Executive Summary
The Georges Hotel is an upscale European-style boutique hotel located along the Oriental Bay in Wellington. Most of the staff is friends and relatives of Jeff and Chad, who are brothers. The hotel has many advantages that a family business has as well as the disadvantages. Some of the supervisors are not aware of the laws against discrimination. They are not aware of what sexual harassment means and what the appropriate and inappropriate behavior towards their subordinates is. This has resulted in situations where a couple of EEO complaints were raised against the hotel. However, as things stand, the hotel is liable for more ERA/HRA (EEO) complaints if the behavior of the supervisors does not change. In the present case study, one of the employees, Lindsey, had filed an EEO complaint and the supervisor, Dale, had fired her in retaliation, but under the guise of poor performance. Cindy, the Director of Human Resources, has to resolve this issue and has to ensure that such acts are not repeated.
The report analyses the options that Cindy has for resolving the current EEO complaint and how it has to be resolved such that it complies with the New Zealand Equal Employment Laws. It explores the laws about the retaliation, the EEO complaints’ procedure, the process that the hotel has to follow while responding to EEO complaints, and how Cindy should respond to Lindsey’s termination. The process for reducing the likelihood of further complaints is to constitute a comprehensive complaint management system; hence, that process is described in detail. While responding to complaints in a timely and efficient manner is commendable, it is important that the company should reduce the likelihood of complaints. The paper describes the various measures that can be implemented through a comprehensive performance management plan for supervisors to reduce the likelihood of complaints.
Introduction
Jeff and Chad Mitchell co-own The Georges Hotel. Jeff is currently the CEO of the Georges Hotel and is responsible for the day-to-day operations while Chad, his younger brother, is currently the VP community relations. Chad’s wife Cindy is the Director of human resources. While Jeff and Cindy are interested and highly motivated about their jobs, Chad is not. Julie, Jeff’s daughter is an MBA, Michael is a sales associate with an MBA, Brandon is interested in kitchen management, and both are sons of Chad and Cindy. Dale, children of friends, and other family members were appointed, as Cindy preferred to hire by referral. The environment of the hotel also fosters family ties and the mission of the hotel supports it too. There are no formal procedures or policies and no grievance redressal system. Due to the nepotism, there is no discipline and accountability in the hotel. The Hotel is profitable and Jeff is planning to expand to a second hotel by acquiring a dilapidated hotel that was closed due to bankruptcy, after years of litigation. Jeff has plans to expand the hotel to more locations. Cindy wants to change the way the HR works to mitigate the disadvantages of the nepotism in the organization while retaining its positive aspects.
Cindy is planning to put structure to the management that is needed for operating the chain of hotels as well as put in place some policies for changing the way the HR is being handled currently. Cindy also wants to address some issues such as the occasional inappropriate behavior from some of the employees though employees have not come forward with any complaints. One of the sales managers is a tyrant and always demeaning the work of his subordinates. Howard, the engineering manager, was also an impossible manager to work for and was the cause for the separation of some employees. Cindy knows that her brother, Dale, behaves inappropriately with his staff at the Garden Terrace Restaurant in his workplace though his behavior is professional and appropriate in management meetings. Dale touched Marie inappropriately while at work and used inappropriate language with David, both of whom were new in the catering at the Garden Terrace Restaurant. There were two EEO (Equal Employment Opportunity) complaints against the Georges Hotel. One of them was filed by Lindsey, a new employee in Dale’s department. When Cindy brought this complaint to Dale’s notice, he became furious and fired Lindsey on the grounds of poor performance.
Cindy wants to address the inappropriate behavior of the supervisors by making the appropriate policies that can be applied consistently across the hotel chain (when it becomes a multi-unit organization). She wants to install a professional performance management system and an effective grievance and complaint redressal system.
Findings and Analysis
Question 1
Employers are bound by employment laws, statutes, and case law. Employment law statutes and amendments to the statutes are the primary sources of employment law. They define mutual obligations for the behavior in employment relationships and include, but are not restricted to a set of laws called the Equal Employment Opportunity laws. These include
Minimum Wage Act 1983
Wages Protection Act 1983
Immigration Act 1987
Parental Leave and Employment Protection Act 1987
New Zealand Bill of Rights Act 1990
Privacy Act 1993
Hazardous Substances and New Organisms Act 1996
Modern Apprenticeship Training Act 2000
Injury Prevention, Rehabilitation and Compensation Act 2001
Holidays Act 2003
Crown Entities Act 2004
Employment Relations Act 2000 (ERA)
Holidays Act 2003
Health and Safety in Employment Act 1992 (HSEA)
Human Rights Act 1993.
According to the guidelines of International Labor Organization (ILO), an employer has to provide an employee the following to be considered a good employer:
Protection from summary dismissal (employment security)
Adequate wages (income security)
Consultation and employee representation (voice security)
Training opportunities (job security)
A safe work environment (work security)
Work-life balance through reduced hours of work (work security)
Cindy should be aware that New Zealand has a just-cause system and that means if any employee has to be fired, the employer should provide procedural justifications when dismissing an employee by following a due process, which includes three dimensions; adequate notice, fair hearing, and judgment based on evidence. Procedural justice is determined by the rules used in decision-making, including the decision as to who will be responsible for the decision-making, how to communicate the information, and whether the receiver can appeal any decisions. In the case of situations like dismissal, feelings of procedural injustice are cause for employee legal action. Another factor is that, if Dale terminates Lindsey while the EEO complaint procedure is underway, it will be considered as a retaliatory act, which is unacceptable as far as the EEO is concerned. The HRC suggests that, while the complaint is underway, Dale should not interact with Lindsey at all until the EEO complaint is resolved through mediation. If Dale goes ahead and fires Lindsey, she could add a retaliation claim to the EEO complaint, thereby putting the Georges Hotel in a more difficult position. As a Director-HR, Cindy must ensure documentation that substantiates the Dale’s claims of Lindsey’s poor performance exists. The documentation should have enough history that it does not look like it was cooked up for the sake of showing that due process was followed. If there is no documentation to support the claims of poor performance by Lindsey and she is terminated, then the Georges Hotel will not be in a strong position to defend itself against the retaliation claim.
Cindy should meet with Lindsey to find her perspective. This will make it clear to Cindy whether Lindsey will be likely to file an additional EEO complaint. The Human Rights Commission will work with both the parties to arrive at a solution using an informal mediation procedure. If Cindy could talk to Lindsey and find a way to defuse the situation, it could be better for all the parties involved. Since the outcome of an HRC commission mediation is an apology, an agreement that similar behavior will not be repeated or a compensation, Cindy can offer a financial settlement and/or a different position to Lindsey so that further embarrassment can be averted for the Georges Hotel. However, Cindy should take legal counsel before making any offers to Lindsey.
Question 2
There is a significant overlap between the ERA and HRA. The employee has an option to seek redressal under ERA or the HRA under some special circumstances. However, once the employee makes a choice to pursue one of the paths, then the employee is committed. HRA has a wider area of coverage and includes pre-employment while the ERA only covers discrimination (both direct and indirect) and sexual harassment within the employment relation. The Human Rights Act simply makes it unlawful to treat anyone differently, subject to certain exceptions, on any of the grounds listed in s. 21(1) of the Act. The Commission will accept a complaint if:
there is evidence that a person has been treated differently
the different treatment can be attributed to one of the grounds of unlawful discrimination
the treatment results in disadvantage
The process for EEO complaints is as follows:
The employee complains to the HRC Infoline by email, phone or letter, and the HRC gathers the relevant information and provides options for resolution
If it is not resolved, then the mediators appointed by the HRC will look at the relevant information about a complaint and, if required, they may seek additional information, and may provide informal process to resolve the matter at an early stage
If it is still unresolved, the complaint is checked if it comes under any of the 'prohibited grounds' of discrimination and if so, then it will proceed to mediation
HRC mediator will contact all parties and facilitate a mediation meeting. Legal representation is not required.
If the parties do not agree to a settlement then the case goes to Office of the Human Rights, which is independent of the HRC and will represent complainants willing to present their case to the Human Rights Review Tribunal (HRRT).
HRRT will hear the case and make a decision and if any of the parties are not satisfied, they can appeal to high court.
Regarding the current complaints, Cindy should be aware that it is the employer’s responsibility to conduct a prompt, fair, and thorough investigation whenever an ERA/HRA complaint is filed and to take appropriate remedial action. The organization will be advised by ERA/HRA if it considers the charge eligible for mediation. Since this process is least adversarial and is provided free of cost, the employee may choose it. Cindy should develop a good relationship with the EEO investigator and/or duty mediator as well as the employer’s representative to enable a working partnership for resolving the issue. The investigation may include an on-site visit and interviews by the ERA/HRA representatives. Cindy’s department must extend all the required help to the investigators to enable them to gather relevant evidence efficiently.
Question 4
Supervisory responsibilities place an individual in a position of authority and power over other employees. Most supervisors have good intentions, but they sometimes do not understand how their management style and behavior can negatively affect employee performance. Cindy is rightfully concerned, because Dale’s behavior is bullying and may be discriminatory. Performance management and training are needed. Cindy should include the following in her performance management plan:
Job descriptions for all the different types of roles that are in the company should be prepared and made available to the supervisors for use. Supervisors must also have an understanding of their responsibilities and authority levels.
A code of conduct should be developed so that one can identify the appropriate and inappropriate workplace behavior. It should include clear examples of and include penalties for infractions.
The performance appraisal system should assess the supervisors’ behavior and task accomplishment so that they are held accountable for their staff’s success, not just their individual accomplishments.
A reward system that encourages appropriate behavior and rewards managers for the success of those they supervise.
A complaint procedure that allows staff issues to be heard and also protects and supports the rights of managers.
Employees must understand the organization’s discipline process, including the steps and penalties that may be applied. Supervisors must understand their levels of authority in the discipline process. They must be offered training and support from HR in administering discipline.
A process for conflict resolution and conflict resolution training for supervisory personnel must be part of the performance management plan
Performance management starts as soon as an employee is hired. Onboarding activities should include training to ensure that new employees understand what is expected and are properly inducted into the organization by training the employee about policies such as the appropriate conduct, harassment and bullying, safety, customer service, organizational culture, and employee benefits. The management training should include training on motivation, communication, coaching, and delegation, conflict resolution, preventing harassment and discrimination, and documentation and administering the discipline. Cindy’s performance management plan should emphasize good communication. When employees have an avenue to discuss issues, there are fewer chances of them becoming problems. Interaction among staff and management can be increased by informal coffee sessions, weekly snack-and-chat hours for all employees, skip-level interviews, employee newsletters, and interest group blogs, and so forth. After Cindy has established her performance management plan, the managers have to be trained on the new policies and expectations. A process to monitor staff behavior and provide opportunities for improvement is needed. It is not a quick fix, and she must be prepared for resistance from some managers. When it becomes a multi-unit hotel, Cindy will have a performance management plan in place so new employees can start from the first day with a clear understanding of the expectations of the organization.
Conclusion
The Georges Hotel has most of the staff as friends and family of the co-owners who are themselves, brothers. There are both advantages and disadvantages with this setup. The hotel is planning to expand into a chain, but Cindy, the Director of HR, believes that the current HR process does not scale well. The current set up lends itself to abuse with the supervisors not being aware of the various Equal Employment Opportunity laws. So Cindy has to first look at resolving the issue of Lindsey’s termination in retaliation for her EEO complaint, ensure that further incidence of such complaints is reduced by implementing a performance management plan, and set up policies and procedures for a complaint management system. The report and the following recommendations will resolve those issues.
Recommendations
Question 3
The Georges Hotel should have a formal complaint or grievance redressal procedure that is in line with the employments laws, but will provide an avenue for the employees to resolve their issues without feeling the need for taking legal action such as filing a complaint with ERA or HRA. To do this the company should do the following:
Commit itself to operating ethically by being fair to all parties in dealing with complaints in a timely manner. This includes processing complaints free charge and providing easy access to the procedure for all. This is done by implementing a formal complaint management procedure. There is a process to distinguish between a formal complaint, matter of fact complaint, suggestion, and a request for service information.
Welcomes feedback and acts on them to improve their complaint management process. Will use the complaints data to identify recurring issues with the complaint management procedure
Will foster a culture that allows people to express their opinions openly and without fear of reprisal
Is ready to take appropriate remedies, including apologizing to a complainant
Ensure the privacy and fair treatment of complainants
Other actions include training and counseling employees about inappropriate behavior and avoiding direct and indirect discrimination. Cindy must ensure that there is an appropriate code of conduct at the Georges Hotel and that the code is distributed, understood, and followed by all employees. The hotel must establish an employee complaint system with multiple reporting channels to ensure that issues are reported and addressed as soon as possible. When an issue arises, HR must react quickly to investigate and appropriately respond to the situation. Supervisors must understand their responsibilities to the organization and to the staff they manage. They must be trained on harassment and bullying. They must be trained on how to administer discipline and maintain appropriate documentation. HR must be a support resource for supervisors and employees and provide guidance when needed in conflict management and dispute resolution. Finally, the performance management system should assess and reward desired management behaviors.
Question 5
A complaints management forum has to be setup with the senior leadership team (SLT) a part of that. They have the overall responsibility to manage it. Each business area has a defined complaints officer who will not investigate the complaint but will monitor the progress and will ensure that the complaint management process is strictly followed. A complaints investigator is appointed on a case-by-case basis such that he or she is not on a level lower than the employee who is being investigated. The roles of the complaint officer and investigator are clearly defined and they are provided adequate training about how to perform their duties and how they should report on the status of their cases to the SLT. Metrics are determined and measured. Examples of the metrics are
Percentage of the number of complaints acknowledged within, say, five days of receipt should be 100%
Percentage of complaints investigated in 15 days is 75%, within 20 days is 90% and within 30 days is 100%
The complaints process is published on the intranet website or as posters at various locations that employees access so that they are aware of the web form, email address, post box or hotline details for complaining. Complainants can also report their concerns directly to the owner, manager, or somebody in the HR department who will have to ensure that the complaint is entered into the complaint management system. The company has to treat all the personal information provided with the complaints as confidential and complaints handled anonymously.
Fact of matter or trivial complaints are treated by the customer service
Serious complaints are checked by somebody in the SLT and assigned to the right complaints officer and complaints investigator
The complaint officer will perform the initial assessment and thereafter monitoring the progress
The complaint investigator will assess the complaint and investigate the complaint, which includes looking at the original process or action of the employee. The investigator can be team leader, manager, or a director who is at least of the level of the person against whom the complaint has been raised
If the complainant is unhappy with the decision, he or she can ask it to be referred to a complaints review panel (CRP). The CRP can ask for additional information or refer the matter to an external agency such as an ombudsman. It can make recommendations and prepare a report
The outcome of any of the investigations will be informed to the complainant in writing and the reasons for taking the decision are stated
If the complaints are against the members of the SLT, then the ombudsman can be approached directly or the complaint can be raised with ERA or HRA (EEO). At any point in the process, the complainant can halt the process and raise a complaint with the ERA or HRA, if he or she is not satisfied with the progress of the complaint. Both of them have a statute of limit of 90 days from the date of occurrence of the act so that has to be informed by the employee before he or she starts the process
Confidentiality and protection from retaliation are an employee’s immediate concern. Of equal importance is what happens after the complaint is filed. Employees expect a response. The complaint procedure must include an equitable investigation process. If managers see the process as favoring employees and punitive to managers, they will not support the policy (and employees will not support it if they feel the process favors managers). If employees believe the system is just a formality and not a real process that addresses their concerns and protects them from retaliation, they will not use the system and they will distrust the organization. The process should include timelines that allow for thorough investigation and resolution and prevent unnecessary delays or stalling on the part of a disgruntled manager or employee. The investigation needs to be managed by someone with good conflict resolution skills, and, in some cases, an impartial outside facilitator may be necessary to ensure participant confidence in the unbiased nature of the process and the resolution.
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