Reference no: EM133890428

Question

Case 16-1 -United States Freight Group:

Company Background

United States Freight Group (USFG) was founded in the mid-1960s as a small bulk carrier in the transportation industry. Through internal growth, acquisitions, and partnerships, the organization has grown into a diversified transportation company employing over 800 people, 500 of whom are drivers. The company operates internationally in the United States, Canada, and Mexico and is either number one or in the top five of most markets it currently serves. The company is "quality driven" and committed to meeting customer needs 100 percent of the time-providing on-time, contaminant-free deliveries and efficient and accurate billing. The company offers a variety of services ranging from dry bulk transportation to remote silo inventory management. Since 1990, it has been the recipient of eight quality service awards and recently was designated as "supplier of the year." With such a wide range of services and equipment and a focus on quality, USFG has proven it can handle most client needs.

The following situation takes place at one of USFG's remote transloading facilities in the southeastern United States. Operations at this facility entail unloading materials from railcars into trucks and transporting these goods to customers in the surrounding area 24 hours a day, 7 days a week. Because the customer base is "local," the drivers typically travel in a 200-square-mile radius of the transloading facility. This remote location is managed by the regional manager, who is physically located in a different state, but a human resources representative (HRR) is on-site from 8:00 a.m. to 5:00 p.m., Monday through Friday, to handle the daily duties, such as scheduling, paperwork, and employee relations. Thus, the HRR provides staff support without direct line authority. Two shifts (6:00 a.m. to 6:00 p.m. and 6:00 p.m. to 6:00 a.m.) are utilized at the facility, with employees working 12-hour schedules. The HRR sets the schedules on a rotation basis, so the process is considered fair by the employees.

The Model Employee

James Redmond enjoyed working at USFG. In fact, he liked it so much he stayed with the company for over eight years-twice as long as the next senior employee. James liked the company for many reasons. Initially, the pay and benefits attracted him. The benefits included medical, dental, and life insurance, as well as a matching 401(k) plan. The safety incentive programs, number of holidays, and paid vacations after time in service also made employment at USFG attractive to James. Another plus was that USFG paid its employees on a multitiered commission basis tied to the number of loads delivered during an employee's schedule. Drivers made $35 per delivery, while loaders made $30. If an employee had the ability, training, and experience to be a loader and a driver, he could earn up to $65 per delivery by doing both jobs. Approximately four to five deliveries could be made during a normal 12-hour shift. Usually, the more senior employees were given the dual designation of "loaders/drivers." Thus, James was motivated early on to obtain additional job and safety training to gain the dual designation and earn the maximum amount possible.

James had been the facility's number one loader/driver in terms of performance, efficiency, and safety for more than six years. He was a model employee whose recent injury had a big impact on the facility's overall performance. James was injured on the job when the hose used to transfer the material from the container to the truck "broke loose" during loading.

The end of the hose hit James in the arm, breaking his arm and causing major nerve damage. The injury was so severe that even after the break healed and he completed physical therapy, he continued to experience "deadness" in his arm due to the nerve damage. As a result, he could no longer load the trucks. He could only drive.

Given that James was such a model employee, USFG welcomed him back in whatever capacity he could perform. James felt equally as blessed to be back, even if it meant only performing part of his old job. It was less money, but he still enjoyed working at USFG. The individual-based work was well suited for his personality. It provided him an opportunity to have time alone, which with a family of five was a precious commodity. Plus, his previous employer, a local shipbuilder, changed to a team-based culture, which James never really felt comfortable with. It was supposed to be a more positive environment with everyone pulling together, but he found it to be just the opposite. The employees tried ways to outshine everyone else to gain favorable recognition, so James found himself always having to watch his back. That was the great thing about USFG: you didn't have to play politics or worry about dealing with complainers, slackers, or brownnosers. Just do your job, perform it well, and get paid, or so James thought.

The Management Problem

Shortly after James returned to work, USFG lost a local contract that represented a significant amount of work for the transloading facility. Kathy Prunel, the regional manager, was confronted with the challenge of how to keep the employees working when her facility just lost over 25 percent of its business. This remote location was not a top priority for upper management, as evidenced by the lack of marketing efforts for the facility. Without the proper marketing, the facility's client base and production capacity were limited. In the short term, while Kathy explored marketing opportunities with upper management, she decided to change the schedule from 12- to 8-hour shifts (7:00 a.m. to 2:00 p.m., 2:00 p.m. to 10:00 p.m., 10:00 p.m. to 7:00 a.m.) and increase the amount of "standing time" for each employee on each shift. "Standing time" was time spent in the yard at the facility performing activities such as prepping, cleaning, or maintaining the equipment. Although a certain amount of "standing time" was necessary during every employee's schedule, three to four hours became mandatory. This policy change led to lots of discussion and discord around the yard because "standing time" paid $16 an hour, considerably less than one could make loading or driving.

The workers were told the situation was temporary. "Just get through the next several weeks and things will get back to normal," Kathy told them. After two weeks, all of the equipment was spotless and running smoothly, forcing the workers to spend more time together in the yard. Not everyone was happy about the increased interaction. James felt like the company was doing what it could to avoid layoffs, but some of the newer employees, A. J. Johnson in particular, couldn't seem to see anything but the negative in the situation. James had known others like A. J., always complaining about their situation and what they were going to do if the company didn't do right by them.

After several weeks of hearing A. J. spout off, James finally had enough. "If you hate it here so much, why don't you quit," asked James. "I never quit nothin' in my life, and I ain't startin' now!" replied A. J. "That manager better get her act together and start doing something or she's gonna be hearin' from me! And what's it to you anyway, old man!" barked A. J. The conversation escalated to such a point that James and A. J. had to be restrained by their coworkers. On his way to his car, James could hear A. J. screaming behind him, "You're lucky your buddies were here! You better watch out! Don't let me catch you alone!"

The next day, Cindy Smith, the HRR, was informed of what transpired between James and A. J. the previous night. She was concerned. She suspected that A. J. was the one stealing from the office-supplies, coffee, sugar, and so on. She knew A. J. was trouble, but as long as the facility was operating at full capacity, he didn't have an opportunity to interact much with the other workers. Now, things were different! Cindy immediately contacted Kathy Prunel, who flew down the next day with Mike Ebersol, the safety manager, to meet with Cindy, James, and A. J.

The meeting went as well as could be expected. The regional manager hated to involve Mike, but she saw no other way. Mike was a big man, and he had a way of presenting a situation such that all parties agreed to act responsibly. Basically, Mike threatened James and A. J. that if they couldn't resolve their differences amicably and Kathy had to be brought in again, they would be real sorry! James left the meeting with an uneasy feeling. He didn't think Mike's message had much of an impact on A. J. What was he going to do when A. J. pushed the envelope? How was he going to react? He went to Cindy and asked her not to schedule him and A. J. on the same shift. Cindy knew James was a good person, and she was just as concerned as he was. She agreed.

The next several weeks passed without incident, sort of. Although James and A. J. had no direct contact with each other, thanks to Cindy's scheduling, A. J. attempted to agitate James indirectly. At the end of his schedule, A. J. would "accidentally" spill coffee on the seat of the front-end loader, so when James came on he would sit in it. He tried soiling the equipment (spitting on the steering wheel) because he knew how much pride James took in keeping his machinery clean. A. J. even went as far as to break the front-end loader so James would get blamed. Cindy was well aware of his deliberate antics, and she feared James might eventually be pushed to the breaking point and retaliate. After much deliberation, she called Kathy.

Kathy had not been sure that Mike's approach was going to work, so she was not completely caught off guard by Cindy's call. She thanked Cindy for contacting her and began to develop a plan of action. Kathy realized she didn't have any substantial evidence against A. J. If he and James got into another altercation, then both had to be let go for fighting. She decided to do two things. First, Cindy should continue scheduling the work so James and A. J. didn't come into direct contact. Second, Cindy would begin implementing a "checklist." The "checklist" was a list of safety, maintenance, and cleaning items that had to be performed by each worker on his equipment prior to the end of each scheduled shift. Kathy believed this to be the perfect means of documenting any inappropriate behavior that might be grounds for dismissal. Cindy immediately created and distributed the lists, noting the change in policy with the employees on the next shift.

When Mike Ebersol heard about the checklist being used at the remote transloading facility, he thought to himself, "How is Kathy ever going to learn to be a good manager without confronting these problems head on? She always sidesteps issues. Now is the time to force her to deal with this problem directly." He called Cindy and told her to schedule James and A. J. for the same shift for the upcoming Saturday night. "This will force things to a head! They'll solve their differences one way or the other, and then Kathy can take action," Mike thought to himself.

Cindy was panic stricken! She just knew someone was going to get hurt. A. J. was going to cause trouble for sure, but how was James going to be able to defend himself with his injured arm. She was unable to contact Kathy, who was on vacation for seven days. Without being able to speak with Kathy, she had no choice but to follow Mike's instructions. She scheduled the two for Saturday's night shift.

The Showdown

James couldn't believe his eyes when he saw Saturday's schedule. It must be a mistake. He went to talk with Cindy. Cindy was visibly upset and told him what happened. James went into the yard to begin working and planning how he was going to handle the situation. He was adjusting a piece of equipment on the front-end loader when a coworker approached him and said, "James, what you gonna do man? I saw Saturday's schedule, and it ain't good. I heard A. J. flappin' his gums day before yesterday about how he was gonna be packin' some heat. Said if you wuz to get out of line, he'd have to pop you one! You better be real careful James; A. J. is one bad dude!"

Epilogue

Trouble began shortly after A. J. and James started their Saturday night shift. A. J. started talking "smack," and James couldn't contain himself. James verbally defended himself and even went as far as telling A. J. he thought A. J. was responsible for most, if not all, of the problems at the yard. This bantering back and forth did not end until A. J. went to his car and returned with a .357 magnum that he fired at James. Fortunately, A. J. missed his intended target-he wasn't as great a marksman as he proclaimed to be! A. J. was immediately fired for leaving his work area and carrying a weapon. USFG is currently trying to replace its lost client (and revenues) but has not been able to find another. A. J.'s position has not been filled. Recently, the employees have been able to return to longer shifts with less "standing time."

Questions

1. From a management perspective, why did the company allow the initial childish behavior (coffee on the seat, spit on the steering wheel, etc.) to escalate into employee confrontation?

2. When does childish behavior become a harassment issue? At what point does one's practical jokes or intimidating actions toward one employee impact all employees?

3. Visit the Occupational Safety and Health Administration's Web site and review the agency's "Fact Sheet" on workplace violence: What kind of policy statement and/or plan should the company include in its overall policy and procedures manual to avoid violence in the workplace? What type of training should the company provide all employees on this issue?

4. What additional legal issues does this case's problem raise for USFG?

5. Would USFG face potential liability if it fired A. J. based on the rumored threats of violence?

6. The National Rifle Association is lobbying for states to pass laws that prohibit employers from stopping an employee from bringing a gun to work in the employee's car. As of June 2013, 20 states had enacted "bring your gun to work" laws, including Oklahoma. The Oklahoma statute gives employees the right to keep guns locked in their cars. Other bills are being modeled after the Oklahoma statute. Many employers and business groups oppose the law. Discuss.