HUMAN RESOURCE MANAGEMENT
Chapter 9
Ethics, Justice, And
Fair Treatment in HR
Management
Ethics and Fair Treatment at Work
• The Meaning of Ethics
➢ The principles of conduct governing
an individual or a group.
➢ The standards you use to decide
what your conduct should be.
➢ Ethical behavior depends on
a person’s frame of reference.
• Ethical Decisions
➢ Normative judgments
➢ Morality
FIGURE 9–1
Online Ethics Quiz
TABLE 9–1 Specific Observed Unethical Behaviors
Abusive or intimidating behavior toward employees 21%
Lying to employees, customers, vendors, or to the public 19%
A situation that places employee interests over organizational interests 18%
Violations of safety regulations 16%
Misreporting of actual time worked 16%
E-mail and Internet abuse 13%
Discrimination on the basis of race, color, gender, age, or similar categories 12%
Stealing or theft 11%
Sexual harassment 9%
Provision of goods or services that fail to meet specifications 8%
Misuse of confidential information 7%
Alteration of documents 6%
Falsification or misrepresentation of financial records or reports 5%
Improper use of competitors’ inside information 4%
Price fixing 3%
Giving or accepting bribes, kickbacks, or inappropriate gifts 3%
Ethics and the Law
A behavior may be legal
but unethical.
A behavior may be illegal
but ethical.
Ethics and
Behaviors A behavior may be both
legal and ethical.
A behavior may be both
illegal and unethical.
Ethics, Fair Treatment, and Justice
Components of Organizational Justice
Distributive justice Procedural justice
FIGURE 9–2 Perceptions of Fair Interpersonal Treatment Scale
What is your organization like most of the time? Circle Yes if the item describes your organization,
No if it does not describe your organization, and ? if you cannot decide.
IN THIS ORGANIZATION:
1. Employees are praised for good work Yes ? No
2. Supervisors yell at employees (R) Yes ? No
3. Supervisors play favorites (R) Yes ? No
4. Employees are trusted Yes ? No
5. Employees’ complaints are dealt with effectively Yes ? No
6. Employees are treated like children (R) Yes ? No
7. Employees are treated with respect Yes ? No
8. Employees’ questions and problems are responded to quickly Yes ? No
9. Employees are lied to (R) Yes ? No
10. Employees’ suggestions are ignored (R) Yes ? No
11. Supervisors swear at employees (R) Yes ? No
12. Employees’ hard work is appreciated Yes ? No
13. Supervisors threaten to fire or lay off employees (R) Yes ? No
14. Employees are treated fairly Yes ? No
15. Coworkers help each other out Yes ? No
16. Coworkers argue with each other (R) Yes ? No
17. Coworkers put each other down (R) Yes ? No
18. Coworkers treat each other with respect Yes ? No
Note: R = the item is reverse scored.
FIGURE 9–3 Some Areas Under Which Workers Have Legal Rights
• Leave of absence and vacation rights • Employee distress rights
• Injuries and illnesses rights • Defamation rights
• Noncompete agreement rights • Employees’ rights on fraud
• Employees’ rights on employer policies • Rights on assault and battery
• Discipline rights • Employee negligence rights
• Rights on personnel files • Right on political activity
• Employee pension rights • Union/group activity rights
• Employee benefits rights • Whistleblower rights
• References rights • Workers’ compensation rights
• Rights on criminal records
What Influences Ethical Behavior At Work?
• Ethical behavior starts with moral awareness.
• Managers strongly influence ethics by carefully cultivating
the right norms, leadership, reward systems, and culture.
• Ethics slide when people undergo moral disengagement.
• The most powerful morality comes from within.
• Beware of the seductive power of an unmet goal.
• Offering rewards for ethical behavior can backfire.
• Don’t inadvertently reward someone for bad behavior.
• Employers should punish unethical behavior.
• The degree to which employees openly talk about ethics
is a good predictor of ethical conduct.
• People tend to alter their moral compasses when
they join organizations.
What Determines Ethical Behavior at Work?
Individual
Factors
Organizational Organizational
Culture Ethical Work Factors
Behaviors
Ethical Policies The Boss’s
and Codes Influence
FIGURE 9–4
How Do My
Ethics Rate?
FIGURE 9–5 Using the Company Web site to Emphasize Ethics
What Is Organizational Culture?
• Organizational Culture
➢ The characteristic values, traditions, and
behaviors a firm’s employees share
• How Managers Can Support an Ethical Culture
➢ Clarifying expectations with respect to critical values
➢ “Walking the talk” in having their actions align with values
➢ Providing physical support through the use of ethical
managerial values
The Boss’s Influence on Ethical Behavior
Telling staffers to do whatever is
necessary to achieve results
Overloading top performers to ensure
Leading that the work gets done
Employees
Astray Looking the other way when
wrongdoing occurs
Taking credit for others’ work or
shifting blame
TABLE 9–2 Principal Causes of Ethical Compromises
Front- Prof.
Senior Middle Line Non- Admin.
Mgmt. Mgmt. Supv. Mgmt. Salaried Hourly
Meeting schedule pressure 1 1 1 1 1 1
Meeting overly aggressive 3 2 2 2 2 2
financial or business objectives
Helping the company survive 2 3 4 4 3 4
Advancing the career interests 5 4 3 3 4 5
of my boss
Feeling peer pressure 7 7 5 6 5 3
Resisting competitive threats 4 5 6 5 6 7
Saving jobs 9 6 7 7 7 6
Advancing my own career 8 9 9 8 9 8
or financial interests
Other 6 8 8 9 8 9
Note: 1 is high, 9 is low.
Fostering Ethical Work Behaviors
What Employers Can Do
Provide manager Establish
Adopt a strong
and employee ethics whistleblower
ethics code
training policies
Employees and Ethical Dilemmas
• Questions employees should ask
when faced with ethical dilemmas:
➢ Is the action legal?
➢ Is it right?
➢ Who will be affected?
➢ Does it fit the company’s values?
➢ How will it “feel” afterwards?
➢ How will it look in the newspaper?
➢ Will it reflect poorly on the company?
How Managers Use Personnel Methods
To Promote Ethics and Fair Treatment
HRM Practices that
Promote Ethics
Emphasizing
Providing Ensuring fair and Disciplining
ethics and
mandatory objective all instances
fairness in
employee ethics performance of unethical
personnel
training appraisals conduct
selection
HRM-Related Ethics Activities
• Selection
➢ Fostering the perception of fairness in the processes
of recruitment and hiring of people:
❖ Formal hiring procedures that test job competencies
❖ Respectful interpersonal treatment of applicants
❖ Feedback provided to applicants
• Training Employees
➢ How to recognize ethical dilemmas
➢ How to use ethical frameworks to resolve problems
➢ How to use HR functions in ethical ways
HRM-Related Ethics Activities (cont’d)
• Performance Appraisal
➢ Appraisals that make it clear that the company adheres
to high ethical standards by measuring and rewarding
employees who follow those standards.
❖ Standards are clearly defined.
❖ Employees understand the basis for appraisals.
❖ Appraisals are objective.
• Reward and Disciplinary Systems
➢ The organization swiftly and harshly punishes unethical
conduct.
HRM-Related Ethics Activities (cont’d)
• HR’s Ethics Compliance Activities
➢ Complying with the Sarbanes-Oxley Act of 2002
❖ Requires that CEOs and CFOs of publicly traded companies
personally attest to accuracy of their companies’ financial
statements and that their internal controls are adequate.
❖ Increased the need for ethics training and verification of
training.
➢ Firms are using online ethics training programs to comply with
the act’s requirements.
Fostering Employees’
Perceptions of Fairness
Perceptions of fair treatment depend on:
Involvement in Understanding Setting expectations
decisions through explanation and standards
Managing Employee Discipline
Fair and Just Discipline Process
Clear rules A system of A formal unbiased
and regulations progressive penalties appeals process
FIGURE 9–7
Disciplinary
Action Form
FIGURE 9–8
Grievance Form
as Part of the
Appeal Process
Formal Disciplinary Appeals Processes
• FedEx's Multi-Step Guaranteed Fair Treatment Program
➢ Step 1: Management review
➢ Step 2: Officer complaint
➢ Step 3: Executive appeals review
Discipline Without Punishment
(Nonpunitive Discipline)
1. Issue an oral reminder.
2. Should another incident arise within six weeks,
issue a formal written reminder, a copy of which
is placed in the employee’s personnel file.
3. Give a paid, one-day “decision-making leave.”
4. If no further incidents occur in the next year, then
purge the one-day paid suspension from the
person’s file. If the behavior is repeated, the next
step is dismissal.
FIGURE 9–9 Summary of Fair Discipline Guidelines
• Make sure the evidence supports the charge.
• Make sure the employee’s due process rights are protected.
• Warn the employee of the disciplinary consequences.
• Determine if the rule that was allegedly violated should be “reasonably related”
to the efficient and safe operation of the work environment.
• Investigate fairly and adequately the matter before administering discipline.
• Conduct an investigation sufficient to uncover any substantial evidence of misconduct.
• Apply all rules, orders, or penalties evenhandedly.
• Apply a penalty that is reasonably related to the misconduct and
to the employee’s past work.
• Maintain the employee’s right to counsel.
• Don’t rob a subordinate of his or her dignity.
• Remember that the burden of proof is on you.
• Get the facts. Don’t base a decision on hearsay or on your general impression.
• Don’t act while angry.
• In general, do not attempt to deal with an employee’s “bad attitude.”
Focus on improving the specific behaviors creating the workplace problem.
Employee Privacy
• Employee privacy violations upheld by courts:
➢ Intrusion or surveillance
➢ Publication of private matters
➢ Disclosure of medical records
➢ Appropriation of an employee’s name or likeness
• Actions triggering privacy violations:
➢ Background checks
➢ Monitoring off-duty conduct and lifestyle
➢ Drug testing
➢ Workplace searches
➢ Monitoring of workplace
Employee Monitoring
• What Is Monitored:
➢ Identity verification
➢ Location
➢ E-mail activity and Internet use
➢ Telephone calls
• Why Employers Monitor:
➢ To guard against liability for illegal acts and
harassment suits caused by employee misuse
➢ To improve productivity
➢ To detect leaks of confidential information
➢ To protect against computer viruses
Restrictions on Workplace Monitoring
• The Electronic Communications
Privacy Act (ECPA)
➢ Restricts employer interception
and monitoring of oral and wire
communications
❖ “business purpose exception”
❖ “consent exception”
• Common law
➢ Provides protections against
invasion of privacy
FIGURE 9–10 Sample E-Mail Monitoring Acknowledgment Statement
Managing Dismissals
• Dismissal
➢ Involuntary termination of an employee’s employment
with the firm.
• Terminate-at-Will Rule
➢ Without a contract, the employee can resign for any reason,
at will, and the employer can similarly dismiss the employee
for any reason (or no reason), at will.
• Wrongful Discharge
➢ An employee dismissal that does not comply with the law or
does not comply with the contractual arrangement stated or
implied by the firm via its employment application forms,
employee manuals, or other promises.
Managing Dismissals (cont’d)
Protections Against
Wrongful Discharge
Common law Public policy
Statutory exceptions
exceptions exceptions
Grounds for Dismissal
Unsatisfactory
performance
Misconduct
Bases for
Dismissal
Lack of qualifications
Changed requirements of
(or elimination of) the job
Insubordination
1. Direct disregard of the boss’s authority.
2. Direct disobedience of, or refusal to obey,
the boss’s orders, particularly in front of others.
3. Deliberate defiance of clearly stated company
policies, rules, regulations, and procedures.
4. Public criticism of the boss.
5. Blatant disregard of reasonable instructions.
6. Contemptuous display of disrespect.
7. Disregard for the chain of command.
8. Participation in (or leadership of) an effort to
undermine and remove the boss from power.
FIGURE 9–11 Was It Gross Misconduct?
• Was anyone physically harmed? How badly?
• Did the employee realize the seriousness of his or her actions?
• Were other employees significantly affected?
• Was the employer’s reputation severely damaged?
• Will the employer lose significant business or otherwise suffer economic harm
because of the misconduct?
• Could the employer lose its business license because of the employee’s misconduct?
• Will the employee lose any license needed to work for the employer (e.g., driver’s license)?
• Was criminal activity involved?
• Was fraud involved?
• Was any safety statute violated?
• Was any civil statute violated?
• Was the conduct purposeful?
• Was the conduct on duty?
• Is the violated policy well-known to employees?
• Does the conduct justify immediate termination?
• Has the employer immediately fired other employees who did something similar?
Managing Dismissals (cont’d)
• Fostering Perceptions of Fairness in Dismissals
➢ Provide the employee with full explanations of why and
how termination decisions were made.
➢ Institute a formal multi-step procedure (including warning)
and establish a neutral appeal process.
➢ Have the employee’s direct supervisor inform
the employee of the dismissal decision.
• Security Measures
➢ Disable employee passwords and network access.
➢ Collect all company property and keys.
➢ Escort employee from company property.
FIGURE 9–12 Median Weeks of Severance Pay by Job Level
Severance Calculation Method Median Weeks of Severance
Executives Managers Professionals
Fixed 26 6 4
Variable Amount by Employment Tenure
1 year 4 2 2
3 years 7 5 5
5 years 10 7 7
10 years 20 12 10
15 years 26 16 15
Maximum 39 26 24
Avoiding Wrongful Discharge Suits
• Bases for Wrongful Discharge Suits
➢ Discharge does not comply with the law.
➢ Discharge does not comply with the contractual arrangement
stated or implied by the firm via its employment application
forms, employee manuals, or other promises.
• Avoiding Wrongful Discharge Suits
➢ Set up employment policies and dispute resolution procedures
that make employees feel fairly treated.
➢ Review and refine all employment-related policies, procedures,
and documents to limit challenges.
➢ Clearly communicate job expectations to the employee.
FIGURE 9–13 Handbook Acknowledgement Form
Personal Supervisory Liability
• Avoiding Personal Supervisory Liability
➢ Be familiar with applicable statutes and know how to uphold their
requirements.
➢ Follow company policies and procedures.
➢ Be consistent with application of rules or regulations.
➢ Don’t administer discipline in a manner that adds to the
emotional hardship on the employee.
➢ Allow employees to tell their side of the story.
➢ Do not act in anger.
➢ Utilize the HR department for advice regarding how to handle
difficult disciplinary matters.
The Termination Interview
Guidelines for the Termination Interview
1 Plan the interview carefully.
2 Get to the point.
3 Describe the situation.
4 Listen.
5 Review all elements of the severance package.
6 Identify the next step.
Termination Assistance
• Outplacement Counseling
➢ A systematic process by which a terminated employee is trained
and counseled in the techniques of conducting a self-appraisal
and securing a new job appropriate to his or her needs and
talents.
• An offer of outplacement assistance:
➢ Does not imply that the employer takes responsibility
for placing the person in a new job.
➢ Is part of the terminated employee’s support or severance
package and is often done by specialized outside firms.
Termination Assistance (cont’d)
• Outplacement Firms
➢ Can help the employer devise its dismissal plan regarding:
❖ How to break the news to dismissed employees.
❖ Dealing with dismissed employees’ emotional reactions.
❖ Instituting the appropriate severance pay and equal
opportunity employment plans.
Interviewing Departing Employees
• Exit Interview
➢ Its aim is to elicit information about the job or related matters that
might give the employer a better insight into what is right—or
wrong—about the company.
❖ The assumption is that because the employee is leaving, he
or she will be candid.
❖ The quality of information gained from exit interviews is
questionable.
FIGURE 9–14
Employee Exit
Interview Questionnaire
The Plant Closing Law
• Worker Adjustment and Retraining Notification Act
(1989)
➢ Requires employers of 100 or more employees to give 60
days’ notice before closing a facility or starting a layoff of 50
people or more.
➢ The law does not prevent the employer from closing down,
nor does it require saving jobs.
➢ The law is intended to give employees time to seek other work
or retraining by giving them advance notice of the shutdown.
The Layoff Process
• Layoff Steps
➢ Identify objectives and constraints.
➢ Form a downsizing team.
➢ Address legal issues.
➢ Plan post-implementation actions.
➢ Address security concerns.
➢ Try to remain informative.
Layoffs and Downsizing
• Bumping/Layoff Procedures
➢ Seniority is usually the determinant of who will work.
➢ Seniority can give way to merit or ability.
➢ Seniority is usually based on the employee’s hiring
date, not the date he or she took a particular job.
➢ Company-wide seniority allows an employee in one
job to bump or displace an employee in another job.
Layoffs and Downsizing Alternatives
• Voluntarily reducing employees’ pay
• Concentrating employees’ vacations
• Taking voluntary time off
• Releasing temporary workers
• Offering early retirement buyout packages
Adjusting to Downsizings and Mergers
• Guidelines for treatment of departing employees
during a merger:
➢ Avoid the appearance of power and domination.
➢ Avoid win–lose behavior.
➢ Remain businesslike and professional.
➢ Maintain a positive feeling about the acquired
company.
➢ Remember that how the organization treats the
acquired group will affect those who remain.
