Chapter 8
Managing Employee Ethics,
Engagement, Retention and Fair
Treatment
Introduction to Ethics
What is ethics and why is it relevant?
○ Ethics can be defined as: “The principle of conduct
governing an individual or group.”
○ People make ethical choices at work everyday
○ Ethical decisions always require making normative
judgement and are rooted in morality
○ Ethics are important because manager’s personnel
decisions almost always hold ethical consequences
○ Companies that employees view as “fair and just”
also tend to score higher on ethics
Organizational Justice
1. Distributive Justice
● The perceived fairness of how resources and rewards are
distributed or allocated
2. Procedural Justice
● The perceived fairness of the processes and procedures used to
make allocation decisions
3. Interactional Justice
● The extent to which people feel fairly treated when procedures are
implemented
www.workplacefairness.org/news
Mistreatment and Bullying
● Mistreatment of employees
makes it more likely that
the employee will also show
higher levels of work
withdrawal
● Workplace bullying is an
increasingly serious problem
● Bullying involves singling
out someone to harass and
mistreat them
● Bullying involves three
things:
1. Imbalance of power
2. Intent to cause harm
3. Repetition
● It can take many forms
such as: social, physical,
and cyber bullying
● Employers must have
systems in place to
respond
II. Managing Employee Discipline
Discipline is necessary to carry out the rules
and regulations of an organization
Three Pillars of the Discipline
Process
Utility of Non-Punitive Discipline
● Traditional discipline can be flawed
● Non-punitive discipline involves the
employees acceptance of rules
o
Ex: Verbal warning, written warning, conduct
meeting, termination
Employee Electronic Use and Privacy
● Managing and monitoring company e-mail is
an urgent problem.
A majority of employers admit that they monitor
their employee’s e-mail.
o Some employers check the personal blogs and
social networking sites of their employee’s.
 Extensive monitoring raises many privacy issues.
o
Legal Issues
● Employers are allowed to monitor employee phone
calls only if the call pertains to business.
o Once the call subject shifts from business it
becomes illegal for the employer to monitor any
longer.
o E-mail service may be intercepted by law when it is
to protect the property rights of the provider.
Preventative Measures
● Employers have begun to ask employees to sign e-mail
and telephone monitoring acknowledgement
statements.
o If not done,the employer could be found liable for
the action of the employee.
o Monitoring statements must make it clear that
employees should have no expectation of privacy in
their e-mail, internet, and phone transactions sent
or received through employers systems.
Pettigrew Case
● Cameron Pettigrew worked as a client relations
manager at Fidelity Investment, but was fired after
supervisors found out he was sending email messages
about a fantasy football league that he ran.
o Pettigrew stated in an interview, “Let’s be honest:
that’s a complete overreaction.”
o This is not an isolated case!
o http://abcnews.go.com/Business/GadgetGuide/supreme-courtemployee-rights-privacy-workplace-emails/story?id=9345057
Dismissals
Terminate-at-will rule:
The employee can resign for any reason, at will; The employer can dismiss for any reason, at will.
Exceptions:
Statutory Exceptions: Federal, state, EEO laws prohibit specific types of dismissals, such as
dismissals based on race, color, religion, sex, or national origin.
Common Law Exceptions: Example includes: “For Just Cause” termination rule.
Public Policy Exceptions: An example would be an employee being terminated for refusing to break
the law in the workplace.
Dismissals
Grounds for Dismissal:
Unsatisfactory Performance
● Persistent failure to perform duties or meet prescribed standards.
Misconduct
● Deliberate and willful violation of company rules. Example: Stealing.
Lack of Qualifications for the Job
● Inability to complete assigned work.
Changed Requirements of the Job (Elimination)
● Incapability of doing the work after the nature of the job changes.
Avoiding Wrongful Discharge:
(1) Lay the groundwork and (2) set up safeguards to ensure actions are fair.
Dismissals
Severance Pay Averages
● 39 weeks for Executives
● 30 weeks for DownSized Employees
● Only ⅓ of Employers offer Severance Pay to Employees terminated due to poor performance.
Lump Sum payments vs. Packages Tied to Years of Employment
Layoffs
Employer sends workers home for a time for lack of work; usually not a permanent dismissal.
Dismissals
The Termination Interview:
1.
2.
3.
4.
5.
6.
Plan the Interview Carefully
Get to the Point
Describe the Situation
LIsten
Review Severance Package Offered
Identify the Next Step
Outplacement Counseling
● Help with career planning and job search skills.
Managing Turnover
Voluntary Turnover - the rate at which employees
voluntarily leave their firms - varies markedly among
industries
Employer ranked Top 5 reasons for Voluntary Turnover:
1. Promotion
2. Career development
3. Pay
4. Relationship with supervisor
5. Work/life balance
Retaining Employees
Selection - selection refers not only to
the employees but to the supervisors as
well, “retention starts up front, in the
selection and hiring of the right
employees”
Professional Growth - “professionals
who feel their company cares about their
development and progress are much
more likely to stay”
Provide Career direction - discuss
employees career preferences
Meaningful work and Ownership making clear expectations regarding
performance and responsibility
Recognition and Rewards - in addition
to pay & benefits, employees need
recognition for a job well done
Culture and Environment - making your
company less “political” or tense and
making it more comfortable for
employees
Promote work/life Balance - “flexible
work arrangements” & “telecommuting”
were surveyed as the two top benefits
that would convince them to choose a
job
Acknowledge Achievements - frequent
recognition of accomplishments
Engagement
Engagement - being psychologically involved in,
connected to, and committed to getting one’s job done
Affects how well a company performs
o Organizations with higher engagement perform
better
Research/Statistics
Gallup Organization Survey
Companies with highest levels of engagement had 83% chance to perform above
company median, while companies with lowest levels of engagement had 17%
chance to perform above median
Watson Wyatt Worldwide Survey
Highly engaged employees → 26% higher revenue per employee
Director of Recruiting at Fair Trade USA
Believes boosting engagement is responsible for 10% drop in turnover
Harvard Business Review
“Employees should be engaged by providing them with reasons and methods to
satisfy customers and then rewarded for appropriate behavior.”
Only about 21% of the global workforce is engaged, and almost 40% disengaged
Components of Engagement
Traits of an Engaged Employee
● Enthusiasm
o
Enthusiastic about work
● Confident
o
Sure they can achieve success
● Inspired
o
Motivated by their leaders
● Empowered
o
Allowed to get the job done their way
Fostering Employee Engagement
Make sure employees
1) understand how their departments contribute to the
company’s success
2) see how their own efforts contribute to the company’s
success
3) get a sense of accomplishment from working at the
firm
Summary
● Ethics is a major part of everyday life as well as life within the
workplace
● Employers reserve the right to monitor employee ethics/behavior
o Unethical behavior can be grounds for dismissal, or a less
severe punishment
● Employees reserve the right to leave the organization as they
please
o Sometimes a contract is involved at the beginning of
employment
● Employee engagement is a big issue in the workplace and can
affect how well a company performs
Cognitive Engagement
INCIDENT
A new policy was enacted that
required employees to add an
outline to the front of their reports.
Bill recently submitted a report and
forgot to add the mandatory outline
as requested in a reminder sent
earlier that week. The missing
outline was discovered at a
presentation meeting, but the
missing outline did not hinder the
meeting.
WORK HISTORY
Bill has been working for the
company for 6 months and this is the
first time he has missed an outline.
His performance on the job in
general has been virtually error free
and satisfactory. Other employees in
Bill’s department have forgotten the
outline as well.
What would you do?