Peters is an engineering company in the West Midlands. It has been in existence for 65 years, and has a lot of long serving and loyal employees. In total it has 375 employees – with 88% of these being male. Most of the female employees work in the support functions (eg finance and sales) and in administration. It is a very traditional industry.
On the same road as Peters is James – another engineering company. This is younger – it has been in existence for just 16 years. It has just 57 employees – 52 men and 5 women. Although it also operates in an industry that is seen as being very traditional, it has more modern working practices than Peters and uses more progressive engineering techniques.
Both organisations have trade union recognition – both with the BCE union. Peters has 100% membership, whereas James has just 35% membership.
Over the past few months the Managing Director (MD) at Peters has been very concerned about the amount of stainless steel that seems to be going missing. He accepts that there is always a certain amount of raw material that needs to be discarded due to scrap – but the amounts of stainless steel that have been accounted for as ‘scrap’ over the past few months have been very high. After a discussion with his management team he has decided to ask the Security Officer to look back at CCTV recordings of the car park. He has a suspicion that someone is actually stealing the stainless steel – and the only way that it could be removed is in a vehicle, and hence looking at the car park recordings seems a useful move forward.
The Security Officer is not an employee of Peters – but is an employee of a security agency which both Peters and James use to provide security services.
Today the Security Officer has come to meet with the MD of Peters to explain his findings. He has shown the MD of Peters CCTV footage which clearly shows two employees loading considerable amounts of stainless steel into the boot of their cars. From looking at the CCTV recordings the MD of Peters can see that that the two employees involved are John Timberly and Martin Faulkner.
The MD of Peters is shocked. John and Martin are both very long serving employees, indeed John is one of the trade union representatives. The MD of Peters knows both the men well and has a lot of respect for them. As he thinks about what they are doing he becomes very angry – they must realise that stealing material in this way is damaging the business.
In his anger he goes straight to the area of the factory where John and Martin works and shouts at them to come to talk to him in his office. When John and Martin turn up he is furious and tells them they are both dismissed. John and Martin are shocked by this – and demand to know what they have done. In reply the MD of Peters plays the CCTV footage to them. John and Martin start to argue about the footage – but the MD of Peters will not let them speak. He tells them to go immediately – and never return. John and Martin leave the office.
About one hour later the Manufacturing Director bursts into the MD of Peter’s office. He tells the MD of Peters that all the employees have walked out. John and Martin have told their colleagues that they have been dismissed and also told them that they are innocent – and all the employees have walked out in protest.
The MD of Peters is horrified. Peters has recently won a big contract, and everyone is working hard to meet the very tight deadlines. A walk out at this stage could seriously damage the prospects of getting further work from this customer. He leaves his office and goes to the entrance to the organisation to find out what is happening.
He is met by an angry group of employees all demanding that John and Martin be re-instated immediately. He tries to explain that they had been stealing, but everyone shouts at him saying that he ‘does not know the facts’.
Eventually one of the trade union representatives (not John) calls for quiet and he explains to the MD of Peters what must be done before the employees will go back to work:
i. Re-instate John and Martin
ii. Dismiss the Security Officer who provided the information about John and Martin
iii. Put a bonus scheme in place to reward employees if they meet the deadlines on the current important order
The MD of Peters listens to the demands and then walks back to his office. He asks his management team to come with him to discuss what to do. He is just about to start the discussion when his phone rings – it is the MD of James. His employees have heard about the walk out at Peters and they have walked out in sympathy! The MD of James is furious – and demands to know what is going to be done to resolve the problem.
What is your advice to the Managing Director of Peters? In giving this advice answer the following questions:
1. Should John and Martin be re-instated? In answering this question consider whether there are any flaws in the dismissal process.
2. Should the MD of Peters dismiss the Security Officer? What are the implications of doing this?
3. How should the MD of Peters respond to the request for a bonus scheme to be put in place? If he ignores the request how will he get the employees back to work?
4. What responsibility does he have for the situation at James?
5. After all this has been resolved what should he do to improve the employment relationships?
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