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Ethical & Effective Employee Termination

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Adam Reardon

on 9 September 2013

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Transcript of Ethical & Effective Employee Termination

Ethical & Effective Employee Termination
Elements that may not warrant termination
Reasons for termination of employment
1. High absenteeism/late rate
2. Low productivity (slow and with errors)
3. Inconsistent and unreliable work behaviours
4. Being dishonest and theft
5. Drug or Alcohol Possession at Work
6. Lying on resume

Australian Human Resources Institute, 2013, viewed 5th August 2013, <http://www.ahri.com.au/assist/exiting-the-organisation>
Fair Work Act, 2013, Australian Government, viewed 5th August 2013, <http://www.fairwork.gov.au/factsheets/FWO-Fact-sheet-Notice-of-termination-and-redundancy-pay.pdf>
Goodwin, M & Maconachie, G 2011, "Minimum Labour Standards Enforcement in Australia: Caught in the Crossfire?", The Economic and Labour Relations Review : ELRR, vol. 22, no. 2, pp. 55-80.
Kellner, A, McDonald, P & Waterhouse, J 2011, "Sacked! An investigation of young workers' dismissal", Journal of Management and Organization, vol. 17, no. 2, pp. 226-244.
Safety Australia, 2013, viewed 6th August 2013, <http://www.safetyinaustralia.com.au/safety-news/7443-termination-of-employment-best-practice-guide.html>
Small Business, 2013, Australia, viewed 6th August 2013, <http://smallbusiness.chron.com/ethical-issues-terminating-employees-11765.html>
Walsemann, U. 2006, Psychological impact of performance-based termination on the immediate supervisor, Capella University.
Wood, MS & Karau, SJ 2009, "Preserving Employee Dignity During the Termination Interview: An Empirical Examination",Journal of Business Ethics, vol. 86, no. 4, pp. 519-534.
Zins, DP, 2012, "Managing the Exit: Negotiating an Employment Termination", Harvard Negotiation Law Review, vol. 17, no. 1, pp. 289-310.
Zuehl, JJ & Sherwyn, DS 2001, "Identifying uniform employment-termination practices for multinational employers", Cornell Hotel and Restaurant Administration Quarterly, vol. 42, no. 5, pp. 72-85.

Consequences of Unethical Termination
Implications for organisation:
Decreased workforce morale
Reputational consequences
Legal action
Public attention
Word of mouth
Financial consequences
Legal costs
Decrease in productivity
The Fair Work Act

Lawful when:
Genuine redundancy
Not harsh
Not unjust
Not unreasonable
Consistent with Small Business Fair Dismissal code

Factors to be considered:
Relates to conduct or capacity
Employee has been notified of the reason and given the opportunity to respond
Relates to unsatisfactory performance that the employee was previously warned about before dismissal
Training Objectives
To provide managers an understanding of the law in regards to termination of employment
To highlight ethical and effective practical approaches to dealing with employment termination
Disciplinary Action
Justifiable reasons
Effective policies
Wide range of coverage
Disciplinary Issues
Common issues noted by HR managers:
Attendance problems
Work performance problems
On the job behaviour problems
Effective Disciplinary Action
4 basic steps:
Documentation of employee misconduct
The investigative interview
Progressive discipline
Correction or dismissal
Appeal mechanisms
Options need to be available to employees
Disciplinary procedures need to be clear and explicit
Distribution of job relevant behavioural and performance standards
Appealing Disciplinary Action
Legal Aspects
Ensure proper and reasonable steps are taken
Types of misconduct are justifiable, effectively communicated and understood by employees and their unions
Litigation can be avoided
Benefits for both employers and employees
Termination Interview
After 'due process' of communicating disciplinary action is fulfilled and the employee remains unviable to the company, the decision to terminate should be acted on promptly.
Wood and Karau (2009)
Third party presence reduces feelings of respect
Mentioning positive attributes leads to greater feelings of respect and empathy
Escorting employee out of building reduces feelings of respect and increases likelihood of employee complaints & taking of legal action
Emotional Intelligence
What's wrong with this scene?
Be prepared
Timing and neutral site
Direct supervisor/manager/HR
Be honest - no surprises
Maintain composure - high level of EI
Let employee respond
Explain benefits & support network
Allow dignified exit - offer assistance
What's better about this scene?
A successful termination would end on a positive note, and still allow the employee to walk out, ego intact.
Ethical Standard
The law represents only the bare minimum. Ethical standards requires practice to go above and beyond the law.

The basic concepts and fundamental principles of decent human conduct:
Respect the rights of others
Maintain dignity
Pursue just outcomes for those affected
Balance self-interest and honesty
Doing to others what we would expect to be done to us

Types of Dismissal
Reasons for termination of employment
To avoid improper termination claims to maintain the company's reputation as an employer of choice, maintain confidence and cohesion with the other employees after the termination, avoid nuisance and other unnecessary litigation.

1. Discrimination

2. Use one's position to get even with another person for a private grudge

3. Physiologic

Termination occurs when an employer or employee ends an employee's employment with a particular employer. Termination can be voluntary or involuntary depending on the circumstances.
Consequences of Unethical Termination
Poorly handled termination interviews can have detrimental effects on the organisation and the employee.

A breach of the psychological contract:
Employee may feel as though the psychological contract has been violated
Result in anger, frustration, betrayal, bitterness
Impact on employee's behaviour - confrontation
Dismissal without notice:
Termination by frustration
Abandonment of employment

Dismissal with notice:
By notice of agreement
Dismissal for cause
Notice must be in written form and
Either delivered personally,
Left at employee’s current residential address
Posted to the employee’s current residential address.
Full transcript