The Sleepy Nights Motel chain consists of a hundred motels across Canada, providing what's known

in the industry as luxury budget accommodations, at lower than market rates.

Prior to Unionization

All employees of Sleepy Night Motels start at minimum wage regardless of the type of job or the
responsibilities involved in the job. They have a dental plan but the employees have to pay 50% of
the premiums. Employees receive a discount on room rentals if they stay at one of the other Sleepy
Night Motels in the chain. They do not receive any extended health benefits or a sick leave plan.
Employees who have friends who work for other hotel chains such as “Sleep Right” and “Doze City”
know that those employees receive higher wages, and have a lucrative benefit package which
includes full payment for employee uniforms for cleaning staff.

Most people who are familiar with the Oshawa, Ontario location of the motel describe it as having
very poor working conditions and management practices. The supervisors schedule the work shifts.
Those who party with the supervisors get the best shifts. Employees work long and unpredictable
hours with few breaks or rest periods. Many employees do not know from one day to the next what
shifts they will be working. Management has denied employee requests for a lunchroom and more
modern maintenance equipment.

There were few complaints to upper management since employees have learned lessons from other
employees who were fired for questioning the decisions made by supervisors or ridiculed for coming
up with suggestions to improve operations. One employee, who was fired for refusing to follow the
orders of a supervisor, launched a wrongful dismissal lawsuit against the company. He felt he was
asked to complete a task he wasn’t trained to do.

The employees receive an annual Performance Appraisal, but any reason is found to deny them an
increase in wages. Some Supervisors spot-check one or two things the employee was supposed to
have done and try to find fault with it. From the Supervisor’s point of view this would provide
justification for a poor rating. The employees are told verbally by the Supervisor what is written in
the review but they are not permitted to see it. Favoured employees consistently receive better
ratings and higher wage increases regardless of their performance.

Management doesn’t seem to care about the Health and Safety of the employees. One employee
addressed the problem of Health and Safety with the following comments. “If you came in and took
a look around you would find guards off machinery in the boiler room, no written safety procedures
and you wouldn’t find any WHMIS data sheets on site. Just last week another employee was injured,
this time by a filing cabinet falling over in a storage room. He had to be taken to the hospital. We’ve
got to take a stand because it's real hard to work under these conditions. We are all stressed out.”

There is no communication between management and staff. We are simply told what to do. The
supervisors don't have a clue about managing people. Although the systems are computerized many
of the employees do not have the computer skills required to use them effectively.

Last month a supervisor terminated an employee without giving him reasonable notice. The
supervisor defended his actions by saying the employee should have known how to use the new
computer system since the employee had been here long enough. Further investigation revealed no
formal training has ever been provided. Room bookings are often incorrect and front desk staff have
to deal with angry customers. This is a challenge since the front desk staff have not been trained on
how to deal with these issues.

Unionization

In the spring of 2019 the first collective labour agreement was negotiated. The workers were now
members of the SEIU (Service Employees International Union). SEIU was successful in organizing and
securing excellent contracts for workers in many other motel chains in the Oshawa area including
the “Sleep Right” and “Doze City” chains. Starting salaries had increased substantially at these
unionized motels and most negotiated a lucrative benefit package. When interviewed by the local
newspaper, Jim Smith, a front desk clerk and kitchen relief worker, stated, “We are looking for
substantial improvements now that we are unionized. After five years with the company I still only
earn slightly more than minimum wage and our work environment is not safe. “

Case Questions: Place your responses to each question in the large box provided below. Copy and
paste the questions in the box below.

Identify two reasons why you feel the employees voted in favour of joining a union. Provide quotes
from the case to support your answer. (4 marks)

Reason 1:

Quote:
Reason 2:

Quote:

2. Identify and explain the three roles of a union. (3 marks)

3. Based on information from the case, name one factor that influenced the compensation system
at Sleepy Nights Motel before unionization. (2 marks)

4 a) Does Sleepy Nights Motel have internal equity in their compensation system before
unionization? Explain using a quote from the case. (2 marks)

Sleepy nights Motel do not have any internal equity in their compensation system before
unionization. Employees who have friends who work for other hotel chains such as “Sleep Right” and
“Doze City” know that those employees receive higher wages, and have a lucrative benefit package
which includes full payment for employee uniforms for cleaning staff. The employees receive an
annual Performance Appraisal, but any reason is found to deny them an increase in wages. Some
Supervisors spot-check one or two things the employee was supposed to have done and try to find
fault with it. Favoured employees consistently receive better ratings and higher wage increases
regardless of their performance.

4 b) Do you think Sleepy Nights Motel will likely have external equity in their compensation system
with a union? Explain using a quote from the case. (2 marks)

Yes Sleepy Nights would have external equity in their compensation system with a union. This can be
depicted from following statement: After the union formation the workers were now members of
the SEIU (Service Employees International Union). SEIU was successful in organizing and securing
excellent contracts for workers in many other motel chains in the Oshawa area including the “Sleep
Right” and “Doze City” chains. Starting salaries had increased substantially at these unionized
motels and most negotiated a lucrative benefit package. Since so mnay motel chain would be there
we can have a comparison of compensation among the motels.

5. Identify two employee benefits that you would implement if you managed the motels. (2 marks)

The two benefits would be:

 Proper Compensation system and open annual performance system in which employee
would have the right to know what and why they are getting any specific rating.
 Proper safety Rules and regulation for employee health and safety. Proper training should be
given to the employees and timely audit would have been conducted for same.

6 a) Identify and fully describe one pay for performance plan that you could implement to for the
jobs at Sleepy Nights Motel. (2 marks)

The pay performance Align Performance Awards with Shareholder Objectives. Companies should
look at their compensation offerings as if they were an investment portfolio. Each pay portion is a
class of assets. As with investment assets, an organization's portfolio of incentives must include the
right combination of incentive plans and the right volume to be successful. A variety of pay
components that can be considered include: salary, bonuses, long-term cash rewards, equity or
phantom equity, retirement programmes, core benefits and executive benefits. Each one of them
has a different position to play.

6 b) Explain how you think the company and employees could benefit from the pay for performance
plan you recommend. Provide specific examples of what might improve. (2 marks)

Pay-for-performance schemes are a form of compensation where workers are paid on the basis of
productivity, as opposed to hours spent on work or on a fixed salary. Although this may result in less
sense of financial protection for the employee, there are many benefits for both the employee and
the employer. Sleepy nights Must Match Performance Awards with Shareholder Goals.

This companies should have financial responsibilities to their shareholders. As a consequence, the
payout should be calculated as any other expenditure made by the company. Its effectiveness
should be assessed against the background of the expected financial results (return) of shareholders.
There are actually two possible sections to the response. One is the hard dollar impact—increased
sales, earnings, cash flow, etc. The other is the soft dollar impact—increased efficiency, decreased
turnover, better customer support, etc When we look at compensation through a "pay-for-
performance" lens, we treat it as an investment.

7. If Sleepy Nights Motel completed a Job Evaluation process, each job would have number of points
assigned and would be placed on a pay grade. Explain one way the company would decide how
much to pay employees in each pay grade? (2 marks)

Ans: Exercise related to the calculation of wage and salary structure includes Corporate willingness
to pay, labour supply and demand, work appraisal, Prevalence of market rate, cost of living, trade
union bargaining power, managerial attitude, psychological and social influences. The key
consideration listed for this reason shall include the following:

Organizational willingness to pay labour supply and demand

Employment specifications

Index of cost of living

Prevalence of market rate

Trade union bargaining power, psychological and social factors.

8. With reference to the wrongful dismissal suit filed by a former employee, provide two examples
of documentation/evidence management would need to provide to support their decision to
terminate the employee? (2 marks)

The management would need to give proper justification for the termination of the employee. The
company cannot terminate any employee for not just following his/her order when the employee
have not been provided with the training of that particular work. Whenever the sleepy nights are
involved in firing or laying off a worker, there is a risk that the laid off employee will take legal action
against . They can discuss a severance arrangement with the employee to prevent this threat. As
part of the deal, the worker will sign a release indicating that he or she is giving up any or all rights to
sue you.While staff releases have many applications, they are most commonly used when you lack
proper paperwork to shoot, but you want to cut off the employment relationship and avoid the risk
of a lawsuit. They can also be used to give early retirement to a worker, or when you demand early
termination of a contract of employment by "buying out a worker.
9. Was reasonable notice required to be given to the employee terminated for not being able to use
the new computer system? Why? (2 marks)

Ans: Yes reasonable notice should be given to the employee who is terminated for not being able to
use the new computer system. It is the responsibility of every company to train the employee before
giving him that work.And if a person is not able to work properly then some prior notice should be
given so that atleast the employee would get an chance to improve it.

10. Identify two problems with the performance appraisal system at Sleepy Night Motels. Provide a
quote from the case to support each problem identified. (4 marks)

Ans: The two problems are :

No proper reason for not increasing the wage. The employees receive an annual Performance
Appraisal, but any reason is found to deny them an increase in wages. Some Supervisors spot-check
one or two things the employee was supposed to have done and try to find fault with it. From the
Supervisor’s point of view this would provide justification for a poor rating.

Employees are not permitted to see what is written in the review. The employees are told verbally
by the Supervisor what is written in the review but they are not permitted to see it. Favoured
employees consistently receive better ratings and higher wage increases regardless of their
performance.

11. Describe one change you would implement to make the performance appraisal system focus on
employee improvement at Sleepy Nights Motel. (1 mark)

12. Identify two groups of people who might be able to give inpu…
3.

One aspect that affects the structure of wages before unionisation is the low starting minimum
wage, regardless of the type of employment or the obligations involved in the work. They have a
dental coverage, but the workers have to pay 50% of the premiums. Employees can earn a discount
on room rentals if they stay at one of the other Sleepy Night Motels in the chain. They do not offer
any extended insurance care or sick leave plans.
4.