INTERNAL

EMPLOYEE
RELATIONS
 Chapter Objectives
• Describe internal employee relations.
• Explain discipline and disciplinary action.
• Explain how grievance handling is
typically conducted under a collective
bargaining agreement.
• Explain how grievance handling is
typically conducted in union-free firms.
• Define alternative dispute resolution.
 Chapter Objectives (Continued)
• Describe how termination conditions
may differ with regard to non-
managerial/non-professional
employees, executives, managers, and
professionals.
• Explain the concept of employment at
will.
• Describe demotion as an alternative to
termination.
 Chapter Objectives (Continued)
• Explain downsizing and layoffs.
• Describe transfers, promotions,
resignations, and retirements as factors
involved in internal employee relations.
• Explain the importance of evaluating
the human resource management
functions.
Internal Employees Relations Defined
• Promotion
• Transfer
• Demotion
• Resignation
• Discharge
• Layoff
• Retirement
• Discipline
• Disciplinary Action
Discipline and Disciplinary Action
• Discipline - State of
employee self-control and
orderly conduct
• Disciplinary action
-Invokes a penalty
against an employee who
fails to meet established
standards
The Disciplinary Action Process
• Organizational goals
• Establish rules
• Communicate rules to employees
• Observe performance
• Compare performance with rules
• Take appropriate disciplinary action
Approaches to Disciplinary Action

• Hot stove rule

• Progressive
disciplinary
action
• Disciplinary
action without
punishment
Hot Stove Rule
• Burns
immediately
• Provides warning
• Gives consistent
punishment
• Burns
impersonally
 Progressive Disciplinary Action

• Minimum penalty appropriate to offense

• Improper behavior?
• Warrant disciplinary action?
• Warrant more than an oral warning?
• Warrant more than a written warning?
• Warrant more than a suspension?
• Termination
 Disciplinary Action without
Punishment
• Employee violates rule, manager issues
oral reminder
• Repetition brings written reminder
• Third violation: Worker takes one, two
or three days off (with pay) to think
about situation
• Important that all rules be explicitly
stated in writing
Problems in the Administration of
Disciplinary Action
• Lack of training
• Fear
• The only one
• Guilt
• Loss of friendship
• Time loss
• Loss of temper
• Rationalization
 Grievance Handling under a
Collective Bargaining Agreement
• Causes of grievances
• Grievance procedure
• Arbitration
• Factors used to evaluate management
fairness
• Proof that disciplinary action was
needed
• Weaknesses of arbitration
 Causes of Grievances
• Violations of terms and conditions of
agreement
• Violation of law
• Violation of intent of parties as stipulated
during contract negotiations
• Violation of company rules
• Change in working conditions or past
company practices
• Violation of health/safety standards
 Grievance Procedure
• Employee, orally and informally,
presents grievance to immediate
supervisor in presence of union
steward
• Meeting between plant or human
resource manager and higher union
officials, such as grievance
committee, business agent or
manager
Grievance Procedure (Continued)
• Meeting between firm’s top labor
representative (such of vice
president of industrial relations)
and high-level union officials
• Go to arbitration
Arbitration
• Final step in grievance
procedures
• Most agreements restrict
arbitrator’s decision to
application and
interpretation of
agreement and make
decision
• Used to settle grievances
 Factors Arbitrator Uses to Evaluate
Management Fairness
• Nature of offense
• Due process and procedural correctness
• Double jeopardy
• Grievant’s past record
• Length of service with company
• Warnings
• Lax enforcement of rules
• Discriminatory treatment
 Proof that Disciplinary Action Was
Needed - Format of a Written Warning
• State facts of offense
• Identify violated rule
• State what resulted or could have
resulted from offense
• Identify previous similar violations by
individual
• State future consequences if violation
occurs again
• Signature and date
Weaknesses of Arbitration

• Length of time
between first step of
grievance procedure
and final settlement
• Cost of arbitration
 Grievance Handling in
Union-free Organizations

• Means of resolving
complaints vary
• Well-designed
grievance procedure
ensures worker has
ample opportunity to
make complaints
without fear of reprisal
 Alternative Dispute Resolution
• Procedure where employee and
company agree problems will be
addressed by agreed-upon means
ahead of time
• Means
• Types of complaints
• Typically a stepped procedure
Means

• Arbitration
• Mediation
• Mini-trials
Types of Complaints

• Being fired
without cause
• Sexual
harassment
• Discrimination
 Stepped Procedure
• Facilitated interaction between
complaining employee and
supervisor
• Review with senior manager or
review board
• Mediation attempted followed by
arbitration at end
 Termination

• Termination of non-
managerial/non-professional
employees
• Termination of executives
• Termination of middle- and
lower-level managers and
professionals
Termination of Executives
• Economic
• Reorganization/
downsize
• Philosophical
differences
• Decline in
productivity
 Employment at Will
• Unwritten contract created when
employee agrees to work for
employer
• No agreement as to how long
parties expect the employment
to last
Demotion as Alternative to
Termination
• Demotions used as
alternative to
discharge
• Demotion is process
of moving worker to
lower level of duties
and responsibilities,
usually involving a
reduction in pay
 Downsizing and Layoffs
• Downsizing also known as restructuring
and rightsizing
• Reverse of company growing; suggest
one-time change in organization and
number of people employed
• Layoffs differ in magnitude of number of
workers no longer employed
• Layoff/recall procedures
• Outplacement
Layoff/Recall Procedures
• Carefully constructed
procedures should be
developed
• When unionized, procedures
are stated clearly in labor-
management agreement
• Agreement may have
bumping procedure
• Recall procedures also stated
in agreement
 Outplacement
• Laid-off employees are given
assistance finding employment
elsewhere
• Financial module covers pensions
options
• Tutoring in personal promotion,
self-appraisal techniques, research
and gaining entry to potential
employers
Outplacement (Continued)
• Career guidance
• Help understanding successful
interviewing techniques
• Development of personal action
plans and continuing support
Transfers

• Lateral movement
of worker within
an organization
• Transfers serve
several purposes
Transfers Serve Several Purposes
• Necessary to reorganize
• Make positions available in primary
promotion channels
• Satisfy employees’ personal desires
• Deal with personality clashes
• Becoming necessary to have wide
variety of experiences before
achieving promotion
Promotion
• Movement to higher
level in company
• Future promotions will
not be as available
as in past
• Seek other ways to
reward employees
• Dual-track system
Resignation

• Exit interview
• Advance
notice of
resignation
 Exit Interview
• Establish rapport
• State purpose of interview
• Explore employee’s attitudes regarding
old job
• Explore worker’s reasons for leaving
• Compare old and new jobs
• Record changes recommended by
employee
• Conclude interview
Advance Notice of Resignation

• Would like two weeks

• Communicate policy
to all employees
• May pay employee for
notice time and ask
him/her to leave
immediately
Retirement

• Early
retirement
• Retirement
planning
Evaluating the Human Resource
Management Function
• Important for human
resources to receive same
degree of cost evaluation as
for operations
• HR self-audit
• Checklists
• Quantitative measures