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Chapter 17 Employee Stakeholders and Workplace Issues

Learning Outcomes

Outline the characteristics of the new social contract between employers and employees.

Explain the concept of employee engagement and the actions companies are taking to make the workplace friendlier.

Explain the employee rights movement and its underlying principles.

Describe what is entailed with the right not to be fired without cause and discuss the employment-at-will doctrine and its role in employee rights.

Discuss the right to due process and fair treatment.

Elaborate on the freedom-of-speech issue and whistle-blowing.

Chapter Outline

The New Social Contract

Employee Engagement

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

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

The New Social Contract

The typical “baby boomer” worker has held 11.7 jobs on average. All realize their jobs are vulnerable. See themselves as free agents.

They are more mobile, less loyal, and more diverse.

They seek:

Competitive pay

Benefits

Opportunities for professional growth

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

Employee Engagement

Supported through mentoring programs, career development training, and annual employee surveys.

Companies see less turnover, less shrinkage, less absenteeism, fewer safety incidents, and fewer quality defects.

Despite success, a recent Gallup poll found that 50.8% of U.S. workers said they were not engaged with their jobs.

Employee engagement has not seen year-after-year improvements.

What is the problem?

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.

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

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.

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.

Legal Challenges to Employment-at-Will

Public policy exceptions-

Protects employees from being fired for refusal to commit crimes or for exercising 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.

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.

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.

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.

The Right to Due Process and Fair Treatment

Due Process -

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.

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.

Alternative Dispute Resolution (ADR)

Open-Door Policy

Hearing Procedure

The Ombudsman

The Peer Review Panel

Concerns with the Open-Door Policy -

The process is closed.

One person is reviewing what happened.

There is a tendency for one manager to support another manager’s decision.

A hearing procedure helps open up the process because employees can elect representation.

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.

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.

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.

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.

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

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

(Has certain rights)

Emerging

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?

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

Government Protections for Whistle-Blowers

1978 Civil Service Reform Act

1989 Whistleblower Protection Act

Sarbanes-Oxley whistle-blower protections

Michigan Whistle-Blowers Protection Act of 1981

Defend Trade Secrets Act

FBI Whistleblower Protection Enhancement Act

False Claims Act

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.

1099 economy

1978 Civil Service Reform Act

Alternative Dispute Resolution (ADR)

collective bargaining

Defend trade secrets act

due process

Employee engagement

employee Rights

employment-at-will doctrine

enterprise rights

False Claims Act

FBI Whistleblower Protection Enhancement

Fissuring

Gig economy

good cause norm

good faith principle

hearing procedure

implied contract exception

mandatory arbitration

Key Terms (1 of 2)

Michigan Whistle-Blowers Protection Act of 1981

Millennial generation

National Labor Relations Act

ombudsman

open-door policy

peer review panel

Key Terms (2 of 2)

private property

public policy exception

social contract

statutory rights

whistle-blower

Whistle-Blower protection act