August 28, 2022

MANAGING COMPENSATION Employees seek vario

MANAGING COMPENSATIONEmployees seek various psychological rewards from their jobs, but this does not diminish the importance of the compensation they receive. It is essential that this compensation be equitable in terms of the job's value to the organization and in relation to the pay other employees receive. The purchasing power of workers' salaries must be adjusted upward periodically to accommodate rises in the cost of living. In addition, compensation payments must be consistent with the terms of the labor agreement, where one exists, and with state and federal regulations governing it. Issues of equal pay for comparable worth, pay compression, and low wage budgets are emerging issues in the field of management compensation.EMPLOYEE RIGHTS AND DISCIPLINEThe rights of employees to protect their jobs while obtaining fair and just treatment from employers received much attention during the 1990s. On the other side of the balance, are the employer's responsibilities to provide a safe and efficient workplace for employees while expecting productivity and a positive attitude from all jobholders. Issues such as drug testing, smoking on the job, access to one's personnel file, notice of plant closing, and unfair discharge are therefore topics of interest to all organizational members.When employees exhibit unsatisfactory behavior or performance it may be necessary for an employer to take disciplinary action against them. If the employee is represented by a union, the disciplinary action is likely to be appealed through the grievance procedure provided for in the labor agreement. In a nonunion organization, the aggrieved employee may use an alternative dispute-resolution procedure established specifically by the employer. In either the union or nonunion setting, management may ultimately have to defend its position to a specified individual or group who will decide on the reasonableness of the action taken. To defend themselves successfully, as well as to simply impose fair and objective disciplinary procedures, supervisors and managers need to understand the principles of effective discipline.Organizational ethics extends beyond the legal requirements of managing employees in human resources management. Managers must comply with governmental regulations to promote an environment free from litigation. However, beyond what is required by law is the question of organizational ethics and the ethical or unethical behavior engaged in by managers .Question: First, read the section on dispute resolution in your textbook. Then, from your reading, answer the following:

What do you think would constitute an effective alternative dispute resolution system?
What benefits would you expect from such a system?
If you were asked to rule on a discharge (firing) case, what facts would you analyze in deciding whether to uphold or reverse the employer's action?

Snell_18e_PPT_Instructor_Ch13.pptx

Chapter 13 Employees Rights and Discipline

Learning Outcomes

After studying this chapter, you should be able to

Explain the concepts of employee rights and employer responsibilities.

Identify and explain what the privacy rights of employees are.

Establish disciplinary policies and differentiate between the two approaches to disciplinary action.

Identify the different types of alternative dispute resolution methods.

Discussion Starter #1

Google, owner of Nest, set up an internal website for employees to report whistle-blowers. After paying $200 million in fines due to one whistle-blower at Nest, the company now encourages employees to air their frustrations by talking to management before talking to the press.

What are some consequences that employees can face from whistle-blowing?

What government measures have been put in place that provide protection to whistle-blowers?

ANSWER: Whistle-blowers may face retaliation and often become unemployed. In addition, not everyone sees whistle-blowing as a positive decision; rather, you may be looked at as a “snitch.”

The Sarbanes–Oxley (SOX) Act protects whistle-blowers employed in publicly traded companies. The law encourages whistle-blowing by motivating publicly held companies to promote a more open culture that is sympathetic to employees who have a “reasonable belief ” that a law has been violated. Federal employees are covered by the federal Whistleblower Protection Act (WPA). The Notification and Federal Employee Antidiscrimination and Retaliation Act (No FEAR Act) requires federal agencies to be more accountable for violations of antidiscrimination and whistle-blower protection laws. The False Claims Act (FCA) and Dodd–Frank Wall Street Reform and Consumer Protection Act protect and financially reward whistle-blowers who expose fraud related to governmental programs and wrongdoing related to consumer financial products or services, respectively. OSHA administers the whistle-blowing provisions in 15 federal statutes protecting whistle-blowers in such industries as airline, nuclear power, and public transportation.

13.1 Employee Rights and Privacy

Employee rights – Guarantees of fair treatment that become rights when they are granted to employees by the courts, legislatures, or employers

Included among those rights are the rights of employees to:

Protest unfair disciplinary actions

Question genetic testing

Have access to their personal files

Challenge employer searches and monitoring

Be largely free from employer discipline for off-duty conduct

Figure 13.1: Employee Rights vs. Employer Rights

Section 13.1a: Employee Rights versus Employer Responsibilities

Balanced against employee rights is the employer’s responsibility to provide a safe workplace for employees while guaranteeing safe, quality goods and services to consumers. However, employee rights and employer responsibilities often come into conflict.

13.1b Negligent Hiring

Negligence – The failure to provide reasonable care when such failure results in injury to consumers or other employees

Group Activity

Assume the following hypothetical situation:

A company is being sued for negligent hiring. They hired an employee who at the time of recruitment disclosed verbally and stated in writing about their prior drug addiction. Is the company guilty of negligent hiring?

Step 1: The instructor will divide the class into two groups—one supporting the argument that the company is guilty of negligent hiring and the other opposing it.

Step 2: Conduct a debate. Substantiate your claims with real-life examples.

Estimated class time: 15–20 minutes

13.1c Job Protection Rights (slide 1 of 5)

Psychological contract – Expectations of a fair exchange of employment obligations between an employee and employer

Example: In exchange for their talents and technical skills, workers expect employers to provide fair compensation, job training, and promotions.

Employment-at-Will

Employment-at-will relationship – The right of an employer to fire an employee without giving a reason and the right of an employee to quit when he or she chooses

The employment-at-will doctrine does not give managers and supervisors the unrestricted right of termination.

Federal and state laws and court decisions restrict termination decisions.

In unionized organizations, collective bargaining agreements limit automatic discharges.

13.1c Job Protection Rights (slide 2 of 5)

Employment-at-Will (cont’d)

Three exceptions to the employment-at-will doctrine:

Violation of public policy

Occurs when an employee is terminated for refusing to commit a crime; for reporting criminal activity to government authorities; for disclosing illegal, unethical, or unsafe practices of the employer; or for exercising employment rights

Implied contract

Occurs when employees are discharged despite the employer’s promise of job security or contrary to established termination procedures

Implied covenant

Occurs when an employer has acted with a lack of good faith and fair dealing

Figure 13.2: Discharges That Violate Public Policy

Section 13.1c: Job Protection Rights

Figure 13.2 lists examples of public policy violations.

13.1c Job Protection Rights (slide 3 of 5)

Wrongful Discharge

Wrongful discharge – A discharge, or termination, of an employee that is illegal

Whistle-Blowing

Whistle-blowing – Complaints to governmental agencies by employees about their employers’ illegal or immoral acts or practices

Implied Contract

If an implied promise by an employer of a condition, such as job security, has been made, courts have generally prohibited the employer from terminating the employee without first exhausting the conditions of the contract.

Figure 13.3: Tips to Avoid Wrongful Employment Termination Lawsuits

Section 13.1c: Job Protection Rights

Figure 13.3 lists some suggestions that firms can follow in order to avoid wrongful employment termination lawsuits.

13.1c Job Protection Rights (slide 4 of 5)

Explicit Contracts

Explicit employment contracts are formal written (signed) agreements that grant to employees and employers agreed-upon employment benefits and privileges.

Explicit contracts normally state the period of employment, terms and conditions of employment, and severance provisions.

When an employee has an explicit contract, he or she cannot be dismissed at will.

Before hiring employees, employers sometimes impose certain restrictions, or provisions, in explicit contracts, such as nondisclosure of information agreements, which forbid employees from revealing proprietary information outside the company during or following their employment, and noncompete agreements, which prevent ex-employees from either becoming a competitor or working for a competitor for a designated period of time.

Explicit contracts are enforceable in court when either the employee or employer violates any provisions of the agreement.

13.1c Job Protection Rights (slide 5 of 5)

Constructive Discharge

Constructive discharge – An employee’s voluntary termination of his or her employment because of harsh, unreasonable employment conditions placed on the individual by the employer

Discharge as a Result of Retaliation

Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and other employment laws prohibit employers from retaliating against employees when they exercise their rights under these statutes.

Discharges and the WARN Act

The Worker Adjustment and Retraining Notification (WARN) Act requires organizations with more than 100 employees to give employees 60 days’ notice of any closure or layoff affecting 50 or more full-time employees.

Figure 13.4: The Balance of Employee Rights to Privacy vs. Employers Wanting to Know

Section 13.1d: Privacy Rights

The right of privacy is the freedom from unwarranted government or business intrusion into one’s personal affairs. It involves the individual’s right to be given personal autonomy and to be left alone. Not surprisingly, employees strongly defend their right to workplace privacy. Meanwhile, employers defend their right to monitor employees’ activities when they directly affect a business, its productivity, workplace safety, and/or morale.

13.1d Privacy Rights

Substance Abuse and Drug Testing

In the private sector, drug testing is largely regulated by individual states.

Federal regulations and laws restrict drug testing as well.

Barring state and federal laws that restrict or prohibit drug testing, however, private employers generally have a right to require employees to submit to the tests.

The exception is unionized workforces; drug testing for unionized employees must be negotiated by their unions.

Impairment Testing

Impairment testing – Also called fitness-for-duty or performance-based testing, it measures whether an employee is alert enough to work

Figure 13.5: Recommendations for a Drug-Free Workplace Policy

Section 13.1d: Privacy Rights

Figure 13.5 shows an example of a drug-free workplace policy.

13.1e Digital Surveillance (slide 1 of 4)

Camera Surveillance

In general, employers can train video cameras on their employees without significant legal concerns as long as they have a legitimate business reason for doing so and inform employees they are doing as much.

Phone Conversations and Text Communications

In general, employers have the right to monitor calls, texts, and direct messages sent from their telecommunications devices, provided they do so for compelling business reasons and employees have been informed that their communications will be monitored.

The Electronic Communications Privacy Act (ECPA) restricts employers from intercepting wire, oral, or electronic communications, unless employees are told not to make personal calls or send text messages from their business phones.

13.1e Digital Surveillance (slide 2 of 4)

Email, Internet, and Computer Use

Employers can monitor what their employees do online and fire or discipline them based on that information.

Until recently employers were allowed to monitor any and all email communications their employees sent from work computers, but court rulings have limited employers’ rights somewhat.

More and more companies are banning social media at work.

Companies can legally create electronic communication policies that limit employees’ Internet use.

Access to Personnel Files

A firm’s HR department is usually responsible for maintaining personnel files and safeguarding their flow to prevent, among other things, identity theft.

Legislation at the federal level and various state laws permit employees to inspect their own personnel files.

Figure 13.6: Why Do Employees Turn to Social Media at Work?

Section 13.1e: Digital Surveillance

Figure 13.6 lists reasons why employees use social media at work.

Video Highlight #1

This article and video look at how many companies are using new technology (such as apps) to track and monitor their employees.

“New Ways Your Boss Could Be Keeping Tabs on You”

Section 13.1e: Digital Surveillance

VIDEO: New Ways Your Boss Could Be Keeping Tabs on You (3:44)

This article and video looks at how many companies are using new technology (such as apps) to track and monitor their employees.

https://www.cbsnews.com/news/companies-use-technology-monitor-employees-at-outside-office/

TOPICS/CONCEPTS: employee privacy rights, employer surveillance, employee monitoring

Figure 13.7: Guidelines for Safeguarding Personnel Files

Section 13.1e: Digital Surveillance

Figure 13.7 shows the steps employers can take to safeguard employees’ personal information.

13.1e Digital Surveillance (slide 3 of 4)

Searches

A firm that reserves the right to search employees under warranted circumstances should have a written plan as to the privacy employees can expect.

The search policy should be clearly outlined in a firm’s employee handbook.

When possible, searches should be conducted in private.

The employer should attempt to obtain the employee’s consent prior to the search.

The search should be conducted in a humane and discreet manner to avoid infliction of emotional distress.

The penalty for refusing to consent to a search should be specified.

13.1e Digital Surveillance (slide 4 of 4)

Off-Duty Employee Conduct

A number of states have passed laws that prohibit employees from disciplining or firing employees for activities they pursue offsite on their own time as long as they are legal.

Even when the activities are illegal, court rulings have suggested that the conduct may not, in some circumstances, be a lawful jurisdiction for employee discipline.

Organizations that want to discipline employees for off-duty misconduct must establish a clear relationship between the misconduct and its negative effect on other employees or the organization.

Off-Duty Employee Speech

Some organizations have policies that restrict employees from making disparaging remarks online about their firms or its supervisors.

Figure 13.8: When Workplace Romance Can Be a Bad Idea

Section 13.1e: Digital Surveillance

Workplace romances create a dilemma for organizations. Acceptable behavior in a consensual relationship between employees can become harassing behavior if one party to the relationship no longer welcomes the conduct, and it may result in violence should a scorned lover seek violent revenge at the work site. Of particular concern is an employer’s liability if a coworker, supervisor–subordinate, or other power-differentiated romance goes sour and leads to charges of sexual harassment.

Although some companies have strict anti-fraternization policies, such a policy can lead to lawsuits.

Video Highlight #2

After some public criticism, Starbucks says it’s considering changing its strict employee dress code, including its ban on visible tattoos. This video looks at how visible tattoos are becoming more accepted in today’s workplace.

“Starbucks Rethinking Visible Tattoo Ban for Employees”

Section 13.1e: Digital Surveillance

VIDEO: Starbucks Rethinking Visible Tattoo Ban for Employees (1:56)

https://www.youtube.com/watch?v=OHIu7dORkq4

TOPICS/CONCEPTS: body art, tattoos, discrimination, tattoos in the workplace, employee tattoos

Discussion Starter #2

Explain three areas in which employee rights and employer responsibilities could result in conflict.

How might this conflict arise?

ANSWER: Drug testing, email usage, and employee searches and surveillance are three prominent areas where employee rights and employer responsibilities can come into conflict. Other areas could include genetic testing and off duty conduct. Conflict can arise between employees and employers when employees believe their behavior is their personal concern not subject to employer suspicion or infringement. Employers, however, cite their responsibility to run their business in a safe and efficient manner as a defense against unlimited employee rights. For example, employees might believe they have a right privacy in their personal email messages and object to management routinely monitoring all employee email. Ask students for other areas of possible conflict.

Figure 13.9: The True Definition of Discipline

Section 13.2: Disciplinary Policies and Procedures

When managers are asked to define the word discipline, their most frequent response is that discipline means punishment.

However, in the context of management, discipline does not mean punishment. Rather, discipline is a tool used to correct the practices of employees to help them perform better so they conform to acceptable standards. Many organizations define discipline in their policy manuals as training that “corrects, molds, or perfects knowledge, attitudes, behavior, or conduct.”

Figure 13.10: Common Disciplinary Problems

Section 13.2: Disciplinary Policies and Procedures

Figure 13.10 lists the more common disciplinary problems identified by managers.

Figure 13.11: A Disciplinary Model

Section 13.2a: The Result of Inaction

Figure 13.11 presents a disciplinary model that illustrates the areas where provisions should be established. The model also shows the logical sequence in which disciplinary steps must be carried out to ensure enforceable decisions.

13.2a The Result of Inaction

Should discipline become necessary, the employee’s immediate supervisor is the logical person to apply the company’s disciplinary procedures and monitor the employee’s improvement, although the HR departments should develop and ensure disciplinary policy and action conform to current laws.

13.2b Setting Organizational Rules

Setting an organization’s rules is the foundation for an effective disciplinary system.

These rules govern the type of behavior expected of employees.

The following suggestions can help HR managers and their firms when they are considering the rules the organization should adopt and how they should be implemented:

The rules must be reasonable and relate to the safe and efficient operation of the organization.

The rules as well as the consequences for breaking them should be written down and widely disseminated to all employees.

The rules should be clearly explained.

Employees should sign a document stating that they have read and understood the organizational rules.

The rules should be reviewed periodically.

Figure 13.12: Questions to Consider during Disciplinary Investigations

Section 13.2c: Investigating a Disciplinary Problem

Figure 13.12 lists seven questions to consider when investigating an employee offense. Attending to each question will help ensure a full and fair investigation while providing reliable information free from personal prejudice.

13.2c Investigating a Disciplinary Problem (slide 1 of 2)

Documenting Misconduct

To ensure that the documentation is as accurate as possible, a manager should record the following eight items immediately after an incident takes place:

The date, time, and location of the incident(s)

The behavior exhibited by the employee (the problem)

The consequences of that action or behavior on the employee’s overall work performance and/or the operation of the employee’s work unit

Prior discussion(s) with the employee about the problem

The disciplinary action to be taken and the improvements expected

The consequences of failing to make the improvements by a certain follow-up date

The employee’s reaction to the supervisor’s attempt to change the behavior

The names of witnesses to the incident (if applicable)

Discussion Starter #3

Discuss why documentation is so important to the disciplinary process.

What constitutes correct documentation?

ANSWER: When a manager fails to record the misconduct of employees, it can undermine a firm’s

efforts to deal with the behavior. A manager’s records of employee misconduct are considered

business documents, and as such they are admissible evidence in arbitration

hearings, administrative proceedings, and courts of law.

To be complete, the documentation should include the following eight items:

The date, time, and location of the incident(s)

The behavior exhibited by the employee (the problem)

The consequences of that action or behavior on the employee’s overall work performance and/or the operation of the employee’s work unit

Prior discussion(s) with the employee about the problem

The disciplinary action to be taken and the improvements expected should be documented

The consequences of failing to make the improvements by a certain follow-up date

The employee’s reaction to the supervisor’s attempt to change his or her behavior

The names of witnesses to the incident (if applicable)

13.2c Investigating a Disciplinary Problem (slide 2 of 2)

The Investigative Interview

Before any disciplinary action is initiated, an investigative interview should be conducted to make sure the employee is fully aware of the organization’s rules and that he or she has not followed them.

The interview should concentrate on how the offense violated the performance and behavior standards expected.

The employee must be given a full opportunity to explain his or her side of the issue.

13.2d Approaches to Disciplinary Action

Two approaches to disciplinary action:

1. Progressive discipline – The application of corrective measures by increasing degrees

Four steps:

Oral warning (or counseling)

Written warning

Suspension without pay

Discharge

2. Positive, or nonpunitive, discipline – A system of discipline that focuses on early correction of employee misconduct, with the employee taking total responsibility for correcting the problem

13.2e Discharging Employees

Because discharging a worker poses serious consequences for the employee—and possibly for the organization—it should be undertaken only after a deliberate and thoughtful review of the situation.

If an employee is fired, he or she may file a wrongful discharge suit claiming the termination was “without just or sufficient cause,” implying a lack of fair treatment by management.

Figure 13.13: “Just Cause” Discharge Guidelines

Section 13.2e: Discharging Employees

How does an employer know if it has just cause to terminate an employee? This question is not easily answered, but standards governing discharges do exist in the form of rules developed in the field of labor arbitration. These rules consist of a set of guidelines that are applied by arbitrators to determine if a firm had just cause for a termination. These guidelines are normally set forth in the form of questions, provided in Figure 13.13. A “no” answer to any of the seven questions in the figure generally means that just cause was not established and that the decision to terminate was arbitrary, capricious, or discriminatory.

13.2f Alternative Dispute Resolution Procedures (slide 1 of 3)

Alternative dispute resolution (ADR) – A term applied to different employee complaint or dispute resolution methods that do not involve going to court

Step-Review Systems

Step-review system – A system for reviewing employee complaints and disputes by successively higher levels of management

In most step-review systems, the president, chief executive officer, vice president, or HR director acts as the final authority, and this person’s decision is not appealable.

13.2f Alternative Dispute Resolution Procedures (slide 2 of 3)

Peer-Review Systems

Peer-review system – A system for reviewing employee complaints that utilizes a group composed of equal numbers of employee representatives and management appointees

A peer-review system functions as a jury because its members weigh evidence, consider arguments, and, after deliberation, vote independently to render a final decision.

Open-Door Policy

Open-door policy – A policy of settling grievances that identifies various levels of management above the immediate supervisor for employee contact

Ombudsman System

Ombudsman – A designated individual from whom employees may seek counsel for resolution of their complaints

13.2f Alternative Dispute Resolution Procedures (slide 3 of 3)

Mediation

Mediation – The use of an impartial neutral to reach a compromise decision in employment disputes

Mediator – A third party in an employment dispute who meets with one party and then the other to suggest compromise solutions or to recommend concessions from each side that will lead to an agreement

Unlike an arbitrator, a mediator has no power or authority to force either side toward an agreement.

Arbitration

With arbitration, the employee and employer present their cases, or arguments, to an arbiter, who is typically a retired judge, who then makes a decision that the parties have agreed to be bound by.

Figure 13.14: Key to Success

Section 13.2f: Alternative Dispute Resolution Procedures

A mediator serves primarily as a fact finder and as an open channel of communication between the parties. Unlike arbitrators, mediators have no power or authority to force either side toward an agreement. They must use the

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MANAGING COMPENSATION Employees seek vario

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