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Monitoring Employee Performance

Employee activity may be monitored to measure performance, ensure performance quality and customer service, check for theft, and/or enforce company rules or laws.

Research and analyze workplace monitoring and share what are the costs and benefits of implementing a tracking program? Also, please research and share the possible reactions employees might have and how human resources can help improve any negative reactions?

For full credit, include the course textbook and one journal article to support your post.
You will not be able to view your classmates’ posts until you post.
Your initial post is due by Wednesday. This allows you and your classmates time to read and reply.
Your initial post should be 2-3 paragraphsin length.
Make sure to demonstrate critical thinking and analysis by using research and personal work experiences.
For full credit, you are required to respond to a minimum of two classmates. Please begin your reply by addressing the student by name. Your responses must be completed by Friday at midnight.
Please refer to the rubric for the grading requirements. You can view the rubric by clicking on the wheel in the upper right corner and selecting “show rubric.”

CHAPTER 14

Employee Rights and Responsibilities

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Learning Objectives
Explain elements of employment contracts, including noncompete and intellectual property agreements
Define employment at will and discuss how wrongful discharge, just cause, and due process are interrelated
Discuss issues associated with employee privacy, free speech, and whistle-blowing

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Learning Objectives (continued)
Analyze workplace monitoring, employer investigations, and other steps taken to ensure a safe and productive workplace
Understand the use of policies, procedures, and employee handbooks to communicate workplace behavior and performance expectations
Outline approaches to employee discipline and termination of employment

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Employee Rights and Responsibilities
Rights: Powers, privileges, or interests derived from law, nature, or tradition
Statutory rights: Result of specific laws or statutes passed by federal, state, or local governments
Equal employment opportunity
Collective bargaining
Workplace safety
Responsibilities: Obligations to perform certain tasks and duties

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Contractual Rights
Rights based on a specific contract between an employer and an employee
Employment contract: Formal agreement that outlines the details of employment
Noncompete agreement: Prohibits individuals who leave an organization from working with an employer in the same line of business for a specified period of time

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Noncompete Agreements
Employment contract clauses
Nonpiracy agreements
Nonsolicitation of current employees

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Contractual Rights (continued)
Protection of intellectual property
Right to keep trade secrets confidential
Right to have employees bring business opportunities to the employer first before pursuing them elsewhere
Common-law copyright for works and other documents prepared by employees for their employers

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Implied Contracts
Unwritten agreements created by the actions of the parties involved
Affect employment relationship
Rights and responsibilities of the employee may exist only as unwritten employer expectations about what is acceptable behavior or performance

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Rights Affecting the Employment Relationship
Employment at will (E A W)
Wrongful and constructive discharge
Just cause
Due process
Organizational justice

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Employment at Will (E A W)
Common-law doctrine stating that
Employers have the right to hire, fire, demote, or promote whomever they choose, unless there is a law or a contract to the contrary
Employees can quit at any time with or without notice
Courts have recognized certain exceptions to E A W
Public policy exception, implied contract exception, good-faith and fair-dealing exception, and statutory exception

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Wrongful Discharge and Constructive Discharge
Wrongful discharge: Termination of an individual’s employment for reasons that are illegal or improper
Constructive discharge: Deliberately making conditions intolerable to get an employee to quit

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Keys for Preparing a Defense against Wrongful Discharge
Put together accurate performance evaluations
Develop documentation justifying dismissals
Provide employees with a written warning
Provide written grounds for termination decisions
Involve more than one person in the dismissal decision

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Just Cause and Due Process
Just cause: Reasonable justification for taking an employment-related action
Due process: Occurs when an employer is determining if there has been employee wrongdoing and uses a fair process to give an employee a chance to explain and defend his or her actions

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Criteria for Evaluating Just Cause
Just cause determinants
Was the employer’s rule reasonable?
Was the employee warned of the consequences of the conduct?
Did management investigate before disciplining?
Was the investigation fair and impartial?
Was there sufficient evidence of guilt?
Were the rules and penalties applied consistently?
Was the penalty reasonable, given the offense?

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Criteria for Evaluating Due Process
Due process considerations
How have precedents been handled?
Was the employee asked for his or her side of the story?
Is a complaint process available?
Was the complaint process used?
Did the company retaliate against the employee?
Was the decision based on facts?
Were the actions and processes viewed as fair by outside entities?

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Organizational Justice
Fairness of decisions and resource allocations in an organization
Elements
Procedural justice: Perceived fairness of the processes used to make decisions about employees
Distributive justice: Perceived fairness in the distribution of outcomes
Interactional justice: Extent to which a person affected by an employment decision feels treated with dignity and respect

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Open-Door Policy
Allows workers with a complaint to talk with someone in management
Used by union-free firms but can be mishandled
Union-free firms benefit from having formal complaint procedures that are well-defined to provide a more systematic due process for employees than do open-door policies
Unionized employees have a formal grievance procedure specified in the union contract

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Alternative Dispute Resolution (A D R) Methods
Arbitration: Uses a neutral third party to make a binding decision, thereby eliminating the need to involve the court
Compulsory arbitration: Employees waive their rights to pursue legal action until arbitration is complete
Peer review panels: Internal committees of employees that review disciplinary actions and make recommendations
Reduce lawsuits, provide due process, and lower costs

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Alternative Dispute Resolution (A D R) Methods (continued)
Ombuds: Individuals outside the normal chain of command who act as independent problem solvers for both management and employees
Mediation: Tool for developing appropriate and fair outcomes for all parties involved
Facilitative approach: Fosters communication among parties and uncovers options for settling
Evaluative approach: Points out potential weaknesses in each side’s case and offers potential settlement options

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Privacy Rights
Right to privacy: An individual’s freedom from unauthorized and unreasonable intrusion into personal affairs
Change in nature of privacy issues at workplace is due to:
Internet communications
Social media
Mobile devices
Telecommunication systems

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Employee Records
Employee medical records
Americans with Disabilities Act
Requires that all medical-related information be maintained separately from all other confidential files
Health Insurance Portability and Accountability Act
Includes regulations designed to protect the privacy of employee medical records
Access restrictions and security procedures
Should exist to protect the privacy of employees and protect employers from potential liability for improper disclosure of personal information

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Employees’ Free Speech Rights
Three situations in which employees’ freedom of speech might be restricted include:
Expressing controversial, divisive, and/or political views
Whistle-blowing
Using the Internet and other communication-based technology

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Expressing Controversial, Divisive, and/or Political Views
Handling concerns
Attempt informal resolution first
Outline boundaries and standards for appropriate behavior in a formalized policy that addresses work expectations
Have a signed nondisclosure privacy agreement

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Whistle-Blowing
Whistle-blowers: Individuals who report real or perceived wrongs committed by their coworkers or employers
Laws protecting whistle-blowers
Sarbanes-Oxley Act
Antiretaliation rules issued by O S H A
Equal Employment Opportunity Commission rules

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Whistle-Blowing (continued)
Key questions regarding whistle-blowing:
When do employees have the right to speak out with protection from retribution?
When do employees violate the confidentiality of their jobs by speaking out?

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Technology and Employer–Employee Issues
Monitoring electronic communications
E-mail, social media, and text messaging cause major issues for privacy
Bring your own device (B Y O D): Employees use their own mobile devices such as smartphones and digital tablets in the workplace
H R policies on electronic communications
Should provide guidance
Employers should develop policies

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Recommended Employer Actions Regarding Electronic Communications
Develop an electronic communications policy
Communicate the policy to employees
Obtain signed permission from employees
Monitor for business purposes only
Enforce the policy through disciplinary procedures

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Employee Rights and
Personal Behavior
Counterproductive behavior
Bullying, harassment, and assault
Dress and body appearance limitations
Visible tattoos, certain clothing, and body piercings
Off-duty behavior
Misconduct, especially when wearing clothing or badges with company identification
Weapons in the workplace
Balance a safe workplace with the right to bear arms

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Workplace Monitoring
Private-sector employers can monitor, observe, and search employees
Conducting video surveillance at work
Employers should be careful so that employer rights and employee privacy do not collide
Employers should develop a policy and inform employees of the policy
Monitoring employee performance
Signed employee consent form stating that performance will be monitored regularly should be obtained from employees

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Employer Investigations
Develop a good plan to respond in crises
Specify who will conduct the investigation
Investigate problems quickly before evidence can be tampered with
Assess the credibility of individuals and information in an investigation
Use the stories and information collected to conclude the investigation and recommend any remedial steps

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Employee Theft and Fraud
White-collar theft occurs through embezzling, accepting bribes, and stealing company property
Addressing employee theft and other workplace misconduct
Conduct thorough pre-hire applicant screening and background investigations
Use honesty tests both before and after a person is hired
Use workplace monitoring to review unusual behaviors

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Employee Theft and Fraud (continued)
Develop an ethics code that outlines appropriate behaviors, and conduct ethics training
Conduct internal checks and balances and audits regularly

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Honesty and Polygraph Tests
Employee Polygraph Protection Act
Prohibits the use of polygraphs for most pre-employment screening
Requires that employees must:
Be advised of their rights to refuse to take a polygraph exam
Be allowed to stop the exam at any time
Not be terminated because they refuse to take a polygraph test or solely because of the exam results

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Negative Impacts of Substance Abuse in the Workplace
Work performance
Inconsistent work quality
Increased absenteeism
Carelessness and mistakes
Risky, unsafe acts
Personal behavior
Blaming coworkers for own errors
Complaints and excuses for time off
Deteriorating personal hygiene

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Negative Impacts of Substance Abuse in the Workplace (continued)
Avoiding colleagues
Financial costs
Inadequate production
Rework or replacement for poor quality production
Coverage for absences
Workers’ compensation and health care

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Substance Abuse and
Drug Testing
National Council on Alcohol and Drug Dependence estimates that 70% of people who illegally use drugs are employed
Laws that address drug testing:
Americans with Disabilities Act
Specifies that alcoholism is a disability but that dependency on illegal drugs is not
Drug-Free Workplace Act of 1988
Government contractors must try to eliminate employee drug use

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Drug Testing and Employee Rights
Policies for conducting drug tests
Random testing of all employees at periodic intervals
Testing only in cases of probable cause
Testing after accidents

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Drug Testing and Employee Rights (continued)
Test conditions
Job-related consequences outweigh privacy concerns
Accurate test procedures are available
Written consent of the employee is obtained
Results are treated confidentially
Employer offers a complete drug rehabilitation program, including an employee assistance program

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H R Policies, Procedures, and Rules
Policies: General guidelines that help focus organizational actions
Procedures: Customary methods of handling activities
More specific than policies
Rules: Specific guidelines that regulate and restrict individuals’ behavior

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Shared Responsibility for Policies, Procedures, and Rules
H R unit
Designs formal mechanisms for coordinating H R policies
Assists in developing organization-wide H R policies, procedures, and rules
Provides information on application of H R policies, procedures, and rules
Trains managers to administer policies, procedures, and rules

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Shared Responsibility for Policies, Procedures, and Rules (continued)
Managers
Help in developing H R policies and rules
Review policies and rules with all employees
Apply H R policies, procedures, and rules
Explain rules and policies to all employees
Give feedback on effectiveness of policies and rules

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Employee Handbook
Physical or electronic manual that explains a company’s essential policies, procedures, and employee benefits
Communicates workplace culture, benefits, attendance, pay practices, safety issues, discipline, and other critical information
Effective when written in common language rather than legalistic fashion

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Recommendations on Creating an Employee Handbook
Eliminate controversial phrases
Use disclaimers that are prominently displayed
Keep the handbook content current

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Possible Topics for an Employee Handbook
Introduction
Welcome message
Company history
Mission, vision, and values
General employment policies
Employment and labor laws
Employment status and work hours
Nondisclosure and intellectual property protections
Use of company technology/bring your own device policy

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Possible Topics for an Employee Handbook (continued)
Workplace conduct
Harassment and civility policies
Professional attire and behavior
Attendance requirements
Disciplinary procedures
Compensation and benefits
Pay grades and pay increase policy
Performance management process
Benefits eligibility
Paid time off/vacation entitlement

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Communicating H R Information
Downward communication
Flows from top management to the rest of the organization
Informs employees about what is and will be happening in the organization and what top management’s expectations and goals are
Upward communication
Enables managers to learn about the ideas, concerns, and information needs of employees

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Employee Discipline
Discipline: Process of corrective action used to enforce organizational rules
Effective discipline:
Is aimed at problem behaviors, not at employees personally
Is monitored by H R to ensure that remedial actions follow corporate and legal guidelines, are appropriate, and are fair and consistent
Relies on supervisors and managers who are properly trained on when and how to use discipline

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Approaches to Discipline
Positive discipline approach
Counseling
Written documentation
Final warning
Discharge
Progressive discipline approach
Incorporates steps that become progressively more severe and are designed to change the employee’s inappropriate behavior

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Figure 14-9:
Progressive Discipline Process

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Challenges in Employee Discipline
At-will employment
Formally stated discipline processes can undercut at-will provisions
Fairness and consistency
Equity should be the key
Documentation problems
Documenting issues ensures the process is done correctly
Reluctance to discipline

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Employee Discipline (continued)
Reasons why managers might not use discipline
Organizational culture of avoiding discipline
Lack of support from higher management
Guilt about past behavior
Fear of loss of friendship
Avoidance of time loss
Fear of lawsuits

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Termination
Occurs when an employee is removed from a job at an organization
Occurs for numerous reasons such as excessive violations of attendance policies and behavioral issues
Treating employees with dignity and respect is an ethical approach
Separation agreement: Terminated employee agrees not to sue the employer in exchange for specified benefits

H U M A N R E S O U R C E
MANAGEMENT
V A L E N T I N E M E G L I C H M A T H I S J A C K S O N
S I X T E E N T H E D I T I O N

CHAPTER 15

Union–Management Relations

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Learning Objectives
Discuss what a union is and explain why employees join and employers resist unions
Outline the current state of union activity in the United States and identify several reasons for the decline in union membership
Explain the provisions of each of the major U.S. labor laws and recognize the impact of these laws and National Labor Relations Board (NLRB) rulings on nonunion workplaces

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Learning Objectives (continued)
Describe the phases of the unionization process and the typical collective bargaining process
Define a grievance and identify the stages in a dispute resolution procedure

Unions
Union: Formal association of workers that promotes the interests of its members through collective action
Employees join unions because:
They are dissatisfied with how they are treated by employers
They believe that unions can improve their work situations

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Perspectives on Unionization
Advantages
Provides a channel for feedback about employee concerns and suggestions
Balances unchallenged decision-making power of management
Increases job tenure, performance, and employee earnings
Disadvantages
Negatively impacts the allocation of organizational resources
Decreases profitability
Hurts productivity as a result of increased compensation and rigid work practices

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Factors Leading to Employee Unionization
Working conditions
Inadequate staffing
Mandatory overtime
Unsatisfactory work requirements
Unrealistic expectations
Compensation
Noncompetitive pay and inequitable pay raises
Inadequate benefits
Unfair allocation of resources

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Factors Leading to Employee Unionization (continued)
Management style
Arbitrary decision making
Use of fear/intimidation and autocratic leadership
Lack of recognition
Employee treatment
Job insecurity
Unfair discipline/policies
Lack of response to complaints
Harassment/abusive behaviors

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Why Employers Resist Unions
Unions affect how employees and workplaces are managed
Unions may create inefficiencies in the workplace that cause waste and poor performance
Union workers frequently receive higher compensation than nonunion workers

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Prevention of Unions
Develop good employment practices
Earn employee trust
Encourage employee feedback
Offer fair, competitive compensation
Build supportive supervisory relationships with workers
Ensure that both H R professionals and operating managers are attentive and responsive to employees

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Union Membership in the United States
Unions played a critical role in improving the lives of American workers
Evolved as the Industrial Revolution took hold in the early 20th century
Focused on better wages, reasonable work hours, and safer working conditions
After the Great Depression in 1929, workers gained the right to:
Form labor unions
Negotiate with their employers regarding terms and conditions of their employment

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Union Membership in the United States (continued)
Membership in unions has steadily declined since 1983
Only 10.7% of employed individuals in the United States were members of unions in both 2016 and 2017
Significant difference in membership exists between the private and public sectors
In 2017, only 6.5% of private-sector employees belonged to labor unions, whereas 34.4% of public-sector employees belonged to labor unions

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Reasons for U.S. Union Membership Long-Term Decline
Changing job conditions
Deregulation
Foreign competition
Increased right-to-work legislation
Increased use of temporary or contingent workers
Improved workplace practices
Unions no longer seen as necessary

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Reasons for U.S. Union Membership Long-Term Decline (continued 1)
Geographic changes
Firms may elect to move their operations to places that are less open to unions or to places where there is cheaper labor and fewer employment restrictions
Industrial changes
Jobs in the United States have shifted from manufacturing, construction, and mining industries to service industries
Private-sector union membership is primarily concentrated in the shrinking part of the economy

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Reasons for U.S. Union Membership Long-Term Decline (continued 2)
In 2017, union representation of nongovernmental employees was heavily concentrated in utilities, transportation and warehousing, and other industrial sectors
Unions are not making significant progress in the fastest-growing segments of the U.S. economy
Workforce changes
Decline in many blue-collar jobs in heavy industry and increase in white-collar jobs
Growing percentage of women in the U.S. workforce

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Public-Sector Unionism
The public sector is the most highly unionized part of the U.S. workforce
Local government workers have the highest unionization percentage of any group in the U.S. workforce
Criticized recently because of:
High cost of union benefits
Slow change to contemporary contribution plans
Inadequately funded pensions
Automatic deduction of dues

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Ways to Fight Decline in Union Membership
Creating partnerships with outside organizations and worker centers
Protests
Work stoppages
Targeting low-skilled workers and contingent workers
Joint employer status

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Early Labor Legislation
Railway Labor Act, 1926
Represented a shift in government regulation of unions
Gave railroad employees the right to organize and bargain collectively through representatives of their own choosing
Allows either unions or management to use the National Labor Relations Board
Norris-LaGuardia Act, 1932
Guaranteed workers some rights to organize

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Early Labor Legislation (continued)
Restricted the issuance of court injunctions in labor disputes
Prohibits employers from asking employees to sign yellow dog contracts
Yellow dog contracts: Pledges by workers not to join a labor union

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Major National Labor Laws and Their Primary Focuses
Wagner Act
Focuses on rights of unions and workers
Taft-Hartley Act
Focuses on rights of management
Landrum-Griffin Act
Focuses on rights of union members in their unions

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Major National Labor Laws
Wagner Act, 1935
Known as the National Labor Relations Act
Declared that the official policy of the U.S. government was to encourage collective bargaining
Provided the right to engage in protected concerted activities
Protected concerted activities: Actions taken by employees working together to try to improve their pay and working conditions, with or without a union

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Major National Labor Laws (continued 1)
Prohibits the following unfair labor practices:
Interfering with, restraining, or coercing employees in the exercise of their right to organize or to bargain collectively
Dominating or interfering with the formation or administration of any labor organization
Encouraging or discouraging membership in any labor organization by discriminating with regard to hiring, tenure, or conditions of employment
Discharging or otherwise discriminating against an employee because the employee filed charges or gave testimony under the act

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Major National Labor Laws (continued 2)
Refusing to bargain collectively with representatives of the employees
National Labor Relations Board (NLRB)
Conducts unionization representation elections
Investigates complaints by employers or unions through its fact-finding process
Issues opinions on its findings
Prosecutes violations in court

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Major National Labor Laws (continued 3)
Taft-Hartley Act, 1947
Amended or qualified in some respect major provisions of the Wagner Act and established an entirely new code of conduct for unions
Notable change brought in the process of representation elections is excluding supervisors from inclusion in the bargaining unit
Union members were given the right to hold elections to deauthorize or decertify the union thus reversing the process of representation

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Major National Labor Laws (continued 4)
Allows the president of the United States to declare:
That a strike constitutes a national emergency
An 80-day cooling-off period during which the union and management continue negotiations
Allowed states to enact right-to-work laws
Right-to-work laws: State laws that prohibit requiring employees to join unions as a condition of obtaining or continuing employment
Open shop: Employer that does not require workers to join or pay dues to a union

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Major National Labor Laws (continued 5)
Closed shop: Employer that requires individuals to join a union before they can be hired
Different types of arrangements exist in states that do not have right-to-work laws
Union shop: Workers must join the union, usually 30 to 60 days after being hired
Agency shop: Workers who don’t join the union must make payments equal to union dues and fees to get union representation services
Maintenance-of-membership shop: Workers must remain members of the union for the period of the labor contract

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Major National Labor Laws (continued 6)
Identifies unfair labor practices that might be committed by unions
Refusing to engage in good-faith negotiations with employers
Engaging in activities that might cause employers to discriminate against employees because of their union or nonunion status
Coercing or discriminating against members and failing to adequately represent all those covered by a collective bargaining agreement
Charging excessive membership fees
Engaging in secondary boycotts with neutral parties if the company and union are in a labor dispute

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Major National Labor Laws (continued 7)
Landrum-Griffin Act, 1959
Also called Labor Management Reporting and Disclosure Act
Protects democratic rights of union members
Unions are required to:
Establish bylaws
Make financial reports
Provide union members with a bill of rights

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Major National Labor Laws (continued 8)
Significant NLRB activities and rulings
Include company policies on:
Employees’ use of social media and electronic communications
Courteous or respectful behavior
Company confidentiality rules
Bargaining unit determination and elections
Franchisors as joint employers
Franchisor is liable for labor violations at all operations bearing the company’s name, regardless of who owns the restaurant

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Typical Unionization Process
Involves the following steps:
Organizing campaign
Authorization cards/petition filing
Representation election
Certification
Collective bargaining/contract negotiation

Union Organizing Process
Employers’ union prevention efforts can include:
Emphasizing good morale and loyalty
Paying competitive wages and benefits
Using a fair system for dealing with complaints
Providing safe working conditions
Creating no-solicitation policies
Hiring “union busters”

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Union Organizing Process (continued)
Unions’ organizing efforts can include:
Personally contacting employees outside work
Mailing materials to employees’ homes
E-mailing information about the union to employees
Inviting employees to attend special meetings away from the company
Publicizing advantages of union membership
Distributing brochures and leaflets
Salting: Unions hire and pay people to apply for jobs at certain companies to begin organizing efforts

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Authorization Cards
Union authorization card: Card signed by employees to designate a union as their collective bargaining agent
30% of the employees must sign authorization cards for a representative election to be scheduled
If enough employees sign authorization cards, a union could be designated as their representative without an election

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Representation Election
Bargaining unit: Employees eligible to select a single union to represent and bargain collectively for them
The Taft-Hartley Act excludes supervisors from voting for or joining unions
Results in the exclusion of supervisors in bargaining units for unionization purposes except in industries covered by the R L A

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Representation Election (continued)
All activities must conform to requirements established by applicable labor laws
The Wagner Act and the Taft-Hartley Act place restrictions on the activities employers and unions can engage in
Election process
Union needs to receive only a majority of the votes to win
Election results can be appealed to the N L R B on suspicion of unfair labor practices

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Unfair Labor Practices during Organizing Campaigns
Threatening to reduce pay, fire workers, or take other negative steps to prevent workers from voting for a union
Questioning employees to learn who initiated the organizing attempt and how workers plan to vote
Promising pay raises or other perks in exchange for employees rejecting the union
Spying on employees to find out who is participating in union organizing activities

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Certification and Decertification
N L R B or an equivalent body gives the official certification of a union as the legal representative for employees
Once certified, the union attempts to negotiate a contract with the employer
Decertification: Process whereby a union is removed as the representative of a group of employees
Can occur through election, which requires at least 30% of employees to sign decertification authorization cards

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Contract Negotiation or Collective Bargaining
Process whereby representatives of management and workers negotiate over wages, hours, and other terms and conditions of employment
Goal is to establish conditions beneficial to both
Balances the power between parties
Collective bargaining agreements will be in force for several years

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Figure 15-10: Continuum of Collective Bargaining Relations

Collective Bargaining Issues
Bargaining issues
Management rights: Rights reserved so that the employer can manage, direct, and control its business
Union security provisions: Contract clauses to help the union obtain and retain members and collect union dues
Require union membership of all employees, subject to state right-to-work laws
Dues checkoff clause: Provides for the automatic deduction of union dues from the payroll checks of union members

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Classification of Collective
Bargaining Issues
Mandatory issues: Negotiation topics and collective bargaining issues identified specifically by labor laws or court decisions as subject to bargaining
Permissive issues: Collective bargaining issues that are not required but might relate to certain jobs or practices
Illegal issues: Collective bargaining issues that would require either party to take illegal action

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Mandatory Subjects of Collective Bargaining
Compensation
Wages, merit increases, and bonuses
Benefits
Pensions, profit sharing, and health and welfare plans
Working conditions
Grievance procedures, disciplinary procedures, drug testing, seniority, promotions and transfers, worker health and safety, work assignments, and plant closings

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Collective Bargaining Process
Consists of four possible stages:
Preparation and initial demands
Negotiations
Settlement or impasse
Strikes and lockouts

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Preparation and Initial Demands
Employer and industry data on the following are gathered:
Wages, benefits, working conditions, management and union rights, productivity, safety, and absenteeism
Core bargaining issues
Wages
Benefits
Working hours and conditions

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Continuing Negotiations
Each side attempts to determine what the other side values highly so that the best bargain can be struck
Good-faith negotiations
Parties agree to send negotiators who can bargain and make decisions rather than people who do not have the authority to commit either group to a decision
To be more effective, meetings should be conducted professionally and address issues rather than being confrontational

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Settlement and Contract Agreement
Ratification: Process by which union members vote to accept the terms of a negotiated labor agreement
Before ratification, the union negotiating team explains the agreement to the union members and presents it for a vote
If the members approve the agreement, it is then formalized into a contract

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Typical Items in a Labor Agreement
Purpose of agreement
Nondiscrimination clause
Management rights
Recognition of the union
Dues checkoff
Wages, incentives, and hours of work
Vacations and sick/absence leaves
Discipline

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Typical Items in a Labor Agreement (continued)
Separation allowance
Seniority and pension/insurance
Safety
Grievance procedure
No-strike or lockout clause
Definitions
Terms of contract (dates)
Appendices

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Handling Bargaining Impasse
Conciliation: Process by which a third party facilitates the dialogue between union and management negotiators to reach a voluntary settlement
Mediation: Process by which a third party suggests ideas to help the negotiators reach a settlement
Arbitration: Process that uses a neutral third party to make a decision

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Strikes and Lockouts
Lockout: Management shuts down company operations to prevent union members from working
Strike: Union members refuse to work in order to put pressure on an employer
Replacement of workers on strike
Management sometimes replaces workers who strike
Workers’ rights vary depending on the type of strike that occurs

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Types of Strikes
Economic strikes
Parties fail to reach agreement during collective bargaining
Unfair labor practices strikes
Union members leave their jobs over what they feel are illegal employer actions
Wildcat strikes
Occur during the life of the collective-bargaining agreement without approval of union leadership and violate a no-strike clause in a labor contract

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Types of Strikes (continued)
Strikers can be discharged or disciplined
Jurisdictional strikes
Members of one union walk out to force the employer to assign work to them instead of to members of another union
Sympathy strikes
One union chooses to express support for another union involved in a dispute, even though the first union has no disagreement with the employer

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Union–Management Cooperation
Employee-involvement programs
Successful organizational restructurings
Occur when unions have been able to obtain information and share that information with their members to work constructively with company management at various levels
Unions and employee ownership
Unions have encouraged workers to become partial or full owners of the firms that employ them
Employee stock ownership plans for union members have been successful in some situations

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Resolving Disputes
Division of responsibilities between the H R unit and operating managers for handling grievances varies from one firm to another, even among unionized firms
Grievance: Complaint formally stated in writing
Complaint: Indication of employee dissatisfaction
Grievance procedures: Specific steps used to resolve grievances

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Grievance Procedures
Union representation in grievance procedures
Unionized employee has a right to union representation if:
The employee is being questioned by management
Discipline may result
Employee will be reinstated with back pay if Weingarten rights are violated and the employee is dismissed

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Grievance Procedures (continued)
Grievance arbitration: Means by which a third party settles disputes arising from different or conflicting interpretations of a labor contract
Common concerns
Discipline and discharge
Safety and health
Security

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Steps in a Typical Grievance Procedure
Discussion of written grievance between employee, union steward, and supervisor
Meeting between union steward and supervisor’s manager and/or H R manager
Meeting between committee of union officers and company managers
Discussion between national union representative and company executive or corporate industrial relations officer
Arbitration by impartial third party

H U M A N R E S O U R C E
MANAGEMENT
V A L E N T I N E M E G L I C H M A T H I S J A C K S O N
S I X T E E N T H E D I T I O N

CHAPTER 16

Global Human Resource Management

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Learning Objectives
Define forces impacting global trade
Discuss three global business approaches
Compare three types of international staffing assignments
Identify typical international compensation practices

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Learning Objectives (continued)
Compare labor union issues in various countries
Define four important aspects of developing leaders for a global organization

Managing in a Global Context
Managing various functions becomes complex when an organization operates in multiple countries
Different legal and social contexts create challenges that can make it difficult to ensure that operations run smoothly, ethically, and effectively

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Economic Interdependence
Most countries participate in the world economy beyond their own domestic markets
Multinational enterprise (M N E): Organization that has facilities and other assets in at least one country other than its home country
Many economic factors are linked to different political, legal, cultural, and economic systems
Some expand globally as a strategy to reduce costs by finding cheaper labor in developing countries

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global and Regional Alliances
North American Free Trade Agreement (N A F T A), 1994
Promotes free trade between Canada, Mexico, and the United States
European Union
Allows for the free movement of goods and people across the borders of the 28 member states
Largest economic entity in the world
Accounts for nearly one-fourth of the world’s economy

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Global and Regional Alliances (continued)
Additional proposed alliances
Transatlantic Trade and Investment Partnership (T T I P) and Trans-Pacific Partnership (TPP)
Foreign policy officials continue to evaluate the merits of joining these multinational groups or favoring a country-by-country trade agreement

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Population and Demographic Trends
Population growth has been declining in many developed nations around the world, and people above age 65 are becoming a larger share of the world population
Migration of working age individuals from less-developed countries to more-developed countries can bolster economic growth and progress
Immigration policies instituted by each nation significantly impact the inflow of people into a country and its economic health

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Reasons for Global Expansion
Diversifying markets and customer base
Extending the sales life of current products
Reducing dependence on current markets by spreading risk
Countering seasonal fluctuations
Accessing a deeper, more diverse talent pool and cheaper, better supplies/suppliers
Increasing efficiencies/economies of scale, reducing costs, and obtaining investment capital

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
International Orientations
Organizations approach the international market with a particular orientation
E P R G model outlines the following worldviews:
Ethnocentric: Strong emphasis on home-country practices
Polycentric: Strong emphasis on each country as a unique environment
Regiocentric: Countries considered as aggregates within a region
Geocentric: Emphasis on utilizing the best ideas and practices from anywhere in the world

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Global Expansion Methods
Various business approaches require different levels of human resource management involvement
Non-equity approaches demand little from the headquarters H R staff while equity approaches require more assistance from the H R staff
Non-equity business forms: Importing and exporting, licensing and franchising, and piggybacking
Equity business forms: Joint ventures, mergers and acquisitions, and foreign direct investment
Outsourcing and offshoring

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Non-Equity Business Forms
Importing and exporting: Buying and selling goods and services outside the home country
Licensing agreement: Organization sells the rights to its products or trademarks to producers
Franchising: Organization grants the right to use its business model and brand
Piggyback: Arrangements when an organization partners with another firm that sells complementary products or services

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Equity Business Forms
Joint ventures: Two or more partners who share ownership and risk in the investment
Merger: Two companies combine their businesses to create a new business entity
Acquisition: One company being bought by another, resulting in the acquired company being folded into the acquirer’s business
Foreign direct investment: When a company takes a controlling ownership interest in a business in another country

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Outsourcing and Offshoring
Outsourcing: Transferring the management and performance of a business function to an external service provider
Offshoring: A company’s relocation of a business process or operation from one country to another

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Cultural Dimensions
Culture: Shared mind-set of a group of people that distinguished them from others
Understanding the differences in national cultures is important when conducting business abroad
Geert Hofstede developed a model to classify country cultures based on various cultural dimensions
The model helps analyze risks of international expansion and determine the appropriate country to include in a global strategy

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Geert Hofstede’s Cultural Dimensions
Power distance index (P D I)
Individualism versus collectivism (I D V)
Masculinity versus femininity (M A S)
Uncertainty avoidance (U A I)
Long-term orientation (L T O)
Indulgence versus restraint (I N D)

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Human Resource Management
Operating in multiple countries requires H R staff to navigate diverse laws and cultural practices in establishing effective human resource programs
Maintaining an appropriate balance between standardization and localization is an ongoing effort
H R challenges created by global operations:
Worldwide population trends that will lead to ever greater workforce diversity
A more dispersed workforce resulting from people working remotely

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Human Resource Management (continued)
H R professionals should:
Address the new workplace dynamic created by engaging and motivating workers from a distance
Learn about H R demands around the world to adopt effective practices and to prepare for opportunities in their own organizations

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Staffing Strategies
Optimal solution:
To combine the expertise of local employees with organization-specific knowledge of employees from the home country (headquarters)
Some countries require that the organization employ a certain percentage of workers from the host country
Staffing global assignments involves making selection decisions that impact (or take place in) other countries

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Employees
Types
Home-country national
An employee working in his or her home country for a firm that is headquartered in a different country
International assignee/expatriate
A citizen of one country who is working in a second country and employed by an organization headquartered in the first country
Host-country national
An employee working in his or her home country for a firm that is headquartered in a different country

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Employees (continued)
Third-country national
A citizen of one country who is working in a second country for an organization that is headquartered in a third country
Key competencies
Cultural adjustment
Organizational requirements
Personal characteristics
Communication skills
Personal and family concerns

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Labor Markets
Firms reshore employees (bring jobs back to the home country) for various reasons
Recruiting employees for global assignments may present problems that require different approaches from those used in the home country
Dealing with foreign labor markets can be challenging because recruiting may be regulated and require government approval
H R planning is a key concern in both global and domestic firms

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Compensation Systems
Annual pay differences among countries can vary significantly
Result from differences in annual working hours
Relate to country culture, norms, and business demands
M N E’s have various options regarding how to approach compensation in diverse locations:
A totally global approach, a totally customized approach for each location, or a hybrid method

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Compensation Systems (continued)
Globalizing pay policies to attract and retain employees requires management to:
Balance the need for consistent practices throughout the company with the need for differentiating practices based on local input and customs
Monitor the pay level and policy trends in other countries

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Variable Pay
Must accommodate cultural, legal, and economic differences
Important for retaining key staffers after global mergers and acquisitions
Managers should be trained on how to distribute rewards for maximum impact
Global incentive programs can be challenging since strategies can have varied results in different geographic regions

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
International Compensation for Expatriates
Primary approaches
Home-country-based approach
Objective is to maintain the standard of living the expatriate had in the home country
Can result in higher employer costs and more administrative complexity than other plans
Host-country-based approach
Compensates the expatriate at the same level as workers from the host country

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Employee Benefits around the World
Paid time off benefits
Employers in most countries are required to provide paid holidays, vacation, and sick leave
Health care programs
Financed by the employer, employee, or both
Statutory benefits
Programs of a firm should be compliant in the various countries where they have operations

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Employees and Labor Relations
M N E’s face particular complexities regarding employment policies and practices
Some firms adopt a comprehensive set of work rules that meet the standards of the most restrictive nation
H R policy decisions should align with the organization’s overall philosophy and global strategy

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Unions in the Global Arena
Ability of a country to remain competitive is influenced by its labor laws and attitude toward labor unions
H R professionals should be aware of diverse legal requirements and social mores when operating globally
Unions worldwide are facing changes as the world economy becomes more integrated

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
International Union Issues
Range of labor concerns is quite wide and varies from nation to nation
Collective bargaining methods vary from country to country
Labor unrest is common, and protests, work stoppages, and strikes occur in many nations
Some nations require codetermination
Codetermination: Union or worker representatives are given positions on a company’s board of directors

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Labor Organizations
International Labor Organization
Coordinates the efforts of labor unions worldwide and has issued some principles about rights at work
Such coordination is occurring as unions deal with multinational firms with operations in multiple countries
Union Network International (U N I)
Entity composed of unions from numerous countries
Works with other international groups to establish international policies on child labor, worker safety and health, and training

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
The United States and Global Differences
Union management relations in the United States differ from other countries in addressing the following issues:
Economic issues versus other concerns
United States: Unions focus on improving bread-and-butter issues for their members
Other countries: Unions focus on integration with ruling governmental and political power, activism, and economic issues

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
The United States and Global Differences (continued 1)
Organization by kind of job and employer
United States: People unionize based on companies or type of work
Other countries: National unions bargain with the government or with employer groups
Collective agreements as “contracts”
United States: Collective bargaining contracts usually spell out compensation, work rules, and conditions of employment for several years
Other countries: Agreements are made with the government and employers, sometimes for only one year because of political and social issues

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
The United States and Global Differences (continued 2)
Competitive relations
United States: Management and labor traditionally take the roles of competing adversaries who often clash to reach agreement
Other countries: Tripartite bargaining occurs between the national government, employers’ associations, and national labor federations with little conflict or obstruction

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Global Assignment Training
Success of an overseas assignment is affected by the orientation and training that expatriates and their families receive before departure
Companies recognize that it is important to prepare workers for overseas assignments and to offer training to smooth the transition
Global employers are providing intercultural competence training for employees sent abroad and those who manage workers in multiple countries

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Intercultural Competence Training
Incorporates a wide range of human social skills and personality characteristics
Three components require attention when training expatriates for global assignments
Cognitive: What does the person know about other cultures?
Emotional: How does the person view other cultures, and how sensitive is the person to cultural customs and issues?
Behavioral: How does the person act in intercultural situations?

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Intercultural Competence Training (continued 1)
Possible training for the components
Cognitive
Culture-specific training: Traditions, history, cultural customs, and so on
Language course
Emotional
Uneasiness: Social skills training focusing on new, unclear, and intercultural situations
Prejudices: Coaching may be clarifying
Sensitivity: Communication skills course (active listening, verbal/nonverbal cues, and empathy)

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Leadership Development
Competencies needed for global leadership are more complex than those focused on only one country
Managers need to manage paradoxes, appreciate the unique attributes of each context, and communicate effectively across time and geography
GLOBE studies
Resulted in the identification of leadership profiles for various societies or cultures

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Leadership Development (continued 1)
Suggest that leaders who recognize and value diverse cultures will be more effective than those who view the world from only one perspective
Consulting company I4cp recommends incorporating the following elements into a global development plan:
Make global cultural fluency an organization-wide priority
Tap into the best minds inside and outside of the organization to share knowledge and stories

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Leadership Development (continued 2)
Offer diverse hard and soft skills development
Leverage strategic workforce planning to determine skills gaps and to identify candidates for succession plans from the global workforce
Leadership development programs for diversified M N E’s should include participants from both developed and emerging economies
Increases knowledge sharing and speeds up the development of all participants

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Global Career Concerns
Many global employees experience anxiety about their continued career progression
Employers should take steps to ensure that the experience gained overseas benefits the employee and the firm
Repatriation
Involves planning and training for the reassignment of global employees back to their home countries
Returning expatriates may have concerns about:
Personal finances and reacclimating to the lifestyles in their home country

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Career Concerns (continued 1)
Their organizational status, such as what jobs they will have, whether their international experiences will be valued, and how they will be accepted back into the organization
Efforts should include focus on the individual employee’s needs and career aspirations and building organizational support to capitalize on the enhanced knowledge base of repatriating workers
Global development
Global management development must focus on developing local managers and global executives

© 2020 Cengage Learning®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Global Career Concerns (continued 2)
Global competencies should also be developed early in careers, instead of assigning domestic-based senior executives to international positions
Organizations might:
Recruit foreign graduate students into fast-track development programs to staff global positions
Offer international assignments to leaders to improve their work experience
Utilize social networking to enhance training and development

H U M A N R E S O U R C E
MANAGEMENT
VA L E N T I N E M E G L I C H M AT H I S J A C K S O N
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