I don’t know how to handle this Management question and need guidance.
Harry Potter readers will recall the house elves who work in the kitchen at Hogwarts. They would never think of asking to be paid. Hermione finds this outrageous. “This is slavery!” she contends. Of course, Harry Potter is fantasy. Or is it?
Greg Petouvis, a junior at Cornell University, worked for the Equal Employment Opportunity Commission in Washington, DC, during a recent summer. The job included performing site compliance visits at several companies, interviewing people who filed discrimination complaints, determining whether complaints had merit, and settling disputes. The work was very similar to that done by full-time EEOC field analysts. But Greg received no pay. Not even a housing allowance for living in Washington, DC during two and one-half summer months.
Scott Hurff from Wake Forest also spent a recent summer in Washington, DC. He interned at the Heritage Foundation, a conservative think tank. He received a 10-week stipend of $2500 plus subsidized housing.
Rather than receiving a stipend from the employer, Aaron Mieszczanski received a $1320 grant from Williams College to work as an unpaid intern with Layers for Children, a non-profit organization.
1) Should summer interns be paid? If yes, how much? How would you recommend that an employer decide the answers to both of these questions?
2) What added information would you like to have before you make any recommendations? How would you use this information?
Please read Your Turn; Burger Boy on pages 337 to 339 in your textbook. This case study describes a common scenario at a QSR (Quick Serve Restaurant). The rates of pay are based on the when the scenario took place, pre-2007. Please answer the following questions based on the case study:
1. What appears to be the problems at this Burger Boy?
2. Can any of these problems be explained as compensation issues?
3. How can some of these problems be lessened with diligent use of rewards other than pay?
4. Are hours worked a reward? What may explain why the author was happy working only 20 hours a week while a coworker was unhappy working less than 30 hours per week? How can schedules be used as a reward?
Please read Your Turn; Predicting a Contract’s Clauses on page 546 of your textbook. Based on the information in your case study and your lessons, explain why the following components of the current agreement are predictable outcomes:
1. Eligible UAW-represented GM employees are given a $5000 signing bonus.
2. The new profit sharing formula is based on GM’s North American profits. In the past, profit sharing checks were based on a more global profit measure.
3. GM agreed to restart production at an idled plant in Spring Hill, Tennessee, and to start assembly of new products at existing factories in Michigan.
Deb Allen’s life-altering discovery at work really “communicated” her company’s pay practices. Swamped with work at an asset-management firm, she went into the office over the weekend and found a document abandoned on the copy machine. The document contained the base compensation, raises, performance ratings, and bonus information for 80 of her colleagues.
Ms. Allen was outraged that a noted screw-up was making $65,000 a year more than more competent colleagues, while some new hires were earning almost $200,000 more than their counterparts with more experience. The discovery led her to question why she was working weekends for less pay than others were getting. ”I just couldn’t stand the inequity of it,” she says. Three months later she quit.
But Ms. Allen couldn’t bring herself to share the information with her colleagues. “I would have been better off not knowing any of that,” she explains. “I couldn’t give it to people who were still working there because it would make them depressed, like it made me depressed.”
1) How would you have reacted if you were Ms. Allen? Why?
2) As the compensation director, what would you do if Ms. Allen had brought you this document, and asked for your help in understanding what was going on. (Firing the person who left it on the copier is not an option).