Pope Leo XIII wrote the encyclical Rerum Novarum as the industrial revolution and political change swept across Europe. The relationship between employers and employees was changing dramatically. Individuals had become wealthy, but most remained poor even though they worked hard. Pope Leo XIII's encyclical spoke of the condition of the working classes during a time when many advocated revolution.
The Church recognizes that the lack of workers union contributed to an unjust situation where many work in conditions little better than slavery. One solution proposed by socialists was to eliminate private property altogether. Pope Leo XIII dismisses this solution because "every man has by nature the right to possess property as his own." He also notes that "the impelling reason and motive of his work is to obtain property." Instead of helping the working class, the elimination of private property would only hurt those it was intended to benefit.
Private ownership "is not only lawful, but absolutely necessary." In addition, the right to property is essential in maintaining the structure of the family. A worker ought to be given the opportunity to live sparingly, save money, and invest his savings for the future.
People have become accustomed to working for their own needs. Working enables people to earn an honorable livelihood, but using employees as mere objects is wrong. Workers and the rich are dependent upon each other. The worker ought to complete the tasks that they freely agree to, never destroy an employer's property, never use violence for their cause, never take part in riots or disorder, and not associate with those who encourage them to act unethically. (As Pope John Paul II would later emphasize in Laborem Exercens, work ought to be seen as a privileged expression of human activity. Work, including cultural production, is an example of human creation in the image of the creator.)
The employer ought to respect the dignity of each employee and shouldn't view them as slaves. Workers must also have time for their religious duties and must receive tasks appropriate for their sex and age. Workers and employers ought to be free to negotiate and come to an agreement, but natural justice must ensure that wages are sufficient to support a "frugal and well-behaved wage-earner." To ensure these rights and duties are maintained worker's associations ought to exist to work towards the common good.
The relationship between worker and employer ought to be shaped by the bonds of friendship and brotherly love. Both are children of God and created in His image. The Church desires that the poor better their situation and has a role to speak out on their behalf and to seek relief of poverty.
Both workers and employers should have their rights protected. Children shouldn't be employed for tasks suited for adults, and employers should compensate workers with just wages. Humanity should remember that Christian morality leads to prosperity.
It is important to remember that we were not created for this world, but rather for everlasting life with God. Riches should be viewed as an obstacle for eternal happiness, and that they do not bring freedom. With this in mind, associations of workers and employers ought to do what is best for the body, soul, and property of all involved.