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The only virtue I claim is the truth and non- violence


Moral issue Judgment



Deontological Theory

Stakeholder Theory


Discourse Theory

HRM Environment

Social Justice

Distributive Justice

Natural Justice

Procedural Justice

Employee Responsib ility Safety and health Employm ent issues

Performa nce appraisal

Ethical Issues

Cash and incentive plans

Restructur ing and layoffs

Privacy issues

Race and disability

Mostly Industrial Work is hazardous

Extensive use of high speed and noisy machinery

Production Processes requiring higher temperature

Increasing reliance on chemical compounds

Where does the issues arises


Underground and underwater tunneling



Video Display Terminal and Computer Keyboards

Health Issues
Stress causing trauma and disorder
rising productivity pressure Escalating job demands Wrist pain by meat cutters, keyboard operators, Super market checkers

Legislations by govt. to compensate victims



Restructuring and consequent layoffs have become relevant because of poor management . If restructuring requires to close a plant, in this case layoffs are ethically important.

Parts of the organization are significantly over or under staffed Workforce productivity is stagnant or deteriorating Morale is deteriorating ADVANTAGES Improved productivity and morale Reduced personnel turnover Increased organizational effectiveness and efficiency

Layoff Loss of wages and benefits

Loss of role as worker and

provider Loss of dignity and self esteem Loss of trust Loss of the pattern of daily life

Voluntary Reductions in remuneration

Voluntary timeoff

Redundancy training

Supplemental employees



Rights vs. Responsibilities

RIGHTS-are owed to people according to some legal system, social convention or ethical theory.

RESPONSIBILITIES- something for which one is responsible, a duty ,obligation, or burden.

Responsibilities are: Be compassionate Honor patient wishes Maintain confidentiality Adhere to safe practice Adhere to professional standards Maintain professional relationships Report unethical behavior Protect patients from harm Report patient abuse

Do early homework-

understand work and determine skills

Plan with manager- time management and meeting deadlines Use available resources and take responsibility Participation- good team player Be punctual and regular Cost effectiveness Creative thinking and innovative

Incentive Plans

Incentive Scheme
An incentive scheme is a plan or program to motivate individual or group performance. An incentive program is most frequently built on monetary rewards but may also include a variety of non-monetary rewards or prizes

Pay influences employees

Reinforcement theoryBehavior that is rewarded will be repeated.

Expectancy Theory
If I attempt this level of performance, am I likely to succeed?

Motivational Force = E*I*V

If I achieve this level of performance, am I likely to be rewarded?

What value do I place on the rewards available to me?

Performance Related Pay (PRP)

"Performance Related Pay" is the formalizing of the link between personal performance and remuneration. It is an attempt to bring the traditions of "piece-work" associated with the Agricultural Age to the late stages of the Industrial Age and the early stages of the Information Age. Objectives of PRP: Control over income Engagement/Role ownership Performance Management

Types of incentive scheme

Individual incentives

Group incentives

Individual incentive schemes

Individual payment schemes include payment by results, piecework and bonuses, work measurement and appraisal and performance related pay Many sectors of employment use pay systems that contain direct links to individual performance and results. On an individual basis this may be via: 1. payment by results (PBR) e.g. bonus, piecework, commission 2. work-measured schemes and pre-determined motion time systems 3. measured day work (MDW) 4. appraisal/performance related pay 5. market-based pay 6. competency and skills based pay.

Important Wage Incentive Plans

Halsey Premium Plan

Rowan Premium Plan

Halsey Premium Plan

A wage incentive program established as the first in the US industry. The incentive program was created by Frederick A. Halsey as a method for improving the straight piece rate system in an effort to reduce wage rate cutting by management

Rowan Premium Plan

In the Rowan Plan, the time saved is expressed as a percentage of the time allowed, and the hourly rate of pay is increased by that percentage so that total earnings of the worker are the total number of hours multiplied by the increased hourly wages. The plan aims at ensuring the permanence of the premium rate, which is often cut by the employer when the workers efficiency increase beyond a certain limit.

To business
retain existing employees increase their motivation, morale and loyalty boost productivity link individual and business performance focus employees on achieving targets build teamwork Indirect benefit, e g free health assessments may reduce absences.

To employees enhance the quality of working life reward employee efforts add value to the employment contract

Group Incentives
Compensation system which links pay to a group's combined performance measured by reduction in costs, increase in productivity, progress in attaining firm's objectives, etc.

Advantages & Disadvantages

Better co-operation among workers Less supervision Reduced Absenteeism Leads to improved communication and employee relations. Shorter training time

Weakens relationship b/w individuals effort and performance. Intra-group conflict The incentive may not be strong enough to serve its purpose

Performance Appraisal

Ethical Dilemma 1: Use of Trait Oriented or Subject

Evaluation Criteria
Favoritism or Vengeance

Ethical Dilemma 2: Problems in the writing of performance standards

and measurement indicators.
quantitative, time-oriented, realistic, and job-related Easier said then done rewards/bonuses dispensed on the basis of 'outstanding performance' (as measured qualitatively) can go to really inadequate performers who have the 'good numbers', while bypassing the truly effective performer.

Ethical Dilemma 3: The use of different PA systems within the same

From an ethical standpoint, cet. par., it is unfair to rate one group of people objectively and another group subjectively.

Ethical Dilemma 4: How are the results of PA to be used?

subject to abuse

Ethical Dilemma 5: Who determines the objective standards?

designing of appropriate standards or objectives for specific jobs issue of fairness



Ethical Issues in HRM



Ethical Methods to safeguard employee against prejudice of Race, Gender, Age and Disability
Monitor the principles and norms of enterprise to endure reflection of values(TATA)

Monitor, selection, reward, devt and appraisal systems

Vigorously defend/against violations

Protect women against workplace exploitation

Employment issues

Common Types of Problem Behavior

In general, problem employees fall into two categories: employees causing problems- for example by starting fights or leaving early employees with problems -such as an employee whose money worries are a distraction from work.

Those most likely to be encountered by supervisors are absenteeism and tardiness insubordination and uncooperativeness alcohol and drug abuse employee theft

1. Absenteeism and tardiness

This is an expensive problem. An absent employee may be paid for the time off replaced with a less productive person Also, missing work is often a sign of a deeper problem. such as a family crisis, anger about something at work, or plans to leave the organization.

2. Insubordination and
Insubordination: Deliberate refusal to do what the supervisor or other superior asks. Poor performance may result from not understanding how to do something. This is corrected by training. Sometimes an employee performs poorly or breaks rules because he or she chooses to do so. This may be uncooperative behavior or deliberate refusal to do what he or she is told

Many kinds of negative behavior fall into the following categories: General poor attitude criticizing, complaining, and showing dislike for the supervisor and organization Making an art out of doing as little as possible Spending most of the day socializing, joking around, or moving as slowly as possible

3. Alcohol and drug abuse

Some poor performance such as unsafe practices, sloppy work, or frequent absences may be a symptom of alcohol or drug abuse on or off the job. These employees are expensive to the organization.

They can hurt the organization by lower productivity. They are more likely to quit, to cause accidents, to have a higher use of disability and sick benefits, and to increase insurance costs.

4. Employee theft
Employees take companies inventory, supplies, and money as well as steal time by giving the employer less work than they are paid for. A supervisor should take measures to prevent and react to theft.

It is an issue to protect a persons personal life from intrusive and unwarranted actions.

Privacy has emerged as an important social as well as organizational concern. Privacy has emerged as an issue because of fast expanding information technology that has made it possible to intrude into the privacy of individuals.

Concept of Privacy
Defined as control over transactions between persons and others. Aim- to enhance autonomy or to minimize vulnerability. 2 main theories of privacy one that focuses on privacy as a process of regulating levels of social interaction other that focuses on the states and functions of privacy.

Employee Privacy
The main issue of employee privacy relates to the employee records maintained by organization . 1. 2. 3. 4. These are maintained in relation to Selection Placement Promotion Assessment etc.

While the employees may approve such practices, there is a concern about the handling and us of such information.

Employee Privacy
Few facts related to privacy issues are: The American Management Association found that : 19 % - companies taped phone conversations 15% - stored and reviewed e-mails 34% - used video cameras to monitor employee activities

Managing Ethics

Be sure you are right, then go ahead!!

Managing ethics
1. Recognize that managing ethics is a process. Ethics is a matter of values and associated behaviors. Values are discerned through the process of ongoing reflection. Therefore, ethics programs may seem more process-oriented than most management practices. Managers tend to be skeptical of process-oriented activities, and instead prefer processes focused on deliverables with measurements.

2. The bottom line of an ethics program is accomplishing preferred behaviors in the workplace. As with any management practice, the most important outcome is behaviors preferred by the organization. The best of ethical values and intentions are relatively meaningless unless they generate fair and just behaviors in the workplace.
3. The best way to handle ethical dilemmas is to avoid their occurrence in the

first place.

4. Make ethics decisions in groups, and make decisions public, as appropriate. This usually produces better quality decisions by including diverse interests and perspectives.
5. Integrate ethics management with other management practices. 6. Use cross-functional teams when developing and implementing the ethics management program. Its vital that the organizations employees feel a sense of participation and ownership in the program if they are to adhere to its ethical values. Therefore, include employees in developing and operating the program. 7. Value forgiveness. People are more sensitive therefore increase in no. of ethical issues. Consequently, there may be more occasions to address peoples unethical behavior. The most important ingredient for remaining ethical is trying to be ethical. Therefore, help people recognize and address their mistakes and then support them to continue to try operate ethically.

8. Note that trying to operate ethically and making a few mistakes is better than not trying at all. Some organizations have become widely known as operating in a highly ethical manner, e.g., Ben and Jerrys, Johnson and Johnson, Aveda, Hewlett Packard, etc. Unfortunately, it seems that when an organization achieves this strong public image, it's placed on a pedestal by some business ethics writers. It's the trying that counts and brings peace of mind -- not achieving an heroic status in society


Cash and Compensation Plans

Issues pertaining to salaries, executive perquisites and the annual incentive plans etc. Pressure on HR- both ways

Further ethical issues crop in HR when long term compensation and incentive plans are designed in consultation with the CEO or an external consultant. While deciding upon the payout there is pressure on favouring the interests of the top management in comparison to that of other employees and stakeholders.

Race, gender and Disability

In many organisations till recently the employees were differentiated on the basis of their race, gender, origin and their disability. Differentiating factor is performance! In addition the power of filing litigation has made put organisations on the back foot. Managers are trained for aligning behaviour and avoiding discriminatory practices.

Employment Issues
Hiring issue- someone who has been recommended by a friend, someone from your family or a top executive. Yet another dilemma arises when you have already hired someone and he/she is later found to have presented fake documents

Two cases may arise and both are critical:

First Case-the person has been trained and the position is critical. Second case- the person has been highly appreciated for his work during his short stint or he/she has a unique blend of skills with the right kind of attitude.

Resolving Ethical Dilemmas

1. Obtain the relevant facts.

2. Identify the ethical issues from the facts.

3. Determine who is affected.

Resolving Ethical Dilemmas

4. Identify the alternatives available to the person who must resolve the dilemma.

5. Identify the likely consequence of each alternative.

6. Decide the appropriate action.

Know the Principles

In ethical decision making there are three basic principles that can be used for resolution of problem. These three principles are that of intuitionism, moral idealism and utilitarianism. 1) Principle of intuition 2) Principle of moral idealism- abide by the rule of law without any exception. 3) Principle of utilitarianism - There is no clear distinction between what is good and what is bad; the focus is on the situation and the outcome

Balance Sheet Approach In balance sheet approach, the manager writes down the pros and cons of the decision. This helps arrive at a clear picture of things and by organizing things in a better way.
Engage People Up and Down the Hierarchy One good practice is to announce ones stand on various ethical issues loudly such that a clear message to every member of the organization and to those who are at the greater risk of falling prey to unethical practices. Debate Moral Choices Before taking a decision, moral decisions need to be thought upon and not just accepted blindly. It is a good idea to make hypothetical situations, develop case studies and then engage others in brainstorming upon the same.

Solution for Ethical Dilemma 1

Develop a standards-based system (key performance standards for a job as determined from a job analysis), supplemented by a valid, reliable measure of subjective job factors such as BARS (Behaviorally Anchored Rating Scales) (Barrett, 1966 and Campbell et al, 1970). The BARS technique uses some form of job analysis to determine what specific behaviors, and subsequently what behavioral dimensions actually constitute job performance (Smith and Kendall,1963)

Develop an objective-based system (specific, quantifiable, time-oriented objectives for the rating period)


Solution for Ethical Dilemma 2

Much time and care must be placed on writing performance standards that accurately and fairly reflect both the quantitative and the qualitative dimensions of the job

Solution for Ethical Dilemma 3

The resolution to this dilemma is to develop consistency through the establishment of organization-wide objectives or the implementation of a standards-based system

Solution for Ethical Dilemma 4

(1) Adequate steps must be taken to (2) Steps must be ensure that an taken to ensure appropriate that the standards amount of time is are objective, spent in developing reliable, and valid; performance standards; (3) Information gathered from PA should not be used capriciously or arbitrarily (measures to protect the employee from such abuse would include a mechanism for grievance and and ombudsman's office); and

(4) Each employee must be informed as to how the information from the PA is to be used.


Solution for Ethical Dilemma 5

The optimal solution seems to be the use of 'knowledge experts' (both subordinates and superiors) who collectively specify the key dimensions of job performance and measurements of those dimensions