CH-13 Employee Benefits and Services – Human Resources Management in Canada : Book Guide

This document contains Chapters 13 to 15 PART FOUR: TOTAL REWARDS CHAPTER 13 EMPLOYEE BENEFITS AND SERVICES REVIEW AND DISCUSSION QUESTIONS 1. Explain two main approaches to reducing workers’ compensation claims. The two main approaches to reducing workers' compensation claims include: reducing accident- or illness-causing conditions by instituting effective safety and health programs, and complying with government safety standards; and instituting rehabilitation programs for injured or ill employees, since workers' compensation costs increase the longer an employee is unable to return to work. These include physical therapy programs and career counselling to guide such employees into new and less strenuous or stressful jobs to reintegrate recipients back into the workforce. Workers are required to cooperate with return-to-work initiatives such as modified work. (page 339) Explain the difference between sick leave plans and short-term disability plans. Short-term disability plans (also known as salary continuation plans) provide a continuation of all or part of an employee's earnings when the employee is absent from work due to non-work-related illness or injury. These plans often provide full pay for some period of time (often two or three weeks) and then gradually reduce the percentage of earnings paid as the period of absence lengthens. The benefits cease when the employee returns to work or when the employee qualifies for long-term disability. Such plans are sometimes provided through an insurance company. Sick leave plans operate quite differently from short-term disability plans. Most sick leave policies grant full pay for a specified number of permissible sick days – usually up to about 12 per year (often accumulated at the rate of one day per month of service). Newfoundland, the Yukon, Quebec, and the federal jurisdiction require sick leave (unpaid) as a minimum standard. The problem is that while many employees use their sick days only when they are legitimately sick, others simply utilize their sick leave as extensions to their vacations, whether they are sick or not. Also, seriously ill or injured employees get no pay once their sick days are used up. (page 345) Why are long-term disability claims increasing so rapidly in Canada? The number of long-term disability claims in Canada is rising sharply primarily because the workforce is aging and psychological disabilities are becoming very common. An average disability claim can cost up to $78 000 per injury, including production delays, product and material damage due to inexperienced replacement staff, clerical and administrative time, and loss of expertise, on top of the actual benefits payments. Therefore, disability management programs with a goal of returning workers safely back to work are becoming a priority in many organizations. (page 346) Outline the kinds of services provided by EAPs. An employee assistance plan (EAP) is a formal employer program that provides employees with counselling and/or treatment programs for problems such as mental health issues, marital/family problems, work/career stress, legal problems, and substance abuse. They also assist employees who have suffered a workplace trauma – ranging from harassment to physical assault. (page 354) CRITICAL THINKING QUESTIONS You are applying for a job as a manager and are at the point of negotiating salary and benefits. What questions would you ask your prospective employer concerning benefits? Describe the benefits package you would try to negotiate for yourself. In addition to asking questions regarding the types of benefits offered by the firm, other than those required by law, the employee would ask for details regarding coinsurance amounts, deductibles, and maximum payouts. The employee would also inquire about the type of pension plan offered, as well the issues of vesting and portability. The employee would request a copy of the benefits handbook, so that s/he could read through it at his or her convenience, and indicate that they would call if they had any specific questions. The benefits package that the employee would try to negotiate would include any life, health, disability, or pension benefits not provided as part of the regular package; generous vacation entitlement (such as five weeks after one year of service); a golden parachute clause; a comprehensive educational subsidy/educational leave program; and some perks such as an expense account, company car, company credit card, a reserved parking spot, a spacious office with windows and a view, a private secretary, and a physical fitness club membership. The employee would also try to arrange for an annual bonus and profit sharing. What are pension "vesting" and "portability”? Why do you think these are (or are not) important to a recent university or college graduate? In most jurisdictions, pension legislation requires that employer contributions be vested once the employee has completed two years of service. Plans may vest more quickly than required by law. This issue should be extremely important to a recent university or college graduate, given the fact that employees today are highly mobile. If the employee terminates employment before being vested, he or she will only be entitled to a refund of his or her own contributions, plus interest (unless the employer decides to be more generous). Once an employee is vested, all contributions are "locked-in” and employees must wait until retirement to receive a pension from the plan. Portability refers to a provision that employees who change jobs can transfer the lump-sum value of the pension they have earned to a locked-in RRSP or their new employer's pension plan. Given the reality that movement from one firm to another is often required in order to broaden skills and obtain advancement opportunities, plus the fact that most employees today have a number of different careers over their lifetime, portability should also be of concern to recent college and university graduates. Vesting and portability are both critical in ensuring adequate retirement income. Without them, an individual who makes several changes of employer over the course of his or her working life may end up with an inadequate pension, unless he or she does some exceptional planning and wise investing in registered retirement savings plans. (page 351) You are the HR consultant to a small business with about 40 employees. At the present time they offer only the legal minimum number of days for vacation and paid holidays, and legally mandated benefits. Develop a list of other benefits you believe should be offered, along with your reasons for suggesting them. Before making specific recommendations, the employees should be surveyed regarding their preferences in order to ensure additional benefits will aid in building employee commitment and enhancing retention. Cost issues would also have to be taken into consideration. Since most employees today find time off with pay to be a particularly attractive benefit, and since family-friendly benefits and health promotion are becoming more and more important, recommendations would likely include granting additional vacation, a few extra paid holidays, providing a nutritious food service (such as having a coffee truck visit twice per day, or installing some vending machines with healthy snacks), and granting some sick days/personal leave days. Life insurance and accidental death and dismemberment insurance should also be considered, since these are extremely inexpensive yet highly valued benefits, as well as a supplementary healthcare plan. If offered on a cost-shared basis, such a plan could be quite affordable. Further suggestions would include giving consideration to flextime, which could aid employees to better balance their work and other responsibilities, and could be implemented with virtually no cost to the firm. An educational subsidy plan, designed to encourage employees to upgrade their skills and qualifications, should also be considered since such plans benefit both employees and the employer. If you were designing a retirement benefits plan for a mid-sized organization that had not previously offered one, what type of plan would you recommend to them and why? The defined contribution plan would be the recommended plan. This plan only specifies what contribution the employer will make to a retirement fund set up for the employee. It does not define the eventual benefits amount, only the periodic contribution to the plan. Most organizations have adopted defined contribution plans because the company is not tied to providing a specified amount. Therefore, the financial burden on the company is less if a defined contribution is adopted. There is a risk towards the employee in a defined contribution plan because if the company faces serious financial difficulties or goes bankrupt, the employee will not receive further contributions from the employer. APPLICATION EXERCISES RUNNING CASE: LearnInMotion.com (page 360) The New Benefits Plan Draw up a policy statement regarding vacations, sick leave, and paid days off for LearnInMotion.com, based on sources such as those discussed in this and the previous two chapters. The students are likely to create different policy statements, which will reflect their different preferences for benefits. The students should be encouraged to discuss how LearnInMotion.com might allow for flexibility in their pay for time not worked. Policy Statement: Vacations, Sick Leave, and Paid Days Off At LearnInMotion.com, we recognize the importance of providing comprehensive benefits to support the well-being and productivity of our employees. Our policy regarding vacations, sick leave, and paid days off is designed to promote work-life balance, employee health, and job satisfaction. Below is our policy statement based on industry best practices and legal requirements: 1. Vacation Leave: • Eligibility: All full-time employees are entitled to vacation leave. • Accrual: Vacation leave accrues based on length of service, with employees earning a specified number of vacation days per year of employment. • Scheduling: Employees are encouraged to request vacation time in advance, considering operational needs and workload distribution. • Carryover: Unused vacation days may be carried over to the following year up to a specified limit or may be compensated in accordance with company policy. 2. Sick Leave: • Eligibility: All employees, including full-time and part-time staff, are eligible for sick leave benefits. • Accrual: Sick leave accrues on a per-pay-period basis or as specified in the employee handbook. • Usage: Sick leave may be used for personal illness, injury, medical appointments, or to care for an ill family member, as defined by applicable legislation. • Notification: Employees are required to notify their supervisor or the HR department as soon as possible when unable to report to work due to illness. 3. Paid Days Off: • Eligibility: Paid days off (PDOs) may be provided as additional time off for holidays, personal reasons, or other purposes. • Allocation: LearnInMotion.com may designate specific days as paid holidays, including statutory holidays recognized by provincial or federal legislation. • Additional PDOs: Employees may be eligible for additional paid days off as part of employee recognition programs, tenure milestones, or other special occasions. 4. Flexible Work Arrangements: • LearnInMotion.com supports flexible work arrangements, such as telecommuting, flexible hours, or compressed workweeks, where feasible and compatible with job responsibilities. • Employees may request flexible work arrangements to accommodate personal needs, subject to managerial approval and operational requirements. 5. Administration and Compliance: • The HR department is responsible for administering vacation, sick leave, and paid time off policies in compliance with applicable employment standards legislation and company guidelines. • Employees are encouraged to refer to the employee handbook or consult HR for further details on vacation accrual rates, sick leave eligibility, and paid time off entitlements. Conclusion: LearnInMotion.com is committed to providing competitive and equitable benefits and services to support the well-being and satisfaction of our employees. Our vacation, sick leave, and paid time off policies are designed to foster a healthy work environment, promote work-life balance, and enhance employee engagement and retention. We continuously review and update our benefits plans to meet the evolving needs of our workforce and remain compliant with legal requirements and industry standards. What are the advantages and disadvantages to LearnInMotion.com of providing its employees with health insurance and disability programs? The students should refer to the supplementary health-care/medical insurance and disability insurance sections of the chapter to develop their lists of advantages and disadvantages. Advantages and Disadvantages of Health Insurance and Disability Programs for LearnInMotion.com Advantages: 1. Employee Well-being and Satisfaction: • Health insurance and disability programs demonstrate LearnInMotion.com's commitment to the well-being of its employees. • Access to comprehensive health coverage and disability benefits can enhance employee satisfaction and morale, leading to higher retention rates and improved productivity. 2. Attracting Top Talent: • Offering health insurance and disability programs can help LearnInMotion.com attract and retain top talent in a competitive job market. • Prospective employees may be more inclined to join the company knowing that their health and financial security are prioritized. 3. Reduced Absenteeism and Presenteeism: • Adequate health coverage and disability benefits can help employees address health issues promptly, reducing the likelihood of prolonged absences from work. • By supporting employees' health needs, LearnInMotion.com can mitigate absenteeism and presenteeism, ensuring a more productive workforce. 4. Legal Compliance: • Providing health insurance and disability programs may be mandated by provincial or federal employment laws. • Compliance with legal requirements helps LearnInMotion.com avoid penalties, lawsuits, and reputational damage. Disadvantages: 1. Cost Considerations: • Health insurance and disability programs can be costly for employers, particularly for small businesses like LearnInMotion.com. • Premiums, administrative fees, and potential claims can strain the company's budget, impacting profitability and financial stability. 2. Administrative Burden: • Managing health insurance and disability programs requires administrative resources, including time and expertise. • LearnInMotion.com may need to invest in HR personnel or third-party administrators to handle enrollment, claims processing, and compliance tasks. 3. Risk of Adverse Selection: • Adverse selection occurs when employees with higher health risks or disability concerns disproportionately enroll in the company's benefit programs. • This can lead to higher premiums and increased financial strain on LearnInMotion.com's benefits budget. 4. Complexity and Compliance Challenges: • Health insurance and disability programs are subject to complex regulations and compliance requirements. • Ensuring compliance with applicable laws and regulations requires ongoing monitoring and adjustments, adding to the administrative burden and potential legal risks. Conclusion: While providing health insurance and disability programs offers numerous benefits for LearnInMotion.com and its employees, it also presents challenges in terms of cost, administration, and compliance. By carefully weighing the advantages and disadvantages, LearnInMotion.com can make informed decisions about the design and implementation of its benefits plans to best meet the needs of its workforce while managing costs and risks effectively. In terms of competitors and any other information that you think is relevant, do you or do you not think it’s a good idea for LearnInMotion.com to establish a defined contribution retirement plan for its employees? If they were to establish such a plan, briefly summarize the plan as you see it. While Pierre has a point about their cash, having an RRSP or other retirement plan may help their recruiting efforts. LearnInMotion.com should conduct Internet research and use a compensation survey to assess what competitors are doing to determine the various retirement options available, and what is being offered in the industry. If a defined contribution retirement plan was established, LearnInMotion.com should begin with a small amount of employer-matching contributions. The level of matching can be increased in future when the business is more established and cash flow is more predictable. CASE INCIDENT: Barrie Shipping Ltd. (page 361) 1. What methods of health-care cost control should Heath include in his presentation? What are the advantages and disadvantages of each? Heath should include all five of the health-care cost control methods provided in the chapter: increasing the amount of health-care costs paid by the employees – company costs will be reduced if deductibles are increased, coinsurance is decreased, and employees are required to pay part of the premium. The disadvantage is that employees may resist higher payments, particularly if they are unionized. using a restricted list of drugs – company costs can be reduced if generic drugs are covered instead of their expensive brand-name counterparts. However, some employees may resist this decrease in choice available to them. health promotion – exercise classes, nutrition counselling, weight loss, and smoking cessation programs can improve employee health and thus reduce health-care costs. However, there may be limited interest in such programs on the part of this particular hard-living employee group. risk assessment programs – a third party can survey the employees on their health history to identify common health risk factors, which can then be addressed by customized programs. However, this hardliving employee group may not be interested in availing themselves of this kind of program. health services spending accounts – the company could establish an account for each employee with a specified amount of money to be spent on health-care services each year. The company’s health-care costs would be capped at the amount in the account for each employee. However, employees who become very ill may not have all their expenses covered and may feel that this approach is unfair, particularly if they are unionized. Should Barrie Shipping continue to provide health-care coverage to retirees? Why or why not? Yes, the company should continue to provide health-care coverage to retirees because of the potential legal difficulties in rescinding the program. In order to decrease costs, they could increase the amount the employees are required to pay up to 50 percent, and use the methods described above for the retiree plan as well. What recommendations should Heath Proctor make to Leo? The most effective cost-control methods for Barrie Shipping are increasing the amount of health-care costs paid by the employees, using a restricted list of drugs and health services spending accounts. If employees resist any of these measures, they could be dropped on the condition that employees undergo risk assessment and agree to participate in personalized health promotion programs (which seems unlikely to be attractive to this employee group). The coinsurance for retiree health-care benefits should be increased, possibly as high as 50 percent. EXPERIENTIAL EXERCISES (page 361) Working individually or in groups, compile a list of the perks available to the following individuals: the head of your local public utilities commission; the president of your college or university; the president of a large company in your area. Do they all have certain perks in common? What do you think accounts for any differences? Perquisites (perks, for short) listed may include: management loans (which typically enable senior officers to use their stock options); salary guarantees (also known as golden parachutes) to protect executives even if their firms are the targets of acquisitions or mergers; financial counselling (to handle top executives' investment programs); relocation benefits, which may include subsidized mortgages, purchase of the executive's current house, and payment for the actual move; a cell phone; outplacement assistance; a company car; a chauffeured limousine; a security system; use of the company plane and/or yacht; executive dining room privileges; legal services; tax assistance; a liberal expense account; club membership(s); season tickets; credit card(s); subsidized children's education; a physical fitness program; a concierge service; supplemental life insurance; and a reserved parking spot. Reserved parking, an expense account, a personal or leased automobile, and supplementary life insurance are fairly common perks. Differences in the perks offered are likely due to the nature of the business and the preferences of the incumbents, as well as the organization’s ability to provide and fund these types of benefits. Large private-sector firms generally offer much more generous perquisites than do public-sector and quasi public-sector organizations, which are wholly or partially government funded. Working individually or in groups, contact the Workers' Compensation Board (Workplace Safety and Insurance Board in Ontario) and compile a list of their suggestions for reducing workers' compensation costs. What seems to be their main recommendations? The Board respondent is likely to explain that a renewed focus on accident prevention is the best way to manage workers' compensation costs over the long term. Minimizing the number of workers' compensation claims is an important goal for all employers. While the Workers' Compensation Board (Workplace Safety and Insurance Board in Ontario) pays the claims, the premiums for most employers depend on the number and amount of claims that are paid. Minimizing such claims is thus important. Two practical approaches are likely to be recommended: reducing accident- or illness-causing conditions in an organization's facilities by instituting effective safety and health programs; employee education, training, and/or financial incentives; and complying with government safety standards. instituting rehabilitation programs for injured or ill employees, since workers' compensation costs increase the longer an employee is unable to return to work. These include physical therapy programs and career counselling to guide such employees into new and less strenuous or stressful jobs to reintegrate recipients back into the workforce. Workers are required to cooperate with return-to-work initiatives such as modified work. Boards generally provide resources and guidelines to assist employers in accommodating employees who have been collecting benefits and are now ready to return to work, but are unable to perform their preinjury or pre-illness job. VIDEO CASE 4: Pension Promise (page 362) Why have the older workers shown in the video not received the full pension they had earned over their working life? Their company went bankrupt when it had an underfunded defined benefit pension plan. There was not enough money in the pension fund to pay out the accrued pension, and pensioners were low on the list of creditors to be paid. What laws could be introduced to prevent this situation? A law requiring full funding of defined benefit plans might prevent this situation. A law requiring the government to set up a fund to pay pensioners in this situation is another option. 3. If the workers had been in a defined contribution plan, would they be facing the same problem? No, they would not have been expecting a specified amount of pension benefit, and would have received the full amount of money in their account in the pension fund. Video Resource: Based on “Pension Promise,” CBC The National (November 15, 2004). PART FIVE: BUILDING EFFECTIVE EMPLOYEE–EMPLOYER RELATIONSHIPS CHAPTER 14 OCCUPATIONAL HEALTH AND SAFETY REVIEW AND DISCUSSION QUESTIONS Discuss the purpose of occupational health and safety legislation and how it is enforced. The purpose of these laws is to protect the health and safety of employees at work by legislating general health and safety rules, rules for specific industries, and rules related to specific hazards. Provisions of occupational health and safety legislation differ significantly across Canada, but most have certain basic features in common, including designated responsibilities and rights of employers and employees, joint health and safety committees, and enforcement procedures. In all Canadian jurisdictions, occupational health and safety law provides for government inspectors to periodically carry out safety inspections of workplaces. Safety inspectors may order a variety of actions on the part of employers and employees, including orders to stop work, stop using tools, install first aid equipment, and stop emission of contaminants. Penalties consist of fines and/or jail terms. Governments across Canada are increasingly turning to prosecutions as a means of enforcing health and safety standards. An amendment to the Criminal Code has been introduced which is called “corporate killing,” which imposes criminal liability on corporate decision-makers who fail to ensure that their company maintains an appropriate level of safety. (page 365) Explain the supervisor's role in safety. Most jurisdictions impose a personal duty on supervisors to ensure that workers comply with occupational health and safety regulations, and place a specific obligation on supervisors to advise and instruct workers about safety. Safety-minded managers must aim to instil in their workers the desire to work safely. Minimizing hazards is important, but no matter how safe the workplace is, there will be accidents unless workers want to and do act safely. Of course, supervisors try to watch each employee closely, but most managers know this will not work. In the final analysis, the best (and perhaps only) alternative is to get workers to want to work safely. Then, when needed, safety rules should be enforced. Most safety experts agree that safety commitment begins with top management. Without the full commitment at all levels of management, any attempts to reduce unsafe acts by workers will meet with little success. The first-line supervisor is a critical link in the chain of management. If the supervisor does not take safety seriously, it is likely that those under him or her will not either. (page 369) Explain what causes unsafe acts. Personal characteristics (personality, motivation, and so on) serve as the basis for certain "behaviour tendencies" such as the tendency to take risks and undesirable attitudes. These behaviour tendencies in turn result in unsafe acts such as inattention and failure to follow procedures. It follows that such unsafe acts increase the probability of someone having an accident. The person who is accident prone on one job may not be on a different job – accident proneness is situational. In fact, many human traits have been found to be related to accident repetition in specific situations: Vision: Vision is related to accident frequency for many jobs. For example, passenger car drivers, intercity bus drivers, and machine operators who have high visual skills have fewer injuries than those who do not. Age: Accidents are generally most frequent between the ages of 17 and 28, declining thereafter to reach a low in the late fifties and sixties. Perceptual versus Motor Skills: Where a worker's perceptual skill is equal to, or higher than, his or her motor skills, the employee is a relatively safe worker. But where the perception level is lower than the motor skills level, the employee is accident prone, and his or her accident proneness becomes greater as this difference increases. (page 375) Describe how to reduce workers’ compensation costs, both before and after an accident. Before the accident, firms should remove unsafe conditions, screen out employees who might be accident prone for the job in question (without violating human rights legislation), and establish a safety policy and loss-control goals. After the accident, the employer should provide first aid and make sure that the worker gets quick medical attention, should make it clear that he or she is interested in the injured worker and his or her fears and questions, document the accident, file any required accident reports, and encourage a speedy return to work. Some people believe that the most important and effective thing an employer can do to reduce costs is to develop an aggressive return-to-work program, including making light-duty work available. Functional abilities evaluations are an important step in facilitating the return to work. This evaluation determines the level of disability so that the worker can either go back to his or her original job or be accommodated. (page 379) Explain the four traditional techniques for dealing with substance abuse. The four traditional techniques for dealing with substance abuse are: Discipline Discharge – this is used only after repeated attempts at rehabilitation have failed. In-house counselling – can be offered by the employer’s medical staff, the employee assistance plan, or agencies such as AA Referral to an outside agency Analyze the legal and safety issues concerning workplace toxins. The leading cause of work-related deaths around the world is cancer, and hundreds of Canadian workers die from occupational cancer each year. Cancer-causing agents in the workplace are not being significantly reduced, as it is costly for employers to do so and unions have placed a higher priority on wages and benefits. In Manitoba, the workers’ compensation law provides benefits to firefighters who develop any of five specific job-related cancers, and this law could set a precedent for other occupations and other jurisdictions. (page 391) Explain how to reduce violence at work. Several concrete steps can be taken by employers to reduce the incidents of workplace violence. These include identifying jobs with high risk of violence; instituting a workplace violence policy; creating a healthy work environment; enhancing security arrangements; improving employee screening; and training for violence reduction. (page 393) CRITICAL THINKING QUESTIONS What is your opinion on the question “Is there such a thing as an accident-prone person?” Based on the material presented in this chapter, the evidence seems fairly conclusive that there is no such thing as an accident-prone person and that accident proneness is situational. Human traits that have been found to be related to accident repetition in specific situations include vision, age, and perceptual versus motor skills. (page 375) What guidelines would you suggest for determining the point at which to terminate an employee who shows signs of being prone to violence? A decision to terminate an employee should be based on the following: an act of violence on or off the job erratic behaviour evidencing a loss of perception or awareness of actions overly defensive, obsessive, or paranoid tendencies overly confrontational or antisocial behaviour sexually aggressive behaviour isolationist or loner tendencies insubordinate behaviour with a suggestion of violence tendency to overreact to criticism exaggerated interest in war, guns, violence, mass murders, catastrophes, and so on the commission of a serious breach of security possession of weapons, guns, knives, or like items at the workplace violation of privacy rights of others such as searching desks or stalking chronic complaining and the raising of frequent, unreasonable grievances get-even attitude The firm should institute a workplace violence policy, heighten security measures, and provide workplace violence training. Having taken these steps, the appropriate course of action will depend on the nature of the offence. An act of violence on the job, insubordinate behaviour with a suggestion of violence, the commission of a serious breach of security, possession of a weapon, and violation of privacy rights of others are offences that justify immediate termination of employment following a fair and impartial investigation and ensuring that the individual’s due process rights are protected. What do you think are the most important things to include in a wellness program, and why? As experts predict, over the next 25 years, prevention and wellness will be the next great leap forward in health care, as employees become more broadly recognized as the most important assets of organizations. Figure 14.5 shows some of the wellness initiatives launched by Canadian organizations. Considering the rise in the number of employees experiencing work-related stress, it would be important to include stress management, tai chi, and EAPs as key components of wellness programs. As more and more people spend longer hours at work with little time for extracurricular activities, wellness programs will also need to include physical fitness programs and nutrition and weight management. Ergonomics will also play a key role considering that employees use computers to do their work for most parts of the day. This requires employees to be at their workstation in a particular posture for long periods of time with repetitive movements, which can cause repetitive strain injuries. Therefore, designing workstation equipment to reduce such injuries should be considered under ergonomics. (page 380) Given the disappointing progress in reducing workplace injuries and deaths, do you think that the “corporate killing” law should be used more aggressively? The Criminal Code was amended in 2004 to introduce a criminal offence commonly known as “corporate killing,” which imposes criminal liability on “all persons” who direct the work of other employees and fail to ensure an appropriate level of safety in the workplace. Criminal Code convictions can be penalized by incarceration up to life in prison and unlimited fines. Statistics show that on average more than three Canadians die each working day. Over the years, these numbers have continued to increase despite various laws and regulations that have been introduced with the aim of reducing such deaths. Therefore, it would be wise to bring in a law that imposes criminal liability upon the employer and the supervisors. It is the duty of employers to ensure the health and well-being of their employees and to provide a safe environment to work in. While employers are held accountable for workplace injuries and deaths, employees too will have to be held accountable. Even if the employer provides a safe work environment, or has workplace policies and regulations to prevent injuries and accidents, if employees do not adhere to them then it is difficult to avoid such situations. Therefore, it’s necessary to consider how such laws can also be extended to hold the employees accountable, and what consequences they have to face if investigations reveal that employee negligence caused an accident that resulted in a death. (page 367) APPLICATION EXERCISES RUNNING CASE: LearnInMotion.com (page 396) The New Health and Safety Program Based on your knowledge of health and safety matters and your actual observations of operations that are similar to LearnInMotion.com, make a list of the potential hazardous conditions employees and others face at the company. Make specific recommendations to reduce the potential severity of the top five hazards. Potential hazardous conditions that employees and others face at LearnInMotion.com include cables and wires on the floors throughout the office; electrical hazards; carpal tunnel syndrome from long hours of computer work; and job stress and burnout from long working hours. Wires and cables should be extended along the walls where possible, and securely taped down when they have to cross any floor space. The company must institute a policy prohibiting employees from working on electrical repairs unless the power has been shut off. Employees working at computers for long periods of time should be required to take regular breaks, and ergonomic keyboards and other equipment should be provided. Employees working long hours should be provided with frequent nutrition and rest breaks, and should be given time off for rest and relaxation when the project is finished. Would it be advisable for the company to set up a procedure for screening out stress-prone or accident prone individuals? Why or why not? If so, how should they be screened? It is more important in this situation to be concerned about stress-prone individuals, given the stressful nature of the dot-com business world. It may be difficult to screen out stress-prone individuals given that discrimination on the basis of mental and emotional conditions is prohibited under human rights legislation. Individuals can be asked about how they have handled stressful situations in the past and asked whether they have experience at working long hours on a frequent basis. If a decision is made to screen applicants, what are the legal implications? Can they do this legally? How? To ensure that screening procedures are not in violation of human rights legislation, the student should suggest that LearnInMotion’s management contact OSHA for assistance in developing safety policies and procedures on the job, along with including suggestions discussed in the chapter. What specific topics should be included in their health and safety training program? The training program should include fire safety and how to ensure that wires and cables are secured to avoid tripping over them, safe use of computers including tips on how to avoid repetitive strain injuries, and stress management. Many other topics could also be included. CASE INCIDENT: Introducing Ergonomics: What Went Wrong? (page 397) What went wrong in this case? The steps that Roger has taken heightened employee awareness of the ergonomic problems in their working conditions. Having trained the employees regarding ergonomic issues also made it culturally acceptable to discuss such problems openly. The number of problems has not likely changed, but awareness and discussion have resulted in an increase in the rates of illness and injury being reported. What elements of Roger’s plan could be improved? Roger may wish to implement his plan incrementally, focusing first on employees and departments experiencing high rates of illness or injury that are clearly related to workstation design. What do you think accounts for the increase in reported illness and injury? Employee awareness has increased. In the past, employees may not have related aches and pains they were experiencing to workplace-related issues. Given your answer to Question 3, do you think that Harbour should go ahead with the renovation? There are two separate issues that need to be dealt with – employee perceptions and actual workstation design problems. Given the problems that Roger discovered, failing to go ahead with the renovation would be unethical and highly undesirable from the perspective of morale and the bottom line. After all, the reason that Roger got excited about an ergonomics program in the first place was the potential cost savings associated therewith. As far as employee perceptions are concerned, immediate steps should be taken to improve the communication and implementation strategy so that employees will not have the perception that the firm has been negligent about working conditions up to this point, but is genuinely concerned about employee well-being and wants to enhance employee health and safety. EXPERIENTIAL EXERCISES (page 397) In a group of four to six students, spend about 30 to 45 minutes in and around one of the buildings on your campus identifying health and safety hazards. Research whether or not these unsafe conditions violate the applicable health and safety legislation. Report your findings to the entire class and give recommendations for changes to eliminate these hazards. Unsafe conditions are the mechanical and physical conditions that cause accidents. Answers to this question require an understanding of the material found on page 439. Students should focus on physical aspects such as defective equipment, poor lighting, unsafe storage of hazardous materials, and inaccessibility of fire exits. The provincial/territorial safety council and/or the health and safety committee members at the college or university should be able to provide a copy of the applicable health and safety legislation for students’ reference. Note: By law, the legislation should be posted in English and the majority language of the workplace. Review a workplace violence consulting Web site and contact a workplace violence consultant. Gather information on what advice is provided to clients on preventing workplace violence, and ask for a sample workplace violence policy. Prepare a brief presentation to the class on your findings. The material on workplace violence in the text (pages 392) can be used to guide students' questions, and to organize the information obtained from the workplace violence consultant. Key aspects of workplace violence prevention include training, employer policies, security measures, employee screening, and behaviour management techniques. PART FIVE: BUILDING EFFECTIVE EMPLOYEE–EMPLOYER RELATIONSHIPS CHAPTER 15 FAIR TREATMENT: THE FOUNDATION OF EFFECTIVE EMPLOYEE RELATIONS REVIEW AND DISCUSSION QUESTIONS Explain the role of communication and fair treatment programs in establishing a foundation for effective employee relations. Treating employees fairly begins with good listening and effective two-way communication. Programs that foster upward communication include suggestion programs, employee opinion surveys, fair treatment programs, and top down communication programs, which include activities such as in-house television centres, electronic bulletin boards, and newsletters that provide continuing opportunities for the firm to update employees on important matters. It is hard for employees to feel committed when their boss will not tell them what is going on. Some firms, therefore, give employees extensive data on the performance of and prospects for their operations. The potential for employee grievances and discontent stemming from perceived unfairness is always present. Discipline cases and seniority issues in promotions, transfers, and layoffs probably top the list. Others include grievances growing out of job evaluations and work assignments, overtime, vacations, incentive plans, and holidays. Thus, many firms today (and virtually all unionized ones) give employees fair treatment programs through which to air grievances. The net effect is twofold: complaints do not get a chance to accumulate; and all managers think twice before doing anything unfair, since their actions will likely be brought to their bosses’ attention. Describe specific techniques that you would use to foster top-down communication in an organization. Utilize a company newsletter, hold frequent staff meetings, and meet with employees one-on-one to discuss individual concerns and provide performance feedback. For new-employee orientation, use a video presentation to introduce the firm's key managers and products/services. Use high-tech communication – e-mail, electronic bulletin boards, and the company’s intranet because of its advantages of immediacy and the fact that the message can be tailored to individual employees when it relates to personal information such as benefits. Explain how fairness in employee discipline can be ensured, particularly the prerequisites to discipline, discipline guidelines, and the "discipline without punishment" approach. The purpose of discipline is to encourage employees to adhere to rules and regulations. Courts have repeatedly articulated the rights of employees to fair treatment not only during the term of employment, but also during the discipline and termination process. A fair and just discipline process is based on three foundations: rules and regulations which address things like theft, drinking on the job, and insubordination; a system of progressive penalties which includes steps such as verbal warnings, written warnings, suspension, and discharge; and an appeals process to ensure that discipline is meted out fairly and equitably. Research has shown that there are six general components of fairness relating to a disciplinary discussion between a manager and an employee. Managers should: Take a counselling approach to the problem. Exhibit a positive non-verbal demeanour. Provide the employee with some control over both process and outcome. Provide a clear explanation of the problem behaviour. Ensure that the discussion occurs in private. Ensure that the discipline is consistent with other similar situations. Discipline Without Punishment (non-punitive discipline) is accomplished by gaining the employees’ acceptance of the rules and by reducing the punitive nature of the discipline itself. Key steps in the process are: Step 1 – First, issue an oral reminder. Step 2 – Should another incident arise within six weeks, issue the employee a formal written reminder, a copy of which is placed in the HR file. Step 3 – The next step is a paid one-day “decision-making leave.” Step 4 – If no further incidents occur in the next year or so, the one-day paid suspension is purged from the person’s file. If the behaviour is repeated, dismissal is required. Describe the four main reasons for dismissal. The four main reasons for dismissal include: Unsatisfactory performance, defined as a persistent failure to perform assigned duties or to meet prescribed standards on the job. Specific reasons here include excessive absenteeism, tardiness, a persistent failure to meet normal job requirements, or an adverse attitude toward the company, supervisor, or fellow employees. Misconduct, defined as deliberate and wilful violation of the employer's rules, and may include stealing, rowdyism, and insubordination. Lack of qualifications for the job, defined as an employee's incapability of doing the assigned work although the person is diligent. Changed requirements of the job, defined as an employee's incapability of doing the work assigned after the nature of the job has been changed or the job has been eliminated. In the latter two circumstances, every effort should be made to salvage the employee if at all possible, through retraining or a transfer, for example. (pages 409–410) 5. What are the techniques that can be used as alternatives to layoffs? Voluntary reduction in pay plan; all employees agree to reductions in pay in order to keep everyone working. Use of contingent employees where temporary supplemental employees are hired with the understanding that their work is of a temporary nature and they may be laid off at any time. Then when layoffs come, the first group to be laid off is the cadre of contingent workers. Voluntary time off where companies arrange to have all or most of their employees accumulate their vacation time and concentrate their vacations during slow periods. Work Sharing Program available through Human Resources Development Canada allows employers to reduce the workweek by one to three days and for the time not worked, employees can claim employment insurance. 6. Discuss some of the issues that should be covered in a pre-retirement counselling program. Retirement itself is traumatic, as the once-busy employee tries to cope with suddenly being “non-productive.” For many retirees, in fact, maintaining a sense of identity and self-worth without a full-time job is the single most important task they will face. It is one that employers are increasingly trying to help their retirees cope with as a logical last step in the career management process. Most employers provide some type of formal pre-retirement counselling aimed at easing the passage of their employees into retirement. Court decisions have confirmed that employers do have some legal responsibility to help employees prepare for retirement. Retirement education and planning firms provide services to assist upcoming retirees with issues such as lifestyle goals (including part-time or volunteer work and/or moving to another country), financial planning, relationship issues, and health issues. (page 420) CRITICAL THINKING QUESTIONS Describe the similarities and differences between a program such as FedEx Canada's guaranteed fair treatment program and a typical union grievance procedure. FedEx Canada's Guaranteed Fair Treatment Program (GFTP) has a number of similarities with a typical union grievance procedure. Both are designed to provide a communication device through which management can become aware of employee concerns and areas of dissatisfaction, and ensure that such concerns are dealt with fairly. Both involve systematic deliberation of complaints pertaining to such matters as job promotion and discipline at progressively higher levels of authority in the company. Both involve the use of time limits to ensure that employee grievances are dealt with promptly, have specially designed forms to make filing a grievance easy, and require written responses. There are a number of differences, however. The highest levels of management are routinely involved in reviewing complaints in the GFTP; in union grievance procedures, the supervisor and industrial relations specialist play a key role, as well as the union steward, chief steward, and union grievance committee. At FedEx Canada, for example, it is a representative of the HR department who helps individuals file a written complaint; in a unionized setting, the union steward performs this function. Union grievance procedures serve a number of additional purposes, such as ensuring the application of the contract with a degree of justice for both parties, resolving issues that were not anticipated by those at the bargaining party, providing an opportunity to interpret contract language, serving an important political purpose for union officials, and calling to the attention of management and union leaders areas of the contract requiring clarification or modification in subsequent negotiations. The other major difference is that the last step in a union grievance procedure is final and binding arbitration, which involves a neutral third party, whereas at FedEx Canada, the last step involves an internal executive appeals review. Describe the similarities and differences between the “discipline without punishment” approach and a typical progressive discipline procedure. Both progressive discipline and discipline without punishment involve rules and regulations and a series of steps. Both systems involve a verbal reminder first. The goal, however, is quite different. In progressive discipline, the verbal warning is designed to inform the person about the nature of his or her wrongdoing, and to warn him or her about the consequences of failing to change his or her behaviour. A record of this warning is placed in the employee’s HR file. The oral reminder that is the first step in non-punitive discipline is designed to remind the employee of the reason for the rule and the fact that he or she has a responsibility to meet performance standards. A written record of the incident is kept in a separate working file in the supervisor’s desk rather than in the employee’s HR file. Both processes involve a written reminder (warning in the case of progressive discipline) as a second step, a copy of which is placed in the employee’s HR file. Once again, though, the focus is different. Non-punitive discipline also requires the supervisor to hold a second, private discussion with the employee at this step to express confidence in the person’s ability to act responsibly at work. The third step in both processes involves time off from work. With progressive discipline, however, this involves a suspension without pay for a period of time (generally one to three days, although the length of a suspension will vary depending on the circumstances and the severity of the offence). In non-punitive discipline, the third step is a paid one-day “decision-making leave.” In non-punitive discipline, if no further incidents occur in the next year or so, reference to the one-day paid leave is removed from the person’s file. Company policy and/or the union collective agreement may specify that any record of disciplinary action will be removed from an employee’s HR file after a specified period of time in a progressive discipline system, but this is not always the case. Both non-punitive and progressive discipline systems involve discharge as the final step. In both systems, the process is changed in exceptional circumstances: criminal behaviour or in-plant fighting may be grounds for immediate dismissal. In addition, if several incidents occur at very close intervals, step two may be omitted. Is it worth the time and expense to monitor employees’ use of the Internet if employee performance is generally good? Is this not the same principle as monitoring telephone usage for personal calls? Electronic monitoring is becoming easier and less expensive as new software is developed that can track Web sites visited by workers and the time spent on each. Therefore, a company does not face a huge financial burden by taking this on, be it for all its employees or a single employee. If monitoring is used in a company, it should be applied consistently across all employees and not limited to those who are considered poor performers. If the company decides not to monitor those who are good performers, this would be considered unfair treatment and can make employees feel very uncomfortable and can lead to potential complaints and loss of productivity and morale. Furthermore, the employer should have a written policy which is communicated to all staff providing specific guidelines and consequences of breaching the policy. The principles of monitoring Internet usage and telephone usage will be the same because transmission is being done through a device that can be intercepted by someone other than the intended recipient. However, it should be noted that employees should be made aware of call monitoring. Should a company consider providing termination packages to employees who have ongoing disciplinary problems rather than taking the time and effort to go through the progressive discipline process? The answer to this depends on the nature of the disciplinary problem at hand. For example, some disciplinary issues require immediate termination such as theft, insubordination, violence at work, etc. On the other hand, most disciplinary issues are performance related such as absenteeism, failing to meet job expectations, etc. If employees are going through such issues, it is important to consider progressive disciplinary action before providing a termination package. It’s important to bring to the attention of the employee what the issues are and give him/her a chance to improve performance levels. There are situations where employees get disgruntled when progressive disciplinary action is taken. Some employees do not respond positively to such action and can create trouble within the team environment they are in. If this happens, it is best to terminate employment because further action can lead to further deterioration of performance/morale from the part of the employee, which can create a negative work environment for other employees and a decline in general employee morale and performance. APPLICATION EXERCISES RUNNING CASE: LearnInMotion.com (page 422) Fair Treatment in Disciplinary Action 1. Advise Jennifer and Pierre whether there should be formal policies and rules regarding employee behaviour. What should these include? A written code of conduct should be read and signed by all employees as proof that they are clear on what behaviours are acceptable or not acceptable in all aspects of their work, not just in operating their computers. Should a disciplinary system be established at LearninMotion.com? Why or why not? The fact that neither Jennifer nor Pierre is sure how this situation should be handled is a clear indication that a formal disciplinary system needs to be established. Without such a system, disciplinary action will be inconsistent and inequitable. If such a system is introduced, what should it cover, and how should the company deal with employees who break the rules? The discipline system should include clearly specified rules and regulations. These must be communicated to the Centre employees along with consequences of misconduct. The store managers must be familiarized with the rules and regulations and trained in proper enforcement strategies. The discipline system should also include a through, impartial investigation process, ensuring protection of the employees' due process rights, a series of progressive penalties, and an appeals process. Since this is a serious matter, but the errant counter people have apparently never been formally warned about the consequences of such behaviour, they should be given a verbal warning (recorded in their HR files) and be told about the consequences of a repeat offence (a written warning). If investigation reveals that the store manager did, in fact, condone their actions, he or she should also receive a recorded verbal warning. CASE INCIDENT: Fire my best salesperson? (page 423) Assume you are Johns and answer the following questions. What should you do now? Terminate employment. However, before termination it will be necessary to talk to Bob with evidence seeking his explanations. Why should you do it? Greg should take action because Bob, despite being the best salesperson, has been stealing from the company. This constitutes misconduct on the part of Bob, and if proven he can be terminated from employment with the company. Further as per the findings of the accounting department, Bob has been exaggerating sales figures and misleading the company to believe he is the best salesperson. Based on findings of the accounting department, Bob may no longer be the top salesperson. How would you do it? I would call a meeting with Bob to seek his explanations to what has been found by the accounting department. An HR representative should be present during the discussion as a witness. All evidences provided by the accounting department will be brought to the meeting and should be discussed with Bob. EXPERIENTIAL EXERCISES (page 423) Working individually or in groups, obtain copies of the student handbook for a college or university and determine to what extent there is a formal process through which students can air grievances. Would you expect the process to be effective? Why or why not? Based on contacts with students who have used the grievance process, has it been effective? According to the college or university handbook chosen. Most educational institutions have a formal student appeals process, although in some, it only pertains to grades. In assessing the program's effectiveness, helpful hints can be found in the textbook. For example, is the grievance process accessible to every student? Is it easy to use and are students encouraged to use it? Grievance procedures can only be effective if there is an atmosphere of trust, complainants are guaranteed due process, steps and time limits are specified, confidentiality is guaranteed to the greatest extent possible, and there is provision for impartial investigation. Working individually or in groups, determine the nature of the academic discipline process in a college or university. Does it appear to be an effective one? Based on this chapter, should any modification be made to the student discipline process? Most educational institutions have a formal academic discipline policy and procedure. To determine its effectiveness and assess whether any modifications are required, the textbook should be used for reference. An effective discipline process is based on clearly specified rules and regulations, a system of progressive penalties, and an appeals process. A computer department employee made an entry error that ruined an entire run of computer reports. Efforts to rectify the situation produced a second batch of improperly run reports. As a result of the series of errors, the employer incurred extra costs of $2,400, plus a weekend of overtime work by other computer department staffers. Management suspended the employee for three days for negligence, and also revoked a promotion for which the employee had previously been approved. Protesting the discipline, the employee stressed that she had attempted to correct her error in the early stages of the run by notifying the manager of computer operations of her mistake. Maintaining that the resulting string of errors could have been avoided if the manager had followed up on her report and stopped the initial run, the employee argued that she had been treated unfairly in being severely punished because the manager had not been disciplined at all even though he had compounded the problem. Moreover, citing her “impeccable” work record and management’s acknowledgment that she had always been a “model employee,” the employee insisted that the denial of her previously approved promotion was “unconscionable.” Working in groups, determine what your decision would be if you were the arbitrator. Why? (Your instructor will inform you of the actual arbitrator’s decision when you discuss this exercise in class.) Do you think that the employer handled the disciplinary situation correctly? Why? What would you have done differently? Understanding of the aspects of fair disciplinary procedures. Figure 15.3 (page 408) provides disciplinary guidelines that will assist in determining whether the discipline was unfairly imposed and inconsistently applied. A fair and just discipline process involves due process, which means that the accused is entitled to a fair and thorough investigation. Such an investigation would confirm or contradict the employee’s assertion that she had tried to correct the error by reporting the problem to her manager and that he had failed to follow up. Another element of a fair and just discipline process is a system of progressive penalties that are reasonably related to the misconduct and to the employee’s past work history. A three-day suspension and the loss of a promotion would be considered severe disciplinary action for an employee with an exemplary work record up to this incident. In addition, imposing a suspension and the loss of a promotion means that the employee was, in effect, punished twice for the same error. The fact that the manager did not receive any type of discipline may also lead one to believe that discipline is not applied in a consistent or non-discriminatory manner. An arbitrator would rule that the discipline imposed was far too harsh, given the employee’s past record, her attempt to correct the problem in the early stages, and her manager’s failure to follow up on her report. On the other hand, the employer incurred substantial costs because of the employee’s error, something that deserves to be penalized. To determine an appropriate penalty, the arbitrator would take into consideration the way in which similar incidents have been handled in the past. In this particular case, management testified that other employees had been issued three-day suspensions for similar infractions in the past, testimony that the union did not challenge. Given all of the above facts, the arbitrator upheld the three-day suspension, but ordered that the employee be awarded the promotion for which she had previously been approved. Solution Manual for Human Resources Management in Canada Human Resources Management in Canada Gary Dessler, Nina D. Cole 9780132270878, 9780134005447