Chapter Six

Employee Stakeholders And The Corporation

Copyright 2003 by SouthWestern, a division of Thomson Learning

Chapter Topics
1. Employee stakeholders: The workforce in the 21st century 2. The changing social contract between corporations and employees 3. Employee and employer rights and responsibilities 4. Discrimination, equal employment opportunity, and affirmative action 5. Sexual harassment in the workplace 6. Whistle-blowing versus organizational loyalty
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The Workforce In The 21st Century

Within the context of the digital economy the following changes with employees and stakeholders occur:
A shift to knowledge work The concept of a job for life is dying Compensation, income, and the social distribution of benefits are shifting Quality of work life is not inherent in the uses of technology

Employee Stakeholders:

Five predicted trends in the work-life of employees include:

Demographics will drive a growing focus on family, personal, and spiritual matters Employees will demand schedules that work for them Internet-age values will take deeper root A back-to-basics trend It will get harder to tell work and home lifestyles apart
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The Workforce In The 21st Century

Several demographic trends that were predicted have been and are being realized:
The workforce is aging (growing) Managerial leadership positions are more difficult to fill Women entrants (new in profs.)are increasing Workforce cultures are mixing The education gap continues The level of education lags (slow move) The number of employees with disabilities is expanding

Employee Stakeholders:

Gay couples are denied health care insurance in most companies Copyright 2003 by South-Western, a division of Thomson
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The Workforce In The 21st Century

The trends in the workforce necessitate accommodation from managers and employees. Moral and legal conflict will likely increase if action is not taken with regard to:

Employee Stakeholders:

Age discrimination Physical harassment Health care provisions Educational challenges Paradigm shift toward a new work life model Copyright 2003 by South-Western, a division of Thomson
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The Workforce In The 21st Century

The following values were identified as motivators for professionals:
Competitive pay Benefits and opportunities A fair deal Being valued Decent relationships

Employee Stakeholders:

Workforce 2000 related values considered most important include:

Recognition Respect and dignity Personal choice Involvement at work Pride in work Quality of lifestyle Financial security Self-development Health and wellness
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The Workforce In The 21st Century

Generational analysis looks at differences among world views, attitudes, and values of generations of Americans:
GI generation Silent generation Baby boomers Generation X Generation Y
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Employee Stakeholders:

Copyright 2003 by South-Western, a division of Thomson Learning

The Changing Social Contract Between Corporations and Employees

The social contract that has historically defined the employee/employer relationship is known as the employment-at-will (EAW) doctrine. The EAW remains the cornerstone of U.S. labor law. At issue is the continuing debate over the nature of property and property rights.
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Employee And Employer Rights And Responsibilities

The ideal relationship between employer and employees is one based on mutual respect and trust. A right can be understood as a moral claim. The moral foundation for employee rights is based on the fact that employees are persons. The evolving social contract between employers and employees still recognizes employers power over physical and material property, but the contractual relationship aims in principle at balance, mutual respect, integrity, and fairness. Copyright 2003 by South-Western, a division of Thomson
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Employee And Employer Rights And Responsibilities

Employers are obliged to:

Pay employees fair wages for work performed To provide safe working conditions Fulfilling their contractual obligations to the corporation For following the goals, procedural rules, and work plans For performing productively Timeliness Avoiding absenteeism Acting legally and morally Respecting the intellectual and property rights of the employer
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Employees are responsible for:

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Employee And Employer Rights And Responsibilities

Major types of employee rights in the workplace include:
Right not to be terminated without just cause Right to due process Right to privacy Right to workplace health and safety Right to organize and strike Rights regarding plant closings
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Employee And Employer Rights And Responsibilities

Employees right to privacy remains one of the most debated and controversial rights. Areas centered around issues of privacy include:
Technology use Polygraph and psychological testing Workplace surveillance Internet use Drug testing Genetic discrimination
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Discrimination, Equal Employment Opportunity, And Affirmative Action

Recently, discrimination has surfaced in a number of categories including:
Racial profiling Income disparities Ratio of female compensation compared to male

Examples of discriminatory practices have been found in:

Recruitment Screening Promotion Termination Conditions of employment Discharge

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Discrimination, Equal Employment Opportunity, And Affirmative Action

Title VII of the Civil Rights Act of 1964 makes discrimination on the basis of gender, race, color, religion, or national origin in any term, condition, or privilege of employment illegal. The Civil Rights Act of 1992 extended punitive damages to victims of employment discrimination. The Age Discrimination in Employment Act prohibits employers from discriminating against individuals based on their age. The Equal Pay Act of 1963 prohibits discriminatory payment of wages and overtime based on gender.
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Copyright 2003 by South-Western, a division of Thomson Learning

Discrimination, Equal Employment Opportunity, And Affirmative Action

Affirmative action programs are a proactive attempt to recruit applicants from minority groups to create opportunities for those who would be excluded from the job market. Affirmative action as a doctrine is derived from several ethical principles that serve as bases for laws:
Principle of justice Utilitarian principle Rights principle

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Discrimination, Equal Employment Opportunity, And Affirmative Action

Reverse discrimination is alleged to occur when an equally qualified woman or minority member is given hiring preference over white males. Notable court cases that illustrate how affirmative action and discrimination issues have been addressed include:
The Bakke case The Weber case The Stotts case The Adarand Constructors v. Pena case The Hopwood v. Texas case The Grutter v. University of Michigan Law School case

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Sexual Harassment In The Workplace

Physical harassment remains among the most prominent civil right issues in the workplace. Forms of sexual harassment include:
Unwelcome emotional (physical) advances Coercion (force) Favoritism Indirect harassment Physical conduct Visual harassment
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Whistle-Blowing Versus Organizational Loyalty

DeGeorge has identified five conditions when whistle-blowing is morally justified. Five instances when whistle-blowing is not justified have been suggested. There have been twelve guidelines that offer factors which should be considered before deciding to blow the whistle on an employer. Four managerial steps to prevent external whistle-blowing have been suggested.
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