© 2015 Cengage Learning

Chapter 17 Employee Stakeholders and Workplace Issues © 2015 Cengage Learning

Learning Outcomes Identify the major challenges occurring in the workforce today. Outline the characteristics of the new social contract between employers and employees. Explain the employee rights movement and its underlying principles. Describe and discuss the employment-at-will doctrine and its role in the employee rights. Discuss the right to due process and fair treatment. Describe the actions companies are taking to make the workplace friendlier. Elaborate on the freedom-of-speech issue and whistle- blowing. © 2015 Cengage Learning

Chapter Outline The New Social Contract The Employee Rights Movement The Right Not to Be Fired Without Cause The Right to Due Process and Fair Treatment Freedom of Speech in the Workplace Summary Key Terms © 2015 Cengage Learning

Employee Stakeholders and Workplace Issues The social contract between organizations and workers continues to evolve, and is different from contracts of the past. Three employee rights issues- Right not to be fired without good cause Right to due process and fair treatment Right to freedom of speech in the workplace © 2015 Cengage Learning

The New Social Contract Today’s worker has held 11.3 jobs on average. All realize their jobs are vulnerable, and they receive a smaller portion of the economic pie. They are more mobile, less loyal, and more diverse. They seek: Competitive pay Benefits Opportunities for professional growth © 2015 Cengage Learning

The Changing Social Contract Old Social Contract New Social Contract Job security Few tenure arrangements Life careers with one employer Few life careers; changes common Stable positions/job assignments Temporary project assignments Loyalty to employer Loyalty to self Paternalism Relationships far less familial Employee sense of entitlement Personal responsibility for one’s job future Stable, rising income Pay for value added Job-related skill training Employees in charge of own education Focus on individual accomplishments Focus on team building and projects © 2015 Cengage Learning

The Employee Rights Movement Public sector employees have constitutional protections. We focus on employees in the private sector, not subject to constitutional control because of the concept of private property. Individuals and private organizations are free to use their property as they desire. Although labor unions have been successful in improving pay, benefits and working conditions, they have not been as active in pursuing civil liberties. © 2015 Cengage Learning

The Meaning of Employee Rights We approach the topic from the perspective of the Principle of Rights, justifiable claims that utility cannot override. We will also cover legal rights. Sources of employee rights - Statutory rights Collective bargaining rights Enterprise rights © 2015 Cengage Learning

3 Models of Management Morality Moral management - Employees are viewed as a human resource that must be treated with dignity and respect. Amoral management - Employees are treated as the law requires. Immoral management - Employees are viewed as factors of production to be used, exploited, and manipulated. © 2015 Cengage Learning

The Right Not to Be Fired Without Cause Good cause norm - The belief that employees should only be discharged for good reasons. This belief prevails in the United States today, though it conflicts with reality. Employment-at-will doctrine - The reality is that the relationship between employer and employee is voluntary and can be terminated at any time by either party. The central issue is changing views of the employment at will doctrine. © 2015 Cengage Learning

Legal Challenges to Employment-at-Will Public policy exceptions- Protects employees from being fired for refusal to commit crimes or for utilizing legal rights. Implied contract exception- Protects employees who they believe have contracts or implied contracts. Good faith principle- Employers may lose lawsuits to former employees if they cannot show that employees had opportunities to improve their performance before termination. © 2015 Cengage Learning

Moral and Managerial Objections to Employment-at-Will Employees deserve respectful treatment. Employees do not have the option of being arbitrary or capricious with employers. Employers should bear the same responsibility. Employees are expected to be trustworthy, loyal and respectful with employers. Employers should show employees the same consideration. © 2015 Cengage Learning

Dismissing an Employee With Care Fire employees in a private space. Be mindful of employees’ logistics. Preserve the employee’s dignity. Choreograph the notification in advance. Use transparent criteria for layoffs. © 2015 Cengage Learning

What NOT to do When Terminating an Employee Don’t fire on a Friday. Don’t say that downsizing is finished. Don’t terminate an employee via e- mail. Stick to the topic and avoid platitudes. Don’t rush through the meeting. © 2015 Cengage Learning

The Right to Due Process and Fair Treatment The right to receive an impartial review of one’s complaints and to be dealt with fairly. The right of employees to have decisions that adversely affect them be reviewed by objective and impartial third parties. © 2015 Cengage Learning

The Requirements of a Due Process System It must be a procedure; it must follow rules; it must not be arbitrary. It must be visible and well-known so that potential violators and victims are aware of it. It must be predictably effective. It must be institutionalized – a relatively permanent fixture in the organization. It must be perceived as equitable. It must be easy to use. It must apply to all employees. © 2015 Cengage Learning

Alternative Dispute Resolution Open-Door Policy Hearing Procedure The Ombudsman The Peer Review Panel © 2015 Cengage Learning

Concerns with the Open-Door Policy - The process is closed. One person is reviewing what happened. There is a tendency for a manager to support another manager’s decision. A hearing procedure helps open up the process because employees can elect representation. © 2015 Cengage Learning

The Ombudsman An ombudsman is neutral and promises confidentiality. An ombudsman can handle employee concerns in a way that keeps the problem from getting out of hand. The procedure has been used in Sweden since 1809 to curb abuses by government against individuals. © 2015 Cengage Learning

Factors for a Successful Peer Review Panel Be sure that people involved in the process are respected members of the organization. Committee members should be elected rather than appointed. They must receive training in dispute resolution, discrimination, fairness, legalities, and ethics for everyone involved. Representatives of both employees and management should be involved in decision making. © 2015 Cengage Learning

The Future of ADR The use of ADR is growing because of time and cost savings over litigation. But some employers require new hires to sign contracts waiving their right to sue their employer in favor of mandatory arbitration. Arbitration - A neutral party resolves a dispute between two or more parties and the resolution is binding. Mandatory arbitration The parties must agree to arbitration prior to any dispute occurring, and be bound. © 2015 Cengage Learning

Freedom of Speech in the Workplace While the U.S. Constitution protects an individual's speech from government interference, this does not apply to an employer, and some forbid conflicting political views. Whistle-Blower - An organization member who discloses illegal, immoral, or illegitimate practices under the control of their employers, to persons or organizations that may be able to effect action. © 2015 Cengage Learning

Whistle-Blowing Key Elements in the Process - The whistle-blower The act or complaint The party to whom the complaint is made The organization against which the complaint is made © 2015 Cengage Learning

Two Views of Employee Responsibility in a Whistle-Blowing Situation Corporate Employer Loyalty Obedience Confidentiality Employee Traditional (Has certain rights) Public Employee Corporate Employer Whistle blowing Responsibility Emerging © 2015 Cengage Learning

A Checklist to Follow Before Blowing the Whistle Is there any alternative to blowing the whistle? Does the proposed disclosure advance public interest rather than personal or political gain? Have you thought about the outcomes of blowing the whistle for yourself and your family? Have you identified the sources of support, both inside and outside the organization, on which you can rely during the process? Do you have enough evidence to support your claim? Have you identified and copied all supporting records before drawing suspicion to your concerns? © 2015 Cengage Learning

Consequences of Whistle-Blowing 4800 employees reported retaliation - 64% - exclusion from decisions & work activities 62% - cold shoulder from coworkers 62% - verbal abuse from management 56% - almost lost job 55% - not given promotion or raise 51% - verbal abuse from coworkers 46% - cut in hours or pay 44% - relocated or reassigned © 2015 Cengage Learning

Government Protections for Whistle-Blowers 1978 Civil Service Reform Act Sarbanes-Oxley whistle-blower protections Michigan Whistle-Blowers Protection Act of 1981 False Claims Act © 2015 Cengage Learning

Management Responsiveness to Whistle-Blowing Whistle-blowing occurs after normal, less dramatic channels of communication have failed. To encourage open communications - Managers must be clear that they invite and accept suggestions. Managers must refute assumptions and organizational myths that discourage communication. Managers should tailor rewards so that employees share more directly in cost savings or sales increases from ideas they offer. © 2015 Cengage Learning

Key Terms Alternative Dispute Resolution (ADR) Civil Service Reform Act of 1978 collective bargaining due process employee Rights employment-at-will doctrine enterprise rights false Claims Act good cause norm good faith principle hearing procedure implied contract exception mandatory arbitration Michigan Whistle-Blowers Protection Act of 1981 ombudsman open-door policy outplacement peer review panel private property public policy exception social contract statutory rights whistle-blower © 2015 Cengage Learning