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In the prior issue of this newsletter, we discussed the recent Circuit City decision and arbitration agreements as a method for resolving employment disputes. As we discussed, the arbitration process relies heavily on contract law and the outcome often depends on the enforceability of the arbitration agreement. There are, however, two other alternatives for resolving conflicts, neither of which involve third-party intervention: open-door policies and peer review.
Open Door Policy
The open-door policy is a form of communication that enables upper levels of management to stay informed about employee attitudes, job-related problems and beliefs about the company in general. This is a preventive approach and the simplest method for handling complaints. It works well for small organizations where employees have familiar contact with management. Open-door policies offer an environment that encourages employees to discuss their concerns with any level of management or the Human Resources Department. It allows misunderstandings or conflicts to be resolved before they progress to more serious problems. This type of policy, which is based on face-to-face communication, creates work environments based on mutual trust and respect and is often a successful way to quickly resolve employee issues, particularly when the issue involves an employee's immediate supervisor. In addition to offering an open-door policy, examples of other activities that enhance communication include:
- Regularly scheduled meetings;
- Suggestion or idea boxes;
- Employee surveys; and
- Question and Answer forums in employee newsletters.
Some problems can not be resolved simply by employee access to management. In these cases, a more formal internal review process - peer review - may be used.
What is Peer Review?
The function of a peer review panel is to review management's actions regarding the interpretation and application of policies, procedures, practices and work rules to ensure that the guideline, policy or practice was followed appropriately and consistently. For example, if an employee has a work-related problem, such as a disciplinary warning for performance or attendance issues, or a termination notice, they may request review of the situation by a peer review panel. The panel is comprised of co-workers who have been trained and certified in the peer review process. Potential panelists must not have had any interest or participation in the problem or be a relative of the employee who requested the review. A peer review panel can make recommendations to management to clarify policies and procedures; however, they can not do the following:
- Make or change company policy.
- Make or change work rules.
- Establish or change pay rates or benefits.
- Change performance appraisals or ratings (this is best left to the "open-door review.")
- Unlawfully discriminate against the employee or violate any state or federal laws.
Panelists may not change the initial supervisory decision that prompted the peer review to make it more severe than the original action. Further, decisions made by a peer review panel can be final and binding.
How Does Peer Review Work?
Peer review begins with a written request for review by the employee, which is followed by the designation of a facilitator (usually the human resources manager) by the employee, selection of the peer review panel, and the investigation. When the review process is complete, the employee receives a copy of the final and binding decision.
Guidelines for Participants
All parties involved in the peer review process: the human resources department/facilitator, the employee filing the request and the panelists, have specific responsibilities. The human resources department and the facilitator are responsible for overseeing the peer review program. The facilitator schedules meetings, coordinates employee and panel records and ensures that all sessions conform to the peer review policy. Responsibilities of the facilitator include the following:
- Serving as a neutral party;
- Documenting requests for review and maintaining confidential records;
- Processing requests in a timely manner and consistent with established procedures;
- Counseling employees regarding procedures and possible outcomes;
- Not influencing the outcome of the review;
- Training panelists; and
- Administering peer review hearings.
The employee who requested peer review is responsible for:
- Following the peer review procedures;
- Respecting the rights of other employees involved in the process; and
- Accepting the final and binding decision of the panel.
Panelists must:
- Complete a peer review training program;
- Conduct a thorough and fair investigation;
- Make a decision based on the facts presented;
- Not discriminate against the employee in any legally protected category;
- Disqualify themselves when they have a conflict of interest;
- Make a determination that is consistent with past practice and precedent; and
- Keep the complaint and the peer review proceedings confidential.
It is important that panelists receive thorough training to ensure that they are fully informed of their responsibilities and are aware of the parameters in which they may conduct their investigation (e.g., legal and ethical considerations, types of questions that can be asked, how to handle questions and comments from employees not involved in the peer review).
Investigation Process
Outlined below is the investigation process followed by the peer review panel:
Step 1: Employee submits a written request for peer review with a description of the problem and their desired remedy.
Step 2: Panel reviews the written appeal and the disciplinary action taken by management.
Step 3: Panel meets with the employee, hears their version of events and asks questions to clarify facts and understand the situation.
Step 4: Panel meets with the supervisor and any witnesses, hears their version of events and asks questions as necessary to clarify facts.
Step 5: Panel identifies additional information needed to make an informed and fair decision:
- identifies other employees and supervisors to interview;
- analyzes the company policy that applies to the situation under review;
- reviews the employee's personnel file;
- reviews previous similar situations, precedents or past practices; and
- notes other information that would be helpful to making a decision.
Step 6: Panel meets as a group to discuss the situation under review:
- analyze the facts as presented and other information and documents reviewed;
- review witness statements;
- analyze the company's policy and procedures and management's application of the policy to the situation; and
- review precedents and note similarities or differences.
Step 7: Panel makes a decision by a secret ballot vote based on their investigation:
- if the facts of the situation support management's action, then the employee's appeal is denied;
- if the facts of the situation do not support management's action or interpretation of the policy, or if the action taken was not consistent with previous precedents, then the employee's appeal is upheld; and
- the panel prepares written summary of their decision.
Step 8: Panel provides feedback to the employee and his or her supervisor.
The peer review process, from panel selection to issuance of its decision, is usually completed within 6 days of receipt of the request for peer review. Peer review is a prompt, fair and impartial method for evaluating complaints internally.
Benefits to Employers
Because open-door policies and peer review programs do not involve outside intervention (e.g., arbitrators, attorneys and judges) they allow employers to keep problems in-house. All records - from the nature of the complaint through the investigation and final decision - are confidentially kept within the company and there are no public records of the dispute, as there are with litigation. Further, employers who use these more informal methods are able to resolve issues quickly and with a minimum of disruption.
The best method for handling employee concerns is through open, consistent and effective communication that allows both employees and management to address issues and misunderstandings promptly and before they develop into more difficult problems - the "nip it in the bud" approach. Last but not least, these programs must protect any employees who participate from any form of retaliation. This approach may not work in every situation and employers may need to consider the alternatives of peer review or arbitration.
For more information, please call (414) 423-1330 or e-mail educational services.
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