employ the whole person; they don’t buy a worker’s labor for eight hours a day."

Hillel’s version of the golden rule, "What is hateful to you, do not do to others" (Babylonian Talmud, Shabbos 31a), could easily be applied to organizations: Employees must treat employers fairly and employers must treat their employees equitably.

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