In 2018 , several employees were upset with the way merit raises were distributed because they said their supervisor did not effectively evaluate their performance. Some employees said their performance was stellar, but their supervisor would not give high ratings because the supervisor did not feel that anyone performed at the top level. The employees contended that the performance ratings should accurately reflect the quality of their work and the current system did not provide this assurance. You did not offer any salary increases in fiscal years 2019, 2020, or 2021. In 2022, even though COVID negatively impacted others in your industry, you were able to offer a 3\% salary increase. Unemployment had dropped to 3.5\% and the Cost of Living Adjustment (COLA) was 5.6%. You decided to bring jobs up closer to market by using 2% of the salary increase for those market adjustments and the remaining 1% was given on merit. Employees had to be evaluated with an overall average of 4 out of 5 by their supervisor. Human Resources still reported dissatisfaction with the current evaluation system to the senior Leadership (C-Suite). Your senior leadership team (C-Suite) is working on their 2023 budget and they have determined that your company will give all employees a 5\% COLA and there will not be additional compensation for stellar performance or market adjustments. You a. Strongly Agree b. Agree c. Disagree d. Strongly Disagree Explain your answer Answer the following questions: 1. Salary increases whether merit or COLA are generally forever. a) What would happen if the company found a way to offer both the 5\% COLA, merit, and market adjustments in the current year's budget, but the following year there was a budget crisis (e.g., recession)? b) Is there another way? How would you arrive at an alternative solution? 2. Inaccurate performance evaluations make merit raises difficult. a) What could/should management do in terms of ensuring performance is accurately evaluated? Why or why not would this be important in consideration of distributive and procedural justice? b) Explain how inaccurate performance evaluations would affect the level of trust and the perception of justice amongst employees. Explain how this may affect the employee's ability to focus on their job tasks. How would this affect how employees accept the decision? 3. How influential do you think salary adjustments are to employees (consider the job satisfaction and motivation theories in your answer)? In your answer, explain disposition-based trust, cognition-based trust, and affect-based trust. 4. How important are distributive and procedural justice in the decision to offer salary increases and how to offer them? a) Explain the level of trust the employees of this company may feel toward senior leadership. b) Define informational justice and explain the role informational justice would play in this decision 5. Explain how you made the decision and the information you considered. Explain how bounded rationality may affect the quality of this decision. How would you prevent satisficing during this decision-making session? 6. How would this decision affect the level of trust employees have with senior management? How would this decision affect the level of organizational commitment, citizenship behaviors, and counterproductive behaviors of the employees? Part 2: Company Email (Informational Justice) Remember, this memo is to your employees. Review the elements of informational justice, you will need to keep the memo/email to the point, avoid placing blame and using casual language, use facts and avoid emotional language (e.g., we will be better off), identify your purpose for writing the memo, be concise and clear. But provide enough information to ensure employees believe you are being honest and forthright with them. That is you are not covering up or deceiving them. Use a memo template, 12-point font (either Arial or Times New Roman), and single space your memo. You are the CEO and you need to let your employees know about the decision regarding salary increases in fiscal year 2021. Email is not a secure form of communication. You cannot control where the document (email) goes, and it can hang in cyberspace for an indeterminate amount of time. While you have little control over who a memo/letter will be shared with, it is more difficult to forward correspondence received as a hard copy than it is to forward electronic communications. You are creating a permanent record of this communication with your employees. Chapter 7 (Trust, Justice and Ethics) and Chapter 8 (Decision-making) How Will You Compensate This assignment is important because throughout your career you will face issues related to trust, justice, and ethics. How you handle these situations will say a lot about your character and may ultimately effect whether your company remains viable. The assignment is intended to help you think through management decisions where there are often not right or wrong answers, but the consequences of those decisions may be unintended or deleterious to the organization. 20% of the grade will be based on writing style issues. You will need to cite two sources (the textbook and an outside source) for part 1 (answers to questions) of the assignment. Upload your paper to D2L. Objectives - Explain the four-component model of ethical decision-making. - Define and provide an example of trustworthiness. - Define four types of organizational justice. - Analyze ethical behavior and provide a plan to restore trust. - Applying knowledge learned, create a memo that explains the consequences of unethical behavior that is persuasive and includes recommendations for remedial action(s). Part I: You will need to cite from the textbook and from an outside source (use APA style to cite sources in the text of your paper and in the reference page). Read the following scenario and answer the questions. After reading the scenario, you will decide whether you agree with the decision made by senior management (i.e., strongly agree, agree, disagree, strongly disagree). You will then provide a rationale for the decision you chose. Your rationale should consider job performance, organizational commitment, job satisfaction, job motivation, and distributive and procedural justice. You will also provide an explanation of the decision-making process including information you considered when making your decision. You have been provided with the Cost-of-Living Adjustments (COLA) from the Social Security Administration for your reference (see below). Scenario: How Will You Compensate You are on your company's senior leadership team, and it is time to finalize your budget for fiscal year 2023. In 2018, the cost-of-living adjustment (COLA) based on the Consumer Price Index was 2.8% (see COLA chart below). In order to balance your budget, you were only able to offer a 2% COLA to your employees. You have several star performers, who you believe contribute substantially to the profitability of your firm and you have several positions that after a market analysis you have determined you are 10% under market. Your profitability depends on maintaining the star performers and in this tight job market 3.9\% unemployment rate), you do not want to lose the people who are being paid substantially below market. In 2018 you gave a 1% COLA and disbursed the other 1% by means of merit raises and market adjustments. In 2019 the unemployment rate was 3.67% and the C-Suite decided not to offer pay increases. In 2020 COVID pandemic hit, and unemployment was 8.05%, because you did not give a pay increase in 2019 and your workforce was still upset with the performance evaluation system you had in place you decided to give a 1% across the board pay increase. Because you were unable to offer raises and the raises you provided were less than the Cost-of-Living Adjustment (COLA), your employees' salaries remained flat