Presentation to the Mid-West Kentucky SHRM

Dane M. Partridge, Ph.D.Associate Professor of Management

University of Southern IndianaJuly 24, 2008

Workplace Due Process

Procedural Justice Procedurally fair treatment results in increased performance,

job satisfaction, organizational commitment, trust, and organizational citizenship behaviors

Grievance procedures found in about half of all nonunion firms In addition to increased organizational commitment and

performance, outcomes include decreased litigation and unionization (Cascio, 2006)

But note that procedure can have negative impact on supervisor morale (if they perceive that their decisions aren’t being backed by org) (Berenbeim, 1980)

Research involving hotel chain surveyed ees about their fairness perceptions (whether Er showed concern for their rights, whether they could appeal mngt decisions, whether ees’ concerns were listened to, etc.)Customer satisfaction data showed ratings were higher in

locations where ees felt they were treated more fairlyBoth formal procedures followed by managers and the way

individual supervisors treated ees was important (Jackson and Schuler, 2006)

Employee RightsStatutory Rights

E.g., Civil Rights Act (and ADEA, PDA, ADA, and now Genetic Information Nondiscrimination Act), Occupational Safety and Health Act, National Labor Relations Act

Contractual RightsVery small percentage of labor force works under

employment contractCollective bargaining agreementImplied contract

Other RightsPsychological contract

Other rights may be less extensive than perceived by employees E.g., right to ‘fair’ treatment, right to privacy, right to free

speech

Issue: Restrictions on Office Romance Is there a job-related reason why a company would

decide to restrict dating between employees and enforce a no-dating (no fraternization) policy? Do you think employers have a right to restrict the following off-duty conduct of their ees -- Having a romantic affair outside of the marriage relationship? January 2006 survey found 50% of respondents have known

married co-worker who was involved w/ someone else at office

American Management Association found only 12% of companies surveyed in 2003 had written policies on issue Of these, most simply prohibit mngrs from dating subordinates Some ers also bar romance among peers on same work team

“Romance changes the dynamics of team relationships” Studies by SHRM show mngt taking increasingly punitive

stance 55% of companies in 2001 survey said ee who mismanaged office

romance would be transferred, up from 42% in 1998 study 35% said ees could be fired, up from 27%

January 2006 survey found 38% of ees have experienced unwanted advances from co-worker

o Source: Wall Street Journal, 2/20/04; HRNews Online, 2/9/06

Management RightsEmployment-at-will

Legal limitations to employment-at-willPublic policy exceptions Implied contractsGood faith and fair dealing

Employment-at-will acknowledgementsMay have legal advantages, but job security is important

feature to many applicantsOrganizational recruiting materials that emphasize due

process, rights of appeal, and grievance mechanisms send message that job security is high – employment-at-will acknowledgements suggest the opposite

Research indicates that applicants find companies with due process policies more attractive than companies with employment-at-will policies (Noe et al., 2008)

(As reported in Monthly Labor Review, January 2001.)

EMPLOYEES COVERED BY UNJUST DISMISSAL PROTECTIONS

Source: Budd (2008)

Administering and Managing DisciplineBasic Standards of Discipline

Communication of rules and performance criteria

Documentation of the factsConsistent response to rule violations

Hot-stove ruleIs it fair to treat everyone equally?

‘Just Cause’ Standard of DisciplineFailure to answer “yes” to one or more of these

questions suggests that the discipline may have been arbitrary or unwarranted.Notification Was the employee forewarned of the disciplinary

consequences of his or her conduct?Reasonable Rule Was the rule the employee violated

reasonably related to safe and efficient operations?Investigation Before the Discipline Did managers conduct an

investigation into the misconduct before administering discipline?

Fair Investigation Was the investigation fair and impartial?Proof of Guilt Did the investigation provide substantial

evidence or proof of guilt?Absence of Discrimination Were the rules, orders, and

penalties of the disciplinary action applied even handedly and without discrimination?

Reasonable Penalty Was the disciplinary penalty reasonably related to the seriousness of the rule violation? (Gomez-Mejia et al., 2007)

Right to Appeal Discipline Open-door program (org culture determines whether program is credible

w/ ees – how open is the door? Whose door?) Appear to be more popular with white-collar ees, while blue-collar prefer

more formalized approach (McCabe, 1997) Speak-up program (or skip-level, similar to open-door but prescribes

specific steps for ee to take in bringing work problem to mngt’s attention) Ombudsman (Rockwell, J&J, Herman Miller, Eastman Kodak) (Bohlander

and Snell, 2007) Peer review (peers and managers other than direct supervisor) (aka

internal tribunal) May be final step, following appeal to direct supervisor, then employee

relations rep One model is three peers, two mngrs Peer review may be element of participative mngt approach (McCabe,

1997) Peer review panels used by Red Lobster, TRW, Marriott International,

Rockwell (French, 2007) Union grievance procedure (more on nonunion shortly…)

Duty of fair representation Weingarten rights (investigatory interview) Steelworkers’ Trilogy, Spielberg, and Collyer

Alternative Dispute Resolution Stages

Open door policyPeer reviewMediationArbitration

American Arbitration Association can provide mediators or arbitrators, as can Federal Mediation and Conciliation Service

Arbitration typically reviews implementation of policy, not policy itself (Bernardin, 2007)

ADR can be highly effective in terms of cost and time savingsFor example, over four-year period, Kellogg, Brown and Root

found that legal fees dropped 90 percent after instituting ADR Of 2,000 disputes initiated by ees, only 30 (1.5 percent) ever reached

binding arbitration (Noe et al., 2008) Unless ee believes er’s procedures allow valid appeal, ee

may prefer to take grievance to court (Fossum, 2006)

Nonunion Grievance Procedures All ees must know about procedure and exactly how it operates Ees must believe there will be no reprisals taken against them for

using it Mngt must respond quickly and thoroughly to all grievances

Time limits should be established For genuine due process to operate, ee must have representation

or assistance in preparing and presenting grievance, procedure must include objective investigator and decision maker who has power to make binding decision (Cascio, 2006)

Specific details of grievance procedure policy not as important as the way the policy is carried out (Jackson and Schuler, 2006) Is nonunion grievance procedure more credible than peer review?No one best system for all firms – each system should be specifically

tailored to fit the particular organization, and ees should be involved in planning and implementation (McCabe, 1997)

Research indicates that providing employee with explanation for the decision is significantly related to perceived fairness of process (Blancero, 1995)

Compulsory Arbitration of Employment DisputesU.S. Sup Ct has allowed employers to impose as

condition of employment requirement that any employment dispute be resolved by arbitration (even a dispute arising from statutory right, such as Title VII) (Gilmer, Circuit City)But note EEOC v. Waffle House – EEOC can still bring

action against Er, even if EE is subject to binding arbitration

Issues:Cost (in union procedures cost is split; in nonU may be

most fair if Er pays, but that may raise concerns re: arbitrator bias)

Arbitrator selectionLimits on awards

Due Process as Union Avoidance PracticeEmployment security and effective

complaint procedure, among other things, may be substantive policies contributing to nonunion statusOutcome: ee perceptions of security and

equity, positive ee attitudes and higher morale

Grievance procedures more likely in firms with higher proportion of professional ees, larger firms, higher value on HR (Fossum, 2006)