Firing People

Let's get topical!

Since I'm seeing a lot of stuff in the news and across the internet about lazy people benefiting from unemployment insurance, forcing people collecting benefits to prove they're actually looking for work, and that employers are simply not offering enough to get their employees back, let's explore this through the lens of...

Industrial-Organizational Psychology

(that's a cause for celebration, so go ahead and do it!)

Onboarding and Offloading Employees

It takes a lot of money to actually hire someone to perform a job, from going through all legal paperwork to training them up to do what they're expected to do to providing benefits for them before they can really justifiably earn them based on their work.

And it takes a lot of money to fire someone as well, from having all the reviews with various managers to justify the removal to any kind of legal paperwork to potential severance packages and/or wrongful termination lawsuits.

Given that, an employer should be careful about who they hire. This potential employee is going to be an investment for your company, and you don't want someone who you'll have to fire, or who will only be here for a limited amount of time - at least without knowing that in advance and being able to weather the absence.

And likewise, an employer should be incentivized to keep their employees as long as possible. Entice them with benefits and rewards for doing their job well and work with them when they're underperforming. Because once you've expended the effort in hiring someone, it's generally better to improve them - for both the individual and the company - than to discard them and find someone to replace them. At that point, you're basically just playing craps, with each hire being one more throw of the dice.

Now that doesn't mean that there aren't cases where firing someone isn't the right call. But it costs a lot of money and time, and that decision should be a last resort, only used in cases where it is not effective to keep the underperforming employee.

Complications

The real world doesn't work all that nicely, though.

The first thing is that the costs of hiring an employee and getting them competent in their area of work varies by job.

Higher-paying jobs typically take months or years to effectively train up a competent employee - usually because of other business decisions such as proprietary software or processes that means almost no experience can be transferred in or out of the job: everyone must be trained for this job, and the training only applies to this job.

Lower-paying jobs typically don't have as much of a cost for employment on paper, since learning the ins and outs of most minimum-wage jobs takes a few days, maybe a few weeks. So if someone needs to be let go and you need to train someone up real quickly, it's conceivable to do that without a huge drop in productivity. Hell, with that short of a turnaround, it's even possible to have the fired employee train their replacement before they actually leave.

This does not take into effect that competence and expertise are not the same thing. Having worked as a cashier for about 7 months while in school, I can tell you that I'm significantly more competent than someone who's never had to do the job before, but I cannot compete with someone who's been doing the job as a career. I worked with someone who'd been doing the job for at least a decade, and they could do twice as much as I could in half the time; everything was just natural to them.

(being a cashier is a lot more than just sitting at a register and ringing people out, for those of you unaware. for certain types of jobs, you basically make the entire store work)

And employers recognize this in some fashion - giving raises to people who've been there longer, or who have good reviews, or whatever. But occasionally this just makes them more of a target for removal - removing this one higher-paid employee will allow us to hire two brand-new employees, that's savings! (it's not)

Likewise, the higher wage an employee earns, the more money and difficulty it is to fire that employee. If someone is in management or a white-collar job, they're more likely to have the knowledge and resources to cause a lot of trouble on the way out. But if someone is making minimum wage, they don't have any resources to fight back regardless of the situation.

Which means, the rich get to stay rich, and the poor struggle to get by.

And some laws make it much easier to fire someone - such as At-Will Employment laws - by reducing the legal overhead and liability for getting rid of someone.

Combating the Complications

Unions are a way for employees to band together and have the strength to actually protect individuals from the whims of a faceless company, or mean-spirited managers. But they're only truly effective if the union itself has some kind of political power. Either hard - where they're officially recognized and have some kind of say over the company itself - or soft - where it's effectively impossible for the company to fire enough of the union to kill it without destroying their own workforce.

Scabs complicate the matter, especially when the union represents workers with a relative short training-time-to-competence.

I have a few opinions on laws regarding the workplace, but most are beside the point. Simplistically, though, if a law makes something easier for the employer to do, it almost always takes power away from the employee. Even if it's a net-neutral law in terms of difficulty for the employer/employee relationship, it almost always helps the employer more, as they have more resources and power than any individual employee. Laws that actively make it harder for the employer to do something generally give the employee more leverage.

There's a balancing act here, and I would hope that the balancing act is what is usually being argued about in these cases. Let's talk about the general concept of regulation as an example.

Regulations are specifications that employers must hold to. And as regulations are built into laws, there are either a lot of specific ones (to handle all the unique cases) or ones that are overly broad so as to cover as much as possible. Most importantly, creating regulations costs resources, and making sure that any given company complies to them costs resources (both for the company and whoever audits the company). If a regulation is not actually needed - for example, forcing a company to have an on-call clown to cheer-up any disgruntled employee - it's a waste of money. But if a regulation is needed and does not exist, bad things will happen. A regulation I'd hope no one disagrees with is OSHA - or the Occupational Safety and Health Administration - who's entire existence is to make sure that companies cannot provide an unsafe work environment for their employees.

But the balancing act still exists: regulations cost money and time, and if the regulation is not needed then it's a waste. Where that line is drawn is a point of argument and discussion, but there needs to be a line. If the line is too far on regulation, companies will lose out on profits. Which may not be too bad for large companies, but can destroy smaller local or family-owned shops. But if the line is too far against regulation, horrible things happen. The cost of a life could be measured in pennies. Or something on the scale of Chernobyl or the Flint Water Crises could become a more regular occurence.

At-Will Employment

So important it gets its own section...

Technically this gives both the employer and employee the ability to terminate the employment agreement at any time for any reason (with the exception of legally-protected classes, such as sex, race, etc.), but practically this gives nothing to the employee and everything to the employer.

The benefits of this policy universally help the employer - by allowing them to fire whoever they want. This reduces the firing costs, allowing employers to get rid of bad employees - or whoever they suspect to be bad employees - without having to grab specific numbers justifying their decision. In some ways, this helps the economy as a whole - allowing companies to truck along without those pesky complications - at the expense of individual people. People who may be underperforming for any number of perfectly justifiable reasons.

And while the "good ones" attempt to work with their employees, helping with any kind of personal situations, mental or medical issues, or whatever else may be contributing to their lowered performance, and I'd argue that doing so is a good business decision, there is no actual mandate that must be done. A company may run the numbers and figure that personal attention to get someone back to baseline is not worth just getting rid of them and replacing them with fresh blood.

A tricky part underlying everything is that "protected classes" clause. If someone was under a protected class and felt comfortable letting that known to people, and then that protected class somehow got revoked, they could be fired for who they are without any kind of change in their work performance.

This isn't a hypothetical: transgender individuals are currently in a state of uncertainty as to whether their being transgender is safe to share or not. There are a swath of laws being proposed now to allow legal discrimination of these individuals, as children, and that's little more than a test to spread it to more areas.

(i mean, yes, the primary reason for this is for political support. but if this achieves that goal, then ramping up is the next logical step)

So while the intent of At-Will Employment is to be used for employers to have a say over who they fire without a host of legal fees telling them they did it wrong, it is very possible - probable even - that people are abusing the law to get rid of a subordinate who doesn't comport themselves to the superior's sensibilities.

Yes, I like to believe that most companies have some manner of internal, work-related, review process to justify firings. And this is the intent - let the company do what they know is necessary rather then regulate some kind of standard that may not apply - but there's loopholes purposely built into the law and there's no oversight to protect individuals being abused by those loopholes.

Good Faith

Now everything that I wrote about above is assuming that at least some part of the world is acting in bad faith. And there are some bad faith cases hidden within the potential solutions that make them as bad as, some might say worse, than the issues they aim to solve.

The best case scenario here is simply for everyone to act in good faith. An employer has an incentive to keep their employees happy, since they'll do good work. They have an incentive to keep their employees safe and whole, so they'll continue to work for the company and the company doesn't need to pay legal or medical fees. The employee has an incentive to do their best so they'll be rewarded. The employee has an incentive to keep the company in business so they're not in danger of being downsized. Both are incentivized to increase profits since that's how capitalism works, and it will make both more money.

Et cetera, et cetera.

But as soon as some amount of bad faith is rewarded - whether it be an employer figuring out how to underpay for work without losing any employees or an employee learning how to underperform without getting caught - someone will attempt to take advantage of it. Maybe not me, maybe not you, but someone will. And as soon as that bad faith case is recognized by others, and any severe consequences lacking, it will spread.

Wrap Up

Oops, this wasn't what I meant to write. As evidenced by the pre-essay having nothing to do with the essay itself.

This is what you get when freeforming, I guess. Maybe I'll do a follow-up for what I actually wanted to talk about, which is about carrots and sticks in employments (spoiler: carrots are better).