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Chapter 17
Employee Stakeholders and Workplace Issues
LEARNING OUTCOMES
After studying this chapter, you should be able to:
1.
2.
3.
4.
5.
6.
7.
Identify the major changes that are occurring in the workforce today.
Outline the characteristics of the new social contract between employers and employees.
Explain the employee rights movement and its underlying principles.
Describe and discuss the employment-at-will doctrine and its role in the employee’s right
to not be fired.
Discuss the right to due process and fair treatment.
Describe the actions companies are taking to make the workplace friendlier.
Elaborate on the freedom-of-speech issue and whistle-blowing.
TEACHING SUGGESTIONS
INTRODUCTION – The employer/employee relationship is central to business’s role in society.
The authors devote two chapters to the subject, with this being the first. They discuss some of
the changes occurring in the workplace, the emerging social contract, and the employee rights
movement. Particular areas of interest include the right to not be fired without just cause, the
right to due process and fair treatment, and the right to freedom of speech in the workplace.
These employee stakeholder issues entail economic, legal, and ethical responsibilities.
KEY TALKING POINTS – The issues discussed in this chapter should be highly relevant to the
students, because they will soon be employees of companies, if they are not already. The
doctrine of employment-at-will has the potential to affect each of them, both directly and
significantly. Employers that outsource jobs to cheap labor locales rely on employment-at-will
to allow them to terminate employees as they see fit, without any legal consequences. Of course,
this same doctrine is what allows an employee to changes jobs quickly and easily. Students are
often surprised that at its most basic level, the employment-at-will doctrine permits employers to
terminate employees as long as the decision is not based on discrimination. After studying the
basic rule, students are eager to learn the exceptions to this concept.
Much is currently being written about employee rights and due process in the workplace. As
pointed out in the textbook, employees have routinely been expected to forego their civil liberties
when they enter the workplace. Organizational theorists might question an organization’s ability
to operate efficiently without a command-and-control bureaucratic structure, but employees are
increasingly demanding the right to be treated fairly and as something more than a machine part.
Marjorie Kelly addresses the need for democratic principles in the governance of corporations in
her book The Divine Right of Capital (San Francisco: Berrett-Koehler Publishers, Inc., 2003).
Students usually are willing to open up and discuss their ideas regarding due process in the
workplace and will describe their current employer’s due process procedures when questioned.
Business and Society
Chapter Notes
The most dramatic topic in this chapter is the question of freedom of speech, particularly that of
whistle-blowing. As the textbook mentions in Figure 17-5, several movies have been made
about true-life whistle-blowers. Although several of them are now dated, students can view
graphic representations of some of the very real hazards whistle-blowers encounter. In addition
to informing a discussion of employees’ right to free speech, these movies are also excellent
vehicles with which to approach the concept of moral courage. This concept, which is one James
Rest’s four components of moral behavior (moral sensitivity, judgment, motivation, and
character—or courage), has undergone little research, and few papers have been written about it.
However, after viewing one or more of the movies listed in Figure 17-5, students quickly grasp
the concept of moral courage and why it is a relevant topic in a business and society class. These
movies depict dramatic situations that students may never encounter. But they will encounter
situations where they will be asked to do something they consider unethical, and that is when
moral courage becomes a precious commodity. Instructors also may want to point students to
recent examples of whistle-blowing. In 2002, Time Magazine recognized Sharon Watkins,
Cynthia Cooper and Coleen Roley as its persons of the year for blowing the whistle on illegal
and unethical practices at Enron, Worldcom and the FBI, respectively.
PEDAGOGICAL DEVICES – In this chapter, instructors may utilize a combination of:
Cases:
To Hire or Not to Hire
The Travel Expense Billing Controversy
Family Business
Should Business Hire Illegal Aliens?
A Moral Dilemma: Head versus Heart
Wal-Mart and Its Associates: Efficient Operator or Neglectful Employer
Dead Peasant Life Insurance
The Case of the Fired Waitress
Pizza Redlining: Employee Safety or Discrimination?
After-Effects or After-Hours Activities: The Case of Peter Oiler
Tattoos and Body Jewelry – Employer and Employee Rights
Is Hiring on the Basis of “Looks” Discriminatory?
The Case of Judy
Ethics in Practice Cases:
Manager’s Makeshift
Rowdy Recruiting
Search the Web:
Workplace Fairness - http://www.workplacefairness.org
The National Whistleblower Center - http://www. whistleblowers.org
Video clips:
Spying at Work
Protesting Nike Sweatshops
Business and Society
Chapter Notes
Whistleblowers Honored
You Tube and Whistleblowing
Power Point slides:
Visit http://academic.cengage.com/management/carroll for slides related to this and other
chapters.
LECTURE OUTLINE
I.
THE NEW SOCIAL CONTRACT
II.
THE EMPLOYEE RIGHTS MOVEMENT
A. The Meaning of Employee Rights
III.
THE RIGHT NOT TO BE FIRED WITHOUT CAUSE
A. Employment-at-Will Doctrine
1. Legal Challenges to Employment-At-Will
a. Public Policy Exceptions
b. Contractual Actions
c. Breach of Good Faith Actions
B. Moral and Managerial Challenges to Employment-at-Will
C. Terminating an Employee with Care
IV.
THE RIGHT TO DUE PROCESS AND FAIR TREATMENT
A. Due Process
B. Alternative Dispute Resolution
1. Common Approaches
2. The Ombudsman
3. The Peer Review Panel
V.
FREEDOM OF SPEECH IN THE WORKPLACE
A. Whistle-Blowing
B. Consequences of Whistle-Blowing
C. Government’s Protection of Whistle-Blowers
D. Sarbanes-Oxley Whistle-Blower Protections
E.
False Claims Act
F.
Management Responsiveness to Potential Whistle-Blowing Situations
VI.
SUMMARY
SUGGESTED ANSWERS TO DISCUSSION QUESTIONS
Students should recognize that their answers to these discussion questions should be well
reasoned and supported with evidence. Although some answers will be more correct than others,
Business and Society
Chapter Notes
students should be aware that simplistic answers to complex questions, problems, or issues such
as these will never be “good” answers.
1.
Using the four forces detailed by John Challenger, my rankings are: 1) technology and
automation, 2) globalization, 3) deregulation of protected industries, and 4) shareholder
activism. I rank technology first because it affects every business, and machines don’t
demand rights. The worker rights movement is just one more reason that an employer
faced with the opportunity to replace workers with machines would jump at the chance to
do so. Globalization is second because workers in China or Vietnam work for much less
pay and don’t expect any of the rights that American workers do. The third and fourth
items seem to have little impact on the workers’ rights movement.
2.
The employment-at-will doctrine means that either the employer or the employee can
terminate the employment contract at any time, for any reason other than discrimination. It
is being eroded because the courts are restricting the employer’s ability to fire employees
through public policy exceptions, contractual exceptions, and breach of good faith actions.
I think the one-sided erosion of employment-at-will (i.e., employers’ right to fire are being
abridged) is a good thing. Employers and employees do not enter into the employment
contract as equals. Employers hold much more power than do employees, so something
that helps equalize the balance of power is a good thing.
3.
Due process is the right to receive an impartial review of one’s complaints and to be dealt
with fairly. Employers utilize a variety of tactics to provide due process, including open
door policies (for this to be effective, the employee has to trust the manager and to be sure
that his/her complaint will be dealt with fairly), some type of hearing procedures,
providing an ombudsman, or granting decision-making authority to a peer review panel.
4.
I would institute a peer review panel, making sure that employees from every level of the
company were represented on the panel. There are distinct class and power differences
between managers and workers, and different levels of managers. This hierarchy often
manifests itself in distrust among the different levels, so any process that relies solely on
upper managers to adjudicate outcomes will be distrusted by a large percentage of the
employees. A properly constructed peer review panel would help overcome that obstacle.
5.
I have always been sympathetic to whistle-blowers, and still am. Organizations hold a
great deal of power over their employees, and often expect the workers to do things that
many consider unethical. People who are willing (and have sufficient moral courage) to
defy the organization and point out the wrong-doing should be praised and held in high
esteem. Furthermore, many whistle-blowers undertake the task to report illegal and
unethical conduct at the risk of losing the jobs, future livelihoods and possibly even their
friends and family.
6.
Anything that can be done to provide incentive for whistle-blowers and to protect them is a
step in the right direction. If someone is willing to risk their families, their jobs, maybe
even their lives, they certainly should share in the financial recovery. Even if it is a large
amount, it probably isn’t enough to compensate the whistle-blower for all s/he went
Business and Society
Chapter Notes
through (see Connie Alderson’s comment in the textbook). And because whistle-blowers
are often subjected to extortion and terrorist acts from their employers, the government
should be doing all it can to protect the whistle-blower.
GROUP PROJECT
Divide students into groups of four to five students. Ask students in the class to bring in the
employment manuals from their current jobs. Distribute the manuals among the groups. Each
group should identify what rights workers have under the manual with regards to the following
(1) termination, (2) due process and (3) freedom of speech in the workplace. Specifically,
students should determine whether employees have contractual rights to employment under the
policy, the procedures involved in a due process proceeding, and mechanisms employed by the
company to encourage freedom of speech in the workplace. Students should summarize these
issues in a memo. Instructors may want to attach the memos to the various manuals and allow
the students to review these memos before, during and after class to obtain a sense of different
strategies and approaches used by a variety of companies regarding these issues.