Labor Law Topics

Challenges to management I
March 10, 2017

Tatiana Marques
tatiana.marques@ucp.pt
 What is this class about?
Labor Law Human Resources Organizational Behavior

• National laws and • Organizational policies and • Universal frameworks and

regulations procedures principles of behavior
(psychology and sociology)

• Regulates the legal • Establishes processes for • Identifies best practices for
relationship between managing people increasing employee
workers, employers, unions commitment and
and the government performance

• Focuses on legal rights and • Focuses on recruitment, • Focuses on motivating

obligations of the worker training, evaluating and employees
and the employer rewarding employees

To manage people we must use knowledge from the 3 fields!

Agenda

How do we get things done in organizations?

1. DRW case

2. Organizational justice

3. Psychological contract
DRW Technologies

• Dagmar Hilgar, CEO

• Ed Claiborne, VP Procurement
• Debby Lopez, Assistant
• Plant Procurement Managers
 DRW Technologies - Email
Effective immediately, you will send me all contracts valued at
$250,000 or more at least two weeks before you are planning to
sign them. I will let you know how to proceed. There are no
exceptions to this policy.

This policy has been approved by Dagmar Hilgard and is of

utmost importance to our continued competitiveness. Our markets
are changing rapidly and we need to respond quickly and
effectively.

If you have any questions, contact my assistant, Debby Lopez.

DRW Technologies

• How do you explain that no

contracts have been submitted
to Claiborne?
DRW Technologies
If we assume that procurement managers are
not following the policy...

1. What approaches did Claiborne misused?

2. What could he have done differently?

3. Would YOU comply?

4. In general, why don’t people follow rules?

DRW Technologies
• Procedures and rules: are they
always effective?

• How do we get people from

compliance to commitment?
 Questions for today...

• What is the key role of managers?

▫ To motivate employees to achieve their best performance

• What if, as managers, we cannot give employees everything they

want?
▫ We can give them fair outcomes, fair procedures, and fair
treatment

• How do employees see the employment relation?

▫ Psychological contract
 Motivation
• Think about an experience / event in which you were highly
motivated, turned on, intensely involved in an endeavor

• Think about an experience / event in which you were highly

unmotivated, bored, avoiding the event

• The experiences need not be academic. They can be from any

context: sports, work, hobbies, travel, home, etc.

• Why were you motivated and unmotivated? Write down

adjectives
▫ E.g. I was being challenged
 Motivation
• “To be motivated means to be moved to do something. A person who
feels no impetus or inspiration to act is thus characterized as
unmotivated, whereas someone who is energized or activated toward
an end is considered motivated”. (Ryan & Deci, 2000, p.54)

• “a set of energetic forces that originates both within as well as beyond

an individual's being, to initiate work-related behavior, and
to determine its form, direction, intensity, and duration”
(Pinder, 1998, p.11)

"Motivation is the art of getting people to do what you want them to

do because they want to do it.“ (Dwight D. Eisenhower)
 Motivation Theories

• Content / needs theories:

▫ What motivates people?
▫ What are the needs to be satisfied?
▫ E.g., Maslow’s hierarchy of needs

• Process theories:
▫ How does motivation occur?
▫ E.g., Goal-setting theory
▫ E.g., Organizational justice/fairness
A monkey video ...?
 Organizational Justice
• Employee’s perceptions about fairness in the workplace
• Its not enough to be fair, organizations and leaders must be
seen as fair
What are the costs of Unfairness?

• Withholding effort
• Stress
• Team dysfunction
• Absenteeism
• Theft
• Violence
• Legal actions
• Turnover

(Lind & Tyler, 1988; Tyler & Blader, 2000; 2003;

Tyler & Bies, 1990; Aquino, Tripp, & Bies, 2006)
What are the payoffs of Fairness?
• Employee engagement
• Organizational citizenship behaviors (pro-social behavior)
• Team cohesion
• Quality of decision making
• Acceptance of job offer
• Organizational change effectiveness
• Acceptance of changes in HR policies
• Quality of customer service

(Brockner, DeWitt, Grover, & Reed, 1990;

Brockner, Wiesenfeld, & Martin, 1995; Tyler, 1995; Tyler & Blader, 2003)
Organizational Justice Framework

Three Dimensions:
1. Distributive justice: outcomes
2. Procedural justice: decision-making processes
3. Interactional justice: supervisor’s treatment

(Cropanzano, Byrne, Bobocel, & Rupp, 2001)

 Distributive Justice
• Equity theory: individuals compare (the ratio of) their job
inputs and outcomes with those of others

• Individuals attempt to eliminate inequities.

▫ Change inputs
▫ Change outcomes
▫ Adjust perceptions of self
▫ Adjust perceptions of others
▫ Choose a different referent
▫ Leave the organization

(Adams, 1963; 1965; Huseman, Hatfield, & Miles, 1987)

 Procedural Justice

• Criteria for procedural fairness:

▫ Consistency
▫ Lack of bias
▫ Accuracy
▫ Correctability
▫ Ethicality

▫ …. AND VOICE

(Leventhal, 1980)
 Give Them Voice!

• Instrumental voice = You can

influence the decision.

• Symbolic voice = You can express

your opinion.

(Lind, Kanfer, & Earley, 1990; Korsgaard & Roberson, 1995)

Voice: Why Is It Important?

• Improve understanding.
• Increase engagement and accountability.
• Enhance motivation and decision acceptance.
• Increase perceptions of fairness.
 Voice: Why Don’t We Do It?

Status differences: “I know better.”

Avoid conflict: “This will open a can of worms!”
Challenging : “What if they don’t agree ....”
Ignorance: “They only care about outcomes.”
Time & Energy: “I have better things to do than listen
to the ones who will implement the decisions”
Underconfidence: “This might show weakness, doubt”
 Interactional Fairness
(Fair Communication)

• Explanations that are:

▫ Timely
▫ Personalized
▫ Detailed
▫ Sincere
▫ Accurate

• Polite and respectful treatment

(Tyler & Bies, 1990; Greenberg, 1993)
 The Psychological Contract

• Mutual expectations constitute part of the

psychological contract
▫ An unwritten and unspoken agreement between the
individual and the organization
▫ Specifies what each expects to give and receive from the
other
▫ These implicit agreements may take precedence over written
agreements

(Schein, 1965; Rousseau, 1995)

 Exercise
1. Who has paid work experience?

2. Interviewers will ask:

▫ What sort of employment contract did/do you have? (permanent, temporary,
part time, etc)? What were the official terms of employment?
▫ What did your employer expect from you? Which expectations were explicit?
Which ones implicit?
▫ What did you expect from your employer? Explicit? Implicit?
▫ Did your employer violated any of your expectations? How did it affect your
attitudes and behavior at work?
▫ Have you had any experiences where the employer did more than you
expected? How did this affect your attitudes and behavior?
Psychological
Contract:

Iceberg Model
 Types of contracts

Internal perspective External perspective

Individual
level Psychological contract Implicit contract

Group
level Normative contract Social contract

(Rousseau, 1995)
 Psychological Contract Breach
• The perception one party has that the other party has failed to
fulfill their obligations

• Can lead to:

▫ Lower performance
▫ Lower job satisfaction and well-being at work
▫ Lower citizenship behavior
▫ Lower commitment
▫ Unfairness perceptions
▫ Anger and resentment
▫ Counterproductive behaviors (sabotage, theft, …)
▫ Turnover intentions
(e.g., Bordia et al, 2010; Cassar & Briner, 2011;
Conway et al, 2011; Parzefall & Coyle-Shapiro, 2011)
 Takeaways
• Labor law is insufficient in regulating employee behavior
• So are HR procedures and policies…
▫ Do we want compliance or commitment?

• How can managers influence employee behavior?

1. Motivation  Justice: be fair & seem fair

▫ Fair outcomes
▫ Fair procedures and voice
▫ Fair treatment

2. Psychological contract
▫ Understand expectations
▫ Avoid breaches!
Challenges to management I
Tatiana Marques, March 3

How do we get things done in organizations?

1. DRW case

2. Organizational Justice

3. Psychological contract
Challenges to management II
David Patient, March 10

How do we get things done in organizations?

1. Steve Jackson case

2. Power

3. Persuasion
 Labor Law Topics

Challenges to management I
March 10, 2017

Tatiana Marques
tatiana.marques@ucp.pt