Chapter 14 Procedural Justice and Ethics in Employee Relations McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc. All rights reserved.

Questions This Chapter Will help Managers Answer How can I ensure procedural justice in the resolution of conflicts between employees and managers? How can I administer discipline without at the same time engendering resentment toward me or my company? How do I fire people legally and humanely? What should be the components of a fair information practice policy? What is ethical decision making in employee relations? What steps or considerations are involved?

Employee Relations Definition of Terms Justice refers to the maintenance or administration of what is just, especially by the impartial adjustment of conflicting claims or the assignment of merited rewards or punishments

Definition of Terms (contd.) Procedural justice focuses on the fairness of the procedures used to make decisions. Distributive justice focuses on the fairness of the outcomes of decisions, for example, in the allocation of bonuses or merit pay, or in making reasonable accommodations for employees with disabilities.

Definition of Terms (contd.) Ethical decisions about behavior concern one’s conformity to moral standards or to the standards of conduct of a given profession or group. Ethical decisions about behavior take account not only of one’s own interests but also equally of the interests of those affected by the decision.

Organizational Citizenship Behaviors  Altruism  Conscientiousness  Civic virtue  Sportsmanship  Courtesy

Components of Procedural Justice Structural (employee voice) Interactional justice Informational justice

Functions of Employee-Voice Systems  They assure fair treatment to employees  They provide a context in which unfair treatment can be appealed  They help to improve the effectiveness of an organization  They sustain employee loyalty and commitment

Table 14-1 Core Characteristics of Effective Voice Systems EleganceSimple procedures, broad application, vested authority, good diagnostic system AccessibilityEasy to use, advertised, comprehensive, open process CorrectnessAdministered well, includes follow-up, self-redesigning, correctable outcomes ResponsivenessTimely, culturally-viable, tangible results, management commitment NonpunitivenessAppeal system, anonymity, no retaliation for using the system

Purposes of Grievance Procedures  To increase organizational commitment and performance by treating employees fairly and by identifying problem areas  To avoid costly lawsuits  To prevent unionization

Figure 14-1 Example of a Nonunion Grievance Procedure Grievant Supervisor Open Door – Any Member of Management the Grievant Chooses to Approach Roundtable Bulletin Board Regular procedural route Route that may be taken Not Resolved Not Resolved

Basic Requirements of a Nonunion Grievance Procedure  All employees must know about the procedure and exactly how it operates  Employees must believe that there will be no reprisals taken against them for using it  Management must respond quickly and thoroughly to all grievances  Provide employees with an appeal process

Just Cause The concept of just cause requires an employer not only to produce persuasive evidence of an employee’s liability or negligence, but also to provide the employee a fair hearing and to impose a penalty appropriate to the proven offense

Social-Learning Theory Individuals in groups look to others to learn appropriate behaviors and attitudes. They learn them by modeling the behavior of others, by adopting standard operating procedures, and by following group norms.

The “Red-Hot-Stove Rule” According to this rule, discipline should be Immediate With warning Consistent Impersonal

Characteristics of a Legally-Defensible Progressive- Discipline System  Allow an employee the opportunity to respond, and  Allow employees a reasonable period of time to improve their performance

Disciplinary Interviews 1.Over issues of workplace conduct, such as attendance or punctuality, or 2.Over issues of job performance, such as low productivity. Generally, such interviews are held for one of two reasons:

Employment-at Will … is created when an employee agrees to work for an employer but there is no specification of how long the parties expect the agreement to last.

Exceptions to Employment-at-Will  Public policy exemption  When an employer has promised (including implied promise) not to terminate an employee except for unsatisfactory job performance or other good cause  Employees can seek damages for outrageous acts related to termination, including character defamation (includes retaliatory discharge)

Restrictive Covenants in Employment Contracts (examples)  Non-solicitation clause  “Payback” clause  Opportunity to match any employment offer  No-disclosure clause  No-compete clause

Conducting the Termination Interview Prior to conducting such an interview, the supervisor should be prepared to answer three basic questions: Who : the responsibility for terminating rests with the manager of the individual who is to be released When : need to consider personal situations – birthdays, anniversaries, family illnesses Where : neutral territory – not the manager’s or employee’s office

Employee Privacy Privacy refers to the interest employees have in controlling the use that is made of their personal information and in being able to engage in behavior free from regulation or surveillance

Whistleblowing and the Sarbanes-Oxley Act  Makes it unlawful to discharge, demote, suspend, threaten, harass, or in any manner discriminate against a whistleblower  Establishes criminal penalties of up to 10 years in jail for executives who retaliate against whistleblowers  Requires board audit committees to establish procedures for hearing whistle-blower complaints  Allows the Secretary of Labor to order a company to rehire a terminated whistleblower with no court hearings whatsoever  Gives a whistleblower a right to a jury trial, bypassing months or years of cumbersome admin. hearings

Key Terms Discussed in the Chapter Alternative dispute resolution (ADR) programs Employee relations Justice Procedural justice Distributive justice Due process Ethical decisions about behavior Organizational citizenship behaviors Organizational support Employee voice Interactional justice Informational justice Just cause Positive discipline Social learning theory Progressive discipline Red-hot stove rule Employment-at-will Public policy exception Implied promises

Key Terms (Contd.) Retaliatory discharge No-compete agreements Fiduciary duty of loyalty Choice-of-law provision Privacy Ethical dilemma Whistle blowing Meta-analysis