Chapter 16

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					               The Changing Employment Contract

   Old Social Contract                    New Social Contract
Job security                     Few tenure arrangements

Life careers with one employer   Few life careers; changes common

Loyalty to employer              Loyalty to self

Paternalism                      Relationships far less familial
                                 Personal responsibility for one’s job
Sense of entitlement
Stable, rising income            Pay for “value added”

Focus on individual
                                 Focus on team building and projects
                                   Employee Rights

                Sources of Employee Rights

   Statutory rights
   Collective bargaining rights
   Enterprise rights
             Models of Management Morality

               Employees are a human resource that
               must be treated with dignity and

  Amoral       Employees are treated as the law
Management     requires.

              Employees are viewed as factors of
              production to be used, exploited,
              and manipulated.
                                    Job-Related Rights

         The right not to be fired without just cause(*)

         The right to due process and fair treatment

         The right to freedom, particularly freedom of
         expression and freedom of speech

         The rights to privacy, safety, and health in the

(*) see employment at will
            Right Not to be Fired Without Cause

                Employment-at-Will Doctrine

Public Policy     Protects employees from being fired for
 Exceptions       refusal to break the law

 Contractual      Protects employees who they believe have
  Actions         contracts or implied contracts

Breach of Good Employers are expected to hold to a
 Faith Actions standard of fairness and good faith dealings
       Management’s Response to Job Claims

1.   Stay on the right side of the
2.   Investigate complaints in
     good faith
3.   Deal in good faith with
4.   Fire only for good cause
               The Right to Due Process

          The right of employees to have
  Due     decisions that adversely affect them
Process   to be reviewed by objective, impartial
          third parties.
                                     The Requirements of a
                                       Due Process System

1.   It must be a procedure and must follow rules.
2.   It must be visible so that potential violators are aware of it.
3.   It must be predictably effective.
4.   It must be institutionalized.
5.   It must be perceived as equitable.
6.   It must be easy to use.
7.   It must apply to all employees.
                Alternative Dispute Resolution

 Hearing      Permits employees to be represented by
Procedure     an attorney or neutral party

              A “troubleshooter” investigates and helps
Ombudsman     achieve equitable settlements for
              employee complaints

              Fellow workers in the same job family and
Peer Review
              at a grade level equal to or higher than
              the employee with a grievance
     Freedom of Speech in the Workplace

            An individual who reports to some
Whistle-    outside party some wrongdoing that
            he/she knows or suspects his/her
            employer of committing.


     Key Elements in the Whistle-Blowing Process

1.   The whistle-blower
2.   The complaint
3.   The party to whom the complaint is made
4.   The organization against which the complaint is
                      Checklist for Whistleblowers
1.   Avoid a conflict of interest. Maintain ethical
2.   Make sure premises are sound and facts are
3.   Enlist others who share the same view.
4.   Enlist support of professional societies and
     regulatory agencies.
5.   Stay focused on issues that merit
     public trust.
6.   Come forward and be identified as the
7.   Be relentless.
             Consequences of Whistle-Blowing

   More stringent criticism of work
   Less desirable work assignments
   Pressure to drop charges against the company
   Heavier workloads
   Loss perquisites
   Exclusion from meetings

           Examples of Government Protection

   1978 Civil Service Reform Act
   Michigan Whistle-Blowers Protection Act of 1981
   Sarbanes-Oxley Whistle-Blower Protections
   False Claims Act

          Sarbanes-Oxley Whistle-Blower Protections

   Comprehensive coverage for all employees of publicly-traded
   Comprehensive protection for discrimination or harassment
   Any corporate conduct that could threaten shareholder value
   Timely responses
   The right to a jury trial
   Lessened burden of proof on employee
   Compensatory damages and judicial fees
   Criminal felony penalties for retaliation
   Audit committees required to have complaint response procedures
                      Management’s Responsiveness
                               to Whistle-Blowing
1. Assure employees that the organization will not interfere
   with their basic political freedoms.
2. Streamline grievance procedure so that employees can
   direct complaints and not “blow the whistle.”
3. Review the organization’s concept of social
   responsibility so that it is not simply corporate giving to
4. Formally recognize and communicate respect for
   individual consciences of employees.
5. Realize that dealing harshly with whistle-blowers could
   result in adverse public reaction.
                      Management’s Responsiveness
                               to Whistle-Blowing
               Responsiveness to Employees

1. Listen
2. Delve into why the employee is pursuing the complaint
3. Look for solutions that will address the interests of both
   the objector and the company
4. Attempt to establish an equitable means of judging
   future actions
                  Five Issues of Employee Privacy

1. Collection and use of employee
   information in personnel files
2. Use of the polygraph, or lie detector,
   in making employee decisions
3. Honesty testing
4. Drug testing
5. Monitoring employee’s work and
   conversations by electronic means
        Collection and Use of Employee Information

   Privacy Act of 1974
   USA Patriot Act
   Department of Health and Human Services
   Americans with Disabilities Act (ADA)
                                Use of the Polygraph
 Employee Polygraph Protection Act
   Exceptions include security services, and workers in
    nuclear facilities, radioactive or toxic waste, controlled
    substances, public water supply, public transportation
                                    Use of the Polygraph
          Proponents                        Critics

   Employers have a right to      Inaccurate diagnoses in
    protect property                50% of cases

   95% accuracy                   Probes into zones of
                                    privacy that are personal
                                    and not job related
   Gathers only information
    the company has a
    legitimate right to know
                             Integrity Testing

                        Stem employee theft

                    Avoid “negligent hiring” suits
Reasons for Use
                  Screen employees cost-effectively

                        Replace polygraphs
                                           Drug Testing

               Arguments For Drug Testing

   High cost of drug abuse
     Increased rate of injuries
     Increased rate of theft
     Increased propensity to make poor decisions

   Ethical responsibility to employees and public to
      Safe workplaces
      Secure asset protection
      Safe places to transact business
                                             Drug Testing

                Arguments Against Drug Testing

   Violates due process rights
   Invades privacy rights
   Ignores employee’s actual performance
   Inaccuracy of tests
   Negative impact on employee morale
   Tests show use, not abuse
   High cost
   Management, employee, and union opposition
                          Guidelines for Drug Testing

   Management should not discipline or fire someone for
    refusing to take drug test
   Use drug tests only when there is legitimate suspicion
    of abuse
   Focus should be on-the-job performance
   Employees should be informed of methods used and
   A confirmatory test should be conducted
   Conduct in a way to respect employee dignity and
                                              Drug Testing

                 State and Federal Legislation

   State laws
     Restrict drug testing to reasonable suspicion

   Federal laws
     Americans with Disabilities Act (ADA)
     Mandatory testing programs
        • Federal workers
        • Transportation workers
                Employee Assistance Programs

                 Affirmations of EAPs

1. Employees are valuable members of the
2. It is better to help troubled employees than to
   discipline or discharge them
3. Recovered employees are better employees

   Employee monitoring occurs at 82% of mid- to
    large-sized firms
       video cameras
       listening devices
       Internet connections
       telephone calls
       e-mail
       GPS
       camera phones
                                     Privacy Issues

             Effects of Employee Monitoring

   Invades privacy
   Treats employees unfairly
   Creates stress and tension
   Produces low morale
   Creates a sense of job
                                          Privacy Issues

        Policy Guidelines on the Issue of Privacy

1. Obtain informed consent before acquiring information
2. Disclose the nature of surveillance
3. Set controls to avoid unauthorized spread of information
4. Collect and use only job-relevant medical and health data
5. Require reasonable suspicion before doing drug tests
6. Respect and preserve the boundary between work and
                                       Workplace Safety

                   OSHA’s Strategic Goals

   Reduce occupational hazards through direct intervention

   Promote a safety and health culture through compliance
    assistance, cooperative programs, and strong leadership

   Maximize OSHA’s effectiveness and efficiency by
    strengthening its capabilities and infrastructure

                                     Workplace Safety
        OSHA’s Hazard Communication Standard
1. Update inventories of hazardous chemicals in the
2. Assemble material safety data sheets.
3. Ensure that hazardous chemicals are properly labeled.
4. Train workers on the use of hazardous chemicals.
5. Prepare a written description of the hazard communication
6. Consider any problems with trade secrets from the
   disclosure requirements.
7. Review state requirements for hazard disclosure.
                                       Workplace Safety
    Employee Responsibilities and Rights Under OSHA

   Each employee shall comply with standards, rules,
    regulations, and orders.
   Employees shall use safety equipment, protective
    equipment, and other devices/procedures provided.
   Employees shall have the right to report unsafe and
    unhealthful working conditions.
   Employees shall be authorized official time to participate
    in the activities.
                                       Workplace Safety
                   Workplace Violence

   Workplace violence research
     Each workday…
       • 16,400 threats
       • 723 workers are attacked
       • 43,800 workers are harassed
     1,000 homicides at work yearly
   Companies respond
                                     Workplace Safety
         Workplace Violence: Who Is Affected?

   Workers who…
     exchange money with the public
     deliver passengers, goods, or services
     work alone or in small groups
     work late at night or early morning
     work in community settings with extensive public
     work in high-crime areas
                                 Workplace Safety
           Preventing Workplace Violence

1. Provide safety education
2. Secure the workplace
3. Provide drop safes
4. Equip field staff with cell phones and alarms
5. Instruct employees not to enter unsafe locations
6. Develop policies and procedures for home
   health-care providers
              Health Issues in the Workplace
Components of HIV/AIDS Comprehensive Programs

1. Workplace policy
2. Training
3. Employee education
4. Family education
5. Community involvement
                    Health Issues in the Workplace
                  Family-Friendly Workplace

   Corporate policies
   Federal law
     Family and Medical Leave Act
                  Health Issues in the Workplace
              Family-Friendly Benefits

1. Dependent care flexible
   spending accounts
2. Flextime
3. Family leave
4. Telecommuting
5. Compressed workweeks
                  Health Issues in the Workplace
             Domestic Partner Benefits

1. Health Insurance
2. Life Insurance
3. Family leave