Employee Stakeholders and

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 Chapter Sixteen Objectives
• Identify the major changes occurring in the
workforce today
• Outline the new social contract between employers
and employees
• Explain the employee rights movement
• Discuss the employment-at-will doctrine
• 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
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 Chapter Sixteen Outline
• The New Social • The Right to Due
Contract Process and Fair
• The Employee Rights Treatment
Movement • Freedom of Speech in
• The Right to a the Workplace
Job/Not to Be Fired • Whistle Blowing
Without Cause • Summary

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 Introduction to Chapter Sixteen
• Consider how global competition has
reshaped the social contract between
organizations and their workers
• Consider the trend of expanding employee
rights
– Right not to be fired without just cause
– Right to due process and fair treatment
– Right to freedom of speech within the workplace

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 The New Social Contract

Business Understandings
Organization’s Employee’s
Expectations Expectations

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 Social Contract
Reasons for the Change in the Social Contract

• Global Competition
• Technology advances
• Deregulation

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 Social Contract: Changes
Old Social Contract
Job security
Life careers with one employer
Loyalty to employer
Paternalism
Sense of entitlement
Stable, rising income
Focus on individual
accomplishments
New Social Contract
Few tenure arrangements
Few life careers; changes common
Loyalty to self
Relationships far less familial
Personal responsibility for one’s
job future
Pay for “value added”
Focus on team building and
projects
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Social Contract: New View

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 Employee Rights Movement
For nonunion workers, employee rights issue
continues to be a problem . . . That is, the employees’
desires to be treated with dignity and respect, to have
a right to due process,
privacy, freedom of speech, and
safety, and even a right to a job.

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 Employee Rights Movement
Sources of Employee Rights
• Statutory rights
• Collective bargaining rights
• Enterprise rights

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 Employee Rights Movement
Models of Management Morality and
their Orientation Toward Employees

Moral Amoral Immoral

End Law Means

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Right Not to be Fired Without Just
Cause
Employment-at-Will Doctrine
• Public policy exceptions
• Contractual actions
• Breach of good faith actions

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Right Not to be Fired Without Just Cause
Management’s Response

1. Stay on the right side of the law

2. Investigate complaints in good faith
3. Deal in good faith with employees
4. Fire only for good cause

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 The Right to Due Process
Types of Due Process
• Substantive due process
– Right to fair treatment
• Procedural due process
– Right to a fair system of decision making

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 The Right to Due Process

Employee Constitutionalism

• Procedure • Equitable
• Visible • Easy to use
• Effective • Apply to all employees
• Institutionalized

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 Alternative Dispute Resolution

Common Approach
• Open door policy
• Three concerns
– Process is closed
– One person review
– Bias in favor of managers

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Alternative Dispute Resolution:
Ethical Ways for Due Process
Hearing procedure—permits employees to be
represented by attorney or neutral party

Peer Review Panel—Fellow

workers in the same job family and
at a grade level equal to or higher
than the employee with a grievance

Ombudsperson—A “troubleshooter” investigates and helps

achieve equitable settlements for employee complaints

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 Whistle Blowing
Corporat
Employe
e
Loyalty e
Employer
Obedience
Confidentiality

Corporat Responsibility Responsibility

Employe
e Public
e
Employer
(Has certain
rights)
(Has certain (Has certain
rights) rights)
Whistle blowing

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Consequences of Whistle-Blowing
• Increased criticism of work
• Less desirable work assignments
• Pressure to drop charges against the company
• Heavier workloads
• Loss perquisites
• Exclusion from meetings

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 Whistle-Blowing
Seven Stages of Life of a Whistle-Blower
• Discovery of the organizational abuse
• Reflection on what action to take
• Confrontation with superiors
• Retaliation against the whistle-blower
• Long haul of legal action
• Termination of the case
• Going on to a new life

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 Whistle-Blowing

Examples of Government Protection

• Civil Service Reform Act
• Whistle-Blowers Protection Act of Michigan
• False Claims Act

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 Management’s Preemptive
Responses to Whistle-Blowing
• The company should assure employees that the
organization will not interfere with their basic
political freedoms.
• Grievance procedure should be streamlined so that
employees can direct complaints and not “blow the
whistle.”
• Review the organization’s concept of social
responsibility so that it is not simply corporate
giving to charity.
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 Management’s Preemptive
Responses to Whistle-Blowing
• Formally recognize respect for the individual
consciences of employees.
• Realize that dealing harshly with whistle blowing can
result in adverse public reaction.

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 Selected Key Terms
• 1978 Civil Service • Employee rights
Reform Act • Employment-at-will
• Alternative dispute doctrine
resolution (ADR) • Enterprise rights
• Collective bargaining • False Claims Act
• Due process • Good faith principle
• Employee • Hearing procedure
constitutionalism

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 Selected Key Terms

• Implied contracts • Public policy

• Ombudsperson exception
• Open-door policy • Social contract
• Peer review panel • Statutory rights
• Private property • Whistle-blower

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