Performance Diagnosis: Cengage HRM Exercise Week4

Discuss the Cengage Human Resources Management exercises included in this week’s materials.
Consider the following:
• What was the main issue of this week’s topic?
• How were your choices received by the supervisor in the simulation?
• What was the main lesson that you learned from this exercise?
• Did other people approach the scenario with your same point of view?
• How were your results similar or different from those of your peers?
***Please answer the questions 350-700 words
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PART IV EMPLOYEE DEVELOPMENT CHAPTER7
PART IV EMPLOYEE DEVELOPMENT CHAPTER7
Appraising and Managing Performance
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 223
The Managerial Perspective
The situation at Milo Engineering (a real organization given a fictitious name) illustrates
common problems with performance appraisal—the process of assessing employee per-
formance and diagnosing and improving performance problems. Maintaining and improv-
ing your performance and the performance of other people in the organization will be
an important part of your role as a manager. To conduct this process, you may rely on
appraisal forms and systems that are often designed by HR personnel. Although these
forms and systems are key elements of the appraisal process, they are only a starting point.
To appraise effectively, you must also spot performance problems, provide construc-
tive feedback, and take action to improve performance. Measuring and managing per-
formance are two of the most difficult issues a manager faces. However, managers must
measure performance and provide meaningful feedback to employees if employees are to
improve—even if salary dollars are not at stake. We all need, want, and deserve feedback
regarding how we are doing in the workplace.
Our first goal in this chapter is to acquaint you with the foundation, design, and imple-
mentation of performance measurement systems. Our second is to describe the principles
of effective performance management.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 223
The Managerial Perspective
The situation at Milo Engineering (a real organization given a fictitious name) illustrates
common problems with performance appraisal—the process of assessing employee per-
formance and diagnosing and improving performance problems. Maintaining and improv-
ing your performance and the performance of other people in the organization will be
an important part of your role as a manager. To conduct this process, you may rely on
appraisal forms and systems that are often designed by HR personnel. Although these
forms and systems are key elements of the appraisal process, they are only a starting point.
To appraise effectively, you must also spot performance problems, provide construc-
tive feedback, and take action to improve performance. Measuring and managing per-
formance are two of the most difficult issues a manager faces. However, managers must
measure performance and provide meaningful feedback to employees if employees are to
improve—even if salary dollars are not at stake. We all need, want, and deserve feedback
regarding how we are doing in the workplace.
Our first goal in this chapter is to acquaint you with the foundation, design, and imple-
mentation of performance measurement systems. Our second is to describe the principles
of effective performance management.
ISBN
1-256-39369-X
What Is Performance Appraisal?
Performance appraisal, as shown in Figure 7.1, includes the identification, measurement , and
management of human performance in organizations.1
¦
Identification means determining what areas of work the manager should be examining
when measuring performance. Rational and legally defensible identification requires a
measurement system based on job analysis, which we explored in Chapter 2 . The appraisal
system, then, should focus on performance that affects organizational success rather than
performance-irrelevant characteristics such as race, age, or sex.
¦
Measurement, the centerpiece of the appraisal system, entails making managerial judgments
of how “good” or “bad” employee performance was. Performance measurement
must be consistent throughout the organization. That is, all managers in the organization
must maintain comparable rating standards.2
¦
Management is the overriding goal of any appraisal system. Appraisal should be more
than a past-oriented activity that criticizes or praises workers for their performance in the
preceding year. Rather, appraisal must take a future-oriented view of what workers can
do to achieve their potential in the organization. This means that managers must provide
workers with feedback and coach them to higher levels of performance.
The Uses of Performance Appraisal
Organizations usually conduct appraisals for administrative and/or developmental purposes.3
Performance appraisals are used administratively whenever they are the basis for a decision
about the employee’s work conditions, including promotions, termination, and rewards.
Developmental uses of appraisal, which are geared toward improving employees’ performance
and strengthening their job skills, include providing feedback, counseling employees on effective
work behaviors, and offering them training and other learning opportunities.
Performance appraisal offers great potential for a variety of uses, ranging from operational
to strategic purposes.4 If done effectively, performance appraisal can be the key to developing
employees and improving their performance. In addition, it provides the criteria against which
selection systems are validated and is the typical basis on which personnel decisions, such as terminations,
are legally justified. Further, performance appraisal makes the strategy of an organization
real. For example, performance measures that assess courtesy and care can make a stated
competitive strategy based on customer service very tangible to employees.
The importance of performance appraisal is underscored in a small-business environment.
The Manager’s Notebook, “Breadth and Direction: Keys to Effective Performance Appraisal in
Small Businesses,” considers basic characteristics of effective performance appraisal in a small-
business environment.
performance appraisal
The identification, measurement,
and management of human
performance in organizations.
Identification
Measurement
Management
FIGURE 7.1
A Model of Performance
Appraisal
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
224 PART IV • EMPLOYEE DEVELOPMENT
HR in Small Business
Breadth and Direction
Keys to Effective Performance Appraisal in Small Businesses
The workers in a small business are a critical resource that can make the difference between
the success or failure of the business. A small-business employee who makes serious on-
the-job mistakes or drives away customers can put a small operation out of business. How
do you get people on-board and provide a setting in your small business that will allow them to
perform at their best? A survey of almost 18,000 employees of small and medium businesses
indicates that performance management is a key driver of employee performance. How do you
appraise and manage the performance of workers in a small business in a way that engages them
with the business and promotes their best performance? Below are basic suggestions.
Go for Breadth
Developing job descriptions may seem like a formality that can be put off in a small business,
but small businesses are increasingly turning to job descriptions to make sure employees are
clear about their duties. However, the job descriptions need to be broad so that workers realize
that stepping into different roles or putting on different hats can be part of the job. A small busi-
ness may not have a sufficient number of specialists on staff. Succeeding as a small business can
mean that others have to pitch in a variety of ways. The performance expectations and measures
need to reflect that reality.
Provide a Clear Line of Sight to Strategic Objectives
How does a worker’s task make a difference or contribute to what the business is trying to do?
Each worker should be provided the big picture about the customers and how their efforts con-
tribute to the goal of serving those customers. Sometimes it is not obvious how performance on
some tasks makes a difference. However, if employees understand that a mistake may mean a
customer not getting an order or may result in damaged goods, they will understand the impor-
tance of their contributions.
Sources: Cicerone, B. (2009). Making a car engine purr. Industrial Management, 51, 13–17; McClellan, M. (2009).
Crystal clear. Smart Business Los Angeles, 4, 13; NJBIZ (2008). In crunch, small businesses focus on their work force.
21, 17–18; Westerlund, E. J. (2010). What makes people care. Profit, 29, 35. ¦¦
MANAGER’S NOTEBOOK
Despite the many uses of performance appraisals, companies struggle to realize the potential
in their performance appraisal systems. If managers aren’t behind the system and see its value,
it is little wonder if workers also don’t see the value in it. To be effective, the performance
appraisal system may require considerable time and effort of managers and may require employees
to gather information and receive feedback. Unfortunately, some managers do not take the
task seriously or do not have the skills needed to do a good job of evaluating performance and
providing feedback. Some employees do not calmly accept the feedback, and others may become
frustrated with an ineffective performance appraisal system and end up believing that the system
is unfair and doesn’t matter.
Although performance appraisal systems can have problems and are the target of many
criticisms, employees still want performance feedback, and they would like to have it more frequently
than the typical once-a-year performance evaluation.5 Although more frequent formal
appraisal can be positive, the practical reality is that informal appraisal, including feedback and
discussion with workers, should occur on a continuous basis.
If appraisal is not done well—if, for instance, performance is not measured accurately and
feedback is poorly given—the costs of conducting the appraisal may exceed its potential benefits.
6 It makes good business sense to engage in a practice only if the benefits exceed the cost.
Some people take the position that performance appraisal should not be done at all.7 From this
perspective, the practice of performance appraisal is staunchly opposed as a hopelessly flawed
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 225
and demeaning method of trying to improve performance.8 Thus, performance appraisal should
be eliminated as a practice in organizations because of the problems and errors in evaluating
performance.9 One basis for the position against doing performance appraisal is the quality philosophy10
that performance is mainly due to the system and that any performance differences
among workers are random.
Although there is selected opposition, the vast majority of organizations conduct performance
appraisal. Most organizations recognize employees as an important and nonrandom influence
on performance. (In order for selection systems to be found valid, employees must have a
nontrivial and consistent influence on performance.) However, in order to maintain and improve
their performance, employees need assessment and feedback.
Whether the performance is in the workplace, in the classroom, or on a playing field, you
have to gauge how you are performing to learn how to improve and, later, to assess whether
you have improved. Figure 7.2 lists several reasons, from both the employer’s and employee’s
perspectives, why appraisal is valuable despite the criticisms that have been leveled against it.
In the next two sections, we explain the issues and challenges involved in the first two steps
of performance appraisal: identification and measurement. We conclude the chapter by discussing
how managers can use the results of appraisal to improve employee performance.
Identifying Performance Dimensions
The first step in the performance appraisal process (see Figure 7.1 ) is identifying what is to be
measured. Consider the following example:
As part of her job as team manager, Nancy has to allocate raises based on performance.
She decides to take a participative approach to deciding which aspects, or dimensions, deter-dimension
mine effective job performance. In a meeting, she and her team start generating dimensions of An aspect of performance
performance. One of the first suggestions is the quality of work done. However, Nancy realized
that determines effective job
performance.
that some of the workers she supervises took three times longer than others to complete assignments,
so she offered quantity of work performed as another dimension. One worker volunteered
that how well someone interacted with peers and “customers” inside the organization was pretty
important. The team added interpersonal effectiveness as another performance dimension.
Employer Perspective
1. Despite imperfect measurement techniques, individual differences in performance can make a difference
to company performance.
2. Documentation of performance appraisal and feedback may be needed for legal defense.
3. Appraisal provides a rational basis for constructing a bonus or merit system.
4. Appraisal dimensions and standards can help to implement strategic goals and clarify performance expectations.
5. Providing individual feedback is part of the performance management process.
6. Despite the traditional focus on the individual, appraisal criteria can include teamwork and the teams
can be the focus of the appraisal.
Employee Perspective
1. Performance feedback is needed and desired.
2. Improvement in performance requires assessment.
3. Fairness requires that differences in performance levels across workers be measured and have an
effect on outcomes.
4. Assessment and recognition of performance levels can motivate workers to improve their performance.
ISBN
1-256-39369-X
FIGURE 7.2
The Benefits of Performance Appraisal
Source: Based on Cardy, R. L., and Carson, K. P. (1996). Total quality and the abandonment of performance appraisal: Taking a good thing too far? Journal of
Quality Management, 1, 193–206; Heinze, C. (2009). Fair appraisals. Systems Contractor News, 16, 36–37; Tobey, D. H., and Benson, P. G. (2009). Aligning
performance: The end of personnel and the beginning of guided skilled performance. Management Revue, 20, 70–89.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
226 PART IV • EMPLOYEE DEVELOPMENT
competencies
Characteristics associated with
successful performance.
competency model
Set of competencies associated
with a job.
relative judgment
An appraisal format that asks
supervisors to compare an
employee’s performance to the
performance of other employees
doing the same job.
Raising and considering additional work dimensions might continue until Nancy and her
team have identified perhaps six or eight dimensions they think adequately capture performance.
The team might also decide to make the dimensions more specific by adding definitions of each
and behavioral descriptions of performance levels.
As you have probably realized, the process of identifying performance dimensions is very
much like the job-analysis process described in Chapter 2 . In fact, job analysis is the mechanism
by which performance dimensions should be identified.
Management experts point out that what is measured should be directly tied to what the
business is trying to achieve,11 because measurement should be viewed as a management tool,
not a measurement exercise. Many organizations identify performance dimensions based on
their strategic objectives. This approach makes sure that everyone is working together toward
common goals.12
An increasingly popular approach to identifying performance dimensions focuses on
competencies, the observable characteristics people bring with them in order to perform the
job successfully.13 Defining competencies as underlying and unseen characteristics leads to
the same difficulties associated with defining and measuring performance as personality traits,
as discussed in the following section. The set of competencies associated with a job is often
referred to as a competency model. An example of a competency model is presented in the
Manager’s Notebook, “Competencies for Beginning Legal Eagles.”
Measuring Performance
To measure employee performance, managers can assign it a number or a label such as “excellent,”
“good,” “average,” or “poor.”14
It is often difficult to quantify performance dimensions. For example, “creativity” may be an
important part of the advertising copywriter’s job. But how exactly can we measure it—by the
number of ads written per year, by the number of ads that win industry awards, or by some other
criterion? These are some of the issues that managers face when trying to evaluate an employee’s
performance.
Measurement Tools
Today managers have a wide array of appraisal formats from which to choose. Here we discuss
the formats that are most common and consider their legal defensibility. Appraisal formats can
be classified in two ways: (1) by the type of judgment that is required (relative or absolute) and
(2) by the focus of the measure (trait, behavior, or outcome).
RELATIVE AND ABSOLUTE JUDGMENTS Appraisal systems based on relative judgment ask
supervisors to compare an employee’s performance to the performance of other employees
doing the same job. Providing a rank order of workers from best to worst is an example of a relative
approach. Another type of relative judgment format classifies employees into groups, such
as top third, middle third, and lowest third.
Relative rating systems have the advantage of forcing supervisors to differentiate among
their workers. Without such a system, many supervisors are inclined to rate everyone the
same, which destroys the appraisal system’s value. For example, one study that examined the
MANAGER’S NOTEBOOK
Emerging Trends
Competencies for Beginning Legal Eagles
C
C
ommon competencies that new associates need to exhibit in order to succeed underlie the
dynamic work environment of a law firm. Figure 7.3 shows the competencies identified
by a law firm as important to the success of new associates. Each abstract, or conceptual,
description is followed by behavioral examples illustrating poor and good levels of performance.
The law firm is using the competency framework for performance appraisal and also to
drive recruitment, training, and promotion. It has already made performance standards clearer
to everyone in the organization.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 227
Competency Behavioral Illustration
Knowledge: Associate has solid grasp
of basic legal concepts. Demonstrates
intellectual curiosity and commitment
to understand. Takes ownership of
assignments.
Invests time to learn relevant law
Asks informed questions
Counts on others to know law
Skills and Capabilities: Associate
demonstrates strong basic skills in
written and oral communication,
analysis, organization, and problem
solving. Seeks out training and
work opportunities to improve skills.
Produces written work that a partner
can send to a client or to the court
with limited editing or rewriting
Produces written work that a partner
must substantially rewrite
Work Management: Associate
demonstrates strong work
management skills, including time
ISBN
1-256-39369-X
distribution of performance ratings for more than 7,000 managerial and professional employ
ees in two large manufacturing firms found that 95 percent of employees were crowded into
just two rating categories.
Most HR specialists believe the disadvantages of relative rating systems outweigh their
advantages, however.15 First, relative judgments (such as ranks) do not make clear how great
or small the differences between employees are. Second, such systems do not provide any
absolute information, so managers cannot determine how good or poor employees at the
extreme rankings are. For example, relative ratings do not reveal whether the top-rated worker
in one work team is better or worse than an average worker in another work team. This prob
lem is illustrated in Figure 7.4 . Marcos, Jill, and Frank are the highest-ranked performers in
their respective work teams. However, Jill, Frank, and Julien are actually the best overall
performers.
Third, relative ranking systems force managers to identify differences among workers where
none may truly exist.16 This can cause conflict among workers if and when ratings are disclosed.
Finally, relative systems typically require assessment of overall performance. The “big picture”
nature of relative ratings makes performance feedback ambiguous and of questionable value to
workers who would benefit from specific information about the various dimensions of their per
formance. For all these reasons, companies tend to find relative rating systems most useful only
when there is an administrative need (for example, to make decisions regarding promotions, pay
raises, or termination).17
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
228 PART IV • EMPLOYEE DEVELOPMENT
228 PART IV • EMPLOYEE DEVELOPMENT
Rankings and Team 1 Team 2 Team 3
Performance Levels Actual Ranked Work Ranked Work Ranked Work
Across Work Teams
10 (High) Jill (1) Frank (1)
9 Julien (2)
8 Tom (2) Lisa (3)
7 Marcos (1) Sue (3)
6 Uma (2)
5
4 Joyce (3) Greg (4)
3 Bill (4) Ken (5) Jolie (4)
2 Richard (5) Steve (5)
1 (Low)
absolute judgment
An appraisal format that asks
supervisors to make judgments
about an employee’s performance
based solely on performance
standards.
trait appraisal instrument
An appraisal tool that asks a
supervisor to make judgments about
worker characteristics that tend to
be consistent and enduring.
Unlike relative judgment appraisal formats, absolute judgment formats ask supervisors
to make judgments about an employee’s performance based solely on performance standards.
Comparisons to the performance of coworkers are not made. Typically, the dimensions of performance
deemed relevant for the job are listed on the rating form, and the manager is asked to
rate the employee on each dimension. An example of an absolute judgment rating scale is shown
in Figure 7.5.
Theoretically, absolute formats allow employees from different work groups, rated by different
managers, to be compared to one another. If all employees are excellent workers, they all
can receive excellent ratings. In addition, because ratings are made on separate dimensions of
performance, the feedback to the employee can be more specific and helpful. Absolute formats
are also viewed as more fair than relative formats.18
Although often preferable to relative systems, absolute rating systems have their drawbacks.
One is that all workers in a group can receive the same evaluation if the supervisor is reluctant to
differentiate among workers. Another is that different supervisors can have markedly different
evaluation standards. For example, a rating of 6 from an “easy” supervisor may actually be lower
in value than a rating of 4 from a “tough” supervisor. But when the organization is handing out
promotions or pay increases, the worker who received the 6 rating would be rewarded.
Nonetheless, absolute systems do have one distinct advantage: They avoid creating conflict
among workers. This, plus the fact that relative systems are generally harder to defend when
legal issues arise, may account for the prevalence of absolute systems in U.S. organizations.
It is interesting to note, though, that most people do make comparative judgments among
both people and things. A political candidate is better or worse than opponents, not good or bad
in an absolute sense. If comparative judgments are the common and natural way of making judgments,
it may be difficult for managers to ignore relative comparisons among workers.
TRAIT, BEHAVIORAL, AND OUTCOME DATA In addition to relative and absolute judgments, performance
measurement systems can be classified by the type of performance data on which they
focus: trait data, behavioral data, or outcome data.
Trait appraisal instruments ask the supervisor to make judgments about traits, worker characteristics
that tend to be consistent and enduring. Figure 7.6 presents four traits that are typically
found on trait-based rating scales: decisiveness, reliability, energy, and loyalty. Although some
organizations use trait ratings, trait ratings have been criticized for being too ambiguous19 and for
leaving the door open for conscious or unconscious bias. In addition, because of their ambiguous
nature trait ratings are less defensible in court than other types of ratings.20 Definitions of reliability
can differ dramatically across supervisors, for example, and the courts seem to be sensitive to
the “slippery” nature of traits as criteria.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
PERFORMANCE AREA 1 2 3 4 5 PERFORMANCE AREA 1 2 3 4 5
Ability to make job-related decisions
Accepts change
Accepts direction
Accepts responsibility
Attendance
Attitude
Compliance with rules
Cooperation
Cost consciousness
Dependability
PERFORMANCE REVIEW
Three-month (H&S) Annual (H-Only) Employee Name
Six-month (H&S) Special (H&S)
H = Hourly S = Salaried
Social Security # Hourly Salaried
For probationary employee review: Do you recommend
that this employee be retained? Yes No Classification/Classification Hire Date
Review period: From To Department/Division
For each applicable performance area, mark the box that most closely reflects the employee’s performance.
1 = unacceptable 2 = needs improvement 3 = satisfactory 4 = above average 5 = outstanding
Effective under stress
Initiative
Knowledge of work
Leadership
Operation and care of equipment
Planning and organizing
Quality of work
Quantity of acceptable work
Safety practices
SUPERVISOR’S OVERALL APPRAISAL
For overall appraisals at the 1 or 2 level: Is the employee to remain or be placed on probationary status? Yes No
If yes, what is the approximate date of next performance review?
JOB STRENGTHS AND SUPERIOR PERFORMANCE INCIDENTS:
AREAS FOR IMPROVEMENT:
PROGRESS ACHIEVED IN ATTAINING PREVIOUSLY SET GOALS:
SPECIFIC OBJECTIVES TO BE UNDERTAKEN PRIOR TO NEXT REVIEW FOR IMPROVED WORK PERFORMANCE:
SUPERVISOR COMMENTS:
EMPLOYEE COMMENTS:
Use separate sheet, if necessary, for additional comments by supervisor or employee. Please note on form if separate sheet is used.
Signing a review does not indicate agreement, only acknowledgment of being reviewed.
Employee’s Signature Date Rating Supervisor’s Signature Social Security # Date
Second Level Supervisor’s Signature Date Department Head’s Signature Date
FIGURE 7.5
Sample of Absolute
Judgment Rating Scale
ISBN
1-256-39369-X
Rate each worker using the scales below.
Decisiveness
1 2 3 4
Very low Moderate
5 6 7
Very high
FIGURE 7.6
Sample Trait Scales
Reliability
1 2
Very low
3 4
Moderate
5 6 7
Very high
Energy
1
Very low
2 3 4
Moderate
5 6 7
Very high
Loyalty
1
Very low
2 3 4
Moderate
5 6 7
Very high
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
230 PART IV • EMPLOYEE DEVELOPMENT
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka joka
230 PART IV • EMPLOYEE DEVELOPMENT
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka joka
behavioral appraisal
instrument
An appraisal tool that asks managers
to assess a worker’s behaviors.
FIGURE 7.7
Sample BARS Used to
Rate a Sales Manager
Source: Campbell, J. P., Dunnette,
M. D., Arvey, R. D., and Hellervik,
L. V. (1973). The development and
evaluation of behaviorally based rating
scales. Journal of Applied Psychology,
15–22. © 1973 by the American
Psychological Association. Reprinted
with permission.
Assessment of traits also focuses on the person rather than on the performance, which can
make employees defensive. This type of person-focused approach is not conducive to performance
development. Measurement approaches that focus more directly on performance, either
by evaluating behaviors or results, are generally more acceptable to workers and more effective
as development tools. It is not that personality traits are not important to performance; the problem
is with using a broad person characteristic, such as reliability, as a performance measure. To
categorize an employee as “unreliable” will likely make the worker defensive, and the basis for
the assessment may not be clear. It would be preferable to assess and provide feedback on more
observable and performance-relevant measures, such as number of times the employee has been
late, the number of missed deadlines, and so on.
Behavioral appraisal instruments focus on assessing a worker’s behaviors. That is, instead
of ranking leadership ability (a trait), the rater is asked to assess whether an employee exhibits
certain behaviors (for example, works well with coworkers, comes to meetings on time).
With one type of behavioral instrument, Behavioral Observation Scales, supervisors record how
frequently the various behaviors listed on the form occurred.21 However, ratings assessing the
value rather than the frequency of specific behaviors are more commonly used in organizations.
Probably the best-known behavioral scale is the Behaviorally Anchored Rating Scale (BARS).
Figure 7.7 is an example of a BARS scale used to rate the effectiveness with which a department
manager supervises his or her sales personnel. Behaviorally based rating scales are developed
with the critical-incident technique. We describe the critical-incident technique in the Appendix
to this chapter.
The main advantage of a behavioral approach is that the performance standards are unambiguous
and observable. Unlike traits, which can have many meanings, behaviors across the range of a
9
Could be expected to give his sales personnel
confidence and a strong sense of responsibility by
delegating many important jobs to them.
7
Could be expected to exhibit courtesy and respect
toward his sales personnel.
5
Could be expected to be rather critical of store
standards in front of his own people, thereby
risking their developing poor attitudes.
3
Could be expected to go back on a promise to an
individual whom he had told could transfer back
into previous department if she or he didn’t like the
new one.
1
Could be expected to conduct a full day’s sales clinic
with two new sales personnel and thereby develop
them into top salespeople in the department.
8
Could be expected never to fail to conduct training
meetings with his people weekly at a scheduled
hour and to convey to them exactly what he expects.
6
Could be expected to remind sales personnel to
wait on customers instead of conversing with
each other.
4
Could be expected to tell an individual to come in
anyway even though she or he called in to say she or
he was ill.
2
Could be expected to make promises to an
individual about her or his salary being based on
department sales even when he knew such a
practice was against company policy.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 231
dimension are included directly on the behavioral scale. Because behaviors are unambiguous and
based on observation, BARS and other behavioral instruments are more legally defensible than
trait scales, which often use such hard-to-define adjectives as “poor” and “excellent.” Behavioral
scales also provide employees with specific examples of the types of behaviors to engage in (and
to avoid) if they want to do well in the organization, and they encourage supervisors to be specific
in their performance feedback. Having behavioral examples can make clear to employees how
to enact organizationally prescribed values that may otherwise be unclear to them. For example,
acting with integrity or being ethical may sound like great concepts, but workers may be unclear
about what these concepts should mean for their day-to-day work performance. The Manager’s
Notebook, “Make Ethics Part of Appraisal,” suggests how you can operationalize these concepts.
Finally, both workers and supervisors can be involved in the process of generating behavioral
scales.22 This is likely to increase understanding and acceptance of the appraisal system.
Ethics
Make Ethics Part of Appraisal
Performance appraisal is typically focused on tasks and business accomplishments.
However, how duties are carried out and how goals are achieved can be critically important
in organizations. Specifically, the ethical conduct of employees can be an important issue,
but it is often not directly measured. Ethical conduct is often identified as a guiding value at the
organizational level. But how does this value translate into everyday performance on the job?
Including ethics in the appraisal of performance sends a clear signal about the importance
of ethics in the organization. Taking a behavioral approach to the assessment of ethical perfor-
mance can make clear the types of actions workers should and shouldn’t do.
The dimensions described here are examples of ethical characteristics that have been found
to occur in organizations. A positive and negative behavioral example is provided for each of
these dimensions of ethical performance. These behavioral examples are general and provide
only a broad behavioral description of each dimension. The behavioral descriptions would prob-
ably be most useful if they were customized for each organization’s setting.
Dimensions General Behavioral Examples
Misrepresentation This worker accurately states work situations.
This worker misconstrues work situations.
Information Sharing This worker openly shares information with coworkers.
This worker withholds information from coworkers.
Collegiality This worker supports colleagues and provides a positive influence.
This worker attacks colleagues and is a negative influence.
Adherence to Work Rules This worker follows standards for work processes.
This worker does not follow standards for work processes.
Sources: Cardy, R. L., and Selvarajan, T. T. (2004). Assessing ethical behavior: Development of a behaviorally anchored
rating scale. Paper presented at the Southern Management Association meeting, Orlando, FL, March; Selvarajan, T. T.,
and Cloninger, P. A. (2007). The influence of job performance outcomes on ethical assessments. Personnel Review, 38,
398–412; Selvarajan, T. T., and Sardessai, R. (2010). Appraisal of ethical performance: A theoretical model. Journal of
Applied Business Research, 26, 1–8. ¦¦
MANAGER’S NOTEBOOK
ISBN
1-256-39369-X
Behavioral systems are not without disadvantages, however. Developing them can be very
time consuming, easily taking several months. Another disadvantage is their specificity. The
points, or anchors, on behavioral scales are clear and concrete, but they are only examples of
behavior a worker may exhibit. Employees may never exhibit some of these anchor behaviors,
which can cause difficulty for supervisors at appraisal time. Also, significant organizational
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
232 PART IV • EMPLOYEE DEVELOPMENT
232 PART IV • EMPLOYEE DEVELOPMENT
outcome appraisal
instrument
An appraisal tool that asks managers
to assess the results achieved by
workers.
management by objectives
(MBO)
A goal-directed approach to
performance appraisal in which
workers and their supervisors set
goals together for the upcoming
evaluation period.
changes can invalidate behavioral scales. For example, computerization of operations can dramatically
alter the behaviors that workers must exhibit to be successful. Thus, the behaviors
painstakingly developed for the appraisal system could become useless or, worse, operate as a
drag on organizational change and worker adaptation. To avoid this problem of obsolescence,
behavioral examples could be developed that reflect general performance capabilities rather
than very job-specific task performance. The Manager’s Notebook “Behavioral Competency”
describes just such an approach to behaviorally based performance appraisal.
Outcome appraisal instruments ask managers to assess the results achieved by workers,
such as total sales or number of products produced. The most prevalent outcome approaches
are management by objectives (MBO)23 and naturally occurring outcome measures. MBO is a
goal-directed approach in which workers and their supervisors set goals together for the upcoming
evaluation period. The rating then consists of deciding to what extent the goals have been
met. With naturally occurring outcomes, the performance measure is not so much discussed and
agreed to as it is handed to supervisors and workers. For example, a computerized production
system used to manufacture cardboard boxes may automatically generate data regarding the
number of pieces produced, the amount of waste, and the defect rate.
MANAGER’S NOTEBOOK
Global
Behavioral Competency
One Set of Behavioral Standards for Everyone
T
T
he promotion process for noncommissioned officers in the Royal Canadian Mounted Police
was in need of repair. Rather than being based on job performance, candidates were promoted
to positions such as constable, corporal, and sergeant based on their job-knowledge
scores and their performance in an interview. The over 6,500 candidates for officer positions
wanted a better system—one that was based on performance. Thus, the Royal Canadian Mounted
Police developed a new performance appraisal system.
An important goal for the new system was that it should apply to all candidates for promotion
to officer status. Thus, the system had to assess people with a common set of standards, even
though they may perform different jobs. How could the Mounties be assessed with a behaviorally
based appraisal system that was not specific to a particular job?
The Royal Canadian Mounted Police bases its performance appraisals on eight core competencies.
Source: Paul McKinnon/Shutterstock
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 233
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka joka
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 233
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka joka
The solution was the development of a set of core competencies for the officer positions.
The process started with a job analysis of officer positions, which was the basis for identifying
core behavioral competencies for officers. The core competencies, along with brief descrip-
tions, follow:
Core Competency Description
Leadership Effectively sets and accomplishes goals through the involvement
and teamwork of others; inspires others to perform to highest
standards.
Service orientation
and delivery
Maintains a client focus and adheres to clear and visible service
quality values/standards.
Thinking skills Identifies, defines, comprehends, and analyzes problems and
situations using rational processes that result in the drawing of
accurate conclusions and viable solutions.
Personal effectiveness
and flexibility
Effectively adapts behavior to changing circumstances and has
tolerance for ambiguity.
Organization and planning Establishes effective courses of action.
Interpersonal relations Interacts sensitively and respectively with diverse individuals and
groups.
Communication Listens to and understands other perspectives.
Motivation Enthusiastic commitment to achieving goals.
For each core competency, BARS were developed for each officer level. The BARS are
now used to behaviorally assess each candidate for an officer position. The candidates with the
highest average rating across the competencies are promoted to officer status.
The Mounties have found a way to behaviorally assess employees even when they perform
different jobs. Further, the behavioral levels on these competencies appear to capture what is
important for performance at higher levels in the organization. The core competency and BARS
appraisal approach could be used effectively in many organizations.
Source: Based on Catano, V. M., Darr, W., and Campbell, C. A. (2007). Performance appraisal of behavior-based
competencies: A reliable and valid procedure. Personnel Psychology, 60 , 201–230. ¦¦
ISBN
1-256-39369-X
The outcome approach provides clear and unambiguous criteria by which worker performance
can be judged. It also eliminates subjectivity and the potential for error and bias that goes along
with it. In addition, outcome approaches provide increased flexibility. For example, a change in
the production system may lead to a new set of outcome measures and, perhaps, a new set of performance
standards. With an MBO approach, a worker’s objectives can easily be adjusted at the
beginning of a new evaluation period if organizational changes call for new emphases. Perhaps
the most important thing is that outcomes can easily be tied to strategic objectives.24
Are outcome-based systems, then, the answer to the numerous problems with the subjective
rating systems discussed earlier? Unfortunately, no. Although objective, outcome measures may
give a seriously deficient and distorted view of worker performance levels. Consider an outcome
measure defined as follows: “the number of units produced that are within acceptable quality
limits.” This performance measure may seem fair and acceptable. However, when the machine
is not running properly, it can take several hours—sometimes an entire shift—to locate the problem
and resolve it. If you were a manager, you would put your best workers on the problem.
But consider what would happen to their performance. Your best workers could actually end up
looking like the worst workers in terms of the amount of product produced.
This situation actually occurred at a manufacturer of automobile components.25 To resolve
the issue, management concluded that supervisors’ subjective performance judgments were
superior to objective outcome measures. The subjective ratings differed radically from the outcome
measures. But in this case, the subjective ratings were found to be related to workers’
scores on job-related tests whereas no such relationship was found for the outcome measures.
Clearly, in some situations human judgment is superior to objective measures.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
234 PART IV • EMPLOYEE DEVELOPMENT
234 PART IV • EMPLOYEE DEVELOPMENT
A QUESTION OF ETHICS
Is it appropriate for organizations
to evaluate and compensate
employees according to objective
measures of performance, even
though performance is at least
partially determined by factors
beyond their control? Should a
salesperson, for instance, be paid
completely on commission even in
the midst of a recession that makes
it practically impossible to sell
enough to make a decent living?
self-review
A performance appraisal system in
which workers rate themselves.
peer review
A performance appraisal system in
which workers at the same level in
the organization rate one another.
subordinate review
A performance appraisal system
in which workers review their
supervisors.
FIGURE 7.8
Evaluation of Major
Appraisal Formats
Another potential difficulty with outcome-based performance measures is the development of
a “results at any cost” mentality.26 Using objective measures has the advantage of focusing workers’
attention on certain outcomes, but this focus can have negative effects on other facets of performance.
For example, an organization may use the number of units produced as a performance
measure because it is fairly easy to quantify. Workers concentrating on quantity may neglect quality
and follow-up service to the long-term detriment of the organization. Likewise, a “results at
any price” mentality can lead workers to disregard ethics in the conduct of their job so that goals
are achieved.27 Although objective goals and other outcome measures are effective for increasing
performance levels, these measures may not reflect the entire spectrum of performance.28
Measurement Tools: Summary and Conclusions
Our discussion so far makes it clear that there is no single best appraisal format. Figure 7.8
summarizes the strengths and weaknesses of each approach in the areas of administration,
development, and legal defensibility. The choice of appraisal system should rest largely on the
appraisal’s primary purpose.
For example, say that your main management concern is obtaining desired results. An outcome
approach would be best for this purpose. However, when outcomes are not adequately
achieved, further evaluation may be needed to diagnose the problem.
Most appraisal systems were developed on the premise that companies could reduce or
eliminate rater errors by using the right appraisal format. However, empiric evidence suggests
that the type of tool does not make that much difference in the accuracy of ratings.29
If formats do not have much impact on ratings, what does? Not surprisingly, it’s the person
doing the rating. Characteristics such as the rater’s intelligence, familiarity with the job,30 and
ability to separate important from unimportant information31 influence rating quality. Thus, the
person doing the rating is an important determinant of the quality of ratings.
Who does the rating is commonly referred to as the source of the appraisal. The most common
source is the worker’s direct supervisor. However, other sources can provide unique and
valuable perspectives to the performance appraisal process. Self, peers, subordinates, and even
customers are increasingly common sources of appraisal.
Self-review, in which workers rate themselves, allows employees input into the appraisal
process and can help them gain insight into the causes of performance problems. For example,
there may be a substantial difference in opinion between a supervisor and an employee regarding
one area of the employee’s evaluation. Communication and possibly investigation are warranted
in such a case. In some situations, people can find themselves having to rely on self-appraisal as
a guide to managing performance.
In a peer review, workers at the same level of the organization rate one another. For instance,
peer review played a central role in the appraisal process at Milo Engineering, the business featured
in our opening vignette. In a subordinate review, workers review their supervisors.
In addition to feedback from within the organization, companies are increasingly looking
to customers as a valuable source of appraisal. Traditional top-down appraisal systems may
encourage employees to perform only those behaviors that supervisors see or pay attention to.
Thus, behaviors that are critical to customer satisfaction may be ignored.32
CRITERIA
Appraisal Administrative Developmental Legal
Format Use Use Defensibility
Absolute 0 .
Relative .
.
.
Trait .
.
Behavior 0 .
.
Outcome 0 0 .
Very poor Poor 0 Unclear or mixed Good Very good
ISBN
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Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 235
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 235
ISBN
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Indeed, customers are often in a better position to evaluate the quality of a company’s products
or services than supervisors are. Supervisors may have limited information or a limited perspective,
whereas internal and external customers often have a wider focus or greater experience with more
parts of the business.
The combination of peer, subordinate, and self-review and sometimes customer appraisal
is termed 360° feedback. A 360° system can offer a well-rounded picture of an employee’s
performance, one that is difficult to ignore or discount, because it comes from multiple perspectives.
Many organizations are now employing technology to make 360° appraisal an efficient
and cost-effective system.
Challenges to Effective Performance Measurement
How can managers ensure accurate measurement of worker performance? The primary means
is to understand the barriers that stand in the way. Managers confront at least five challenges:
¦ Rater errors and bias
¦ The influence of liking
¦ Organizational politics
¦ Whether to focus on the individual or the group
¦ Legal issues
Rater Errors and Bias
A rater error is an error in performance appraisal that reflects consistent biases on the part of the
rater. One of the most prominent rater errors is halo error, the tendency to rate similarly across
dimensions.33
There are at least two causes of halo error:34 (1) A supervisor may make an overall judgment
about a worker and then conform all dimensional ratings to that judgment and/or (2) a
supervisor may make all ratings consistent with the worker’s performance level on a dimension
that is important to the supervisor. If Nancy rates Luis low on all three performance
dimensions (quality of programs written, quantity of programs written, and interpersonal
effectiveness) even though his performance on quality and quantity is high, then she has
committed a halo error.
Another type of rater error is restriction of range error, which occurs when a manager
restricts all of his or her ratings to a small portion of the rating scale. Three different forms of
range restriction are common: leniency errors, or restricting ratings to the high portion of the
scale; central tendency errors, or using only the middle points of the scale; and severity errors,
or using only the low portion of the rating scale.
Suppose that you are an HR manager reviewing the performance ratings given by the company’s
supervisors to their subordinates. The question is: How can you tell how accurate these
ratings are? In other words, how can you tell what types of rating error, if any, have colored
the ratings? It is very difficult to tell. Let us say that a supervisor has given one of her subordinates
the highest possible rating on each of five performance dimensions. There are at least
three possible explanations. The employee may actually be very good on one of the dimensions
and has been rated very high on all because of this (halo error). Or the rater may only use the
top part of the scale (leniency error). Or the employee may be a very good all-around worker
(accurate). Although sophisticated statistical techniques have been developed to investigate
these possibilities, none is practical for most organizations or managers. Further, current
research indicates that “errors” in ratings can sufficiently represent “true” ratee performance
levels (the “accurate” possibility presented previously), such that rater errors are not good indicators
of inaccuracy in rating.35
Personal bias may also cause errors in evaluation. Consciously or unconsciously, a supervisor
may systematically rate certain workers lower or higher than others on the basis of race,
national origin, sex, age, or other factors. Conscious bias is extremely difficult, if not impossible,
to eliminate. Unconscious bias can be overcome once it is brought to the rater’s attention. For
example, a supervisor might be unconsciously giving higher evaluations to employees who went
to his alma mater. When made aware of this leaning, however, he may correct it.
360° feedback
The combination of peer,
subordinate, and self-review.
rater error
An error in performance appraisals
that reflects consistent biases on the
part of the rater.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
236 PART IV • EMPLOYEE DEVELOPMENT
236 PART IV • EMPLOYEE DEVELOPMENT
In performance ratings, the degree
to which the performance ratings
given by various supervisors in an
organization are based on similar
standards.
frame-of-reference (FOR)
training
A type of training that presents
supervisors with fictitious examples
of worker performance (either
in writing or on video), asks the
supervisors to evaluate the workers
in the examples, and then tells them
what their ratings should have been.
Blatant, systematic negative biases should be recognized and corrected within the organization.
Negative bias became an issue at the U.S. Drug Enforcement Agency (DEA) in the
early 1980s when a lawsuit, Segar v. Civiletti, established that African American agents were
systematically rated lower than white agents and, thus, were less likely to receive promotions
and choice job assignments. The DEA failed to provide supervisors with any written instructions
on how to evaluate agents’ performance, and virtually all the supervisors conducting the evaluations
were white.36
A major difficulty in performance measurement is ensuring comparability in ratings across
raters.37 Comparability refers to the degree to which the performance ratings given by various
supervisors in an organization are based on similar standards. In essence, the comparability issue
is concerned with whether supervisors use the same measurement yardsticks. What one supervisor
considers excellent performance, another may view as only average.
One of the most effective ways to deal with errors and bias is to develop and communicate
evaluation standards via frame-of-reference (FOR) training,38 which uses fictitious behavioral
examples of performance that a worker might exhibit.
After rating the performance presented on video or paper, the trainees in a typical FOR
session are told what their ratings should have been. Discussion of which worker behaviors
represent each dimension (and why) follows. This process of rating, feedback, and discussion
is succeeded by the presentation of another example. Again, rating, feedback, and discussion
follow. The process continues until the appraisers develop a common frame of reference for performance
evaluation. In other words, FOR training is all about calibrating everyone to the same
performance standards.39
FOR training has consistently been found to increase the accuracy of performance ratings.40
Perhaps even more important, it develops common evaluation standards among supervisors.
The FOR training procedure does have a number of drawbacks, though. One glaring
problem is the expense, which can be prohibitive owing to the amount of time and number
of people involved. Another drawback is that it can be used only with behaviorally based
appraisal systems.
The Influence of Liking
Liking can cause errors in performance appraisals when raters allow their like or dislike of an
individual to influence their assessment of that person’s performance. Field studies have found
rater liking and performance ratings to be substantially correlated.41 Findings of a correlation
might indicate that performance ratings are biased by rater liking. However, good raters may
tend to like good performers and dislike poor performers.
The fundamental question, of course, is whether the relationship between liking and performance
ratings is appropriate or biased.42 It is appropriate if supervisors like good performers better
than poor performers. It is biased if supervisors like or dislike employees for reasons other than
their performance and then allow these feelings to contaminate their ratings. It can be difficult to
determine if an influence of liking on performance ratings is appropriate or due to bias. Managers
may be able to separate their liking from employee performance and, thus, eliminate the possibility
that liking biases the performance ratings.43 Nonetheless, most workers appear to believe that their
supervisor’s liking for them influences the performance ratings they receive.44 The perception of
bias can cause communication problems between workers and supervisors and lower supervisors’
effectiveness in managing performance.
Precautions
Given the potentially biasing impact of liking, it is critical that supervisors manage their emotional
reactions to workers. They should keep a performance diary of observed behavior for each
worker45 to serve as the basis for evaluation and other managerial actions. An external record of
worker behaviors can dramatically reduce error and bias in ratings.
Recordkeeping should be done routinely—for example, daily or weekly. Keeping records of
employee performance is a professional habit worth developing, particularly to safeguard against
litigation that challenges the fairness of appraisals.46 To prevent error and bias, the record should
reflect what each worker has been doing, not opinions or inferences about the behavior. Further, the
record should present a balanced and complete picture by including all performance incidents—
ISBN
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Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 237
positive, negative, or average. A good question to ask yourself is whether someone else reading the
record would reach the same conclusion about the level of performance as you have.
In one field study of such recordkeeping, supervisors reported that the task took five min
utes or fewer per week.47 More important, the majority of supervisors reported that they would
prefer to continue, rather than discontinue, the recording of behavioral incidents. By compiling
a weekly record, they did not have to rely much on general impressions and possibly biased
memories when conducting appraisals. In addition, the practice signaled workers that appraisal
was not a personality contest. Finally, the diaries provided a legal justification for the appraisal
process: The supervisor could cite concrete behavioral examples that justified the rating.
Two warnings are in order here. First, performance diaries are not guarantees against bias
due to liking, because supervisors can be biased in the type of incidents they choose to record.
However, short of intentional misrepresentation, the keeping of such records should help reduce
both actual bias and the perception of bias.
Second, some managers use performance diaries in place of intervention and discussion
because it is less uncomfortable, initially, to record a performance problem than to discuss it
with the employee. Documenting problems is fine and even useful for creating a legally defen
sible case if the employee must be terminated. However, it is unfair to keep a secret running list
of “offenses” and then suddenly unveil it to the employee when he or she commits an infraction
that can’t be overlooked. The message for managers is simple: If an employee’s behavior war
rants discussion, the discussion should take place immediately.48
Organizational Politics
Thus far, we have taken a rational perspective on appraisal.49 In other words, we have assumed
that the value of each worker’s performance can be estimated. Unlike the rational approach, the
political perspective assumes that the value of a worker’s performance depends on the agenda, or
goals, of the supervisor.50 Consider the following quote from an executive with extensive experience
in evaluating his subordinates:
As a manager, I will use the review process to do what is best for my people and the division.…
I’ve got a lot of leeway—call it discretion—to use this process in that manner.…I’ve used it
to get my people better raises in lean years, to kick a guy in the pants if he really needed it, to
pick up a guy when he was down or even to tell him that he was no longer welcome here . . . . I
believe that most of us here at ______ operate this way regarding appraisals.51
Let’s examine how the rational and the political process differ on various facets of the performance
appraisal process.
¦
The goal of appraisal from a rational perspective is accuracy. The goal of appraisal from
a political perspective is utility, the maximization of benefits over costs given the context
and agenda. The value of performance is relative to the political context and the supervisor’s
goals. For example, a supervisor may give a very poor rating to a worker who seems
uncommitted in the hopes of shocking that worker into an acceptable level of performance.
¦
The rational approach sees supervisors and workers largely as passive agents in the rating
process: Supervisors simply notice and evaluate workers’ performance. Thus, their accuracy
is critical. In contrast, the political approach views both supervisors and workers as
motivated participants in the measurement process. Workers actively try to influence their
evaluations, either directly or indirectly.
The various persuasion techniques that workers use to alter the supervisor’s evaluation are
direct forms of influence. For example, just as a student tells a professor that he needs a higher
grade to keep his scholarship; a worker might tell her boss that she needs an above-average
rating to get a promotion. Indirect influences are behaviors by which workers influence how
supervisors notice, interpret, and recall events,52 ranging from flattery to excuses to apologies.
The following quote from a consulting group manager demonstrates how employees in the organization
used impression-management tactics:53
Phone calls from customers praising a consultant’s performance were rarely received
except during the month before appraisals. These phone calls were often instigated by the
consultants to highlight their importance.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
238 PART IV • EMPLOYEE DEVELOPMENT
238 PART IV • EMPLOYEE DEVELOPMENT
agement
tool. As such, managers
often use the tool to benefit
themselves or the company. For
example, a manager may use
overly positive performance
ratings as a reward for someone
who spear-headed a project for
the manager. Likewise, a manager
may use overly harsh ratings as
punishment for someone who
objected to a project the manager
promoted. Do you think such
use of the appraisal system is
acceptable? Why?
¦
From a rational perspective, the focus of appraisal is measurement. Supervisors are fleshand-
blood instruments54 who must be carefully trained to measure performance meaningfully.
The evaluations are used in decisions about pay raises, promotions, training, and
termination. The political perspective sees the focus of appraisal as management, not
accurate measurement. Appraisal is not so much a test that should be fair and accurate
as it is a management tool with which to reward or discipline workers.
¦
Assessment criteria, the standards used to judge worker performance, also differ between
the rational and political approaches. The rational approach holds that a worker’s performance
should be defined as clearly as possible. In the political approach, the definition of
what is being assessed is left ambiguous so that it can be bent to the current agenda. Thus,
ambiguity ensures the necessary flexibility in the appraisal system.
¦
Finally, the decision process differs between the rational and political approaches.
In the rational approach, supervisors make dimensional and overall assessments based
on specific behaviors they have observed. For instance, Nancy would rate each programmer
on each dimension and then combine all the dimensional ratings into an overall
evaluation. In the political approach, appropriate assessment of specifics follows the
overall assessment. Thus, Nancy would first decide who in her group should get the
highest rating (for whatever reason) and then justify that overall assessment by making
appropriate dimensional ratings.
Appraisal in most organizations seems to be a political rather than a rational exercise.55 It
appears to be used as a tool for serving various and changing agendas; accurate assessment is
seldom the real goal. But should the rational approach be abandoned because appraisal is typically
political? No! Politically driven assessment may be common, but that does not make it the
best approach to assessment.
Accuracy may not be the main goal in organizations, but it is the theoretical ideal behind
appraisal.56 Accurate assessment is necessary if feedback, development, and HR decisions are
to be based on employees’ actual performance levels. Basing feedback and development on
managerial agendas is an unjust treatment of human resources. Careers have been ruined, self-
esteem lost, and productivity degraded because of the political use of appraisal. In addition to
these negative effects, politically driven appraisal is also associated with increased intention of
workers to quit their jobs.57 Such costs are difficult to assess and to ascribe clearly to politics.
Nonetheless, they are very real and important for workers.
Individual or Group Focus
If the organization has a team structure, managers need to consider team performance appraisal
at two levels: (1) individual contribution to team performance and (2) the performance of the
team as a unit.58 To properly assess individual contributions to team performance, managers
and employees must have clear performance criteria relating to traits, behaviors, or outcomes.
Behavioral measures are typically most appropriate for assessing individual contributions to
team performance because they are more easily observed and understood by team members and
others who interact with the team.
The individual contribution measures could be developed with the input of team members.
However, a good starting point is the set of competencies for individual contribution to team
performance identified in recent research.59 The following example describes the use of these
competencies at Pfizer, a large pharmaceutical company. Peers assess team members online in
the finance area of Pfizer.60
The assessment is based on a four-dimensional model of collaboration, communication,
self-management, and decision making. Feedback reports are used as a discussion point to
improve the functioning of teams. Over time, there has been significant improvement in
the average level of ratings given to team members.
Whatever measures are already in existence or are developed for measuring team performance,
here are some points to keep in mind:
First, the measurement system needs to be balanced. For example, although financial objectives
may be apparent and easy to develop as criteria, these kinds of objectives are measured in
such a way that they do not reflect the concerns of customers.
ISBN
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Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 239
Another point to keep in mind is that outcome measures may need to be complemented
with measures of process. For example, achieving a result may be important but so, too, is
interpersonal relations. With a balance of measures, it should be clear to team members that
achieving outcomes by running roughshod over peers and customers is not acceptable perfor
mance.
One more point is that the measures must reflect criteria that the teams can influence.61
Assessing the performance of a team as a unit means that managers must measure perfor
mance at the team, not individual, level. Dimensions for measuring team performance may be
set at higher levels in the organization; if this is not the case, then team members can be great
sources for identifying and developing team-level criteria. Going to team members to help
develop criteria encourages their participation in selecting measures that they feel they can
directly influence.
Two final points: First, experts recommend that individual performance still be assessed,
even within a team environment, because U.S. society is so strongly focused on individual per
formance.62 Second, there is no consensus as to what type of appraisal instrument should be used
for team evaluations. The best approach may include internal and external customers making
judgments across both behavioral and outcome criteria.63
Legal Issues
The major legal requirements for performance appraisal systems are set forth in Title VII of
the Civil Rights Act of 1964, which prohibits discrimination in all terms and conditions of
employment (see Chapter 3 ). This means that performance appraisal must be free of discrimi
nation at both the individual and group levels. Some courts have also held that performance
appraisal systems should meet the same validity standards as selection tests (see Chapter 5 ).
As with selection tests, adverse impact may occur in performance evaluation when members
of one group are promoted at a higher rate than members of another group based on their
appraisals.
Probably the most significant court test of discrimination in performance appraisal is Brito v.
Zia Company, a 1973 U.S. Supreme Court case. In essence, the Court determined that appraisal
is legally a test and must, therefore, meet all the legal requirements regarding tests in organiza
tions. In practice, however, court decisions since Brito v. Zia have employed less stringent crite
ria when assessing charges of discrimination in appraisal.
Appraisal-related court cases since Brito v. Zia suggest that the courts do not wish to rule
on whether appraisal systems conform to all accepted professional standards (such as whether
employees were allowed to participate in developing the system).64 Rather, they simply want to
determine if discrimination occurred. The essential question is whether individuals who have
similar employment situations are treated differently.
The courts look favorably on a system in which a supervisor’s manager reviews appraisals
to safeguard against the occurrence of individual bias. In addition, the courts take a positive view
of feedback and employee counseling to help improve performance problems. An analysis of
295 court cases involving performance appraisal found judges’ decisions to be favorably influ
enced by the following additional factors:65
¦ Use of job analysis
¦ Providing written instructions
¦ Allowing employees to review appraisal results
¦ Agreement among multiple raters (if more than one rater was used)
¦ The presence of rater training
In the extreme, a negative performance appraisal may lead to the dismissal of an employee.
Management’s right to fire an employee is rooted in a legal doctrine called employment-at-will.
Employment-at-will is a very complex legal issue that depends on laws and rulings varying from
state to state. We discuss employment-at-will more fully in Chapter 14 . Here, the major point is
that managers can protect themselves from lawsuits by following good professional practice. If
they provide subordinates with honest, accurate, and fair feedback about their performance, and
then make decisions consistent with that feedback, they will have nothing to fear from ongoing
questions about employment-at-will.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
240 PART IV • EMPLOYEE DEVELOPMENT
240 PART IV • EMPLOYEE DEVELOPMENTe
The effective management of human performance in organizations requires more than formal
reporting and annual ratings. A complete appraisal process includes informal day-to-day interactions
between managers and workers as well as formal face-to-face interviews. Although the ratings
themselves are important, even more critical is what managers do with them. In this section,
we discuss the third and final component of performance appraisal, performance management.
The Appraisal Interview
Upon completing the performance rating, the supervisor usually conducts an interview with the
worker to provide feedback—one of the most important parts of the appraisal process. Many
managers dread the performance appraisal, particularly if they do not have good news to impart.
The HR department or an external group, such as a management association or consulting
group, can help managers by offering training in conducting interviews, providing role-play
practice, and offering advice on thorny issues. Figure 7.9 summarizes several communication
“microskills” that managers need to effectively conduct an appraisal interview.
Performance reviews are sometimes separated into two sessions: one to discuss performance,
the other to discuss salary. 66 (This practice is common in Great Britain, where 85 percent of large
companies split the appraisal meeting.) The logic behind this system was based on two assumptions.
First, managers cannot simultaneously be both a coach and a judge. Thus, the manager
was expected to play the coach role during the performance development meeting and the judge
role during the salary meeting. Second, if performance and salary discussions were combined,
employees probably would not listen to their performance feedback because their interest would
be focused on salary decisions.
However, research has found that discussion of salary in an appraisal session has a positive
impact on how employees perceive the appraisal’s usefulness.67 Managers who have to justify
a low salary increase will probably take time to carefully support their performance assessments,
and this more detailed feedback should make the appraisal session more valuable to the
employee. Second, feedback, goal setting, and making action plans can become a hollow and
meaningless exercise when salary implications are divorced from the session.
In sum, it appears that the best management practice is to combine development and sal
ary discussion into one performance review. Informal performance management throughout the
appraisal period requires a combination of judgment and coaching.
Performance Improvement
Because formal appraisal interviews typically are conducted only once a year,68 they may not
always have substantial and lasting impact on worker performance.69 Much more important than
the annual interview is informal day-to-day performance management. Supervisors who manage
performance effectively generally share four characteristics. They:
¦ Explore the causes of performance problems.
¦ Direct attention to the causes of problems.
¦ Develop an action plan and empower workers to reach a solution.
¦ Direct communication at performance and provide effective feedback.70
Each of these characteristics is critical to achieving improved and sustained performance levels.
Identifying the Causes of Performance Problems
Identifying the causes of performance problems may sound like an easy task, but it is often quite
challenging. Performance can be the result of many factors, some of which are beyond the worker’s
control. In most work situations, though, supervisors tend to blame the worker when they
observe poor performance, whereas workers tend to blame external factors. 71 This tendency is
called actor/observer bias.72 The experience of baseball teams provides an analogy. When a team
is losing, the players (workers/actors) point to external causes such as injuries, a tough road schedule,
or bad weather. The manager (supervisor/observer) blames the players for sloppy execution in
the field. And the team’s owner and the sportswriters (top management/higher observers) hold the
manager responsible for the team’s poor performance.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
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CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 241
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 241
Face-to-face communication during the performance appraisal interview can be more effective if managers use
“microskills”—communication factors that must be present for effective interpersonal communication. Several
examples follow:
Skills Benefit
Description Example
Nonverbal Suggests interest
Rater sits with a slight While the ratee is speaking,
Attending and active listening.
forward, comfortable the rater looks at the
lean of the upper body, person and gently nods
maintains eye contact, and head to signal interest.
speaks in a steady and
soothing voice.
Open and Appropriate use of open
Closed and closed questions
Questions can ensure an effective
flow of communication
during an interview.
Paraphrasing Paraphrasing can clarify
and convey to the ratee
that you are listening
actively.
Open questions encourage
information sharing and
are most appropriate
early in an interview or
in complex, ambiguous
situations.
Closed questions evoke
short responses and
are useful for focusing
and clarifying.
A paraphrase is a concise
statement in your own
words of what someone
just said. It should be
factual and nonjudgmental.
Open questions start with
words like “Could,”
“Would,” “How,”
“What,” or “Why.”
Closed questions start with
words like “Did,” “Is,” or
“Are.”
You might begin by saying
“If I have this right…”
or “What you’re saying
is…” and end with “Is that
correct?” or “That’s what
you are saying?”
Reflection Shows that you are Similar to paraphrase, a Start by saying something
of Feeling sensitive to and trying reflection of feeling is a like “It sounds like you’re
to understand the factual statement of the feeling…” End as you
emotional dimension emotions you sense the would a paraphrase
of the workplace. The other person is feeling. Be (“Is that right?”).
empathy and sensitivity cautious about using this
of reflection can open technique insincerely or
up communication and with those who need
allow task-related issues professional help.
to be addressed more
meaningfully.
Cultural Communication is more Pay attention to cultural When dealing with
Sensitivity effective when you are differences that may employees from a culture
sensitive to the possible influence how another that is highly formal,
influence of cultural person communicates avoid addressing them in
differences. and how you might the workplace by their
communicate with first names. Doing so
others. may signal disrespect.
ISBN
1-256-39369-X
FIGURE 7.9
Communication Skills for the Appraisal Interview
Sources: Based on Kikoski, J. F. (1998). Effective communication in the performance appraisal interview: Face-to-face communication for public managers
in the culturally diverse workplace. Public Personnel Management, 27, 491–513; Ivey, A. B., Ivey, M. B., and Simek-Downing, L. (1987). Counseling and
psychotherapy: Integrating skills, theory, and practice (2nd ed). Upper Saddle River, NJ: Prentice Hall; Cardy, R. L., and Leonard, B. (2011). Performance
management: Concepts, skills, and exercises (2nd ed.). Armonk, NY: M. E. Sharpe, Inc.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
242 PART IV • EMPLOYEE DEVELOPMENT
242 PART IV • EMPLOYEE DEVELOPMENT
lems.
This is only rational. But when the supervisor’s perception significantly differs from the
worker’s, the difference can cause tension. Third, the cause affects the type of remedy selected;
what is thought to be the cause of a performance problem determines what is done about it.
How can the process of determining the causes of performance problems be improved? A
starting point is to consider the possible causes consciously and systematically. Traditionally,
researchers believed that two primary factors, ability and motivation, determined performance.73
A major problem with this view is that situational factors external to the worker, such as degree
of management support, also affect worker performance.74
A more inclusive version of the causes of performance embraces three factors: ability, motivation,
and situational factors. The ability factor reflects the worker’s talents and skills, including
characteristics such as intelligence, interpersonal skills, and job knowledge. Motivation can
be affected by a number of external factors (such as rewards and punishments), but is ultimately
an internal decision: It is up to the worker to determine how much effort to exert on any given
situational factors task. Situational factors (or system factors) include a wide array of organizational character-
or system factors istics that can positively or negatively influence performance. System factors include quality of
A wide array of organizational materials, quality of supervisor, and the other factors listed in Figure 7.10 . 75
characteristics that can positively or
Performance depends on all three factors. The presence of just one cause is not sufficient
negatively influence performance.
for high performance to occur; however, the absence or low value of one factor can result in
poor performance. For example, making a strong effort will not result in high performance if
the worker has neither the necessary job skills nor adequate support in the workplace. But if
the worker doesn’t put forth any effort, low performance is inevitable, no matter how good that
worker’s skills and how much support is provided.
In determining the causes of performance problems, managers should carefully consider
situational factors. The factors in Figure 7.10 are only a starting point; they are too generic for
use in some situations. Involving workers in creating the lists will both produce examples that
supervisors may not have been aware of and send a signal that managers are serious about considering
workers’ input. The supervisor and worker (or work team) can go over the list together
to isolate the causes of any performance difficulties.
Situational constraints/facilitators that managers face can include clerical support, excessive
reporting requirements, and the performance of subordinates and coworkers.76 Only some
of these situational factors are under the control of a manager. To determine whether a factor is
truly in the person or system category, managers must consider the organizational context.
FIGURE 7.10
Situational factors
Situational (System)
• Poor coordination of work activities among workers
Factors to Consider in
•
Inadequate information or instructions needed to perform a job
Determining the Causes
of Performance Problems • Low-quality materials
•
Lack of necessary equipment
•
Inability to obtain raw materials, parts, or supplies
•
Inadequate financial resources
•
Poor supervision
•
Uncooperative coworkers and/or poor relations among people
•
Inadequate training
•
Insufficient time to produce the quantity or quality of work required
•
A poor work environment (for example, cold, hot, noisy, frequent
interruptions)
•
Equipment breakdown
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 243
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 243
s
After the supervisor and the worker have discussed and agreed on the causes of performance
problems, the next step is to take action to control them. Depending on whether the cause of
performance problems is related to ability, effort, or situational characteristics, very different
tactics are called for, as Figure 7.11 makes clear. Leaping to a remedy like training (a common
reaction) will not fix a problem that is caused by ability and will be a waste of the organization’s
77
resources.
Developing an Action Plan and Empowering Workers to Reach a Solution
Effective performance management requires empowering workers to improve their performance.
As in a sports team, the supervisor-as-coach assists workers in interpreting and reacting to the
work situation. The role is not necessarily one of mentor, friend, or counselor. Rather, it is that
of enabler. The supervisor-as-coach works to ensure that the necessary resources are available
to workers and helps employees identify an action plan to solve performance problems. For
example, the supervisor may suggest ways for the worker to eliminate, avoid, or get around
situational obstacles to performance. In addition to creating a supportive, empowered work environment,
coach/supervisors clarify performance expectations; provide immediate feedback; and
strive to eliminate unnecessary rules, procedures, and other constraints.78 The most effective
performance may result from being specific about desired outcomes but not giving too many
details about how the worker should strive to reach these goals.79 Too much detail may stifle
and demoralize an employee. The Manager’s Notebook, “Coaching Effectiveness,” provides an
example assessment of the coaching function.
Directing Communication at Performance
Communication between supervisor and worker is critical to effective performance management.
Exactly what is communicated and how it is communicated can determine whether performance
improves or declines.
Performance discussions can be difficult for managers, and a worker may disagree that there
is a performance issue and become emotional. For example, say that a manager tells an employee
that her late arrivals and long lunches are affecting the performance of the office. Instead of
understanding and promising to improve, the employee denies that there is a problem, claims
Cause Questions to Ask Possible Remedies
Ability Has the worker ever been able to perform Train
adequately? Transfer
Can others perform the job adequately, Redesign job
but not this worker? Terminate
Effort Is the worker’s performance level declining? Clarify linkage between performance
Is performance lower on all tasks? and rewards
Recognize good performance
Situation Is performance erratic? Streamline work process
Are performance problems showing up in all Clarify needs to suppliers
workers, even those who have adequate Change suppliers
supplies and equipment? Eliminate conflicting signals or demands
Provide adequate tools
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FIGURE 7.11
How to Determine and Remedy Performance Shortfalls
Sources: Based on Schermerhorn, J. R., Gardner, W. I., and Martin, T. N. (1990). Management dialogues: Turning on the marginal performer. Organizational
Dynamics, 18, 47–59; Rummler, G. A. (1972). Human performance problems and their solutions. Human Resource Management, 19, 2–10; Cardy, R. L.,
and Leonard, B. (2011). Performance management: Concepts, skills, and exercises (2nd ed.). Armonk, NY: M. E. Sharpe, Inc.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
244 PART IV • EMPLOYEE DEVELOPMENTCopyright © 2012 by Pearson Education, Inc.
244 PART IV • EMPLOYEE DEVELOPMENTCopyright © 2012 by Pearson Education, Inc.
Customer-Driven HR
Coaching Effectiveness
When managers are reluctant to be good coaches to their workers, consider adding a
measure of how well managers are coaching their workers to the managerial perfor-
mance appraisal system. Including coaching as a dimension in the appraisal of managers
signals the importance that the organization places on coaching and helps ensure that it is done as
well as possible. Here is an example of the items used by a company to assess how well the coach-
ing function is being carried out. Workers’ assessments on these items are used by the company to
reward the coaching strengths of managers and to identify areas needing development.
Use the scale below to respond to each of the following items.
1 2 3 4 5
Never Seldom Sometimes Frequently Always
¦ My coaching sessions are held every month.
¦ My coaching sessions are long enough.
¦ My coach sets challenging but achievable performance goals for me to accomplish.
¦ My coach sets too many performance goals for me to accomplish.
¦ My coach shares with me his/her thoughts and feelings, not only facts.
¦ My coach asks for and appreciates my ideas and suggestions.
¦ My coaching sessions are stimulating and help me do my job better.
¦ Because of my coach’s position, I would be afraid to question his/her decisions.
¦ Because of my coach’s personality, I would be afraid to question his/her decisions.
¦ My coach plays favorites when resolving conflicts.
¦ When my coach delegates work to me, he/she checks and rechecks the smallest details
to my frustration and annoyance.
¦ My coach provides me with the skills and knowledge to be successful.
¦ My coach is eager to explore my career path in the organization and what I need to do
to get there.
¦ My coach continuously keeps me informed about where the organization is going
and keeps me updated on what the other departments and branches are doing.
General Comments:
Improving coaching performance requires more than measuring the effectiveness of coach-
ing. The organization also must communicate the business impact of coaching in order to get
managers on board and committed to being good coaches. How does coaching fit in with stra-
tegic plans in the organization? How does coaching add to the bottom line? Does it impact hard
outcomes, such as sales and profit levels, as well as behavioral measures? Providing the reasons
for coaching and the data that demonstrate its effectiveness can convince managers to make
coaching an important part of their job.
Sources: Based on O’Connor, T. J. (2002). Performance management via coaching: Good coaching can help guarantee
profitable results and happy employees in an uncertain economy. Electrical Wholesaling, 83, 39(3); Gaskell, C. (2007,
April). HR directors will gain if line managers take on coaching. Training & Coaching Today, 20; Klie, S. (2010).
Moving from managing to coaching, Canadian HR Reporter, 23, 16, 31. ¦¦
MANAGER’S NOTEBOOK
that the manager is unfairly focusing on her small errors, and begins yelling at the manager.
Handling this type of situation professionally is a key competency to being an effective manager.
Unfortunately, these types of situations will occur during your management career.
A key question is how you will handle these situations. Following some simple steps
can help keep the communication effective and focused on performance.80 First, define
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
ISBN
1-256-39369-
the performance problem. If performance is to improve, understanding the performance issue
is a necessary starting point. Second, make it a discussion. Performance improvement will
be more likely if there is a dialogue, rather than a one-sided lecture. Third, be plain and direct
in communicating the performance issue. Although it might make you more comfortable
to be vague and dance around the issue, focusing on the performance issue will move the
discussion toward a clear plan of action. Last, and most important, maintain your composure.
If you become emotional and say things out of anger or frustration, you will likely regret
them later.
It is important that communication regarding performance be directed at the performance
and not at the person. For example, a worker should not be asked why he is such a jerk! It is
usually much more effective to ask the worker why his performance has been ineffective lately.
Open-minded communication is more likely to uncover the real reason for a performance problem
and thus pave the way for an effective solution.
Summary and Conclusions
What Is Performance Appraisal?
Performance appraisal is the identification, measurement, and management of human performance
in organizations. Appraisal should be a future-oriented activity that provides workers
with useful feedback and coaches them to higher levels of performance. Appraisal can be used
administratively or developmentally.
Identifying Performance Dimensions
Performance appraisal begins by identifying the dimensions of performance that determine
effective job performance. Job analysis is the mechanism by which performance dimensions
should be identified.
Measuring Performance
The methods used to measure employee performance can be classified in two ways: (1) whether
the type of judgment called for is relative or absolute and (2) whether the measure focuses on
traits, behavior, or outcomes. Each measure has its advantages and disadvantages. But it is clear
that the overall quality of ratings is much more a function of the rater’s motivation and ability
than of the type of instrument chosen.
Managers face five challenges in managing performance: rater errors and bias, the influence
of liking, organizational politics, whether to focus on the individual or the group, and legal issues
(including discrimination and employment at will).
Managing Performance
The primary goal of any appraisal system is performance management. To manage and improve
their employees’ performance, managers must explore the causes of performance problems,
direct manager and employee attention to those causes, develop action plans and empower workers
to find solutions, and use performance-focused communication.
ISBN
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Key Terms
absolute judgment , 228 frame-of-reference (FOR) relative judgment , 226
behavioral appraisal training, 236 self-review, 234
instrument, 230 management by objectives situational factors or system
comparability, 236 (MBO), 232 factors, 242
competencies, 226 outcome appraisal instrument , 232 subordinate review , 234
competency peer review , 234 360° feedback , 235
model, 226 performance appraisal , 223 trait appraisal
dimension, 225 rater error , 235 instrument, 228
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
246 PART IV • EMPLOYEE DEVELOPMENT
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246 PART IV • EMPLOYEE DEVELOPMENT
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Discussion Questions
1. At ARCO Transportation, a $1 billion division of Atlantic Richfield, employees are hired,
promoted, and appraised according to how they fulfill the performance dimensions most
valued by the company. One of these performance dimensions is “communication”—
specifically, “listens and observes attentively, allowing an exchange of information” and
“speaks and writes clearly and concisely, with an appropriate awareness of the intended
audience.” Would you say that ARCO appraises performance based on personality traits,
job behavior, or outcome achieved? On which of these three aspects of performance do
you think workers should be appraised?
2. Superficially, it seems preferable to use objective performance data (such as productivity
figures), when available, rather than subjective supervisory ratings to assess employees.
Why might objective data be less effective performance measures than subjective ratings?
3. How important are rating formats to the quality of performance ratings? What is the most
important influence on rating quality?
4. What is comparability? How can it be maximized in performance appraisal?
5. “Occasionally an employee comes along who needs to be reminded who the boss is, and
the appraisal is an appropriate place for such a reminder.” Would the manager quoted here
be likely to use a rational or a political approach to appraisal? Contrast the rational and
political approaches. To what extent is it possible to separate the two?
6. Do you think performance appraisal should be done? Is it worth the cost?
7. What criteria do you think should be used to measure team performance? What sources should
be used for the appraisal? Should individual performance still be measured? Why or why not?
8. You’re the owner of a 25-employee company that has just had a fantastic year. Everyone
pulled together and worked hard to achieve the boost in company profits. Unfortunately,
you need to sink most of those profits into paying your suppliers. All you can afford to
give your workers is a 3 percent pay raise across the board. At appraisal time, how would
you communicate praise for a job well done coupled with your very limited ability to
reward such outstanding performance? Now assume you can afford to hand out some
handsome bonuses or raises. What would be the best way to evaluate employees when
everyone has done exceptional work?
9. Would you design a performance appraisal system based on behaviors, outcomes, or both?
Why would you design it in this way?
Case 7.1 Ethics
Rank and Yank: Legitimate Performance
Improvement Tool or Ruthless and Unethical
Management?
Forced ranking is a performance appraisal system popularized
by Jack Welch when he was CEO of General Electric. It is a
system that has been given the derogatory label of “rank and
yank” by its critics. The intent of the forced-ranking system is
to improve the performance level of an operation by getting rid
of the bottom 10 percent of performers and hiring replacements
who will perform at a high level. a Ranking judgments can be
made in a variety of ways. b For example, a forced distribution
can pre-assign a set percentage of employees that must be placed
into categories such as “most effective,” “average,” and “needs
improvement.” Alternatively, a simple ranking of workers from
best to worst can be used. Top performers may be rewarded and
offered promotion or training. Low performers may be given a
warning or terminated.
Forced ranking has been employed by a number of companies,
but some legal challenges have been made. For example,
Microsoft successfully defended several discrimination suits
challenging its use of a forced-ranking system. Conoco used a
forced-ranking system and reached an out-of-court settlement in
a discrimination lawsuit. Ford Motor Company implemented a
forced-ranking system in January 2000 and ended up paying an
award of $10.5 million as a result of class action suits charging
that the system had a disparate impact on some subgroups of
employees. Ford has since shelved its forced-ranking system. c
Overall, however, there have been relatively few legal challenges
to the forced-ranking system. It remains a controversial
management practice.
A potential downside of forced ranking is increased competitiveness
among workers. d Under a forced-ranking system, workers
can become less focused on common or collaborative tasks.
Instead, workers might focus on their individual performance and
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 247
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 247
ISBN
1-256-39369-X
Jack Welch used forced ranking when he was the CEO of General Electric.
A controversial practice, forced ranking can be accomplished in a variety
of ways including simply ranking workers from most effective to least
effective.
Source: ÂLane Ericcson-PHOTOlink.net/Newscom
ranking. The net result can be less teamwork and a negative effect
on productivity.
Critical Thinking Questions
1.
Do you think forced ranking is a good performance management
system?
Why or why not?
2.
Part of the forced-ranking label reflects the intent to force
distinctions among worker performance levels. In an absolute-
rating system, everyone could be rated “above average.”
Does this difference between the absolute- and relative-rating
approaches mean that the absolute performance judgments
are wrong? Explain.
3.
As a manager, would you prefer to rely on an absolute
performance rating system or a relative system, such as
forced ranking? Why?
4.
Can you devise an absolute-rating system that would guarantee
differentiation among workers? Why or why not?
Team Exercise
As a team, address the effectiveness of the forced-ranking
approach for improving the level of performance in an organization.
Consider the results of a recent simulation studye that used
a computer simulation to examine the impact of terminating the
lowest-ranked employees on average workforce performance. The
computer model found that the system improved the average level
of performance, but the effect decreased to a near-zero level within
six years.
Address the following issues:
a.
Why does the system work? That is, why did the simulation
find improved performance?
b.
The logic behind the forced-ranking approach and the
simulation is that performance in a workplace is normally
distributed. Do you think this is an accurate assumption?
Why or why not?
c.
If performance in a workplace is not normally distributed,
do you think a forced-ranking approach would still improve
the average level of performance in the organization?
Explain.
Share your judgments on these issues with the rest of the
class.
Experiential Exercise: Team
Of the companies that are consistent top performers (increased
profits by at least 10 percent per year for 10 years), none use a
forced-ranking system.f Proponents of forced ranking see the system
as a means for a quick exchange of personnel in a way that
lifts the average performance level of the organization. Critics see
the approach as possibly damaging the culture and camaraderie
in an organization and would prefer to keep people and develop
their skills.
Select representatives as members of a pro or con forced-ranking
team. Each team identifies its assumptions about how performance
is distributed in the workplace. They will then offer reasons why they
are for or against forced ranking. Some of the issues to be addressed
include:
¦
What is the expected impact of forced ranking on performance
in an organization?
¦
Turnover has costs associated with it (see Chapters 5 and 6).
How would these costs affect your position?
¦
What would be the impact of forced ranking on the
organization’s culture? What about the culture without the
system?
¦
Is it better to exchange a poor performer or to try to develop
and improve that worker?
In a debate-style format, each team makes its presentation
of position and rationale and has the opportunity to question and
rebut and rejoin the other team. The instructor moderates this
process. At the end of the debate, the instructor leads the class
in identifying the key reasons for and against the use of forced
ranking. Is there a clear consensus in the class for or against the
system?
Sources: aBeshur, A. (2005, April 4). Survival of the fittest. Corpus Christi
Caller-Times, The Business Leader, O6. bAmalfe, C. A., and Steiner, E. G.
(2005). Forced ranking systems: Yesterday’s legal target. New Jersey Law
Journal. cBoehle, S. (2008). Keeping forced ranking out of court. Training,
45, 40–46. dMachine Design. (2007). Forced rankings of employees bad for
business. 79, 30. e Scullen, S. E., Bergey, P. K., and Aiman-Smith, L. (2005).
Forced distribution rating systems and the improvement of workforce potential:
A baseline simulation. Personnel Psychology, 58, 1–32. f Marchetti, M.
(2005). Letting go of low performers. Sales and Marketing Management,
157 , 6.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
248 PART IV • EMPLOYEE DEVELOPMENT
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka 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248 PART IV • EMPLOYEE DEVELOPMENT
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joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka joka
Case 7.2 Global
Cultural Competency
Global businesses routinely confront diversity in culture and language.
However, increases in minority and immigrant populations
are forcing local organizations to adapt to culturally and linguistically
diverse groups. Cultural competency is increasingly being recognized
as an important capacity. Cultural competency means that you
not only have knowledge of a culture, but that you also have the skills
needed to work with that particular ethnic group and the attitude to
do so effectively. The rationale for cultural competency as a key skill
goes beyond sales and marketing and includes life and death!
For example, physicians in New Jersey must complete “cultural
competency” training. The intent of the training is to provide physicians
with a better understanding of health-related cultural beliefs
that people bring with them to the doctor’s office and how diseases
may affect different subgroups. The reason is the repeated finding
that minority populations receive poorer care. The poorer care may
be completely unintentional; it may happen because physicians
don’t know how to interact with someone from another culture. As
a simple example, one doctor has reported that Phillippinos tend to
tell a doctor that they feel dizzy when they don’t feel good. The
doctor, however, should not leap to the conclusion that the patient
is suffering from vertigo, because the comment, for people from the
Philippines, is a generic indicator that they don’t feel well.
As another example, the Seattle police department trains its
police officers for increased cultural competency. In some Latin
American societies, it is common for a person stopped for a traffic
violation to leave their vehicle and approach the police officer. It is
important for police officers in Seattle, or anywhere, to understand
this cultural tendency so that the behavior is not misinterpreted.
Many organizations would benefit from improvements in their
cultural competency. Teamwork and productivity suffer if a diverse
workforce lacks cultural competency. Further, a lack of cultural
competency could negatively affect service and sales to customers.
Critical Thinking Questions
1.
Is there a distinction between diversity and cultural competency,
or are they the same thing? Explain.
2.
A possible negative impact of cultural-competency training
is the furthering of stereotypes. For example, training content
might portray people of certain ethnic backgrounds as acting
the same way and lead to overgeneralizations. Do you think
this problem could be avoided? How?
3.
Do you think that cultural competency should be included as
a core competency in most businesses? Why or why not?
Team Exercise
Join your team members to work on operationalizing cultural-
competency criteria. Specifically, start by identifying the dimensions
of cultural competency. For example, if you think of cultural
competency as a general duty or area of responsibility, what aspects
make up that area? Perhaps communication is one dimension. In
other words, part of cultural competency may be the capability
to understand someone’s language and to be able to effectively
express yourself in that language. Understanding of a culture could
be another aspect. Identify as many dimensions as you think are
needed to capture the general concept of cultural competency.
Refer to the appendix of this chapter detailing the critical-
incident technique. Using the appendix as a guide, generate
behavioral examples for each of the cultural-competency dimensions
your team identified (see step 2 in the appendix). These
“critical incidents” should describe good and poor levels of each
cultural competency dimension.
Share your team’s dimensions and behavioral examples with
the rest of the class. Can a common or core set of dimensions
be identified? As a class, address the issue of the utility of these
dimensions and the behavioral incidents. Specifically, what could
they be used for?
Experiential Exercise: Team
Select representatives as members of a pro or con cultural-competency
team. Each team identifies a rationale for their position. This rationale
can include, but should not be limited by, the following aspects:
¦
What is the impetus behind the push for cultural competency?
¦
What role does cultural competency have in business?
¦
If it is a competency, should it be measured? How?
¦
What about the bottom line? Can a positive return on an
investment be expected?
In a debate-style format, each team makes its presentation of
position and rationale and has the opportunity to question and rebut
and rejoin the other team. The instructor moderates this process.
At the end of the debate, the instructor leads the class in identifying
the key reasons for and against the use of cultural-competency
training. Is there a clear consensus in the class for or against the
training?
Sources: Benavides, A. D., and Hernandez, J. C. T. (2007). Serving diverse
communities—cultural competency. Public Management, 89, 14–18; Pelletier,
S. (2005). N.J. mandates cultural-competency training. Medical Meetings , 12;
Shannon, D. (2010). Cultural competency in health care organizations: Why
and how? Physician Executive, 36, 18–22.
Case 7.3 Emerging Trends
One Job or Multiple Roles? Consider, for instance, the job of professor. The job of professor
is typically conceived of as consisting of three primary
People have jobs to do, right? There are jobs that must be done in
dimensions: research, teaching, and service. The research dimen
organizations; however, in many of today’s organizations it might
sion involves conducting studies and publishing in scholarly jour-
be useful to think about different roles that employees can play
nals. As a student, you are well aware of the teaching dimension.
rather than those employees all doing the exact same job.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 249
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 249
ISBN
1-256-39369-X
Teaching involves delivering material to students, traditionally in a
classroom setting. The service dimension refers to contributing to
efforts both inside and outside of the university, such as chairing a
college committee, working with student groups, and speaking to a
parent’s group. A university professor must adequately perform on
all three dimensions in order to achieve tenure and to be awarded
merit pay.
The reality is that not all professors enjoy or perform on each
of the three dimensions of research, teaching, and service equally
well. As you may have noticed, some professors excel in the classroom
and others, well, it’s not their forté. Some professors excel
at research, whereas others find research to be a constant struggle.
Some professors shun service and are not very good organizational
citizens, whereas others embrace making service contributions,
recognizing that they are necessary for the university to function.
What if it was in your power to redefine the job of professor?
There might be some advantage to recognizing that the job
really consists of three distinct roles. For example, you might
take the best of your researchers and let them focus on the role of
researcher. The professors in this role might have minimal teaching
and service responsibilities so that they could focus on what
they do best—research. Similarly, teaching and service could be
roles that other professors could emphasize. What would be the
advantage of this role-based approach? Students could have the
best teachers, the university would have the best researchers producing
knowledge, and the community would benefit by having
the best organizational citizens working on service-related projects.
In short, performance could be maximized because people
would be doing what they are best at.
The role-based approach also makes sense in workplaces
that experience a great deal of change. Due to competitive pressures
or changes in technology, many jobs today require workers
to take on various duties and shift from one focus, or task,
to another. The workplace is more dynamic and changeable than
ever before. However, people naturally seem to gravitate to particular
roles that they do well. These roles can be consistent, even
though tasks and technology involved in the job may change. For
example, one worker may be the innovator and focus on coming up
with new ideas and solutions. Another worker might be the technical
expert and be relied on to know details about processes and
how to get things done. Yet another worker might be a leader and
move the team toward improved performance. All of these workers,
however, may have the same job title. Traditional performance
appraisal based on a job description may not, in this type of situation,
adequately capture how the workers are really contributing to
the organization.
Critical Thinking Questions
1.
Innovator, technical expert, and team leader are some possible
roles that may be common in the workplace. What other
roles and additional measures do you think would be useful
for role-based appraisal?
2.
Rafael wants to put more emphasis on being a team player.
Sarah wants to delve into making creative contributions for
the coming appraisal period. However, both need to continue
to perform their job functions.
a.
Design a system that would allow people choice in what
they do and, thus, have flexibility in what they are held
accountable for.
b. Do you think people should be given the chance to place
greater or lesser weight on various roles they might play?
Why or why not?
3.
What advantage might a role-based appraisal system offer to
the organization? To the worker?
Team Exercise
The role-based approach seems to capture the reality of many workplaces,
where workers may shift their responsibilities depending on
demands and on whom else is available and on the team. However,
to be usable, roles need to be operationalized. With your teammates,
identify three or more roles in the workplace of your choosing. For
each role, generate behavior examples (see step 2 of the appendix
in this chapter) that portray good and poor levels of performance in
each role. If performance is viewed through a role framework, could
your behavioral incidents be used to measure performance? Share
your roles and behavioral examples with the rest of the class. Does
there seem to be a common set of roles that emerge from the teams?
Experiential Exercise: Team
As a team, consider the example of professors and apply it to
another job. For example, consider a retail store, Emery’s Cookies,
that makes and sells cookies. The job basically requires people to
make cookies, wash dishes and clean, and interact with customers.
a.
How might the role-based approach be applied in this situation?
That is, what roles would you identify?
b.
What would be the potential advantage of taking a role-based
approach in this retail situation?
c.
What could be a disadvantage of the role-based approach in
this situation?
d.
How would you appraise the workers in this retail situation
using a role-based approach? How would this differ from the
traditional job-based approach?
Each team should take on the role of consultants and provide a
report based on these questions to the owner of Emery’s Cookies
(your instructor). Each team will share its description of the role
approach for the cookie store and provide its recommendations
regarding the adoption of a role-based approach.
Experiential Exercise: Individual
Consider the work experiences you have had. Did you have one
consistent job or did you have multiple roles?
a.
Describe the work situation and explain whether you had one
set of job duties or engaged in various roles.
b.
If you played various roles, what triggered a change from
one role to another? If you had a single set of job duties, why
wasn’t a role-based approach taken?
c.
From an employee perspective, are there advantages to the
role-based approach? Describe. Are there disadvantages?
Explain.
d.
From an employer perspective, are there advantages and
disadvantages to the role-based approach? In particular, does
the appraisal process become more difficult? How could this
be handled?
e.
Overall, do you think viewing performance as a single set of
job duties or multiple performance roles is a better approach
to evaluating performance? Why?
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
250 PART IV • EMPLOYEE DEVELOPMENT
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka 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250 PART IV • EMPLOYEE DEVELOPMENT
joka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka joka joka joka joka joka joka joka jokajoka joka joka joka joka joka joka 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Case 7.4 Customer-Driven HR
Electronic Appraisal: Using Performance
Review Software
Many managers avoid performance appraisals because the task
makes them uncomfortable. Some managers may not do a very
good job of appraising the performance levels of their workers. A
growing number of companies are now offering technology that
promises to solve these difficulties.
A number of software programs can make the rating task a
paperless process. Further, some performance review software
even automates improvement suggestions. For instance, clicking a
below-average score on a performance dimension could automatically
generate the text of a performance review that identifies the
performance as deficient and recommends steps that the employee
should take to improve performance.
Depending on the vendor, electronic performance review systems
can use generic goals and competencies as evaluation criteria
or they can be customized so that organizationally specific goals
and competencies are used. The software can report the extent to
which an employee has contributed to the goals of the organization.
Critical Thinking Questions
1.
Place yourself in the position of an employee receiving a
performance review. Would it matter to you whether your
performance review, the narrative description of your performance
levels, and suggestions for improvement were generated
by computer or by your manager? Why?
2.
From the perspective of a manager, what advantages might
be associated with taking an electronic approach to reviewing
the workers’ performance levels? List these advantages into
two categories: rational and political. The rational category
is for advantages such as the speed with which the appraisal
task could be completed. The political category is for advantages
such as being able to blame the computer software for a
poor performance review that a worker is not happy with.
3.
What rational and political disadvantages are associated with
the use of electronic performance review?
4.
Given your answers to the previous questions, would you
recommend the use of electronic performance reviews?
Justify your position.
Team Exercise
A number of companies offer software for reviewing worker
performance. Some offer technology that can be installed on
computers within an organization. Others offer Web-based
services.
As a team, identify a couple of companies that offer electronic
performance review technology. (Some company names
you will likely run across in a computer search include Halogen,
Workscape, and PerformanceReview.com.) For each company
selected by your team, describe the performance review service
that is provided. What claims do the vendors make with regard to
the benefits their services provide?
If possible, determine the typical cost associated with the use
of the technology for a small or medium-sized firm. Estimate the
per employee cost of the electronic approach. Given your cost
figures, do you think purchasing electronic review technology
is something you would recommend to a small or medium-sized
firm? Share your findings and conclusions with the rest of the
class.
Experiential Exercise: Team
As a team, take a position either for electronic and automated
performance reviews or for human-generated performance
reviews. Further, take the perspective of management, workers, or
customers. Thus, your team might, for example, take the perspective
of workers and be against the use of electronic reviews. Given
your team’s perspective, outline the major arguments in support of
your position.
Choose a representative to present your team’s position. In a
town-hall-style debate, each team representative should present his
or her team’s position and rationale. Are there clear differences
based on perspective? For example, is management for electronic
review and workers against? Following the statements of position
and rebuttals, have the class vote on the use of electronic performance
reviews. Is there a clear outcome?
Experiential Exercise: Individual
Develop a set of criteria for judging the effectiveness of performance
review. For example, is the evaluation and feedback likely
to be accepted? Will it be useful? Will it improve performance?
Does it support an organizational goal of coaching and developing
employees? Given your criteria, evaluate the use of electronic and
automated performance review.
Viewing your class as an organization, present a summary of
your criteria and evaluations. Share your overall recommendation
to the “organization” as to whether it should adopt electronic performance
review.
Case 7.5 HR in Small Business
Let’s Do It Right
behavior can become the norm and prompt others to behave in the
same way. In the extreme, unethical behavior can put the business
In a small business, one employee’s unethical behavior can set a
out of business. For instance, unethical employee behavior could
bad example for other workers and be a negative influence on the
offend an important customer whose account can’t afford to be
culture in the business. For example, a worker taking extended
lost by the small business. Or an employee embezzling funds or
breaks or recording hours that weren’t worked can cause ineq
stealing from the business can financially topple a small business.
uity and friction with other workers. If unchecked, the unethical
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 251
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Of course, you want to hire workers that aren’t likely to engage
in these unethical behaviors. Once workers are hired, however, it
may not be enough to tell them that you want the small business
to be an ethical operation. Including ethical performance in the
appraisal system is a way to make clear to employees that how
they reach business goals is as important as reaching them in the
first place.
Critical Thinking Questions
1.
Place yourself in the position of the manager of a small business.
Describe situations when ethical performance appraisal
for your employees would be useful.
2.
Are there disadvantages to a focus on ethics in performance
appraisal? Describe.
3.
How should a small-business owner or manager develope an
appraisal system that measures ethical performance? Identify
the steps.
Team Exercises
Reread the Manager’s Notebook, “Make Ethics Part of Appraisal.”
As a team, use the dimensions and behavioral examples in the
notebook as starting points.
Select a small business, such as a coffee or sandwich shop, as a
setting. Generate dimensions and behavioral examples for the setting.
In addition to developing a measure of ethical performance,
what else can be done with the dimensions and behavioral examples
generated by your team?
Generate an example of the ethical appraisal instrument that
your team would recommend for use in the small business. Share
your example with the rest of the class.
Experiential Exercise: Team
As a team, consider that employee performance can be divided
into the categories of business outcomes and ethics. In other
words, consideration can be given to what an employee gets
done and how it gets done. Traditional performance appraisal
has focused on what employees get done, while the appraisal
of ethical performance focuses on how the employees get the
work done.
As a team, take the position of either business outcomes or
ethics as the primary focus of employee performance. Consider,
for instance, what you would do as a small-business manager if a
worker typically didn’t hit the numbers (such as didn’t make the
expected number of sales), but always goes about doing the job the
right way. From the business outcomes perspective, you may have
to terminate the worker. However, the ethics position would support
keeping the worker.
Choose a team member to present your team’s position to the
class. Following the presentation of the opposing position, engage
in class discussion and debate. Identify a solution to the opposition
or have the class vote on the preferred priority.
Experiential Exercise: Individual
After completing the team experiential exercise, individually
reflect on the class resolution or vote. If business outcomes were
considered the priority among your fellow future managers, how
does this bode for the importance of ethics in organizations in
the future? If ethics was the priority, how realistic do you think
this position is in today’s business environment? Summarize your
assessment in a reflection paper to hand into your instructor or to
share with the class.
ISBN
1-256-39369-X
Endnotes
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Carroll, S. J., and Schneir, C. E. (1982). Performance
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Gray, G. (2002). Performance appraisals don’t work.
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39.
Institute of Management and Administration (2005). Getting
to the most productive results. HRFocus, 82 , 6.
40.
Bernardin, H. J., and Pence, E. C. (1980). Rater training:
Creating new response sets and decreasing accuracy. Journal
of Applied Psychology, 65, 60–66; Cardy, R. L., and Keefe,
T. J. (1994). Observational purpose and valuative articulation
in frame-of-reference training: The effects of alternative processing
models on rating accuracy. Organizational Behavior
and Human Decision Processes, 57 , 338–357.
41.
Cardy, R. L., and Dobbins, G. H. (1994b). Performance
appraisal: The influence of liking on cognition. Advances
in Managerial Cognition and Organizational Information
Processing, 5 , 115–140.
42.
Cardy, R. L., and Dobbins, G. H. (1994a). Performance
appraisal: Alternative perspectives. Cincinnati, OH:
South-Western.
43.
Varma, A., and Pichler, S. (2007). Interpersonal affect: Does
it really bias performance appraisals? Journal of Labor
Research, 28 , 397–523.
44.
Cardy, R. L., and Dobbins, G. H. (1994a). Performance
appraisal: Alternative perspectives. Cincinnati, OH: South-
Western.
45.
Bernardin, H. J., and Walter, C. S. (1977). Effects of rater
training and diary keeping on psychometric error in ratings.
Journal of Applied Psychology, 62, 64–69; Flanagan, J. C.
(1954). The critical incident technique. Psychological Bulletin,
51 , 327–358.
46.
Painter, C. N. (1999). Ten steps for improved appraisals.
Supervision, 60 , 11–13.
47.
Flanagan, J. C., and Burns, R. K. (1955, September–
October). The employee performance record: A new
appraisal and development tool. Harvard Business Review,
95–102.
48.
Bookman, R. (1999). Tools for cultivating constructive
feedback. Association Management, 51 , 73–79.
49.
Ferris, G. R., and Judge, T. A. (1991). Personnel/human
resources management: A political influence perspective.
Journal of Management, 17 , 1–42.
50.
Murphy, K. R., and Cleveland, J. N. (1991). Performance
appraisal: An organizational perspective. Boston: Allyn &
Bacon.
51.
Adapted from C. O. Longenecker, H. P. Sims, Jr., and
D. A. Gioia (1987, August). Behind the mask: The politics
of employee appraisal. Copyright © by the Academy of
Management. Reprinted by permission of the publisher.
Academy of Management Executive, 1 (3), 183–193.
52.
Ferris, G. R., and Judge, T. A. (1991). Personnel/human
resources management: A political influence perspective.
Journal of Management, 17, 1–42; Ferris, G. R., Judge,
T. A., Rowland, K. M., and Fitzgibbons, D. E. (1993).
Subordinate influence and the performance evaluation
process: Test of a model. Organizational Behavior and
Human Decision Processes, 58 , 101–135.
53.
Kozlowski, S. W., Chao, G. T., and Morrison, R. F. (1998).
Games raters play: Politics, strategies, and impression
management in performance appraisal. In J. W. Smither
(Ed.), Performance appraisal: State of the art in practice.
San Francisco: Jossey-Bass.
54.
Banks, C. G., and Roberson, L. (1985). Performance appraisers
as test developers. Academy of Management Review, 10,
128–142.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 253
CHAPTER 7 • APPRAISING AND MANAGING PERFORMANCE 253
55.
Cardy, R. L., and Dobbins, G. H. (1994a). Performance
appraisal: Alternative perspectives. Cincinnati, OH: South-
Western.
56.
Ibid.
57.
Poon, J. M. L. (2004). Effects of performance appraisal
politics on job satisfaction and turnover intention. Personnel
Review, 33 , 3.
58.
Reilly, R. R., and McGourty, J. (1998). Performance
appraisal in team settings. In J. W. Smither (Ed.),
Performance appraisal: State of the art in practice. San
Francisco: Jossey-Bass.
59.
Dominick, P. G., Reilly, R. R., and McGourty, J. W. (1997).
The effects of peer feedback on team member behavior.
Group and Organization Management, 22 , 508–520.
60.
Reilly, R. R., and McGourty, J. (1998). Performance
appraisal in team settings. In J. W. Smither (Ed.),
Performance appraisal: State of the art in practice. San
Francisco: Jossey-Bass.
61.
Denton, K. D. (2001). Better decisions with less information.
Industrial Management, 43 , 21.
62.
Cardy, R. L., and Stewart, G. L. (1997). Quality and teams:
Implications for HRM theory and research. In D. B. Fedor
(Ed.), Advances in the management of organization quality,
Vol. 2, Greenwich, CT: JAI Press.
63.
Ibid.
64.
Barrett, G. V., and Kernan, M. C. (1987). Performance
appraisal and terminations: A review of court decisions
since Brito v. Zia with implications for personnel practices.
Personnel Psychology, 40 , 489–503.
65.
Werner, J. M., and Bolino, M. C. (1997). Explaining U.S.
courts of appeals decisions involving performance appraisal:
Accuracy, fairness, and validation. Personnel Psychology,
50 , 1–24.
66.
Meyer, H. H., Kay, E., and French, J. R. P., Jr. (1965,
March). Split roles in performance appraisal. Harvard
Business Review , 9–10.
67.
Prince, J. B., and Lawler, E. E. (1986). Does salary discussion
hurt the development appraisal? Organiza tional Behavior and
Human Decision Processes, 37 , 357–375.
68.
Report on Salary Surveys. (2002). Annual reviews are standard
at most companies. April Newsletter of the Institute of
Management and Administration.
69.
Bernardin, H. J., and Beatty, R. W. (1984). Performance
appraisal: Assessing human behavior at work. Boston, MA:
Kent.
70.
Dobbins, G. H., Cardy, R. L., and Carson, K. P. (1991).
Perspectives on human resource management: A contrast
of person and system approaches. In G. R. Ferris and K. M.
Rowland (Eds.), Research in personnel and human resources
management, Vol. 9. Greenwich, CT: JAI Press; Ilgen,
D. R., Fisher, C. D., and Taylor, S. M. (1979). Consequences
of individual feedback on behavior in organizations. Journal
of Applied Psychology, 64 , 347–371.
71.
Carson, K. P., Cardy, R. L., and Dobbins, G. H. (1991).
Performance appraisal as effective management or deadly
management disease: Two initial empirical investigations.
Group and Organization Studies, 16 , 143–159.
72.
Kelly, H. H. (1973). The processes of causal attribution.
American Psychologist, 28 , 107–128.
73.
Cascio, W. F. (1998). Applied psychology in human resource
management (5th ed.). Upper Saddle River, NJ: Prentice
Hall.
74.
Blumberg, M., and Pringle, C. D. (1982). The missing
opportunity in organizational research: Some implications
for a theory of work performance. Academy of Management
Review, 7, 560–569; Carson, K. P., Cardy, R. L., and
Dobbins, G. H. (1991). Performance appraisal as effective
management or deadly management disease: Two initial
empirical investigations. Group and Organization Studies,
16, 143–159; Schermerhorn, J. R., Jr., Gardner, W. L., and
Martin, T. N. (1990). Management dialogues: Turning on the
marginal performers. Organizational Dynamics, 18 , 47–59.
75.
Blumberg, M., and Pringle, C. D. (1982). The missing
opportunity in organizational research: Some implications
for a theory of work performance. Academy of Management
Review, 7, 560–569; Rummler, G. A. (1972). Human performance
problems and their solutions. Human Resource
Management, 19 , 2–10.
76.
Bernardin, H. J., Hagan, C. M., Kane, J. S., and Villanova,
P. (1998). Effective performance management: A focus on
precision customers, and situational constraints. In J. W.
Smither (Ed.), Performance appraisal: State of the art in
practice. San Francisco: Jossey-Bass.
77.
Rummler, G. A. (1972). Human performance problems and
their solutions. Human Resource Management, 19 , 2–10.
78.
Schermerhorn, J. R., Jr., Gardner, W. L., and Martin, T. N.
(1990). Management dialogues: Turning on the marginal
performers. Organizational Dynamics, 18 , 47–59.
79.
Cardy, R. L. (1997). Process and outcomes: A performance-
management paradox? News: Human Resources Division,
21 , 12–14.
80.
French, S. (2002). Conversations that matter:
Communicating effectively in difficult situations. Canadian
HR Reporter, 15 , 12.
ISBN
1-256-39369-X
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
APPENDIX TO CHAPTER
7
The Critical-Incident Technique: A Method for Developing
a Behaviorally Based Appraisal Instrument
The critical-incident technique (CIT) is one of many types of
job-analysis procedures. The CIT is often used because it produces
behavioral statements that make explicit to an employee
what is required and to a rater what the basis for an evaluation
should be.
CIT Steps
The following steps are involved in a complete CIT procedure:
1.
Identify the major dimensions of job performance.
This can be done by asking a group of raters and ratees
to brainstorm and generate dimensions relevant to job
performance. Each person lists, say, three dimensions.
The group members then combine their lists and eliminate
redundancies.
2.
Generate “critical incidents” of performance. For
each dimension, the group members should list as many
incidents as they can think of that represent effective,
average, and ineffective performance levels. Each person
should think back over the past 6 to 12 months for
examples of performance-related behaviors that they have
witnessed. Each incident should include the surrounding
circumstances or situation.
If you are having trouble generating incidents, you
might want to think of the following situation: Suppose
someone said that person A, whom you feel is the most
effective person in the job, is a poor performer. What
incidents of person A’s behavior would you cite to
change the critic’s opinion?
Try to make sure that the incidents you list are observable
behaviors and not personality characteristics (traits).
3.
Double-check that the incidents represent one dimension.
This step is called retranslation. Here you are trying to
make sure there is clear agreement on which incidents
represent which performance dimension. If there is substantial
disagreement among group members, this incident
may need to be clarified. Alternatively, another dimension
may need to be added or some dimensions may need to be
merged.
In the retranslation process, each person in the group
is asked to indicate what dimension each incident represents.
If everyone agrees, the group moves on to the next
incident. Any incidents on which there is disagreement
are put to the side for further examination at the end of the
process. At that time they may be discarded or rewritten.
4.
Assign effectiveness to each incident. Effectiveness values
are assigned to all the incidents that survived retranslation.
How much is incident “A” worth in our organization,
on, say, an effectiveness scale of 1 (unacceptable) to 7
(excellent)? All group members should rate each incident.
If there is substantial disagreement regarding the value of a
certain behavior, that behavior should be discarded.
Note: Disagreement on incident values indicates differences
in evaluative standards or lack of clarity in organizational
policy. Disagreement regarding evaluative standards can be a
fundamental problem in appraisal. The CIT procedure can help
to reduce these differences.
The chart on the following page shows some CIT worksheets
for you to try your hand at. The dimensions included are
a subset of those generated in a research project conducted for
a hospital that wanted a common evaluation tool for all non-
nursing employees.*
The jobs covered ranged from floor sweeper and clerical
worker to laboratory technician and social worker. Of course,
the behavioral standards for each dimension differed across
jobs—an excellent floor sweeper behavior would not be the
same as an excellent lab technician behavior. The dimensions
included in the worksheets appear fairly generic, though, and
are probably applicable to jobs in most organizations. You may
want to develop more specific dimensions or other dimensions
altogether.
Remember, after generating incidents, your group should
determine agreement levels for the dimension and value for
each incident. An easy way to do this is for one person to recite
an incident and have everyone respond with dimension and
value. This process could be informal and verbal or formal and
written.
*Goodale, J. G., and Burke, R. J. (1975). Behaviorally based rating scales need not be job specific. Journal of Applied Psychology, 60 , 389–391.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
Critical Incidents Worksheet Critical Incidents Worksheet
Job Title: Job Title:
Job Dimension: Knowledge of Job— Job Dimension: Initiative—The enthusiasm to
Understanding of the position held and the get things done, energy exerted, willingness
job’s policies, techniques, rules, materials, to accept and perform responsibilities and
and manual skills. assignments; seeks better ways to achieve results.
Instructions: Provide at least one behavioral Instructions: Provide at least one behavioral
statement for each performance level. statement for each performance level.
1. Needs improvement: 1. Needs improvement:
2. Satisfactory: 2. Satisfactory:
3. Excellent: 3. Excellent:
4. Outstanding: 4. Outstanding:
Critical Incidents Worksheet Critical Incidents Worksheet
Job Title: Job Title:
Job Dimension: Personal Relations—Attitude Job Dimension: Dependability—Attention
and response to supervision, relationships with to responsibility without supervision, meeting
coworkers, flexibility in working as part of the of deadlines.
organization.
Instructions: Provide at least one behavioral
Instructions: Provide at least one behavioral statement for each performance level.
statement for each performance level.
1. Needs improvement:
1. Needs improvement: 2. Satisfactory:
2. Satisfactory: 3. Excellent:
3. Excellent: 4. Outstanding:
4. Outstanding:
ISBN
1-256-39369-X
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ee
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s
and Managing Discipline
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 467
employees who would rather not have their employers discover a marijuana infrac-
tion or drunk-driving charge.2
¦ Workers for Weyco, a health-benefits administrator in Okemos, Michigan, can now
be fired for smoking—on or off the job. The company randomly tests workers at least
once a year for smoking. As a business that pays claims for health plans, “we see some
of the devastating effects of smoking-related illnesses,” says Gary Climes, vice presi-
dent of finance. “We are trying to avoid it.” Do such policies violate employees’ rights
to engage in legal activities (smoking) during nonwork hours?3
The Managerial Perspective
The three examples in the chapter opener suggest that the rights of both employees and
employers should be clearly spelled out in every employment relationship. The HR depart-
ment can help in several ways, such as:
¦ Developing and enforcing policies that inform employees of their rights and responsi-
bilities.
¦ Making managers aware of employees’ rights and managers’ obligations to employees.
¦ Acting as an employee advocate, especially in cases where a supervisor misunderstands
or disregards discipline policy.
But it is the manager who can make a tremendous difference here. Managers who
respect employees’ rights are more likely to have employees with high levels of morale
and job satisfaction than managers who ignore these rights. Respecting employees’ rights
also lessens the likelihood of a costly grievance procedure or lawsuit. As a result, managers
need to learn what their employees’ rights are, conduct thorough investigations on behalf
of employees with a complaint, and learn to administer discipline as a way to correct a
behavior or habit that is nonproductive—rather than as a form of punishment.
In this chapter, we examine employee rights and employee discipline. These two issues
are closely related to the quality of employee relations (discussed in the preceding chap-
ter). Organizations with effective employee relations ensure that their managers respect
employees’ rights and use fair and consistent discipline procedures.
First, we examine the concepts of employee rights, management rights, and the
employment-at-will doctrine that governs many nonunion employers. Second, we explore
some challenges that managers encounter in balancing employee rights with the rights of
management. Next, we discuss employee discipline and offer some suggestions for man-
aging difficult employees. We conclude by examining how the HR department can support
managers with proactive policies that minimize the need for disciplinary procedures.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 467
employees who would rather not have their employers discover a marijuana infrac-
tion or drunk-driving charge.2
¦ Workers for Weyco, a health-benefits administrator in Okemos, Michigan, can now
be fired for smoking—on or off the job. The company randomly tests workers at least
once a year for smoking. As a business that pays claims for health plans, “we see some
of the devastating effects of smoking-related illnesses,” says Gary Climes, vice presi-
dent of finance. “We are trying to avoid it.” Do such policies violate employees’ rights
to engage in legal activities (smoking) during nonwork hours?3
The Managerial Perspective
The three examples in the chapter opener suggest that the rights of both employees and
employers should be clearly spelled out in every employment relationship. The HR depart-
ment can help in several ways, such as:
¦ Developing and enforcing policies that inform employees of their rights and responsi-
bilities.
¦ Making managers aware of employees’ rights and managers’ obligations to employees.
¦ Acting as an employee advocate, especially in cases where a supervisor misunderstands
or disregards discipline policy.
But it is the manager who can make a tremendous difference here. Managers who
respect employees’ rights are more likely to have employees with high levels of morale
and job satisfaction than managers who ignore these rights. Respecting employees’ rights
also lessens the likelihood of a costly grievance procedure or lawsuit. As a result, managers
need to learn what their employees’ rights are, conduct thorough investigations on behalf
of employees with a complaint, and learn to administer discipline as a way to correct a
behavior or habit that is nonproductive—rather than as a form of punishment.
In this chapter, we examine employee rights and employee discipline. These two issues
are closely related to the quality of employee relations (discussed in the preceding chap-
ter). Organizations with effective employee relations ensure that their managers respect
employees’ rights and use fair and consistent discipline procedures.
First, we examine the concepts of employee rights, management rights, and the
employment-at-will doctrine that governs many nonunion employers. Second, we explore
some challenges that managers encounter in balancing employee rights with the rights of
management. Next, we discuss employee discipline and offer some suggestions for man-
aging difficult employees. We conclude by examining how the HR department can support
managers with proactive policies that minimize the need for disciplinary procedures.
ISBN
1-256-39369-X
Employee Rights
A right is the ability to engage in conduct that is protected by law or social sanction, free from
interference by another party (such as an employer). For example, employees have the legal right
to form a union. It is illegal for an employer to discourage employees from exercising their right
to form a union by withholding pay increases from those who support the union.
The scope of employee rights has broadened in the last 50 years as the federal and state
governments have enacted laws giving employees specific protections. Additionally, in the last
decade courts have been more willing to protect employees from wrongful discharge than they
were in the past. Many believe that the courts have been more proactive in protecting employees’
rights because of the shrinking proportion of the labor force that is protected by union contracts.
Figure 14.1 shows the three different categories of employee rights that managers must consider:
(1) statutory rights, (2) contractual rights, and (3) other rights.
Statutory Rights
Employees’ statutory rights are protected by specific laws enacted by government. Employees’ key
statutory right is protection from discrimination based on race, sex, religion, national origin, age,
right
The ability to engage in conduct
that is protected by law or social
sanction, free from interference by
another party.
statutory right
A right protected by specific laws.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
468 PART VI • GOVERNANCE
468 PART VI • GOVERNANCE
s
• Protection from discrimination • Employment contract • Ethical treatment
• Safe working conditions • Union contract • Privacy (limited)
• Right to form unions • Implied contracts/employment policies • Free speech (limited)
FIGURE 14.1
Categories of Employee Rights
contractual right
A right based on the law of
contracts.
contract
A legally binding promise between
two or more competent parties.
employment contract
A contract that spells out explicitly
the terms of the employment
relationship for both employee
and employer.
due process
Equal and fair application of a policy
or law.
handicap, or other protected status under Title VII of the Civil Rights Act of 1964 and other equal
employment opportunity laws (see Chapter 3 ). The Equal Employment Opportunity Commission
(EEOC) regulates employer conduct to ensure that employees are not discriminated against.
Another important employee statutory right is protection from unsafe or unhealthy working
conditions. The Occupational Safety and Health Act (OSHA) requires employers to provide
safe working conditions for workers and has established the Occupational Safety and Health
Administration to regulate health and safety practices at companies (see Chapter 16 ).
Employees also have the legal right to form unions and participate in union activities (see
Chapter 15). The National Labor Relations Board (NLRB) regulates employer and employee
conduct to ensure fair labor practices.
Contractual Rights
Contractual rights are based on the law of contracts. A contract is a legally binding promise
between two or more competent parties.4 A breach of contract, in which one of the parties does
not perform his or her promised duty to the other party, is subject to legal remedy.
Both employers and employees have rights and obligations to each other when they enter
into a contract. An employment contract spells out explicitly the terms of the employment relationship
for both employee and employer. In general, such contracts state that the employee is
expected to work competently over a stipulated period of time and that the employer is expected
to provide a mutually agreed upon amount of pay, as well as specific working conditions, over
this time period.5 Employees covered by employment contracts include nonunionized public
school teachers, college football coaches, actors in film and television, top-level executives, and
middle management.6 Only a very small percentage of the labor force works under employment
contracts.
The provisions of the employment contract give the employee job security and are, at least
theoretically, negotiated individually. We say “theoretically” because there are cases in which
contracts are so similar as to be standard. For instance, many public school teachers not covered
by union contracts are hired on a year-to-year basis by the school district. In theory, each teacher
negotiates his or her own contract. In practice, however, because of the volume of contracts that
must be written, the vast majority of these contracts follow a standard pattern.
Some industries have standard contract provisions to protect their interests more fully. For
instance, employers in competitive technology and service industries often have several employment
contract provisions that forbid employees to (1) disclose trade secret information during or
after their employment, (2) solicit business from former customers, or (3) attempt to hire former
coworkers after leaving the company.7 For some high-profile jobs, such as top-level executives,
the contract will not follow the standard pattern and will, in fact, be negotiated individually.8 An
employee under contract may be fired for reasons other than nonperformance, but he or she is
then entitled to compensation for the life of the contract.
A significant percentage of employees in the U.S. labor force (around 12%) are covered
by union contracts, which protect groups of unionized workers. Union contracts do not provide
as much job security as individually negotiated employment contracts do, but they do
provide some job security through seniority and union grievance procedures. Seniority provisions
protect the jobs of the most senior workers through the “last in, first out” layoff criterion
that is commonly written into the union contract (see Chapter 6 ). Union grievance procedures
subject all disciplinary actions (including discharge) to due process, which requires a fair
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 469
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 469
ISBN
1-256-39369-X
investigation and a showing of just cause to discipline employees who have not performed
according to expectations. An arbitrator who is empowered to decide discipline and rights
cases can restore the job rights and back pay of an employee who has been wrongfully discharged.
(Wrongful discharge is discharge for reasons that are either illegal or inappropriate,
such as age or the refusal to engage in illegal activities.)
Sometimes employers and employees enter into a contract even though no formal contract
exists. In this case, the employer and the employee are said to have entered into an implied contract.
Certain employment policies and practices may unintentionally create an implied contract.
The courts have interpreted statements made by an interviewer or manager such as “You will
always have a job as long as you do your work” as a promise of job security.9 Employees who
lost their jobs because of layoffs have successfully obtained legal remedies when such promises
were made.
Employee handbooks can be another source of implied employment contracts if they offer
job security. Some courts have interpreted statements like “Employees will be dismissed only
for just cause” as placing the burden of proof on the company for a termination decision.10 In
addition, when an employee handbook or employment policy makes a distinction between “probationary”
and “permanent” employees, the courts have held that employers are promising continued
employment to workers who successfully complete the probationary period and become
permanent employees. To date, at least 30 state supreme courts have ruled that employee handbooks
can be interpreted as enforceable contracts.11
Other Rights
Employees often expect certain other rights in addition to statutory and contract rights. These
include a right to ethical treatment and limited rights to free speech and privacy. These rights
differ from the first two categories of rights in an important way: Although employees may
expect these rights, they may have no legal recourse if they feel that these rights have been
violated. Even though the law does not require employers to extend these other rights to
employees, doing so is likely to result in more satisfied workers who are willing to go the extra
mile for the organization.
RIGHT TO ETHICAL TREATMENT Employees expect to be treated fairly and ethically in return for
providing their employer with a fair and reasonable amount of work. This expectation is called
the psychological contract.12 Employers who uphold the psychological contract generally have
more productive employees. In contrast, those who violate the psychological contract may cause
employees to quit or to form a union. Because employee turnover is costly and unionization
results in some loss of control over the business, managers should be aware of the importance of
the psychological contract to employees.13 One way of sealing the psychological contract is to
develop and publicize a code of ethics.14 HR can contribute to maintaining an ethical environment
by integrating the code of ethics into employment policies, orientations for new employees,
and formal training programs.15
Managers and supervisors can influence their companies’ climate of fairness and ethical
behavior by the tone they set for employees in their work units.16 Specifically, managers and
supervisors should:
¦
Take actions that develop trust, such as sharing useful information and making good on
commitments.
¦
Act consistently so that employees are not surprised by unexpected management actions
or decisions.
¦
Be truthful and avoid white lies and actions designed to manipulate others by giving a
certain (false) impression.
¦
Demonstrate integrity by keeping confidences and showing concern for others.
¦
Meet with employees to discuss and define what is expected of them.
¦
Ensure that employees are treated equitably, giving equivalent rewards for similar
performance and avoiding actual or apparent special treatment of favorites.
¦
Adhere to clear standards that are seen as just and reasonable—for example, neither
praising accomplishments nor imposing penalties disproportionately.
¦
Demonstrate respect toward employees, showing openly that they care about employees
and recognize their strengths and contributions.17
wrongful discharge
Termination of an employee for
reasons that are either illegal or
inappropriate.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
470 PART VI • GOVERNANCE
470 PART VI • GOVERNANCE
ranted
intrusions into their personal affairs. Although this right is not explicitly stated in the U.S.
Constitution, the Supreme Court found in a 1965 ruling that it is implicit in the Constitution. For
instance, the Constitution does explicitly prohibit unreasonable searches and seizures, and this
prohibition is consistent with a more general right to privacy.
There are two additional legal bases for privacy rights. First, several state constitutions
(including those of Arizona and California) contain an explicitly stated right to privacy. Second,
several federal laws protect specific aspects of an employee’s privacy. For instance, the Crime
Control and Safe Streets Act of 1968 has a provision that prevents employers from viewing or
listening to an employee’s private communications without obtaining prior consent.
Because the U.S. and state constitutions limit the powers of the government, federal and
state employees’ privacy rights are protected, although not absolutely. For instance, under a pro
gram mandated by Congress, employees whose jobs in U.S. aviation are directly related to safety
must undergo periodic blood alcohol testing.18 However, the same constitutional protections do
not apply to private employee arrangements. For instance, government employers are typically
prohibited from searching their employees’ personal work space (desks, lockers, etc.) unless
they have reasonable cause, but private employers typically are not prohibited from this kind of
activity. Still, because employees expect certain privacy rights, it is almost always good policy
for an employer to respect employee privacy.
A sensitive issue involving employee privacy rights is the maintenance of personnel files.
personnel file Each worker’s personnel file contains the documentation of critical information, such as per-
A file maintained for each employee, formance appraisals, salary history, disciplinary actions, and career milestones. Access to the
containing the documentation of personnel file should be denied to all people except managers who have a job-related “need to
critical HR-related information,
know” certain information. Employees should be able to review the information in their per-
such as performance appraisals,
sonnel file periodically to ensure its accuracy. If personnel files are stored in a human resource
salary history, disciplinary actions,
information system (HRIS), access to this sensitive information should be controlled by the use
and career milestones.
of passwords or special codes to protect employees’ privacy rights.
Employees of the U.S. federal government have the privacy of their personnel files pro-
Privacy Act of 1974 tected under the Privacy Act of 1974. The act requires federal agencies to permit employees
Guarantees the privacy of personnel to examine, copy, correct, or amend employee information in their personnel file. The act also
files for employees of the U.S. includes provisions for an appeal procedure if there is a dispute over the accuracy of the informa
federal government.
tion or what is to be included in the file.19
Employers may be able to discover personal information about employees through social networking
sites, such as MySpace and Facebook, where people describe their nonwork activities to
friends and post photos. Individuals should use discretion when posting indiscreet photos or stories
on social networking sites that could potentially damage their reputation for conforming to conventional
morality and ethics or having sound judgment. An increasing number of employers are
scanning social networking sites as an informal recruitment practice to narrow the applicant pool
and eliminate individuals prior to the interview phase.20 An example of a young woman who lost
her job as a teacher when her employer saw a photo of her at a party that had been posted online is
provided in the Manager’s Notebook, “Think Twice Before Posting Photos on the Internet.”
Emerging Trends
Think Twice Before Posting Photos on the Internet
Employee privacy is not protected with regards to photos or descriptions of employees’ off-
the-job activities that are posted on the Internet. Poorly chosen words or photos posted
online regarding one’s leisure time experiences can have career-altering consequences.
Stacy Snyder, who was a senior at Millersville University in Millersville, Pennsylvania, provides
an instructive example. Snyder was dismissed from the student teaching program at a nearby high
school and denied her teaching credential after the school staff came across her photograph on her
MySpace profile. In response, Snyder filed a lawsuit in a federal court contending that her right to
free expression under the First Amendment had been violated, but so far no trial date has been set.
MANAGER’S NOTEBOOK
ISBN
1-256-39369-Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 471
polttouhreja tapahtuisi ase alettiin laskettiinkaytannossa rikki lampaan harha syostaan iesta puhunut sairastuisovituksen kuoltua bisnesta aania toivot itsetunnon paivin tuomionsakiinnostunut sanoma ruokaa poikennut tuliseen jalkeeni ulkoapainvalvokaa tarkasti vaimokseen erillinen koskettaa kiitaa voimanjoudutaan asetti tallaisen suunnilleen miettia mukainen alati ylistettyrasvan tottelemattomia lehti karpat tutkivat vaadi vaikea mannaa asuttetasan laake kuolet maalia tuhotaan lahdin sanottavaa hallitukseenjoiden perusteita siitahan tilanne keskellanne selain tullessaanheimolla suureen jonka totuudessa ymmartavat pystyy luetaanalhainen elamaa tervehti vetta eero kuubassa valalla kohdensaastaiseksi ruotsissa siunaus surmansa yksityinen palvelealkuperainen temppelini veljeasi maksettava netin pahemminvalmistaa millaista kestaa oltava kertonut lakia silleen itsetunnonfaktat sapatin johtamaan silmieni puheensa syyttavat tilata luovutanmerkitys pilkkaa todetaan jarjestelman jollain peruuta kyseinen vaantyperaa luulin rakastan harhaan itkivat lakkaamatta laskettuja taisteleeukkosen asetin asti kestaa hovin aja vauhtia voimallaan kuivaa tasantayttamaan kateen saannot tyton synagogaan lahestulkoon internetniilta vieraissa riemuiten toinen tahtosi typeraa armon mallin mahtaasuunnitelman iankaikkiseen persian valtasivat lahistolla raunioiksisinulle kansoihin kohottaa toivot tekemaan seuraus pyytaa hajottaaruotsissa suurissa harkia kasvoihin ohella vannoen isiensalaskemaan ymparillaan jaksanut tyhja hienoa sanoman toimii kengattoivoo kuuntelee vapauttaa saali jruohoma
ryostavat vieroitusoireet luonnollisesti
tuhoudutte tulvii huonommin aasin
verot voimakkaasti noillaloput noudata tahdot uskovaiset viisaan annoin
lopputulokseen hopealla kertasuusi luo maahansa muuttunut oleellista otsikon terveeksi alainenpaivittaisen hovin ikuisiksi iloista kutsutaan unohtako neljas kiroaapolitiikkaan asiasta seuraavana tiesivat koko tietokoneellatarkoitukseen muuttaminen lyhyt haluamme sokeat noussut tuostavanhinta valtiot unensa palvelee tuliastiat positiivista inhimillisyydensisalmyksia muukalainen todistuksen astuu halveksii rikokset syntipalvelusta tehokasta ansaan kuolivat netissa lyoty terveeksi lopultaliike saavan lopulta viinin omaan esiin viljaa uskollisuutesi uskoamaininnut perati suomessa munuaiset aamun kahdesta miettia heimokysykaa kummassakin tapahtumat nuhteeton pennia viisauttapuheillaan jalkelaisille ylle lukuisia arvokkaampi ajettu puusta sekavaloukata kehityksen kansoihin kaikenlaisia laulu naisista valtaosaristiriita koe kommunismi pienesta jruohoma sydamestasi juutalaisetnae pysyivat kotiisi aamuun vapauta teilta otan eroon kappalettamiljoonaa pilkata puolta hyvin presidentti puhuu kaskenytkertakaikkiaan muissa kauppaan tahtoivat usko ylin alhaiset kristustaantaneet aro kansoja toimii tervehtimaan osata miettia trippiparempaa kaynyt omaksenne soturia kylliksi lihaa tyot kavivat arvo
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 471
polttouhreja tapahtuisi ase alettiin laskettiinkaytannossa rikki lampaan harha syostaan iesta puhunut sairastuisovituksen kuoltua bisnesta aania toivot itsetunnon paivin tuomionsakiinnostunut sanoma ruokaa poikennut tuliseen jalkeeni ulkoapainvalvokaa tarkasti vaimokseen erillinen koskettaa kiitaa voimanjoudutaan asetti tallaisen suunnilleen miettia mukainen alati ylistettyrasvan tottelemattomia lehti karpat tutkivat vaadi vaikea mannaa asuttetasan laake kuolet maalia tuhotaan lahdin sanottavaa hallitukseenjoiden perusteita siitahan tilanne keskellanne selain tullessaanheimolla suureen jonka totuudessa ymmartavat pystyy luetaanalhainen elamaa tervehti vetta eero kuubassa valalla kohdensaastaiseksi ruotsissa siunaus surmansa yksityinen palvelealkuperainen temppelini veljeasi maksettava netin pahemminvalmistaa millaista kestaa oltava kertonut lakia silleen itsetunnonfaktat sapatin johtamaan silmieni puheensa syyttavat tilata luovutanmerkitys pilkkaa todetaan jarjestelman jollain peruuta kyseinen vaantyperaa luulin rakastan harhaan itkivat lakkaamatta laskettuja taisteleeukkosen asetin asti kestaa hovin aja vauhtia voimallaan kuivaa tasantayttamaan kateen saannot tyton synagogaan lahestulkoon internetniilta vieraissa riemuiten toinen tahtosi typeraa armon mallin mahtaasuunnitelman iankaikkiseen persian valtasivat lahistolla raunioiksisinulle kansoihin kohottaa toivot tekemaan seuraus pyytaa hajottaaruotsissa suurissa harkia kasvoihin ohella vannoen isiensalaskemaan ymparillaan jaksanut tyhja hienoa sanoman toimii kengattoivoo kuuntelee vapauttaa saali jruohoma
ryostavat vieroitusoireet luonnollisesti
tuhoudutte tulvii huonommin aasin
verot voimakkaasti noillaloput noudata tahdot uskovaiset viisaan annoin
lopputulokseen hopealla kertasuusi luo maahansa muuttunut oleellista otsikon terveeksi alainenpaivittaisen hovin ikuisiksi iloista kutsutaan unohtako neljas kiroaapolitiikkaan asiasta seuraavana tiesivat koko tietokoneellatarkoitukseen muuttaminen lyhyt haluamme sokeat noussut tuostavanhinta valtiot unensa palvelee tuliastiat positiivista inhimillisyydensisalmyksia muukalainen todistuksen astuu halveksii rikokset syntipalvelusta tehokasta ansaan kuolivat netissa lyoty terveeksi lopultaliike saavan lopulta viinin omaan esiin viljaa uskollisuutesi uskoamaininnut perati suomessa munuaiset aamun kahdesta miettia heimokysykaa kummassakin tapahtumat nuhteeton pennia viisauttapuheillaan jalkelaisille ylle lukuisia arvokkaampi ajettu puusta sekavaloukata kehityksen kansoihin kaikenlaisia laulu naisista valtaosaristiriita koe kommunismi pienesta jruohoma sydamestasi juutalaisetnae pysyivat kotiisi aamuun vapauta teilta otan eroon kappalettamiljoonaa pilkata puolta hyvin presidentti puhuu kaskenytkertakaikkiaan muissa kauppaan tahtoivat usko ylin alhaiset kristustaantaneet aro kansoja toimii tervehtimaan osata miettia trippiparempaa kaynyt omaksenne soturia kylliksi lihaa tyot kavivat arvo
ISBN
1-256-39369-X
Snyder’s photo, preserved at the Chronicle of Higher Education’s “Wired Campus” blog,
turns out to be surprisingly innocent. In a head shot snapped at a costume party, Snyder, with a
pirate’s hat perched atop her head, sips from a large plastic cup whose contents cannot be seen.
When posting the photo, she fatefully captioned her self-portrait “drunken pirate,” although
whether she was serious cannot be determined by looking at the photo.
Millersville University, in a motion asking the court to dismiss the case, contends that
Snyder’s student teaching had been unsatisfactory for many reasons. However, it affirms that she
was dismissed and barred from re-entering the school shortly after the high school staff discovered
her MySpace photograph. The university backed the school authorities’ contentions that her posting
was “unprofessional” and might “promote underage drinking.” It also cited a passage in the
teacher’s handbook that said staff members are “to be well-groomed and appropriately dressed.”
Although social networking sites such as MySpace have privacy settings that can be adjusted
to restrict public access, Snyder had not adjusted the privacy settings. She anticipated that her
profile page would be seen by school authorities but felt that since she is an adult over 21 years
of age she had nothing to hide.
Source: Based on Stross, R. (2007, December 30). How to lose your job on your own time. New York Times, Business 3;
Grasz, J. (2009, August 24). 45% employers use Facebook-Twitter to screen job candidates. The Oregon Biz Report—
Business News from Oregon. www.oregonbusinessreoprt.com; Finder, A. (2006, June 11). For some, online persona
undermines a résumé. New York Times. www.nytimes.com. ¦¦
LIMITED RIGHT TO FREE SPEECH The First Amendment to the U.S. Constitution guarantees all
U.S. citizens the right to free speech. This right is therefore more explicit than the right to
privacy. However, it too is limited.21 Again, government employees are more fully protected
than those who work for private employers. For instance, an IRS agent who disagrees with the
current president’s tax policies is perfectly free to say so publicly without fear of official retribution.
However, if a Sears’ store manager publicly disagrees with corporate pricing strategy,
Sears is free to discipline or terminate that manager. Thus, managers in the private sector can
legally discipline employees who say something damaging to the company or its reputation.
Similarly, a company can and should discipline an employee for using demeaning language
that insults a person based on his or her race or gender. Texaco did not discipline the managers
who insulted African American employees on the basis of race, which resulted in an expensive
discrimination lawsuit.22 There are important exceptions to this situation, however. When
employees reveal management misconduct to outsiders, they are engaging in whistle-blowing,
which is a legal right under federal and some state laws. We discuss whistle-blowing in detail
later in this chapter.
As with the right to privacy, managers should interfere as little as possible with employees’
free speech because this right is so deeply ingrained in U.S. culture. Managers need to balance
the costs and benefits of extending versus not extending privacy and speech rights. For instance,
we saw in Chapter 13 that e-mail is becoming a very popular method of communication. Should
companies establish a policy allowing managers to read all their employees’ electronic communications?
For example, an employer could have employees sign a consent form acknowledging
the company’s right to access e-mail messages.23 Employees who know that managers
are looking at their communications are likely to “censor” them to some degree, and the loss of
candor may lead to less-than-optimal decisions. In addition, such a policy would injure the trust
relationship between employees and their employer. Thus, any theoretical benefit a company
might gain from such a policy—like guarding against criminal activity—would almost certainly
be offset by work-related and psychological costs.
Management Rights
The rights of the employer, usually called management rights, can be summed up as the rights
to run the business and to retain any profits that result. In the United States, management rights
are supported by property laws, common law (a body of traditional legal principles, most of
which originated in England), and the values of a capitalistic society that accepts the concepts
A QUESTION OF ETHICS
A computer programming manager
suspects that one of her programmers
is sharing programming
information with a competitor
through electronic mail. Is it appropriate
for the manager to examine
her employee’s e-mail files without
the suspected programmer’s
permission?
management rights
Management’s rights to run the
business and retain any profits
that result.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
472 PART VI • GOVERNANCE
472 PART VI • GOVERNANCE
A common-law rule used by
employers to assert their right to
end an employment relationship
with an employee at any time for
any cause.
of private enterprise and the profit motive.24 The stockholders and owners who control a firm
through their property rights delegate the authority to run the business to managers.
Management rights include the right to manage the workforce and the rights to hire, promote,
assign, discipline, and discharge employees. Management’s right to direct the workforce is moderated
by the right of employees (at least those who have not signed an employment contract) to
quit their jobs at any time. Thus, it is in management’s interest to treat employees fairly.
Management rights are influenced by the rights of groups who have an interest in decisions
made in the workplace. For example, managers have the right to hire the employees they wish to
hire, but this right is affected by EEOC laws that prevent the employer from discriminating on
the basis of certain applicant characteristics (age, race, sex, and so on). Furthermore, managers
have the right to set pay levels for their employees, but the presence of a union labor contract
with a pay provision requires managers to pay employees according to the contract’s terms.
Management rights are often termed residual rights because they pertain to the remaining
rights that are not affected by contracts or laws that represent the interests of employees or other
parties (such as a union).25 According to the residual rights perspective, managers have the right
to make decisions that affect the business and the workforce except where limited by laws or
contract provisions.
One of the most important employer rights is employment at will.
Employment at Will
Employers have long used employment at will, a common-law rule, to assert their right to end
their employment relationship with an employee at any time for any cause. U.S. courts adopted
the rule in the nineteenth century to promote flexibility in the labor market by acknowledging
the existence of a symmetrical relationship between employer and employee. Because workers
were free to terminate their relationship with their employer for any reason, the courts deemed
it fair for employers to be able to end their relationship with employees whenever they see fit
to do so. Employment at will can be a particularly important management right in small business,
where a low-performing employee can make the difference between a healthy profit and
an unhealthy loss.
Although the courts originally assumed that employment at will would give both parties
equal footing in the employment relationship, it is apparent that employment at will has
stacked the deck in favor of employers. Because of the employment-at-will doctrine, many
employees who are wrongfully discharged each year have no legal remedies.26 One labor relations
expert has estimated that approximately 150,000 employees are wrongfully discharged
by their employers each year.27 Virtually all these wrongful discharges occur in the 70 percent
of the U.S. labor force that is not protected by either a union contract or civil service rules,
which guarantee government employees the right of due process in termination procedures.
Employment at will is not accepted in other parts of the world, including Japan and the nations
of the European Union. These countries have enacted laws that make it difficult for employers
to discharge a worker without good cause. In France, Belgium, and the United Kingdom,
the only grounds for immediate dismissal are criminal behavior.28 In many other countries,
employers who discharge employees for noncriminal reasons face costly mandatory severance
pay requirements that provide many weeks of pay. For example, employment laws provide discharged
workers 32 weeks of pay in France, 34 weeks of pay in the United Kingdom, 75 weeks
of pay in Mexico, 78 weeks of pay in India, 90 weeks of pay in China, and 165 weeks of pay in
Brazil. By comparison, in the United States employers are not legally required to provide severance
pay to discharged employees, although some U.S. companies voluntarily offer modest
amounts of severance pay.29
LEGAL LIMITATIONS TO EMPLOYMENT AT WILL For the past 25 years or so, state courts have
been ruling that employment at will is limited in certain situations.30 Because these are state
rather than federal cases, they have varied widely. In general, however, employment-at-will
limitations can be grouped into three categories: public policy exceptions, implied contracts, and
lack of good faith and fair dealing. In some states, plaintiffs have received sizable settlements for
punitive damages as well as back pay. Although juries have given a median award of $205,000
to plaintiffs in wrongful discharge cases, in one recent case at a Wall Street investment bank a
manager was awarded $1.9 million by his former employer to settle his claim.31
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-X
ISBN
1-256-39369-X
Public Policy Exceptions The courts have ruled that an employee may not be discharged for
engaging in activities that are protected by law. Examples are filing a legitimate workers’
compensation claim, exercising a legal duty, such as jury duty, refusing to violate a professional
code of ethics, and refusing to lobby for a political candidate favored by the employer.32
Implied Contracts As we saw earlier, the courts have determined that an implied contract may
exist when an employer makes oral or written promises of job security. For instance, an implied
contract may exist when an employee handbook promises job security for good performance, or
when a manager who is unaware of this doctrine makes promises during the selection interview,
such as “good performers will always have opportunities at our company.” To prevent implied
contract lawsuits, employers should carefully rewrite employee handbooks to eliminate any
language that could be interpreted as an implied contract. In addition, employers must train
managers to refrain from implying promises of job security in conversations with new and
current workers.
LACK OF GOOD FAITH AND FAIR DEALING Courts in some jurisdictions expect each party in the
employment relationship to treat the other in good faith. If one party acts with malice or bad
faith, the courts may be willing to provide a remedy to the injured party. For example, the courts
may reason that firing a worker shortly before he or she becomes eligible for a retirement plan
indicates bad faith. In this situation, the burden of proof may be on the employer to show that the
discharge was for just cause.
The following case makes it plain how costly it can be for an employer to act in bad faith in
discharging employees:
In 1987 two employees of a New Jersey real estate management firm took maternity leave.
One was dismissed after she returned to work; the other was fired seven weeks before
her planned return. Both women sued, and in 1992 a jury awarded them $210,000 and
$225,000, respectively, in compensatory damages. They were awarded another $250,000
each in punitive damages, and on top of that the judge added another $374,000 in interest
and legal fees. Total cost to the employer: $1.3 million.33
To minimize the risk of wrongful discharge lawsuits based on an implied contract, many
A QUESTION OF ETHICS
employers have drawn up employment-at-will statements that all new employees must sign,
Is it ethical to require all employ-
acknowledging their understanding that the employer can terminate their employment at any ees to sign an employment-at-will
time for any reason.34 statement acknowledging that they
understand that the employer can
terminate their employment at any
time for any reason?
Employee Rights Challenges: A Balancing Act
Four workplace issues are particularly challenging to HR professionals and managers because
they require walking a thin line between the rights of employees and those of management:
(1) random drug testing, (2) electronic monitoring, (3) whistle-blowing, (4) moonlighting, and
(5) office romance.
Random Drug Testing
The practice of random drug testing pits management’s duty to protect the safety of its employees
and customers against an employee’s right to privacy. Random drug testing screens employees for
the use of drugs randomly, without suspicion or cause. The test usually includes the analysis of a
urine specimen provided by the employee.
Many employees consider random drug testing an unreasonable and illegal invasion of their
privacy.35 Although random drug testing is required by law for specific occupations where safety
is critical, such as airline pilots and military personnel, it has been challenged in cases where the
employer has other methods available to ensure a drug-free work environment. For example,
the International Association of Fire Fighters will permit clauses in its labor contracts that allow
drug testing based on “probable cause” but will not agree to random drug testing. Numerous
employers also use preemployment drug testing as a condition of employment.36
Because no employee groups have succeeded in stopping drug testing under the U.S.
Constitution, the legal battle between employee privacy and employer-mandated drug testing
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
is being played out at the state level.37 Not only do state constitutions vary widely in their protections
of employee privacy—for example, New Jersey and California have added employee
privacy provisions to their state constitutions, whereas Utah and Texas have not38 —but the
courts’ interpretation of these protections has veered from one side to the other as well. For
instance, the California Supreme Court dealt what was considered a death blow to random drug
testing in that state when it ruled in 1990 that an employer must have a “compelling interest”
to require employees not in safety-sensitive positions to submit to random drug tests.39 Pro-
employee groups cheered the ruling, but four years later the California Supreme Court allowed
the National Collegiate Athletic Association to conduct random drug testing of student athletes.
The court said that the private sector, like the government, must abide by the state constitution’s
right of privacy, but that the private sector can invade privacy for “legitimate” interests.40
Every professional sports league tests its athletes for drugs, including performance-enhanc
ing drugs such as steroids and stimulants. Most of the professional sports leagues require random
drug testing to deter the use of drugs by their athletes, as shown in the following examples:41
¦
Major League Baseball (MLB) requires each player to be tested twice a season, once during
the first five days of reporting to spring training and again on a randomly selected date. In
addition, 600 players chosen at random are tested a third time each year. A player who tests
positive for a performance-enhancing drug is subject to three additional tests in a year, with
penalties of a 50-game suspension, a 100-game suspension, and then a permanent suspension.
¦
The National Football League (NFL) tests all players at least once a year as part of their
training-camp physicals and randomly selects 10 players per team per week during the
regular season for additional drug testing. Players can also be randomly selected for testing
up to six times during the off-season.
¦
The National Basketball Association (NBA) allows players to be randomly tested no more
than four times each season. Players testing positive receive incremental penalties of a
10-game suspension, a 25-game suspension, a one-year suspension, and then a permanent ban.
¦
The National Association for Stock Car Auto Racing (NASCAR) requires random drug
testing as part of its substance abuse policy. Drug testing is conducted with all drivers
beginning at the Dayton 500 race in January. Random testing includes all drivers, crew
members, and NASCAR officials. Failure of a drug test results in an immediate, indefinite
suspension; a third violation results in a lifetime ban.
Designing a random drug-testing policy poses numerous challenges. The HR staff can be helpful
in counseling management on how to deal with some of the following issues:
¦
How should employees who have positive drug test results be treated? Should the manager
discharge them or attempt to rehabilitate them?
¦
If an employee has a positive test for a legitimate reason, such as using a prescription drug
or eating a poppy seed bagel (poppy seeds are the source of opium), how can the employer
ensure that the employee is not charged with using illegal drugs? How can an employer
protect employees from false-positive results in general?
¦
What can managers do to maintain security over urine specimens provided for the drug
test so that they are free from adulteration designed to alter the results? Should managers
require that employees be monitored while providing the urine sample to ensure its authenticity?
Or does such monitoring violate the employee’s privacy rights?
Motorola’s random drug-testing policy was designed specifically to deal with these issues.
Motorola decided to implement random drug testing after it estimated the cost of employees’
drug use in terms of lost time, reduced productivity, and health-care and workers’ compensation
claims at $190 million annually. This amounted to 40 percent of the company’s net profits.42
The jury is still out on whether the benefits of random drug testing outweigh the resentment
and mistrust this policy often generates. A survey of workers at one of the nation’s largest
railroads found that only 57 out of 174 respondents expressed support for periodic drug test-
ing—and all stipulated that it was justifiable only for safety reasons. Many commented that drug
testing undermined their loyalty to the company. One worker wrote:
I am a faithful and loyal employee. I felt like a common criminal, and I didn’t even do any
thing wrong. . . . I happen to have bashful kidneys. The first time I took a drug test it took
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 475
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 475
me almost three hours of drinking water and coffee before I could give a sample. Needless
to say I was upset, angry, humiliated, defensive, etc. . . . 43
Employees’ anger and humiliation about random drug testing is compounded by the evidence
that it does not help deter accidents: In 1991, a Federal Railroad Administration report found that
only 3.2 percent of workers involved in railroad accidents tested positive for drugs.44
In order to avoid some of the disadvantages related to having employees submit to random
drug-testing procedures, management in firms that are not involved with transportation or
safety-sensitive jobs may decide to use either a preemployment drug test or a probable cause
drug test.45 A preemployment drug test is given to each job applicant as part of the hiring process.
For example, the preemployment drug test may be taken as part of a physical examination
that a job candidate must take before being given a job offer. Those who fail the test are not
hired.46 A probable cause drug test is given to employees who have accidents, engage in unsafe
job behavior, or show behavioral signs of drug use, which may include having impaired judgment
or slurred speech. Notice that neither the preemployment drug test nor the probable cause
drug test is given on a random basis but instead is given either at a predetermined time (such as
the time an employee is hired) or for a predetermined reason, such as having an accident or being
reprimanded for unsafe conduct in the workplace. In a survey taken in 2004 by the American
Management Association, 62 percent of U.S. firms reported using some form of drug testing.47
Moreover, there is an alternative to drug testing that does not invade employee privacy and
that is much more reliable for determining an employee’s fitness for work: the performance test.
For example, computer-based performance tests are available that test workers’ hand–eye coordination
to measure their ability to do their jobs. Every morning at Silicon Valley’s Ion Implant
Services, Inc., delivery drivers line up in front of a computer console to “play” a short video
game. Unless the machine spits out a receipt confirming they have passed the test, they cannot
climb behind the wheel of their trucks. What happens to workers who fail their performance
tests? Some companies refer them to a supervisor, others to an employee assistance program.
Besides being both more reliable and less invasive of employees’ privacy, performance testing
has another advantage over random drug testing: It is cheaper. Performance tests cost from $0.60
to $1 per employee compared with the $10 per employee that the cheapest drug test costs.48
Many employers justify random drug testing on the grounds that drug use is illegal. In recent
years, however, some companies have also begun testing employees who engage in legal activities,
such as smoking. Exhibit 14.1 examines the controversy surrounding employer policies that
reject all applicants who smoke on or off the job.
EXHIBIT 14.1 CAN AN EMPLOYER DENY JOBS TO PEOPLE WHO SMOKE?
ISBN
1-256-39369-X
In one of the first court cases dealing with off-the-job smoking as part of the screening and selection
process, the U.S. Supreme Court refused to hear the appeals of job applicants who were rejected from
consideration for employment with the City of North Miami, Florida, because they are smokers. The
denied appeal leaves in place an earlier Florida Supreme Court decision in favor of a city regulation
requiring that all job applicants sign an affidavit stating that they have not used any tobacco products
for one year before seeking a job with the city.a
Arlene Kurtz, a cigarette smoker who applied for a job as a clerk-typist, filed suit, claiming that
the city’s action interfered with her privacy rights to smoke during her time away from the job. Kurtz
offered to comply with any reasonable on-the-job smoking restrictions but indicated that she had
smoked for 30 years and had tried to quit smoking without success. The city argued that it established
the policy because employees who use tobacco cost as much as $4,611 per year more than
nonsmokers. The court noted that the regulation was the least intrusive way to accomplish the city’s
interest because it does not affect current employees, only job applicants.b
An even more restrictive employee smoking policy went into effect in 2005 at Weyco, an insurance
benefits administrator in central Michigan, which alerted all incumbent employees that they will be
randomly tested annually for smoking on or off the job.c See the chapter opener for details.
Other companies have taken a more moderate approach to controlling smoking behavior. They have
enacted nonsmoking policies that restrict on-the-job smoking due to safety concerns and to protect
nonsmoking employees from secondary smoke exposure. For example, FedEx has a nonsmoking policy
(Continued)
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
476 PART VI • GOVERNANCE
that prohibits the use of tobacco products in all company buildings, facilities, vehicles, and aircraft but
does not try to regulate employee’s off-duty smoking behavior.d
Outside Florida, a number of other states have recently enacted laws that protect employees’ legal
off-duty activities such as smoking or skiing (a high-risk leisure activity that an employer might also
object to because of higher insurance costs). These state laws prohibit employers from using an applicant’s
off-the-job smoking as a basis for hiring or continuing the employment relationship.e
Sources: aBarlow, W., Hatch, D., and Murphy, B. (1996, April). Employer denies jobs to smoker applicants. Personnel
Journal, 142; bIbid.; cPeters, J. (2005, February 8). Company’s smoking ban means off-hours, too. New York Times, C5;
dGrensing-Pophal, L. (1999, May). Smokin’ in the workplace. Workforce, 58–66; eBarlow et al., 1996.
Electronic Monitoring
Experts estimate that employee theft costs U.S. business over $400 billion a year.49 “Theft”
includes theft of merchandise, embezzlement, industrial espionage, computer crime, acts of sabotage,
and misuse of time on the job. While the average annual loss a bank suffers from embezzlement
is $42,000, the average computer crime costs around $400,000.50 A retail store loses an
average of $213 in a shoplifting incident (when a store customer steals merchandise) but loses an
average of $10,587 for an employee theft incident.51 The country with the highest level of shrinkage
(losses from shoplifting and employee theft) is India; the countries with the lowest levels of
shrinkage are Germany and Taiwan.52 Industrial spies who steal competitive trade secrets, such
as software codes or plans for a microprocessor chip, may take property so valuable that its theft
threatens the very existence of the business. Employees’ theft of time from employers can also be
costly. Employees steal time when they take long lunches, use the telephone for private conversations,
misuse sick leave for extra vacation time, or surf the Internet for personal reasons.
Companies are attempting to fight these various forms of theft by using electronic surveillance
devices to monitor employees.53 In industries like telecommunications, banking, and insurance,
as many as 80 percent of employees are subject to some form of electronic monitoring.54
To eavesdrop on employees, companies use hidden microphones and transmitters attached to telephones
and tiny fish-eye video lenses installed behind pinholes in walls and ceilings. In a survey
published by Macworld magazine, more than 21 percent of respondents said they have “engaged
in searches of employee computer files, voice mail, electronic mail or other networking communications.”
Most said they were monitoring work flow or investigating thefts or espionage.55
The increased sophistication of computer and telephone technology now makes it possible for
employers to track employees’ job performance electronically—for example, to count the number
of keystrokes an employee makes on a computer terminal or determine how many reservations
a travel agent books in a given time period.56 As noted in the chapter opener, air conditioning
service employees who drive to serve clients can be monitored by special cell phones containing
chips that are tracked by global positioning satellites so that the employer knows the employees’
location at any time and can compare it to where they are expected to be.57 This use of electronic
monitoring has raised concerns not only about employee privacy, but also about the dehumanizing
effect such relentless monitoring can have on employees.58 Many employees whose work is
tracked electronically feel that monitoring takes the human element out of their work and causes
too much stress. One study comparing monitored and nonmonitored clerical workers showed that
50 percent of monitored workers felt stressed, compared with 33 percent of nonmonitored workers;
and that 34 percent of monitored workers lost work time because of stress-induced illness,
compared with 20 percent of nonmonitored workers.59 Some research suggests that there is a
higher incidence of headaches, backaches, and wrist pains among monitored employees.60
Employees are most likely to see electronic monitoring as legitimate when management
uses it to control theft. But even in this area some managers have exceeded reasonable standards.
For example, experts estimated that in 2000 thirty million U.S. workers were subjected to
secret electronic monitoring.61 In one case, the nurses at Holy Cross Hospital in Silver Spring,
Maryland, became quite upset after discovering that a silver box hanging on the locker room
wall was a video camera monitored by the hospital security chief—who was a man.62
Some employers use electronic monitoring devices to control employee theft of time when
they are on the company payroll. This wasted time is sometimes spent playing video games or
visiting pornographic Web sites. Employers monitor to eliminate such wastage. In the retail
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
industry, employee theft is monitored through the use of data-mining programs that are synchronized
with video monitors to permit a more comprehensive look at activity at the cash register.
With the press of a button, managers can highlight irregular register transactions on their computers
and pull up corresponding video. This could enable companies to catch cashiers who cut
deals for their friends or pocket cash refunds for themselves.63
To use electronic monitoring devices to control theft while not intimidating or invading the
privacy of honest employees (who make up the majority of the workforce), managers should:
¦
Avoid secret monitoring, except with specific individuals whom managers have reason to
believe are stealing from the company. In those cases, management should obtain a court
order to perform the secret surveillance.
¦
If the company decides to monitor employees’ e-mail and Internet use, then management
should provide guidelines to employees for exchanging e-mail messages and accessing
Web sites. The guidelines may also state that employees should not access Web sites that
are related to gambling, chat rooms, online game playing, or sites with violent or sexually
explicit images. 64
¦
Find positive uses for electronic monitoring devices that are beneficial to employees as well as
to the employer. Avis Rent A Car, for example, has used monitoring devices to provide feedback
on employee performance. This practice has been accepted as a valuable training tool.
¦
Develop a systematic antitheft policy and other practices to discourage theft, such as reference
checks, pencil-and-paper honesty or integrity tests that screen out employees who are
likely to behave dishonestly, and internal controls that control the use of cash (accounting
controls), merchandise (inventory controls), computers and databases (computer security
controls), and company trade secrets (security badges and clearance procedures).
It is not always necessary to use electronic-monitoring devices to control employee theft.
The Manager’s Notebook, “Employee Theft in Small Business Is a Big Problem,” suggests some
low-cost ways that small companies can fight employee theft.
HR in Small Business
Employee Theft in Small Business Is a Big Problem
Small businesses consisting of less than 100 employees suffer the highest levels of employee
theft compared to that of larger firms. One reason that small businesses are targets for theft
is that they have fewer antitheft controls than larger companies do. The U.S. Department of
Commerce reports that about one-third of annual business failures can be attributed to employee
theft and other employee criminal activity. Here are some low-cost ways that small businesses
can prevent employee theft:
¦ Create a positive work environment A positive work environment encourages employees
to act in the best interests of the company by following established policies and proce-
dures. Managers can maintain a positive work environment by having open lines of com-
munication between management and employees and by developing procedures to provide
positive employee recognition.
¦ Implement internal controls Internal controls should be designed to keep track of the effi-
ciencies and effectiveness of operations, compliance with laws and regulations, the protec-
tion of company assets, and accurate financial reporting.
¦ Perform regular and unannounced audits A good way to fight theft is to perform regular
as well as random, unannounced financial audits and fraud assessments, which can provide
information on the effectiveness of existing controls.
¦ Investigate every incident of theft A thorough and prompt investigation of allegations of theft or
fraud yields valuable information that can be used to revise control policies and reduce losses.
Sources: Based on Report to the Nations on Occupational Fraud and Abuse. (2010). Association of Certified Fraud
Examiners. www.acfe.com; Employee theft: Legal aspects—estimates of cost. (2010). www.jrank.org; Cook, L. (2010).
Eight tips to prevent employee theft and fraud. Yahoo! Small business. www.yahoo.com. ¦¦
MANAGER’S NOTEBOOK:
ISBN
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Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
478 PART VI • GOVERNANCE
Whistle-Blowing
whistle-blowing
Employee disclosure of an
employer’s illegal, immoral, or
illegitimate practices to persons
or organizations that may be able
to take corrective action.
A QUESTION OF ETHICS
You discover that your supervisor
has been billing the company
for business trips that he never
took. When you ask him about it,
he says this is common practice
throughout the company, the other
department heads do the same
thing, and corporate headquarters
has set reimbursement rates so
low that employees have to pad
their expense accounts to be fairly
reimbursed. What should you do?
Whistle-blowing occurs when an employee discloses an employer’s illegal, immoral, or illegitimate
practices to persons or organizations that may be able to take corrective action.65
Whistle-blowing is risky because managers and other employees sometimes deal harshly with
the whistle-blower.66 Although whistle-blowers often have altruistic motives, they may be
shunned, harassed, and even fired for their efforts.67 For example:
¦
Jared Bowen, a Wal-Mart executive, gave the company information to investigate
expense-account abuses and false invoices for as much as $500,000 made by vice
chairman Thomas Coughlin that resulted in the board’s asking for Coughlin’s resignation
from the company in 2005. Shortly afterwards, Wal-Mart also discharged Bowen,
because it claimed he had tampered with his college transcripts by reporting an inflated
grade point average and number of college credits. Bowen has filed a complaint with
the U.S. Department of Labor claiming that Wal-Mart violated federal whistle-blower
rules by firing him.68
¦
Two Federal Aviation Administration (FAA) inspectors became targets of intimidation
after repeatedly alerting higher-ups to lapses in enforcement of safety rules at Southwest
Airlines. Southwest Airlines knowingly flew 46 jet aircraft that had not received required
inspections for cracks in the fuselage. One of the inspectors, Douglas Peters, testified
how a supervisor issued a veiled threat—while holding a family photo Peters kept in his
office—that Peters and his wife, also an FAA employee, would jeopardize their careers if
Peters continued to press for safety issues. The Transportation Department investigated this
incident and fined Southwest Airlines $10.2 million for safety violations, yet the supervisor
who intimidated the whistle-blowers was only reassigned to another work site, and no disciplinary
action was taken against him. 69
Dealing with whistle-blowing requires balancing employees’ right to free speech with
the employer’s right to prevent employees from disregarding managers’ authority or disclosing
sensitive information to outsiders. Although whistle-blowers who work for the federal
government and some state and local governments have certain legal protections, there is
far less protection for private-sector employees, except in states that have enacted whistle-
blower laws. Many times the whistle-blower is subject to the employment-at-will rule and
may be discharged in retaliation for going public about an illegal or unethical company activity.
A potential whistle-blower should have good documentation of the evidence of wrongdoing
before disclosing it to others. The whistle-blower should also be prepared to deal with
employer retaliation and have a contingency plan, which may include lining up another job
in case the worst happens.
Despite all these risks, many employees have used whistle-blowing to call their employers
to account. For example, in 2001 Enron executive Sherron Watkins wrote a blunt memo
to Enron CEO Kenneth Lay warning him that the company might “implode in a wave of
accounting scandals.” Instead of thanking her, management factions tried to squelch the
bad news and intimidate her for not being a team player. After the financial scandal broke
and became a media event, Watkins was praised for her courage and became a positive role
model for whistle-blowers.70 For this reason, many companies have realized that it is in their
best interests to establish a whistle-blowing policy that encourages people to reveal misconduct
internally instead of exposing it externally. This way the company can avoid negative
publicity and all the investigative, administrative, and legal actions associated with it.71
Figure 14.2 lists some of the most important elements of an effective whistle-blowing policy.
Probably the most important is support by top management, including the CEO. Other important
elements of a whistle-blowing policy are provisions for the whistle-blower to remain
anonymous initially and to be protected from retribution. Some companies that have effective
whistle-blowing policies are Bank of America, Pacific Gas & Electric, McDonald’s, and
General Electric.72
The financial scandals at Enron and WorldCom prompted the passage of the Sarbanes-
Oxley Act in 2002. The whistle-blower provision in Sarbanes-Oxley protects whistle-blowers
from retaliation from the company or its employees and holds those who violate the law liable
for both civil and criminal penalties.73
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 479
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 479
1. Get input from top management as you develop the policy and obtain approval of the final version.
2. Develop a written policy that is communicated to employees through multiple media, such as the employee
handbook, e-mail, and the company intranet site, and at department meetings and training sessions.
Communicating the written policy signals the company’s commitment to exposing misconduct.
3. Make it possible for employees to submit their initial complaint anonymously.
4. Develop a streamlined process that makes it easy for employees to report misconduct. Designate a special
representative to hear initial employee complaints so that employees do not have to report to their
supervisor first.
5. Safeguard employees who report suspected misconduct in good faith against reprisals.
6. Develop a formal investigative process and communicate to employees exactly how their reports will be handled.
Use this process consistently in all cases.
7. If the investigation reveals that the employee’s allegations are accurate, take prompt action to correct the
wrongdoing. Whatever the outcome of the investigation, communicate it quickly to the whistle-blower.
8. Establish an appeals process for employees dissatisfied with the outcome of the initial investigation. Provide
an advocate (probably from the HR department) to assist the employee who wishes to appeal an unfavorable
outcome.
9. To ensure the success of the whistle-blowing policy, the organization—from top management on down—must
be committed to creating an ethical work environment.
ISBN
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FIGURE 14.2
Developing an Effective Whistle-Blowing Policy
Sources: Based on Dworkin, T., and Baucus, M. (1998). Internal vs. external whistleblowers: A comparison of whistleblowing processes. Journal of Business
Ethics, 17, 1281–1298; and Barrett, T., and Cochran, D. (1991). Making room for the whistleblower. HRMagazine, 36(1), 59; Eaton, T., and Akers, M. (2007,
June). Whistleblowing and good governance: Policies for universities, government entities, and nonprofit organizations. The CPA Journal. www.nysscpa.org.
Restrictions on Moonlighting
Moonlighting is holding a second job outside normal working hours.74 Employees moonlight moonlighting
for different reasons. Some moonlight to earn extra income. When the economy is in a recession Holding a second job outside normal
and employees are affected by pay freezes, work-hour reductions, or pay reductions, they may
working hours.
take second jobs to maintain their standard of living. Other employees work second jobs for the
enjoyment of the work, such as an accountant who teaches an evening accounting class at the
local university. In the United States, about 5 percent of employees with full-time jobs hold a
second job. When an employer becomes aware of an employee who is moonlighting, it may be
tempting for the manager of that employee to prevent the employee from working the other job.
Restrictions on employees who moonlight may be appropriate in some situations to protect the
employer’s interests; in other situations, such restrictions may be a violation of an employee’s
rights. Consider the following situations:
¦
A sales executive manages his blossoming second job as a motivational speaker by cell
phone and laptop during work hours on his day job.
¦
A police officer works a few evenings a week as a bouncer at a local nightclub.
¦
A truck driver has a job moonlighting during off hours as a local deliveryperson for a
pizza restaurant.
Moonlighting brings with it the need to balance the rights of the employer, who expects
employees to come to the workplace and be fully engaged in performing their jobs, with the
rights of employees, who expect to be free to use their off-duty time any way they want, which
includes working a second job.
The best way for managers to handle moonlighting is to treat it on a case-by-case basis
rather than attempt to have a policy that restricts moonlighting for all employees. Management
should rely on job performance and conflict-of-interest policies to manage moonlighting.75 The
sales executive from the moonlighting situation already listed can be required by the employer
to curtail his cell phone calls and laptop use for his motivational speaker business at the workplace
and limit it to nonwork hours. Speaking with clients on the phone and scheduling business
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
engagements on the laptop for the second job can detract from job performance as a sales executive
and can be corrected as a performance issue. A full-time truck driver has the number of
driving hours per day regulated by federal Department of Transportation (DOT) law. A second
job that requires additional driving time can increase the legal liability of the trucking company
for its driver to have an accident. The trucker who drives in excess of the driving time that is
permitted will be in violation of DOT rules. In this situation, the trucking company can restrict
its drivers from driving on a second job to remain in compliance with the law. In the situation
where the police officer is moonlighting as a nightclub bouncer, this second job can be permitted
as along as the officer is able to perform the job duties of a police officer at expected levels of
performance, which includes coming to work alert and well rested.
An employer may need to restrict a specific employee from moonlighting when the second
employer is a direct competitor and a conflict of interests exists. One video-game firm handles
this situation by having its engineers and artists receive approval from managers in advance, and
approval is likely as long as the work is not done for a competitor.76
Restrictions on Office Romance
The office is an inviting place for romance. People fall in love at work because that is where they
spend much of their time and meet people with similar interests. Some controversial high-profile
office romances, such as the affair between President Clinton and Monica Lewinsky, a young
White House intern, have influenced many companies to view an office romance with a critical
eye. The challenge of dealing with an office romance forces management to balance the need to
protect the company from its liability for preventing sexual harassment with the need to protect
the privacy of employees during their off-duty hours so they feel free to develop romantic relationships
with people of their choosing. The biggest danger occurs when a person in authority
dates a subordinate. If the romance goes sour, the subordinate may claim that the boss forced the
relationship, which opens the door for a sexual harassment case.77 A recent survey conducted
by the Society for Human Resource Management (SHRM) found that 24 percent of employer
respondents reported having had a sexual harassment claim filed against them as a result of a
workplace romance.78
How organizations deal with office romance depends on the goals and culture of the organization.
The U.S. military restricts personal relationships between officers and enlisted personnel
when the relationship compromises the chain of command. In the military the need for a
highly disciplined, strongly bonded group of individuals is critical to a combat unit’s success. A
minority of companies has enacted no-dating policies that attempt to eliminate the presence of
romantic relationships at the workplace between employees. Enforcing no-dating policies can
be difficult. Recently, a senior executive at Staples, an office supply company that instituted a
no-dating policy, was forced to resign when it was revealed he was having a consensual affair
with his secretary. Staples lost a valued officer, and the manager forfeited his lucrative job for
violating company rules, even though he committed no illegal act.79
Other companies view office romance more positively by recognizing the beneficial effect
it may have on employee morale due to the fact that many office romances lead to marriage.
For example, Microsoft CEO Bill Gates met his wife, Melinda French, at the company when
she was a marketing executive. Representative of companies that do not interfere with office
romance is Delta Airlines, which does not have any rule against dating between employees.
Delta expects its employees to maintain a professional and businesslike approach to work, which
includes all work-related relationships. The only exception it makes is that the company does not
allow a spouse or romantic partner to supervise the other. If that were to happen, one of the partners
would be transferred to another work unit.80 Some companies go beyond tolerating office
romance and condone it. At Princeton Review, a well-known New York test-preparation company,
6 of the 10 top executives, including the CEO and president, are married to people on the
payroll. More than 40 couples who met at the company have married. So far there have been no
divorces and no lawsuits—though more than 20 children have been born from these marriages.81
The employment trend of longer work hours in U.S. firms suggests that more employees will be
tempted to develop a romantic relationship with a colleague at the workplace. A recent survey
on employee attitudes about office romance by the American Management Association revealed
that 67 percent of respondents said they approved of dating at the office, and 30 percent said they
had done it themselves.82 Management can be expected to look for guidance on how to deal with
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 481
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 481
The following are some basic guidelines that employees should consider if they are involved
in an office romance, according to Andrea Kay, a career consultant and author:83
¦
Think before you disclose your relationship to the office. Discuss with your partner how
you will inform the office that you are in a relationship with a colleague. It is also important
to plan who will be the recipient of this personal information, which may include
someone in human resources, your supervisor, or coworkers.
¦
Know the rules regarding office romance in your company. According to a recent survey
by the Society for Human Resource Management (SHRM), only 28 percent of companies
have a formal written policy that covers dating in the workplace. Those companies
that have a policy indicate who needs to be informed if there is a consensual relationship
between two employees.
¦
It is recommended that the parties involved in an office romance behave in a subtle fashion
in how they conduct their relationship at the office. Don’t flaunt the relationship. Public
displays of affection should be kept to a minimum. Also, avoid sending love notes to each
other on the company’s e-mail account.
Disciplining Employees
Employee discipline is a tool that managers rely on to communicate to employees that they need
to change a behavior. For example, some employees are habitually late to work, ignore safety
procedures, neglect the details required for their job, act rude to customers, or engage in unprofessional
conduct with coworkers. Employee discipline entails communicating the unacceptability
of such behavior along with a warning that specific actions will follow if the employee does
not change the behavior.84
Employee discipline is usually performed by supervisors, but in self-managed work teams
employee discipline may be a team responsibility. For instance, at Hannaford Bros., a food distribution
center outside Albany, New York, the 120 warehouse employees are divided into five
teams, each of which has a serious conduct committee. The committee handles employee discipline
and makes recommendations to management, including counseling and even termination.
Management usually adopts these recommendations. The committees generally come up with
creative solutions for handling discipline problems. In fact, it has rarely proved necessary to
terminate an employee.85
Jim and Pam (far right) from the tele
vision show The Office exemplify
the virtues of a workplace romance.
Source: Splash News/Newscom
ISBN
1-256-39369-X
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
482 PART VI • GOVERNANCE
482 PART VI • GOVERNANCE
Employee and employer rights may come into conflict over the issue of employee discipline.
Sometimes employees believe they are being disciplined unfairly. In such situations, a
company’s HR staff may help sort out disputed rights. This HR contribution is particularly valuable
because it can enable the employee and the supervisor to maintain an effective working
relationship.
Two different approaches to employee discipline are widely used: (1) progressive discipline
and (2) positive discipline. In both these approaches, supervisors must discuss the behavior
in question with their employees. Managers almost invariably find it difficult to confront an
employee for disciplinary purposes. Reasons for their discomfort range from not wanting to
be the bearer of bad news, to not knowing how to start the discussion, to a fear that the discussion
will get out of control. The Manager’s Notebook, “Five Steps for Effective Disciplinary
Sessions,” offers some guidelines that should make it easier for managers to handle an admittedly
distasteful task.
Ethics
Five Steps for Effective Disciplinary Sessions
1. Determine whether discipline is called for. Is the problem an isolated infraction or part
of a pattern? Consult with HR experts and get some feedback before making a disciplinary
decision.a
2. Outline clear goals for the discussion in your opening remarks. Do not rely on indirect
communication or beat around the bush. The employee should gain a clear idea of your
expectations for improvement.b
3. Ensure two-way communication. The most helpful disciplinary meeting is a discussion,
not a lecture. The objective of the meeting, after all, is to devise a workable solution, not
to berate the employee.c
4. Establish a follow-up plan. The agreement to a follow-up plan is crucial in both the progres-
sive and positive disciplinary procedures. It is particularly important to establish the time
frame in which the employee’s behavior is to improve.d
5. End on a positive note. You may want to emphasize the employee’s strengths so that he
or she can leave the meeting believing that you—and the company—want the employee
to succeed.e
Sources: aCottringer, W. (2003, April). The abc’s of employee discipline. Supervision, 5–7; bIbid.; cDay, D. (1993,
May). Training 101. Help for discipline dodgers. Training & Development, 19–22; dIbid.; eIbid. ¦¦
MANAGER’S NOTEBOOK
progressive discipline
A series of management
interventions that gives employees
opportunities to correct undesirable
behaviors before being discharged.
Progressive Discipline
The most commonly used form of discipline, progressive discipline, consists of a series of
management interventions that gives employees opportunities to correct their behavior before
being discharged. Progressive discipline procedures are warning steps, each of which involves
a punishment that increases in severity the longer the undesirable behaviors persist.86 If the
employee fails to respond to these progressive warnings, the employer is justified in discharging
the individual.87
Progressive discipline systems usually have three to five steps, although a four-step system
is the most common, as shown in Figure 14.3 . Minor violations of company policy involve using
all the steps in the progressive discipline procedure. Serious violations, sometimes referred to as
gross misconduct, can result in the elimination of several steps and sometimes even begin at the
last step, which is discharge. Examples of gross misconduct are assaulting a supervisor and falsifying
employment records. However, most applications of discipline involve minor rule infractions
like violating a dress code, smoking at an inappropriate time or place, or being habitually
late. Figure 14.4 shows more examples of minor and serious violations.
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
a
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 483
1. Verbal Warning 2. Written Warning 3. Suspension 4. Discharge
The employee has an unexcused Two weeks after the verbal Six weeks later the employee Two weeks after his or her return
absence from work. He or she
receives a verbal warning from
the supervisor and is told that if
he or she takes another unexcused
warthe
unenowning from his or her supervisor,
employee takes another
xcused absence. He or she
receives a written warning
fails to show up for work for two
consecutive days. This time he
or she is suspended from work
without pay for one week. He or
from suspension, the employee
does not show up for work. Upon
his or her return to work the
following day, he or she is
absence within the next month,
harsher punishment will follow.
thatabsnextrea
if he or she fails to correct the
enteeism problem within the
t two months, more severe
tment will follow. This
she also receives a final warning
from his or her supervisor that if
there is another unexcused
absence within three months after
discharged.
warning goes into the employee’s returning from suspension, he or
personnel file. she will be terminated.
FIGURE 14.3
Four Steps in a Progressive Discipline Procedure
Minor Violations Serious Violations
FIGURE 14.4
Categories of Employee
t
i
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Misconduct
•
Absenteeism • Drug use at work
•
Dress code violation • Theft
•
Smoking rule violation • Dishonesty
•
Incompetence • Physical assault upon a supervisor
•
Safety rule violation • Sabotage of company operations
•
Sleeping on the job
•
Horseplay
•
Tardiness
A four-step progressive discipline procedure includes the following steps:88
1.
Verbal warning An employee who commits a minor violation receives a verbal warning
from the supervisor and is told that if this problem continues within a specific time period,
harsher punishment will follow. The supervisor provides clear expectations for improvement.
2.
Written warning The employee violates the same rule within the specified time period and
now receives a written warning from the supervisor. This warning goes into the employee’s
records. The employee is told that failure to correct the violation within a certain time
period will result in more severe treatment.
3.
Suspension The employee still fails to respond to warnings and again violates the work
rule. The employee is now suspended from employment without pay for a specific amount
of time. He or she receives a final warning from the supervisor, indicating that discharge
will follow upon violating the rule within a specified time period.
4.
Discharge The employee violates the rule one more time within the specified time period
and is discharged.
Figure 14.3 illustrates how an employer would use progressive discipline with an employee who
has a pattern of unexcused absences from work.
For infractions that fall between the categories of minor violation and serious violation, one
or two steps in the procedure are skipped. These infractions are usually handled by supervisors,
who give the employees an opportunity to correct the behavior before discharging them. For
example, two employees get into a fistfight at work, but there are mitigating circumstances (one
employee verbally attacked the other). In this situation, both employees may be suspended without
pay and warned that another such violation will result in discharge.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
484 PART VI • GOVERNANCE
484 PART VI • GOVERNANCE
A discipline procedure that
encourages employees to monitor
their own behaviors and assume
responsibility for their actions.
Positive Discipline
The emphasis on punishment in progressive discipline may encourage employees to deceive
their supervisor rather than correct their actions. To avoid this outcome, some companies have
replaced progressive discipline with positive discipline, which encourages employees to monitor
their own behaviors and assume responsibility for their actions.
Positive discipline is similar to progressive discipline in that it too uses a series of steps
that increase in urgency and severity until the last step, which is discharge. However, positive
discipline replaces the punishment used in progressive discipline with counseling sessions
between employee and supervisor. These sessions focus on getting the employee to learn from
past mistakes and initiate a plan to make a positive change in behavior.89 Rather than depending
on threats and punishments, the supervisor uses counseling skills to motivate the employee
to change. Rather than placing blame on the employee, the supervisor emphasizes collaborative
problem solving. In short, positive discipline alters the supervisor’s role from adversary
to counselor.
To ensure that supervisors are adequately prepared to counsel employees, companies that
use positive discipline must see that they receive appropriate training either from the company’s
own HR department or from outside professional trainers. At Union Carbide, which began using
positive discipline in the late 1970s, managers attend a two-day training program to gain familiarity
with positive discipline policies and practices. Because Union Carbide had long used a
progressive discipline approach, a key element of the training is helping managers abandon their
tendency to respond to performance problems in a punitive way. Managers also receive training
in documenting their discussions specifically, factually, and defensibly.90
A four-step positive discipline procedure starts with a first counseling session between
employee and supervisor that ends with a verbal solution that is acceptable to both parties. If this
solution does not work, the supervisor and employee meet again to discuss why it failed and to
develop a new plan and timetable to solve the problem. At this second step, the new agreed-upon
solution to the problem is written down.
If there is still no improvement in performance, the third step is a final warning that the
employee is at risk of being discharged. Rather than suspend the employee without pay (as
would happen under progressive discipline), this third step gives the employee some time to
evaluate his or her situation and come up with a new solution. In doing so, the employee is
encouraged to examine why earlier attempts to improve performance did not work. Some companies
even give the employee a “decision-making day off” with pay to develop a plan for
improved performance.91
Managers often resist this aspect of positive discipline because they feel that it rewards
employees for poor performance. Some suspect that employees intentionally misbehave to get
a free day off. According to the employee relations director of Union Carbide, which uses a
paid decision-making day off as part of its disciplinary procedure, this is not so. The company
believes a paid day off is more effective than the unpaid suspension used in progressive discipline
procedures because (1) workers returning from an unpaid suspension often feel anger or
apathy, which may lead to either reduced effectiveness on the job or subtle sabotage; (2) paying
the employee for the decision-making day off avoids making the employee a martyr in the
eyes of coworkers; and (3) paying for the decision-making day off underscores management’s
“good faith” toward the employee and probably reduces the chances that the employee will win
a wrongful discharge suit if he or she is eventually terminated.92
Failure to improve performance after the final warning results in discharge, the fourth step
of the positive discipline procedure. Incidents of gross misconduct (such as theft) are treated no
differently under a positive discipline procedure than under a progressive discipline procedure.
In both systems, theft will most likely result in immediate discharge.
In addition to the costs of training managers and supervisors in appropriate counseling skills
and approaches, positive discipline has another drawback. Counseling sessions require a lot of
time to be effective, and this is time that both the supervisor and employee are not working on
other tasks. Nonetheless, positive discipline offers considerable benefits to both employees and
managers. Employees prefer it because they like being treated with respect by their supervisors.
Counseling generally results in a greater willingness to change undesirable behaviors than
discipline does. Supervisors prefer it because it does not demand that they assume the role of
disciplinarian. Counseling makes for better-quality working relationships with subordinates than
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Copyright © 2012 by Pearson Education, Inc.
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discipline does. In addition, under a system of positive discipline, managers are much more
likely to intervene early to correct a problem.
Finally, positive discipline can have positive effects on a company’s bottom line, as evidenced
at Union Carbide. Studies in five of the company’s facilities have shown an average
decline in absenteeism of 5.5 percent since the company switched from punitive to positive discipline
procedures. Moreover, in one unionized facility at the company, disciplinary grievances
went down from 36 in one year to 8 in the next. Union Carbide executives estimate that taking
an employee complaint through all steps of the grievance procedure (short of arbitration) costs
approximately $400 at this facility, thus the switch in discipline procedures saved the company
over $11,000 per year.93 Pennzoil, General Electric, and Procter & Gamble also have adopted
the positive discipline procedure and have reported successful outcomes with it.94 In addition,
many city police forces and some universities use positive discipline. For example, one university
used positive discipline with a professor who would yell at, criticize, and belittle students
when they volunteered the wrong answers to his questions or avoided class participation. The
department chair and the professor worked together to develop a plan to control his temper in
the classroom. The department chair saw a positive change in the professor’s classroom behavior
that would not have occurred had the chair used a more confrontational form of discipline, such
as the progressive discipline procedure.
Administering and Managing Discipline
Managers must ensure that employees who are disciplined receive due process. In the context of
discipline, due process means fair and consistent treatment. If an employee challenges a disciplinary
action under the EEO laws or a union grievance procedure, the employer must prove that
the employee engaged in misconduct and was disciplined appropriately for it. Thus, supervisors
should be properly trained in how to administer discipline.95 Two important elements of due
process that managers need to consider in this area are (1) the standards of discipline used to
determine if the employee was treated fairly and (2) whether the employee has a right to appeal
a disciplinary action.
BASIC STANDARDS OF DISCIPLINE Some basic standards of discipline should apply to all rule
violations, whether major or minor. All disciplinary actions should include the following procedures
at a minimum:
¦
Communication of rules and performance criteria Employees should be aware of the
company’s rules and standards and the consequences of violating them. Every employee
and supervisor should understand the company’s disciplinary policies and procedures fully.
Employees who violate a rule or do not meet performance criteria should be given the
opportunity to correct their behavior.
¦
Documentation of the facts Managers should gather a convincing amount of evidence to
justify the discipline. This evidence should be carefully documented so that it is difficult
to dispute. For example, time cards could be used to document tardiness; videotapes could
document a case of employee theft; the written testimony of a witness could substantiate a
charge of insubordination. Employees should have the opportunity to refute this evidence
and provide documentation in self-defense.
¦
Consistent response to rule violations It is important for employees to believe that discipline
is administered consistently, predictably, and without discrimination or favoritism.
If they perceive otherwise, they will be more likely to challenge discipline decisions. This
does not mean that every violation should be treated exactly the same. For example, an
employee with many years of seniority and an excellent work record who breaks a rule
may be punished less harshly than a recently hired employee who breaks the same rule.
However, two recently hired employees who break the same rule should receive the same
punishment.
hot-stove rule
The hot-stoverule provides a model of how a disciplinary action should be administered. The
A model of disciplinary action:
rule suggests that the disciplinary process is similar to touching a hot stove: (1) Touching a Discipline should be immediate,
hot stove results in an immediate consequence, which is a burn. Discipline should also be an provide ample warning, and be
immediate consequence that follows a rule infraction. (2) The hot stove provides a warning consistently applied to all.
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Copyright © 2012 by Pearson Education, Inc.
486 PART VI • GOVERNANCE
486 PART VI • GOVERNANCE
that one will get burned if one touches it. Disciplinary rules should inform employees of the
consequences of breaking the rules as well. (3) A hot stove is consistent in administering pain to
anyone who touches it. Disciplinary rules should be consistently applied to all.96
The Just Cause Standard of Discipline
In cases of wrongful discharge that involve statutory rights or exceptions to employment at
will, U.S. courts require the employer to prove that an employee was discharged for just cause.
This exacting standard, which is written into union contracts and into some nonunion companies’
employment policies and employee handbooks, consists of seven questions that must be
answered in the affirmative for just cause to exist.97 Failure to answer “yes” to one or more of
these questions suggests that the discipline may have been arbitrary or unwarranted.
1.
Notification Was the employee forewarned of the disciplinary consequences of his or
her conduct? Unless the misconduct is very obvious (for example, theft or assault), the
employer should make the employee aware, either verbally or in writing, that he or she has
violated a rule.
2.
Reasonable rule Was the rule the employee violated reasonably related to safe and efficient
operations? The rule should not jeopardize an employee’s safety or integrity in any way.
3.
Investigation before the discipline Did managers conduct an investigation into the misconduct
before administering discipline? If immediate action is required, the employee
may be suspended pending the outcome of the investigation. If the investigation reveals no
misconduct, all of the employee’s rights should be restored.
4.
Fair investigation Was the investigation fair and impartial? Fair investigations allow the
employee to defend himself or herself. An employee who is being interviewed as part of a
disciplinary investigation has a right based on federal law to have another employee present
to be his or her advocate, or to have someone to consult with, or simply to be a witness.98
5.
Proof of guilt Did the investigation provide substantial evidence or proof of guilt?
Management may need a “preponderance of evidence” to prove serious charges of gross
misconduct, and a less stringent (but still substantial) amount of evidence to prove minor
violations.
6.
Absence of discrimination Were the rules, orders, and penalties of the disciplinary action
applied evenhandedly and without discrimination? It is not acceptable for managers to go
from lax enforcement of a rule to sudden rigorous enforcement of that rule without notifying
employees that they intend to do so.
7.
Reasonable penalty Was the disciplinary penalty reasonably related to the seriousness
of the rule violation? The employer should consider related facts, such as the employee’s
work record, when determining the severity of punishment. There might be a range of penalties
for a given rule infraction that depend on the length and quality of the employee’s
service record.
Because the just cause standard is fairly stringent and can prove unwieldy in cases of minor
infractions that require immediate supervisory attention, nonunion employers who believe
that their employees work under employment at will may choose a less demanding discipline
standard.99
The Right to Appeal Discipline
Sometimes employees believe they have been disciplined unfairly, either because their supervisors
have abused their power or because their supervisors are biased in dealing with individuals
whom they like or dislike. For a disciplinary system to be effective, employees must have access
to an appeals procedure in which others (who are perceived to be free from bias) can examine
the facts. As we discussed in Chapter 13 , good employee relations requires establishing appeals
procedures that employees can use to voice their disagreement with managers’ actions. For challenging
disciplinary actions, two of the most useful appeals procedures are the open-door policy
and the use of employee relations representatives. These two methods are attractive because of
their flexibility and their ability to reach quick resolutions. The Manager’s Notebook, “Mistakes
to Avoid When Administering Discipline,” lists some common pitfalls that can occur when
disciplining employees and ways to avoid them.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
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CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 487
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 487
Customer-Driven HR
Mistakes to Avoid When Administering Discipline
1. Losing your temper When you lose control of your temper, you may say things that
damage your relationship with the employee and that you may later regret. Your loss of
self-control may also encourage the employee to lose control and yell right back at you.
It is preferable to step back and take a deep breath before you begin to speak to the
employee who is misbehaving, no matter how angry you are feeling. Once you are calm
you can have a more constructive conversation with the employee.
2. Avoiding disciplinary action entirely Many supervisors avoid disciplinary action entirely
because they associate it with punishment and fear harming the relationship with an
employee. A supervisor needs to understand that the purpose of discipline is to correct
behavior, not necessarily to punish an individual. Avoiding disciplinary action may actually
harm an employee who is deprived of the chance to learn how to correct his or her behavior.
3. Playing therapist Trying to get to the root causes and motives for a behavior may send the
wrong message to an employee. Unless a supervisor is trained as a therapist, the employee
may misinterpret the supervisor’s personal questions as being nosy or overly analytical,
which is unlikely to achieve the desired change in behavior. Employees respond more
positively to a supervisor who is more decisive and points out the inappropriate behavior
and communicates clearly what kind of performance is expected in its place.
4. Making excuses for an employee It is common for employees to make excuses that
explain their mistakes. Some employees become adept at creating sympathy for themselves
by telling tales of woe involving their family or personal hardships. By falling for these
excuses, supervisors deprive employees the chance to accept responsibility for their mis-
takes and instead enable them to continue rationalizing their performance deficiencies. If
an employee truly has a serious personal problem that is affecting work performance, he or
she should seek help with the EAP.
5. Using a nonprogressive approach to discipline Managers sometimes postpone disciplin-
ary action until the employee’s behavior is so intolerable that it must be addressed imme-
diately. At this point, the manager feels the need to apply harsh sanctions because the inap-
propriate behavior has become intolerable. Nonprogressive measures (harsh initial action)
that is administered to a long-standing but untreated problem often seem unfair and overly
harsh by the target employee and sometimes by his or her coworkers, too. The solution is
to curtail inappropriate employee behavior at the beginning with a more moderate sanction
before the offense becomes severe and requires more forceful action.
Sources: Based on Bielous, G. A. (1998, August). Five worst disciplinary mistakes (and how to avoid them).
Supervision, 11–13; Lisoski, E. (1998, October). Nine common mistakes made when disciplining employees.
Supervision, 12–14; Bacal, R. (2010). Five sins of discipline. www.conflict911.com. ¦¦
MANAGER’S NOTEBOOK
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Managing Difficult Employees
So far we’ve focused on the challenges of administering discipline. We now turn to some common
problems that managers are likely to encounter. All of the problems we discuss here—poor
attendance, poor performance, insubordination, workplace bullying, and substance abuse—often
lead to disciplinary actions. Managing the discipline of difficult employees requires good judgment
and common sense.
Poor Attendance
The problem of poor attendance includes absenteeism and/or tardiness. Poor attendance can
become a serious problem that leads to discharge for just cause. If poor attendance is not managed
properly, employee productivity can decline and group morale can suffer as those with
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
good attendance are forced to increase their efforts to compensate for people who shirk their
responsibilities.
Sometimes employees are absent or tardy for legitimate reasons—for example, sickness,
child-care problems, inclement weather, or religious beliefs. Managers should identify those
employees who have legitimate reasons and treat them differently than they treat those who are
chronically absent or tardy.
When disciplining an employee for poor attendance, managers need to consider several
factors:
¦
Is the attendance rule reasonable? Attendance rules should be flexible enough to allow
for the emergencies or unforeseen circumstances that most employees experience from
time to time, including religious or cultural holidays celebrated by a diverse workforce.
Most companies deal with this issue by showing leniency when an employee gives notice
that he or she is sick or experiencing an emergency.
¦
Has the employee been warned of the consequences of poor attendance? This could be
particularly important when an employee is unaware of how much time flexibility is possible
in reporting to the job.
¦
Are there any mitigating circumstances that should be taken into consideration? Sometimes
special circumstances need to be considered. These circumstances include work
history, length of service, reason for absence, and likelihood of improved attendance.100
Managers should be aware of patterns of poor attendance within a work unit. Employees
may dread coming to work because coworkers are unpleasant, the job has become unchallenging,
they are experiencing conflicting demands from job and family, or supervision is poor. A
disciplinary approach is not the best way to deal with this type of absenteeism. Possible solutions
to such job avoidance are redesigning jobs or, when the problem is widespread, restructuring the
organization.
For employees whose absences are due to overwhelming family demands, flexible work
schedules or permission to work at home (telecommuting) may be desirable. Flexible work
schedules are gaining popularity at companies both large and small. Ten months into Xerox
Corporation’s experiment with flexible work schedules, absences had fallen by one-third, teamwork
had improved, and worker surveys showed that morale had risen.101
Poor Performance
Every manager must deal with employees who perform poorly and who do not respond to coaching
or feedback. In most cases, the performance appraisal (see Chapter 7 ) can be used to turn
around poor performers by helping them develop an action plan for improvement. Sometimes,
however, the poor performance is so serious that it requires immediate intervention. Consider the
following situations:
¦
A restaurant manager receives daily complaints from angry customers about the quality of
one waitress’s service.
¦
A partner’s poor interpersonal skills affect his working relationships with the other two
partners in his firm. The firm is now failing to meet its goals because of the severe conflicts
and disruptions instigated by this one person.
These examples suggest a glaring need for progressive or positive discipline procedures. If these
employees failed to improve their performance after receiving some warnings or counseling,
dismissal would be justified.
Companies and managers should follow three guidelines when applying discipline for poor
performance:
1.
The company’s performance standards should be reasonable and communicated to all
employees. Job descriptions can be used for this purpose.
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2.
Poor performance should be documented, and poor performers should be told how they are
not meeting the expected standards. One source of documented evidence can be the pattern
of the employee’s performance appraisals over a period of time.
3.
Managers should make a good-faith attempt to give employees an opportunity to improve
their performance before disciplining them.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
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Sometimes poor performance is the result of factors beyond the employee’s control. In these
cases, managers should avoid using discipline except as a last resort. For example, an employee
may be unable to perform at expected standards because of incompetence. An incompetent
employee (one who is lacking in ability, not effort) may be given remedial training (see Chapter 8)
or transferred to a less demanding job rather than be dismissed. An incompetent employee’s poor
performance may be the result of a flaw in the organization’s selection system that caused a poor
match between the employee’s skills and the job requirements.
Some organizations use a probationary employment period (a period of time that allows
the employer to discharge any employee at will) to weed out incompetent employees early.
Probationary employment periods typically last one to three months. In Europe, where permanent
employment is the norm, many companies insist on a six-month trial period as part of the
employment contract. However, this policy can present a problem when recruiting executives,
who understandably want to be guaranteed a permanent position before leaving their current job.
It is not only inappropriate but also illegal to use discipline to correct poor performance when
an employee has a physical or mental disability.102 The Americans with Disabilities Act (ADA,
see Chapter 3 ) requires employers to make reasonable accommodation for disabled employees
who cannot perform the job as it is structured. Accommodation may include redesigning the
job or modifying policies and procedures. For example, an employee who is diagnosed with
a terminal illness may request a change from a full-time job to a part-time job or one with a
more flexible work schedule. The EEOC, which regulates how employers respond to the needs
of employees with disabilities, would probably consider this a reasonable request, so failure to
make such an accommodation could lead to government sanctions.
Unfortunately, many myths hinder firms’ compliance with the ADA. One myth is that reasonable
accommodation always involves prohibitive expense. Actually, accommodation is not
necessarily costly, and more often than not, the money spent to accommodate a disabled individual
is minor compared with the cost of litigation. Samsonite Corporation, a luggage company
located in Denver, has employed deaf production workers for years. The only accommodation
necessary—beyond an accommodating attitude and the willingness of many employees to learn
some sign language—has been the use of lights in the production area in addition to the standard
beepers alerting employees to the presence of forklifts.103
Insubordination
The willingness of employees to carry out managers’ directives is essential to a business’s effective
operations. For example, consider the case of a sales representative who refuses to submit
the weekly activity reports requested by his manager.104 How should the sales manager react to
the sales representative’s behavior?
Insubordination, an employee’s refusal to obey a direct order from a supervisor, is a direct insubordination
challenge of management’s right to run the company. Insubordination also occurs when an Either refusal to obey a direct order
employee is verbally abusive to a supervisor. The discipline for insubordination usually var-from a supervisor or verbal abuse of
a supervisor.
ies according to the seriousness of the insubordination and the presence or absence of mitigating
factors. Mitigating factors include the employee’s work history and length of service and
whether or not the employee was provoked by a supervisor’s verbal abuse.
To justify disciplining an employee for insubordination, managers should document the following:
(1) The supervisor gave a direct order to a subordinate, either in writing or orally; and
(2) the employee refused to obey the order, either by indicating so verbally or by not doing what
was asked. The discipline for a first insubordination offense ranges from applying the first step
of the progressive discipline procedure to immediate suspension or discharge.
Two exceptions allow an employee to disobey a direct order: illegal activities and safety
considerations. For instance, a California court found that an employer had violated public
policy when it fired an employee who refused to commit perjury. Other illegal orders that
employees can refuse with legal protection are participation in price-fixing and improper
bookkeeping.105 The whistle-blowing laws passed in some states provide further protection
to employees who can prove they were discharged for refusing to break the law. The
Occupational Safety and Health Administration protects the rights of employees who refuse
to expose themselves to serious jeopardy. For insubordination to be acceptable, the employee
should have “reasonable cause” to fear for his or her safety—for example, knowing that a
truck the worker is ordered to drive has defective brakes.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
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A form of harassment that consists
of a persistent pattern of offensive,
abusive, intimidating, malicious,
or insulting behavior focused at a
target employee.
Because the penalties for insubordination are severe, companies should create internal
systems and cultures (open-door policies, appeal systems) that allow employees to appeal
charges of insubordinate behavior. The legal and monetary penalties to companies for refusing
to hear an employee’s reasons for insubordination can be severe. Managers should be sure that
insubordination charges are not being used to protect their own illegal or unethical behavior.
For instance, a supervisor who charges an employee with insubordination may be attempting
to force out someone who objects to the supervisor’s illegal behavior. Companies that ignore
such signs of trouble may find that a small problem has escalated into a very difficult and/or
expensive situation.
Workplace Bullying
Employees have a right to be treated with dignity and respect in the workplace. Unfortunately,
many are not. They wake up in the morning and go to work dreading that they will face another
day of abuse.106 Employees who feel this way likely experience workplace bullying, a form of
harassment that results in employees experiencing mental distress, physical illness, loss of productivity,
and a higher propensity to quit to avoid being in a toxic workplace.107 Workplace bullying
consists of “. . . persistent, offensive, abusive, intimidating, malicious or insulting behavior,
abuses of power or unfair penal sanctions, which makes the recipient feel upset, threatened,
humiliated, or vulnerable, which undermines their self-confidence and which may cause them to
suffer stress.”108 The bully could be a boss chewing out a subordinate in front of colleagues, a
peer who spreads a damaging rumor that harms an employee’s reputation, or a subordinate who
withholds support to the boss during a crisis.
Although legal remedies are available for sexual harassment, other forms of antisocial
behavior, such as workplace bullying, are not considered to be illegal, yet can be equally harmful
to the employees who are being targeted. Therefore, it is up to the organization, with the assistance
of the HR staff, to provide remedies to employees being bullied by abusive colleagues.
The media have focused attention on some high-profile situations in which individuals
assumed it was permitted to treat employees harshly, and then found out the hard way that it is not:
Staff sergeant Michael G. Rhoades, a drill sergeant at Fort Knox, Kentucky, used abusive
methods to train soldiers, including calling them humiliating names such as “fat nasty,”
and punching a recruit in the stomach. Rhoades was court-martialed and found guilty of
cruelty and dishonorably discharged for mistreating recruits.109
In 2005, CEO Philip J. Purcell was asked by the board of directors to resign his job as
CEO of Morgan Stanley, a financial services giant, after a stream of top-performing execu
tives quit in recent years, adversely affecting company performance. Former employees
indicated that CEO Purcell treated employees ruthlessly, and was intolerant of dissent or
argument with his ideas. He pushed away and demeaned strong executives and preferred
to surround himself with yes men and women.110
Some examples of bullying behaviors are listed in Figure 14.5 . Although a single occurrence of
one of the specified behaviors in Figure 14.5 is not likely to be perceived as a form of bullying,
a persistent pattern of displaying one or more of these behaviors to a targeted employee has the
cumulative effect of undermining an employee’s self-confidence and morale to the point where
the workplace becomes a stressful and toxic environment.
Unless an organization has a communication channel such as an open-door policy that
encourages the reporting of workplace bullying behavior and provides remedies for it, employees
will tolerate it, and targets of bullying will suffer in silence until they are able to quit. Two
social scientists, Christine Pearson and Christine Porath, conducted a survey of employees who
have been targeted by bullies to discover practices that reduce these incidents of uncivil conduct
between employees. One of the recommendations from this study was for organizations
to develop policies that promote zero tolerance for bullying and other forms of employee-toemployee
incivility (rude conduct). Supporting this idea, organizations need value statements
similar to that of AT&T, which states “we treat each other with respect and dignity.”111 Such
statements set the tone for conduct that is acceptable and indicate that bullying behavior is not
tolerated. Once there is a general consensus that employees need to be treated with dignity and
respect, incidents of bullying can be treated as any other discipline problem.
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Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 491
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 491
Swearing at an employee in a hostile manner Threatening an employee to reveal private or
Treating an employee in a rude and/or
embarrassing information to others
disrespectful manner Subjecting an employee to temper tantrums when
Subjecting an employee to obscene or hostile
disagreeing
gestures Criticizing an employee for his or her personal life
Subjecting an employee to mean pranks
and activities
Subjecting an employee to derogatory name
Subjecting an employee to unwanted terms of
calling
endearment
Targeting an employee to rumors or gossip with
Treating an employee in a condescending and
intentions to harm
insulting manner
FIGURE 14.5
Examples of Bullying Behaviors in the Workplace
Source: Based on Neuman, J., and Keashly, L. (2005, August 9). Reducing aggression and bullying: A long-term intervention project in the U.S. Department of
Veterans Affairs. In J. Raver (chair), Workplace bullying: International perspectives on moving from research to practice. Symposium conducted at the meeting
of the Academy of Management, Honolulu, Hawaii; Roscigno, V., Lopez, S., and Hodson, R. 2009). Supervisory bullying, status inequalities and organizational
context. Social Forces, 87(3), 1561–1589; Workplace Bullying: What everyone needs to know. (2008, April). Safety & Health Assessment & Research for
Prevention Report #87-2-2008.
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Another approach to dealing with workplace bullying is provided by Robert Sutton, a business
professor at Stanford University, who offers advice to companies who seek to implement
and enforce a no-jerk rule when hiring and firing employees. Sutton defines a “jerk” as one who
oppresses, humiliates, de-energizes, or belittles a subordinate or colleague. Sutton differentiates
between temporary jerks, who have a lapse in good judgment and may act rude on an infrequent
basis, and certified jerks, who are routinely nasty to people. He says that certified jerks are the
employees that pose the greatest threat to an organization’s culture and are the targets of the
no-jerk rule. One way of applying the no-jerk rule is to carefully screen job candidates during
the recruiting process by getting groups of employees involved in the interview process. In addition,
he recommends seeking out former coworkers of a recruit who are not listed as a reference
and gathering information about a recruit’s interpersonal conduct at the former employer. When
evidence confirms that a job candidate is a certified jerk, the no-jerk rule is used to eliminate that
individual from the applicant pool.112
Alcohol-Related Misconduct
Employees’ use of alcohol presents two separate challenges to managers. First, there is the challenge
of managing an employee who is an alcoholic. Second, there is the challenge of managing
an employee who uses alcohol or is intoxicated on the job. Each of these employees should be
disciplined differently.
Alcoholic employees are generally viewed sympathetically because alcoholism is an illness
and medical treatment is the generally accepted remedy for it. However, as we mentioned
in Chapter 13 , some alcoholic employees have a strong denial mechanism that prevents them
from admitting that they are alcoholics: Others may not view them as alcoholics either because
alcoholism is often masked by behavioral symptoms such as poor attendance. Thus, a supervisor
may perceive an alcoholic employee as someone who has an attendance or performance problem
rather than an alcohol problem and discipline the employee accordingly. Organizations with
EAPs give employees with performance problems the opportunity to visit a counselor as the
last step in progressive discipline before discharge. This is where the alcoholism may finally be
discovered and the employee referred to an alcohol rehabilitation facility.
Sometimes employees claim to be alcoholic to cover up their misconduct. If the EAP counselor
determines that the individual is not an alcoholic, the discipline procedure is the appropriate
managerial response to the problem.
Using alcohol on the job and coming to work intoxicated are both considered serious misconduct
and can lead to harsh discipline. Organizations that have job-related reasons to restrict
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
alcohol use at work or working “under the influence” should have clearly stated and reasonable
policies. For example, it is reasonable to restrict the alcohol use, on or off the job, of heavy
equipment operators at a construction site. It is more difficult to forbid a sales representative to
drink alcohol when entertaining a prospective client at a lunch.
The best way to prove that an employee has come to work intoxicated is to administer a
blood alcohol content test. A supervisor can ask an employee to submit to this test if there is a
reasonable suspicion that the worker is intoxicated. Supervisors may suspect an individual is
intoxicated if he or she engages in unusual behavior (talking particularly loud or using profanity),
has slurred speech, or has alcohol on the breath.
A first intoxication offense may result in suspension or discharge because of the potential
for damage that an alcohol-impaired employee can create. An extreme example of an alcohol-
impaired employee’s cost to an organization is the accident in which the Exxon Valdez oil tanker
spilled oil off the coast of Alaska in March 1989. A blood alcohol test revealed that the ship’s
captain was intoxicated at the time of the oil spill, which cost Exxon over $1 billion to clean up.
Illegal Drug Use and Abuse
Drug use and abuse by employees also presents a serious challenge to managers. Illegal drug use
refers to any use of prohibited substances such as marijuana, heroin, and cocaine as well as the
illegal use of prescription drugs such as Valium. The problems associated with drug use are very
similar to those associated with the use of alcohol. The key difference is that the use of illegal
drugs is socially unacceptable, whereas the use of alcohol in moderation is socially acceptable.
We examined the specifics of drug-use detection systems earlier in this chapter, and we
will address the health aspects of drug use in Chapter 16 . Here we note only that illegal drug
use is often masked by symptoms such as inattention and unexplained absences. Managers
who suspect that drug use or addiction is the source of a performance problem should refer
the employee to EAP counseling if the organization has such a program. Simultaneously, they
should document performance problems and begin disciplinary procedures. These will prove
valuable should it be necessary to terminate the employee because of failure to overcome the
substance abuse problem after counseling and treatment. Managers who refer employees to an
EAP program for problems that are not strictly related to performance may create some risk for
the company, as we see in Chapter 16 .
Preventing the Need for Discipline with Human Resource Management
By taking a strategic and proactive approach to the design of HRM systems, managers can eliminate
the need for a substantial amount of employee discipline. HR programs designed to use
employees’ talents and skills effectively reduce the need to resort to discipline to shape employee
behavior. In this section we briefly revisit some of the functional areas of HR we discussed in
earlier chapters to show how each can be designed to prevent problem employees.113
Recruitment and Selection
By spending more time and resources on recruiting and selection, managers can make better
matches between individuals and the organization.
¦
Workers can be selected for fit in the organization as well as the job. Choosing applicants
who have career potential in the company decreases the likelihood that employees will
exhibit performance problems later.
¦
Checking references and gathering background information on applicants’ work habits and
character are useful preliminaries to making a job offer.
¦
Multiple interviews that involve diverse groups in the company can reduce biases that
lead to poor hiring decisions. When women, minorities, peers, and subordinates, as well as
senior people, are involved in the interviewing process, companies stand a better chance of
obtaining an accurate portrait of the applicant.
¦
Personality tests or honesty tests can be administered to job candidates. Candidates who
have profiles from the test that correlate strongly with a high propensity to commit misconduct
or display dishonesty in the workplace can be deleted from consideration for a job.114
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
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CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 493
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 493
Investing in employees’ training and development now saves a company from having to deal
with incompetents or workers whose skills are obsolete down the road.
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¦
An effective orientation program communicates to new employees the values important
to the organization. It also teaches employees what is expected from them as members of
the organization. These insights into the company can help employees manage their own
behavior better. FedEx, for instance, has an extensive orientation program to communicate
company values to employees.115
¦
Training programs for new employees can reduce skill gaps and improve competencies.
¦
Retraining programs can be used for continuing employees whose skills have become
obsolete. For example, employees may need periodic retraining on word processing software
as the technology changes and more powerful programs become available.
¦
Training supervisors to coach and provide feedback to their subordinates encourages
supervisors to intervene early in problem situations with counseling rather than discipline.
¦
Career ladders can be developed to give employees incentives to develop a long-term commitment
to the organization’s goals. When employees know that the organization has a
long-term use for their contributions, they are more likely to engage in acts of good citizenship
with their coworkers and customers.
Human Resource Planning
Jobs, job families, and organizational units can be designed to motivate and challenge employees.
Highly motivated workers seldom need to be disciplined for inadequate performance.
¦
Jobs should be designed to use the best talents of each employee. It may be necessary to
build some flexibility into job designs to put an employee’s strengths to best use. One way
companies are creating greater job flexibility is through job banding. Discussed in Chapter
10 , this system replaces traditional narrowly defined job descriptions with broader categories,
or bands, of related jobs. By putting greater variety into jobs, job banding makes
it less likely that employees will feel so underchallenged or bored that they start avoiding
work through absences or tardiness. Job banding has been implemented successfully by
companies such as Aetna, General Electric, and Harley Davidson.116
¦
Job descriptions and work plans should be developed to communicate effectively to
employees the performance standards to which they will be held accountable.
Performance Appraisal
Many performance problems can be avoided by designing effective performance appraisal
systems. An effective performance appraisal system lets people know what is expected of
them, how well they are meeting those expectations, and what they can do to improve on their
weaknesses.
¦
The performance appraisal criteria should set reasonable standards that employees understand
and have some control over.
¦
Supervisors should be encouraged to provide continuous feedback to subordinates. Many
problems can be avoided with early interventions.
¦
Performance evaluations for supervisors should place strong emphasis on their effectiveness
at providing feedback and developing their subordinates.
¦
Employee appraisals should be documented properly to protect employers against wrongful
discharge or discrimination suits.
¦
The performance appraisal criteria should measure employee behaviors in addition to performance
outcomes so that employees receive feedback on the methods they use to achieve
their expected performance goals. This behavioral feedback enables managers to correct
employees who choose inappropriate and undesirable means to reach their objectives.117
Compensation
Employees who believe that rewards are allocated unfairly (perhaps on the basis of favoritism)
are likely to lose respect for the organization. Worse, employees who believe that pay policies
do not recognize the value of their contributions are more likely to withhold future contributions.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
494 PART VI • GOVERNANCE
¦
Pay policies should be perceived as fair by all employees. Employees deserve rewards for
their contributions. It is important to explain to them the procedures used to establish their
compensation level.
¦
An appeal mechanism that gives employees the right to challenge a pay decision should be
established. Employees who can voice their frustration with a pay decision through a legitimate
channel are less likely to engage in angry exchanges with supervisors, coworkers, or
customers.
Summary and Conclusions
Employee Rights
In the employment relationship, both employees and employers have rights. Employee rights fall
into three categories: statutory rights (protection from discrimination, safe work conditions, the
right to form unions), contractual rights (as provided by employment contracts, union contracts,
and employment policies), and other rights (the rights to ethical treatment, privacy, and free
speech).
Management Rights
Employers have the right to run their business and make a profit. These rights are supported
by property laws, common law, and the values of a society that accepts the concepts
of private enterprise and the profit motive. Management rights include the right to manage
the workforce and to hire, promote, assign, discipline, and discharge employees. Another
important management right is employment at will, which allows an employer to dismiss
an employee at any time for any cause. There are three key exceptions to the employmentat-
will doctrine: public policy exceptions, implied contracts, and lack of good faith and fair
dealing.
Employee Rights Challenges: A Balancing Act
Sometimes the rights of the employer and employees are in conflict. For example, a random
drug-testing policy can create a conflict between an employer’s responsibility to provide a safe
workplace and employees’ rights to privacy. HR professionals need to balance the rights of the
employee with those of the employer when designing policies that address workplace issues like
random drug testing, electronic monitoring of employees, whistle-blowing, moonlighting, and
office romance.
Disciplining Employees
Managers rely on discipline procedures to communicate to employees the need to change a
behavior. There are two approaches to discipline. The progressive discipline procedure relies
on increasing levels of punishment leading to discharge. The positive discipline procedure uses
counseling sessions between supervisor and subordinate to encourage the employee to monitor
his or her own behavior. Both procedures are designed to deal with forms of misconduct that are
correctable.
Administering and Managing Discipline
To avoid conflict and lawsuits, managers must administer discipline properly. This entails ensuring
that disciplined employees receive due process. Managers need to be aware of the standards
used to determine if an employee was treated fairly and whether or not the employee has a right
to appeal disciplinary action. For a disciplinary system to be effective, an appeal mechanism
must be in place.
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Managing Difficult Employees
It is often necessary to discipline employees who exhibit poor attendance, poor performance,
insubordination, workplace bullying, or substance abuse. Managing the discipline process in
these situations requires a balance of good judgment and common sense. Discipline may not be
the best solution in all cases.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 495
Preventing the Need for Discipline with Human Resource Management
The need for discipline can often be avoided by a strategic and proactive approach to HRM.
A company can avoid discipline by recruiting and selecting the right employees for current positions
as well as future opportunities by training and developing workers, by designing jobs and
career paths that best utilize people’s talents, by designing effective performance appraisal systems,
and by compensating employees for their contributions.
Discussion Questions
1. Why have managers needed to place greater emphasis on employee rights in recent years?
2. Do employers have rights? If so, what are these rights?
3. Many U.S. companies outsource activities, such as manufacturing, to factories in Asia and
Latin America. For example, Nike manufactures shoes in Indonesia and Hewlett-Packard
uses electrical parts made in Chinese factories for its computers. Should the workers in
these overseas factories that are part of the global supply chain for an American company
have the same rights as U.S. employees? For example, should workers in overseas
factories that make shoes for Nike have the right to the same working conditions as Nike
employees working in the United States? What are the advantages of maintaining a policy
that offers consistent employee rights on a global basis? What are the disadvantages of
such a policy?
4. National Medical Enterprises, Inc., a $4 billion operator of hospitals and psychiatric treatment
centers, faced criminal probes for practices such as widespread overbilling and
fraudulent diagnoses to extend patients’ hospital stays. Investigators found that NME’s top
management urged hospital administrators to adopt “intake” goals designed to lure patients
into hospitals for lengthy and unnecessary treatments. Hospital staffers were also urged to
admit fully half of all patients who came in for an evaluation. Suppose a hospital staffer
at NME refused to admit patients for whom she felt treatment was unnecessary. Could her
refusal be considered insubordination? If the same staffer considered exposing fraudulent
diagnoses to an outside agency, what whistle-blowing precautions would she be wise to
consider before going public with her case?
5. Compare and contrast the progressive and positive discipline procedures.
6. When a whistle-blower steps forward and discloses corruption or misconduct performed by
a manager, how does a company benefit? What can HR staff working with management do
to reduce the fear and risk to employees from being a whistle-blower?
7. The administration of discipline usually occurs between a manager and a subordinate
employee. How can HR staff contribute to the fairness of the administration of discipline?
How can HR staff contribute to the reduction of the need to administer discipline to
employees within a company?
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8. Can you think of a job-related reason why a company would decide to restrict dating
between employees and enforce a no-dating policy? Do you think employers have a right
to restrict any or all of the following off-duty conduct of their employees: (1) smoking
cigarettes, (2) engaging in high-risk leisure activities such as skiing, motocross racing, rock
climbing, or sky diving, (3) actively supporting a radical political candidate in an election,
(4) having a romantic affair outside of the marriage relationship, and (5) joining a religious
cult that preaches hatred against minorities? Justify your answer.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
Key Terms
contract, 468 insubordination, 489 progressive discipline , 482
contractual right , 468 management rights , 471 right, 467
due process , 468 moonlighting 479 statutory right , 467
employment at will , 472 personnel file , 470 whistle-blowing, 478
employment contract , 468 positive discipline , 484 workplace bullying , 490
hot-stove rule , 485 Privacy Act of 1974 , 470 wrongful discharge , 469
496 PART VI • GOVERNANCE
Case 14.1 HR in Small Business
Does labeling this employee behavior as stealing time help
Should Employees Be Disciplined for
“Stealing Time”?
raise people’s consciousness of the seriousness of this prob
lem for employers in small business?
2.
What would happen if employers focused only on results
accomplished by employees and were indifferent to how
they use their time to obtain the expected results? Would this
solve the problem of stealing time that is described in the
case? Justify your position.
Team Exercise
As work in the United States has moved away from a highly structured
workplace characteristic of manufacturing to one that has
increasing flexibility concerning where and how work is done,
employees now have more discretion over how to use their time
in the workplace. Some employees abuse the flexibility given by
the employer and stray mentally or physically from doing their
assigned tasks. A key reason that employees are tempted to take
advantage of the independence they have over their time at work
is due to the many distractions provided by the Internet. Some of
the non-job-related activities that employees do on the Internet
include playing video games, doing personal banking online,
updating personal blogs or social networking Web sites, browsing
the profiles of potential dates posted online, running a sideline
business on eBay, or shopping for bargains on Amazon.com.
Some employers are very concerned about employees who are not
fully engaged in performing their jobs during the time they are on
the clock and take a hostile attitude toward those who steal time
at the workplace. Employees who steal time at the workplace are
particularly detrimental to small-business employers, who have
limited resources and depend on employees being fully engaged
in their work to justify the expense of keeping them on the payroll.
A small-business owner needs assistance to develop a policy on
stealing time that will be effective at reducing the amount of time
employees waste using the Internet for non-job-related activities.
With four or five students, develop a policy that addresses the
following concerns of the small-business owner. What kinds of
non-job-related activities on the Internet are legitimate for employees
to do, and what kinds of non-job-related activities on the
Internet should be considered as stealing time from the employer?
Should the business owner use progressive discipline, positive
discipline, or immediate discharge of employees who are caught
committing a first offense of stealing time? Should the business
owner force employees who steal time to pay the employer back
for the economic value of the lost time out of an employee’s future
wages? How should the policy be communicated to employees?
Be prepared to share the policy about stealing time with other
members of the class when called upon by the instructor.
Experiential Exercise: Individual
A recent study by Salary.com found that the average worker
wastes 2.09 hours per day at work. On an annual basis, this lost
time costs an employer $5,720 per employee. This cost can be
damaging to small businesses that operate on low profit margins,
and it gives small-business owners powerful incentives to control
for these losses.
Assume you are a business owner and you become aware that
some of your employees are using the computer at the workplace
for playing video games, doing online banking, and updating their
Facebook profiles, but they are supposed to be at work updating
customer information on the marketing database and making cold
calls on the telephone to develop new business. How would you
use your knowledge of human resource management to achieve a
higher level of productivity from employees who do not use their
time efficiently on the job?
The question that is often asked by employers when they discover
that some of their employees are using work time for performing
non-job-related activities is, What should be done about
it? Should employers discipline employees who steal time? If so,
how should an employer communicate to employees that they
should not engage in non-job-related activities while working?
How should an employer define the infraction of stealing time?
What kind of sanctions should apply to employees who steal time?
Is there an alternative to discipline that can be used to discourage
employees from stealing time from the employer?
Critical Thinking Questions
1.
What are the advantages and disadvantages of having an
employer draw attention to situations where employees use
some of their work time to do non-job-related activities?
Sources: Based on Martin, L., Brock, M., Buckley, M., and Ketchen, D.
(2010). Time banditry: Examining the purloining of time in organizations.
Human Resource Management Review, 20, 26–34; Ketchen, D., Craighead, C.,
and Buckely, M. (2008). Time bandits: How they are created, why they are
tolerated, and what can be done about them. Business Horizons, 51 , 141–
150; Weatherbee, T. (2010). Counterproductive use of technology at work:
Information & communications technologies and cyberdeviancy. Human
Resource Management Review, 20 , 35–44.
Case 14.2 Ethics
Background Checks Can Misfire, Harming had accused him of “cash register fraud and theft of merchandise”
Employees’ Career Prospects totaling $7,313. “I wanted to cry,” Pendergrass said.
The $4 billion background-screening business is booming.
Theodore Pendergrass was shocked in November 2006 when
Companies large and small are sorting mostly mid- and lower-levelthe Walgreens pharmacy chain rejected his application for a
job applicants based on information compiled by ChoicePoint, itsstore supervisor job. The company told him that a background-
major rivals, and hundreds of smaller competitors. Some employ-
screening firm called ChoicePoint reported that a past employer
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
ISBN
1-256-39369-
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 497
ostin tekojakasittanyt yms maaritella psykologia ostin tuholaiset liittoa tulevaakunnioittakaa etsimaan uhraamaan asui vuonna lunastaa hommaa ylenmuusta veron paljon paino hevosilla kirkas keisarin sanoneet osoitajoiden laskeutuu jarkeva taalta lamput referenssit tutkitaan piittaamatkaansa teltan paatoksia sotilaille sekaan haluavat omaa luovuttivapaiksi tapahtumaan jalkeeni oireita asti todistusta jarjeton ystaviapuhumattakaan alkaaka vastasivat armon henkea pysytteli alhainenvalitset sanonta iki karta pahaksi tainnut pojalleen polttouhrejaedustaja olisikaan maalivahti luottanut portit valittaa vaikuttavat pihaanyleiso riittamiin kahdeksas koon mihin tayttavat lakkaa riemuitsevatbaalin uskovaiset isot koston saavan saastaista jumalaamme simonpeseytykoon riita vahiin pyhittanyt joukossa lahtekaa appensa tuntikenellekaan iljettavia tuhoudutte nailta syyrialaiset korvapuolestamme tapaa jalleen arkun paivien pysya ennusta kaantykaaankaran julkisella hyvaa savu lakkaamatta appensa tsetseniassa
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 497
ostin tekojakasittanyt yms maaritella psykologia ostin tuholaiset liittoa tulevaakunnioittakaa etsimaan uhraamaan asui vuonna lunastaa hommaa ylenmuusta veron paljon paino hevosilla kirkas keisarin sanoneet osoitajoiden laskeutuu jarkeva taalta lamput referenssit tutkitaan piittaamatkaansa teltan paatoksia sotilaille sekaan haluavat omaa luovuttivapaiksi tapahtumaan jalkeeni oireita asti todistusta jarjeton ystaviapuhumattakaan alkaaka vastasivat armon henkea pysytteli alhainenvalitset sanonta iki karta pahaksi tainnut pojalleen polttouhrejaedustaja olisikaan maalivahti luottanut portit valittaa vaikuttavat pihaanyleiso riittamiin kahdeksas koon mihin tayttavat lakkaa riemuitsevatbaalin uskovaiset isot koston saavan saastaista jumalaamme simonpeseytykoon riita vahiin pyhittanyt joukossa lahtekaa appensa tuntikenellekaan iljettavia tuhoudutte nailta syyrialaiset korvapuolestamme tapaa jalleen arkun paivien pysya ennusta kaantykaaankaran julkisella hyvaa savu lakkaamatta appensa tsetseniassa
ers have grown more vigilant about hiring since the September 11
terrorist attacks. Others like the efficiency of outsourcing tasks once
handled by in-house human resources departments or bosses who
simply picked up the phone themselves. Whatever their motives,
employers are becoming more dependent on mass-produced background
reports that rely on anonymous, and sometimes inaccurate
or unfair, sources.
Pendergrass’ difficulties stemmed from a previous job at Rite
Aid, a pharmacy company. In late 2005, when he was 25 years old,
he had reached the first rung of management as a shift supervisor
in a Rite Aid store in Philadelphia. His bosses trusted him to oversee
cashiers, bank deposits, and merchandise deliveries. Then, in
January 2006, a store official accused him of stealing goods and
underpaying for DVDs. He denied the accusations, but the official
said police were waiting outside to arrest him if he did not confess.
Pendergrass wrote a statement but would not admit to theft. He
was soon fired anyway.
Later, at a hearing for unemployment compensation,
Pendergrass was vindicated. A state labor referee ruled that
Rite Aid had not proved its allegations and awarded him nearly
$1,000 in benefits. However, Rite Aid had already submitted its
theft report to a database used by more than 70 retailers and run
by ChoicePoint, the largest screening firm for corporate employers
in the United States. ChoicePoint says that it checks applicants
for more than half of the country’s 100 largest companies, including
Bank of America, UnitedHealth Group, and UPS. Because of
Pendergrass’ tainted ChoicePoint file, retailers CVS Caremark and
Target also rejected him for jobs.
Pendergrass, now 27, makes lattes at a Starbucks in
Philadelphia. The coffee chain does not use a screening firm
for entry-level hires. Pendergrass earns $17,000 a year—30
percent less than he did at Rite Aid—and fears his career has
been derailed. “I worked hard in that store, and none of this stuff
was true,” he says. “I would be locked up somewhere if I stole
$7,000.”
Rite Aid declined to comment on Pendergrass. A ChoicePoint
spokeswoman says the company’s background report merely conveyed
information provided by a former employer.
Critical Thinking Questions
1.
In this case, an employer’s right to protect its property is at
odds with employees’ right to privacy concerning the use
of personal employment information and the right to be
treated ethically with dignity and respect. Why does there
seem to be an imbalance between these conflicting rights,
with the employer’s rights appearing to take precedence
over employees’ rights? Do you agree that employers’
property rights are more important that employees’ rights
to privacy and to fair and ethical treatment? Justify your
reasoning.
2.
ChoicePoint is the largest company in the $4 billion background-
checking industry. Is there anything ChoicePoint can
do, as the industry leader, to be more sensitive and respectful
to the privacy rights of employees in how it distributes information
to employers? What do you recommend? How would
your recommendation affect ChoicePoint’s cost of doing
business?
Team Exercise
The federal Fair Credit Reporting Act covers background screeners,
but it has not been aggressively enforced. The law says that
screeners must use “reasonable procedures” to ensure “maximum
possible accuracy.” It also requires employers to give a copy of
background reports to rejected applicants. An applicant can dispute
the information in the report, but the Federal Trade Commission
has said employers must wait only five business days before hiring
someone else, meaning that objections frequently become
pointless. Form a team with four or five students and develop
an approach to use the federal regulations to protect employees’
employment information in a way that more vigorously protects
employees’ rights. Keep in mind that the background-checking
industry may have a financial interest in maintaining lax enforcement
standards of the Fair Credit Report Act to allow it to have
maximum flexibility to pursue its own interests. Be prepared to
share your recommendation with other class members when called
upon by the instructor.
Experiential Exercise: Individual
Consider how you would react to the following hypothetical situation.
Suppose you were in a dispute with your manager over your
travel expenses on your job. The manager accuses you of charging
the company for personal expenditures on your expense report,
and you strongly deny the accusations that your manager has made.
Rather than remain in your current job, you quickly find a replacement
job and abruptly quit without settling the dispute. Knowing
what you know about background-checking practices from this case,
what preventative measures can you take to protect your reputation
and privacy over disputed information so that you are not harmed
by potential misinformation provided by a background-checking
company? Be specific and indicate what steps you would take to
take preventative action. Be prepared to share your ideas with other
members of the class when called upon by the instructor.
Sources: Based on Terhune, C. (2008, June 9). The trouble with background
checks. BusinessWeek, 54–58; McGregor, J. (2006, March 20). Background
checks that never end. BusinessWeek, 40; Balle, J. (2010). Problems with a
background check. www.smallbusiness.chron.com.
ISBN
1-256-39369-X
Case 14.3 Ethics
Employees Should Be Aware of the Risks that workers at corporate subsidiaries are not covered by the law.
Before They Attempt to Blow the Whistle The government has ruled in favor of whistle-blowers 17 times out
of 1,273 complaints filed between 2002 and 2008, according to
The U.S. Department of Labor, which is charged with enforc-
Department of Labor records. Another 841 cases were dismissed.
ing the federal law protecting whistle-blowers at publicly traded
Many of the dismissals were made on the grounds that employeescompanies, has been dismissing complaints on the technicality
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
498 PART VI • GOVERNANCE
Sherron Watkins blew the whistle
on Enron and its inaccurate financial
reporting in 2002. Four years
later, Enron president Jeffrey Skilling
was sentenced to twenty-four years
in prison after being found guilty of
securities fraud and making false statements
to auditors, among other crimes.
Source: STEPHEN JAFFE/AFP/Newscom
worked for a corporate subsidiary, according to Robert Moberly, a
University of Nebraska law professor.
Besides the lackluster federal enforcement of incidents of
whistle-blowing, organizations are likely to retaliate against the
employee who decides to blow the whistle and expose an alleged
ethics violation. One way companies retaliate is by questioning the
whistle-blower’s mental health. The goal of the strategy, known as
“nuts and sluts,” is to cast doubt on the messenger. National Fuel Gas
Company, a utility based near Buffalo, New York, fired Curtis Lee,
a highly paid company lawyer, after he alleged that the chief executive
and president had ordered him to backdate their stock options
on forms submitted to the Security and Exchange Commission
(SEC) in a way that made the options worth considerably more. Not
only did National Fuel then sue Lee successfully for the return of the
documents that might have provided proof, but it also persuaded a
local court to ban him from ever repeating the accusations. In addition,
the court ruled that he undergo psychiatric treatment, a ruling
that was subsequently reversed on appeal on the grounds that it was
illegal, but not before Lee had been “treated.” An official investigation
into the matter was frustrated by the untimely death of the chairman
of the company’s compensation committee.
Under the “employment at will” doctrine, in the United States
companies do not have to give employees a reason for discharging
them. Advocates for whistle-blowers believe that the greatest
single protection for whistle-blowers would be to make it mandatory
for firms to say why they are discharging an employee. The
Whistleblower Protection Act has been in force since 1989, and in
2002 the Sarbanes-Oxley Act added additional protection to corporate
whistle-blowers. However, these laws have loopholes that
companies can use to protect their interests and avoid penalties
from retaliating against a whistle-blower.
After reviewing hundreds of laws protecting whistle-blowers,
Terrance Miethe, a professor of criminal justice at University of
Nevada, concluded that “most legal protection for whistleblowers
is illusory; few whistleblowers are protected from retaliatory actions
because of numerous loopholes and special conditions of these laws,
and the major disadvantage that individual plaintiffs have against
corporate defendants,” due to the superior availability of resources
and legal talent that companies have compared to a whistle-blower.
Critical Thinking Questions
1.
Why might an employee decide to blow the whistle on
another person or practice in a company? What does an
employee have to gain from blowing the whistle? What are
the potential risks an employee could face by blowing the
whistle on the employer?
2.
How could an employer use the “employment at will” doctrine
to defend against an allegation of retaliation from an employee
who has been discharged after blowing the whistle on the
company?
Team Exercise
With four or five other students, develop a comprehensive list of
factors that represent barriers to whistle-blowing within an organization.
Barriers to whistle-blowing come from three sources:
(1) the organization itself, (2) an employee’s supervisor, and
(3) personal factors related to the employee. The team should
identify barriers to whistle-blowing from each of these sources.
Finally, develop ways to lower the barriers to whistle-blowing
from these different sources. Be prepared to discuss ways
to lower the barriers to whistle-blowing in organizations when
called upon by the instructor.
Experiential Exercise: Individual
Consider the following hypothetical situation and be prepared to
answer the questions that follow. You have noticed that one of the
students taking the final exam in a university course is cheating
ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 499
the cheating incident? How would you deal with these concerns?
Why do you think so few students report incidents of cheating
they see to faculty? Is there something the university could due to
encourage whistle-blowers to step forward when cheating occurs?
Be prepared to share your ideas with other members of the class
when called upon by your instructor.
by looking at an answer sheet, despite the fact that the professor
indicated that the exam is closed book, which means that the use
of prepared notes is forbidden. Viewing the cheating student is
upsetting to you, because you have played by the rules and have
studied many hours in preparation for the final exam. You do not
think it is fair that someone should get a grade that is not deserved
due to cheating. Would you blow the whistle on this cheating student
and inform the professor of what you saw? If you decided to
blow the whistle on the cheater, what would be your motivation?
What concerns would you have about telling the professor about
Sources: Based on Levitz, J. (2008, September 4). Whistleblowers are left dangling.
Wall Street Journal, A3; The Economist. (2006, March 25). Tales from
the back office, 67–68; McKinney, H. (2010, November 20). The hazards of
whistleblowing. www.ehow.com.
Case 14.4 Global
Illegal Immigrants in the Workforce:
Opportunity or Challenge?
California, the most important fruit and vegetable producer in the
nation, 90 percent of farm labor consists of illegal immigrants. In
Texas, restaurants depend heavily on illegal immigrants to clear
tables and wash dishes.
With the exportation of millions of higher paying jobs to India
and China through outsourcing arrangements and the presence of a
large and growing illegal immigrant workforce for low-wage jobs,
Illegal immigrant labor is a global HRM issue that arises from
people from less developed countries (LDCs) illegally entering
more affluent countries to seek employment. Illegal immigrants
are likely to work for wages lower than those that are paid to citizens
within a country. In addition, they are often paid in cash, and
therefore avoid paying taxes on their earned income. This raises
issues of unfairness by those who “play by the rules” and pay taxes
or who wait their turn to enter the country legally.
U.S. citizens are feeling more uncertain than ever about their own
job security and the opportunities that will be available for their
children. Depending on how it is framed, the illegal immigrant
workforce can be viewed as either a new opportunity providing
new markets to serve—or as a challenge that needs to be controlled
so that citizens who follow the economic rules, pay their
taxes, and obey the law do not feel they are being treated unfairly
by their government.
Critical Thinking Questions
1.
What do you consider to be the primary opportunities related
to the issue of illegal immigrants in the workforce? State
your reasoning.
Most of the income earned by illegal immigrants goes back
to family members in their country of origin. This increases
their family’s living standards and contributes to the economic
stability of their country of origin, reducing its need for foreign
economic assistance. Illegal immigrants are often exploited by
unscrupulous employers who may not provide safe working conditions
or who may force them to work excessive hours beyond
what is permitted by the host country’s labor laws. Illegal immigrants
may not have the same legal rights as the host country’s
citizens or they may be unaware of their rights; thus, they are
easily taken advantage of.
2.
What do you consider to be the main challenges related to
the issue of illegal immigrants in the workforce? State your
reasoning.
3.
What makes it so difficult to find an acceptable solution for
this issue, assuming that the status quo concerning illegal
immigration needs to be changed?
Team Exercise
Countries as diverse as Spain, Poland, Italy, and the United
States have significant numbers of illegal immigrants in the
workforce. In Spain, large numbers of Romanians, Moroccans,
Ecuadorans, and Columbians work in the booming tourist and construction
industries. Poland has tens of thousands of illegal immigrants,
chiefly from Ukraine. Italy has many Albanians working
illegally in its underground economy. Finally, the world’s largest
illegal immigrant workforce is in the United States, with estimates
as high as 10 million illegal immigrants working within its borders
in mainly low-wage jobs in industries such as farm labor, meat and
poultry processing, lawn care, restaurant labor, and drywall and
ceiling tile installation.
ISBN
1-256-39369-X
With a group of four or five students, determine which workplace
rights or benefits illegal immigrant employees and regular employees
share, and which ones employees who are citizens or legal residents
have that are not available to illegal immigrants. Here are
some examples of rights or benefits you can examine to answer
this question: Social Security, worker’s compensation, unemployment
insurance, government safety standards, overtime pay, minimum
wage, union membership, and job opportunities working for
the U.S. government. What type of employer is most likely to hire
illegal immigrants? Be prepared to share your group’s findings
with the class.
Experiential Exercise: Individual
In the United States, the illegal immigrant population is so
large that it has become an important market segment. Millions
of illegal immigrants from Mexico have been issued matricula
cards from the Mexican consulate, with the approval of the U.S.
government, that entitles the card bearer to open bank accounts
and to hold driving licenses. Wells Fargo Bank has opened bank
accounts for matricula card holders, and U.S. Sprint Corp. accepts
the card for cell phone contracts. Kraft has developed new drink
products with the illegal immigrant consumer in mind. In some
parts of the country, entire industries depend on the labor of illegal
immigrants. The U.S. Department of Labor estimates that in
This exercise asks you to explore your attitudes concerning illegal
immigrants in the workplace.
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
¦
Would you work for an employer who makes it a point to
hire illegal immigrants? Why or why not?
¦
Would you consume the products of a company that you
know purposely hires illegal immigrants? Why or why
not?
¦
If you worked in a restaurant and found out that some of
the employees working there were illegal immigrants,
would you inform the restaurant manager? Why or why
not?
¦
If you were the owner of a restaurant and the only way
you could fill the dishwashing jobs was to hire people you
expected to be illegal immigrants would you hire these
people? Why or why not?
¦
If you were a department manager and you discovered a
prospective professional employee had an illegal immigrant
providing babysitting services for her children, would you
still extend a job offer to this person? Why or why not?
Be prepared to share your answers with other members of the class
when called on by your instructor.
Sources: Based on Grow, B. (2005, July 18). Embracing illegals. BusinessWeek,
42–49; Justich, R., and Ng, B. (2005). The underground labor force is rising to
the surface. New York: Bear Stearns Asset Management Inc.; The Economist.
(2005, September 10). The grapes of wrath, again, 50; Colvin, G. (2005,
September 5). On immigration policy, we’ve got it backward. Fortune, 44; The
Economist. (2010, December 18). Field of tears: They came to America illegally,
for the best of reasons, 39–41.
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ISBN
1-256-39369-
Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 501
CHAPTER 14 • RESPECTING EMPLOYEE RIGHTS AND MANAGING DISCIPLINE 501
ISBN
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Copyright © 2012 by Pearson Education, Inc.
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ISBN
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Managing Human Resources, Seventh Edition, by Luis R. Gómez-Mejía, David B. Balkin, and Robert L. Cardy. Published by Prentice Hall.
Copyright © 2012 by Pearson Education, Inc.

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