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Procedural Justice and Ethics

Procedural Justice and Ethics. Wayne F. Cascio Executive MBA Class of 2009 November 1, 2008. Some Definitions. Procedural Justice The fairness of the procedures used to make decisions What makes procedures fair? Consistent across persons and over time Free from bias

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Procedural Justice and Ethics

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  1. Procedural Justice and Ethics Wayne F. Cascio Executive MBA Class of 2009 November 1, 2008

  2. Some Definitions • Procedural Justice • The fairness of the procedures used to make decisions • What makes procedures fair? • Consistent across persons and over time • Free from bias • Based on accurate information • Correctable

  3. More Definitions • Ethical decisions about behavior • Take account not only of one’s own interests, but also those affected by a decision • Just cause - An employer must do 3 things • Produce persuasive evidence of an employee’s negligence • Provide the employee a fair hearing • Impose a penalty appropriate for the offense

  4. Basic Rules of Performance Counseling • Be prepared • Be factual • Support the employee’s good performance • Decide to help the employee improve performance • Plan for the future

  5. How to Document Incidents • Describe what led up to it – problem and setting • Describe what actually happened that was so effective or ineffective • Be specific! Include names, dates, times, and other facts • Describe the consequences of the effective/ineffective behavior

  6. The Red Hot Stove Rule • Discipline should be: • Immediate • With warning • Consistent • Impersonal

  7. Termination – Legally and Humanely • Review all relevant facts • Get employee’s version • How were similar cases handled in the past? • Prior to interview, answer 3 basic questions: • Who – immediate manager • When – not on Friday; any personal concerns? • Where – neutral territory

  8. The Termination Interview • Present the situation in a clear, concise, and final manner • Avoid debates or a rehash of the past • Be empathetic, but not compromising • What’s the next step? • Be prepared for a variety of reactions

  9. Typical Severance Agreements • Lower-level employees • 1 week’s pay for each year of service • Executives earning $50 - $150,000 • 8 months • Executives earning $150 - $200,000 • 11 months • CEOs with contracts – 2-3 years

  10. Employment Contracts • Governed by state law • Most firms include choice-of-law prov. • State that the contract is the entire agreement • It can be amended only in writing, and when signed by both parties • Limit “no-competes” by geography, length of time

  11. When Should You Ask for An Employment Contract? • Competition for talent is intense • Ideas are at a premium • Non-standard conditions of employment • Duration – 2-3 years, during which you agree not to quit • Components – title, pay, benefits, stock options, vacation, terms of firing, severance

  12. Employment Contracts • No-solicitation clause • Payback clause • Company-match clause • No-disclosure clause • No-compete clause • Fiduciary duty of loyalty applies with or without a contract

  13. Employment Contracts • Suggestions for Negotiating • Decide beforehand 4-5 “make-or-break” issues • Clarify 2ndary issues, such as length of vacation or company car, but don’t let them become a source of contention • Present the entire package at once. Don’t nit-pick, 2nd guess, or keep coming back for one more concession

  14. Employment Contracts • Let the company win on some issues • Don’t pressure to the point where you come in “looking greedy”

  15. Privacy • The interest employees have in controlling the use of their personal information and in being able to engage in behavior free from regulation or surveillance • 3 main issues: • Kind of information collected and retained • How that information is used • Extent to which it can be disclosed to others

  16. Fair Information Practice Policies • Limit collection of information to that which is relevant • Inform employees about the types of information being maintained and how it is used • Adopt procedures to ensure accuracy, timeliness, and completeness of information • Permit employees to see, copy, correct, or amend their own records

  17. Whistle-Blowing • Disclosure of illegal, immoral, or unethical practices under control of the employer to persons or organizations that might be able to do something about them

  18. Research on Unethical Behavior • People can be conditioned to behave unethically (if rewarded for it), especially under increased competition • But the threat of punishment has a counter-balancing influence • When policies favoring ethical behavior are present, ethical behavior increases

  19. Protections and Incentives • 40 states + federal government protect the jobs of workers who report wrongdoing by their companies • False Claims Act of 1863 (as recently amended): • Citizens may sue a federal contractor for fraud on the government’s behalf • Share up to 30% of $ recovered

  20. Whistle-Blowing Do’s and Don’ts • Do ensure your allegations are correct • Keep careful records, learn if your state provides protection for whistle-blowers • Talk to your family; prepare for worst • Legal protection for non-federal Es varies • Don’t run to media, don’t expect a windfall

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