Human Resource Management

Unit 12

Unit 12

Employee Misconduct and

Disciplinary Procedure

Structure:
12.1 Introduction
Objectives
12.2 Meaning and Objectives of Discipline
12.3 Principles for Maintenance of Discipline
12.4 Basic Guidelines of a Disciplinary Policy
12.5 Disciplinary Action - Penalties
12.6 Procedure for Disciplinary Action
12.7 Summary
12.8 Glossary
12.9 Terminal Questions
12.10 Answers
12.11 Case Study

12.1 Introduction
In unit 7, you have learnt about performance appraisal. Performance
appraisal is an overall evaluation of the employee in the organization. You
have also learnt that well conducted and disciplined employees have a
higher chance of being promoted.
Managing employee behaviour and performance is one of the important
tasks of managers. Discipline refers to the employees observance of
standards set by the organisation. Disciplinary action refers to punishing the
employees who fail to meet the standards of behaviour.
Many organisations maintain a disciplinary policy or system to regulate the
behaviour of the employees and deal with acts of indiscipline. Purpose of
disciplinary action is not to punish erring employee but to make them
understand what type of behaviour organisation wants from the employees
to maintain a proper decorum. In this unit, we will discuss the meaning and
objectives of discipline, and the principles for maintenance of discipline. We
will also study the basic guidelines of a disciplinary policy, disciplinary action
penalties and the procedure for disciplinary action.

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Objectives:
After studying this unit, you should be able to:
describe the concept of employee misconduct at the workplace
state how discipline is implemented and measured
analyse the techniques to ensure discipline

12.2 Meaning and Objectives of Discipline

Discipline is employee self-control which prompts him/her to willingly cooperate with the organisational standards, rules, objectives, etc.
Discipline is best defined as the observation of principles, rules or any other
laid down procedures, practices, written or otherwise in the organisation by
the employees or group of employees, to whom these apply, for smooth and
effective functioning of the organisation.
As per Dr. Spriegal, "discipline is the force that prompts an individual or a
group to observe the rules, regulations and procedures which are deemed
to be necessary to the attainment of an objective; it is force or fear of force
which restrains an individual or a group from doing things which are deemed
to be destructive of group objectives. It is also the exercise of restraint or the
enforcement of penalties for the violation of group regulations". Bremblett,
Earl R says that, "discipline in the broad sense means orderliness-the
opposite of confusion.... According to Richard. D Calhoon, "discipline may
be considered as a force that prompts individuals or groups to observe the
rules, regulations and procedures which are deemed to be necessary for the
effective functioning of an organisation.
Webster's Dictionary gives the meanings of the word discipline as follows:
"First, it is the training that corrects, moulds, strengthens or perfects.
Second, it is the control gained by enforcing obedience. The third meaning
is punishment or chastisement."
In its most practical form, employee misconduct does not mean strict and
technical observance of rigid rules and regulations. It simply means working,
cooperating and behaving in a normal and orderly way, as responsible
adults.

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The aims and objectives of discipline are:

to ensure and enable employees to work in accordance with the rules

and regulations of the organisation.

to ensure that employees follow the organisational processes and

procedures in spite of their different personalities and behaviour.
to provide direction to the employees and fix responsibilities.
to improve organisational performance by improving the efficiency of
each employee.
to maintain a sense of orderliness and confidence in the employees
towards each other and towards the management.
to maintain common feelings of trust and confidence in the employees
towards each other and towards the management.

Good employee conduct is usually catalysed by effective leadership.

Leaders by being examples, prevail upon their teams to willingly follow the
applicable policies, rules and procedures. Similarly employee misconduct
exists when employees fail to observe the rules of the organisation or the
orders of their supervisors. Conditions contributing to poor discipline can be
caused by weaknesses within the organisational structure or by external
factors.
Self Assessment Questions
1. ________________ is the observance of principles, rules or any other
laid down procedures, practices, written or otherwise in the
organisation by the employees or group of employees, to whom these
apply, for smooth and effective functioning of the organisation.
2. According to ____________________, "discipline may be considered
as a force that prompts individuals or groups to observe the rules,
regulations and procedures which are deemed to be necessary for the
effective functioning of an organisation.
3. Conditions contributing to ______________________ are caused by
weaknesses within the organisational structure or by external factors.

12.3 Principles for Maintenance of Discipline

In the previous section, we discussed meaning and objective of discipline.
Let us now study the principles for maintenance of discipline. Since
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disciplinary measures have serious implications for employees; they often

are based on the principles of being fair, just and acceptable to employees
and, where applicable, the union as well. It cannot be enforced or imposed
on employees, as history has proved, it never benefits anyone. One of the
most significant transformations that have impacted the workplace in the
past few years is the reinstatement of discipline in a positive and
employee-supported environment. The way it is practiced in todays
organisations is extremely well communicated and adopts a discretionary
approach.
The most important principles to be observed in the maintenance of
discipline have been outlined by Yoder. Heneman, Turnball and Harold
Stone:

As far as possible, all the rules should be framed in cooperation and

collaboration with the representatives of employees. If the latter have a
share in formulating them, they will be more likely to observe them.

All rules should be checked at regular intervals to ensure that they are
working well according to the organisational policy and practice.

Rules should vary with changes in the working conditions of employees.

Those framed for office employees, for example, may very well be
different from those that are formulated for workers in an industrial
concern.

Rules should be uniformly enforced if they are to be effective. They must

be applied without exception and without bending them or ignoring them
in favour of any one worker.

Penalties for any violation of any rule should be clearly stated in

advance. Employees have the right to know what to expect in the event
of any infringement of a rule or regulation. For this purpose, it is better to
publish them in the employees' handbook.

A disciplinary policy should have as its objective as the prevention of

any infringement rather than the simple administration of penalties,
however just: it should be preventive rather than punitive.

Extreme caution should be exercised to ensure that infringements are

not encouraged. This should be done as a matter of policy.

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If violations of a particular rule are fairly frequent, the circumstances

surrounding them should be carefully investigated and studied in order
to discover the cause or causes of such violations.

For troublesome employees, the organisation should exercise more

caution and take extra measures to control them.

Definite and precise provisions for appeal and review of all disciplinary
actions should be expressly mentioned in the employees' handbook for
collective agreements.

Self Assessment Questions

4. As far as possible, all the rules should be framed in cooperation and
collaboration with the ___________ of employees.
5. ___________ should be uniformly enforced if they are to be effective.
6. A disciplinary policy should be __________ rather than punitive.
Activity 1:
Review few recent articles to identify 2-3 incidents of employee
indiscipline. How do you think it should have been dealt and resolved by
the organisation?

12.4 Basic Guidelines of a Disciplinary Policy

In the previous section, we discussed the principles for maintenance of
discipline. Let us now study the basic guidelines of a disciplinary policy.
Modern organisations have evolved the way it practices the art of managing
employee misconduct. However the basic principles discussed remain as
the guiding framework. The principal ingredients of a sound disciplinary
system in organisations are:
1. Location of responsibility: The responsibility of creating awareness
regarding discipline is entrusted with every individual in the
organisation. In case of employee indiscipline, the line manager issues
only verbal and written warnings. In serious cases, which warrant
discharge or suspension, the Industrial Relations Officer and other
independent legal consultants need to be consulted.
2. Proper formulation and communication of rules: The employees are
expected to conform to rules and regulations, and behave in a
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responsible manner. It is essential that these rules and regulations are

carefully formulated, communicated clearly and properly documented
by organisations. This should be easily accessible for employees. In
many organisations the employees need to read it and sign it once in a
year. This acts as an effective preventive mechanism to ensure that
employees are aware of it and have committed to abide by it.
3. Rules and regulations should be reasonable: Todays organisations
pay a lot of attention, and rightly so, towards formulating equitable
polices that protect employee as well as the organisations values and
rights. Often organisations involve employee representatives in
formulating these policies and guidelines. Sometimes companies
conduct workshops and training programmes to help their employees
to get a good and clear knowledge about company policies.
4. Equal treatment: An employee should realise the consequence of
his/her inappropriate behaviour and if he/she is going against the
norms or the rules. The rule applied for a particular act of indiscipline
should reflect the offence and not the person who committed it.
Discipline should be enforced and ensured across every employee and
every situation.
5. Disciplinary action should be taken in private: While the policies
governing the acceptable code of conduct are communicated publicly,
the reprimand for non-compliance needs to be carried out in private.
This is to ensure that a wrong behaviour is corrected and not that the
wrongdoer be punished, or ridiculed. At all times the organisation
needs to be watchful of remaining respectful of its employees and carry
out any action in a respectful and in a confidential manner.
6. Importance of promptness in taking disciplinary action: As goes the
popular saying justice delayed is justice denied. If the action for
review and reprimand is taken long after a violation of a policy/rule has
happened, it loses its positive and corrective influence. The employees
lose trust in the system and assume that the organisation lacks
commitment to it. It might even lead to resentment, which may not have
developed if the corrective action had been imposed on time.
7. Innocence is presumed: Again as per the fundamental rights of a
human being, an individual is presumed to be innocent until he is
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proven to be guilty. It is the organisations responsibility and therefore

the HR teams responsibility to prove beyond a reasonable doubt, that
a violation or an offence has been committed before any punishment is
awarded. The employee or employees need to be given the first
opportunity to explain himself/herself/themselves. The kind of proof that
would be needed for this purpose would depend on the gravity of the
offence that has been committed.
8. Get the facts: Before taking any disciplinary action, it is important to
ensure that records of the offence and any previous warnings are
reviewed closely.
9. Action should be taken in a non-threatening atmosphere: Based on
appropriate evidence management can take proper action against the
accused employee.
Self Assessment Questions
7. The ___________________ should issue only verbal and written
warnings.
8. While finalising the rules, _________________ should be given the
opportunity to express freely their views.
9. An employee should realise the ___________ of his/her inappropriate
behaviour.
Activity 2:
Visit the official website of ITC and browse through the organisational
code of conduct.
List the aspect of personal conduct that the organisation wants the
employees to adhere.
Refer: www.itcportal.com/about.itc/itc-values/code-of-conduct.aspx.

12.5 Disciplinary Action Penalties

In the previous section, we discussed the basic guidelines of a disciplinary
policy. Let us now discuss the disciplinary - action penalties. There are
varying penalties for first, second, and third offences of the same rule.
Following are the commonly practiced actions in business organisations:
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1. Oral reprimand
2. Written warning
3. Denial of increments, promotions and pay hikes
4. Pay reductions and disciplinary demotions
5. Suspension
6. Discharge or dismissal
Oral reprimand: The penalties are listed in the general order of severity,
from mild to severe. For most cases, an oral reprimand is sufficient to
achieve the desired result. The supervisor must know his or her personnel in
determining how to give a reprimand. For one person, a severe "session"
may be necessary in order to get attention and cooperation; another person
may require only a casual mention of a deficiency. If the offence is more
serious, the reprimand may be put in written form.
Written warning: When an oral warning or counselling to the employee
does not produce the desired result, the manager may issue a written
warning to the employee. The employee is normally asked to acknowledge
the receipt of written reprimand, irrespective of whether he agrees with the
content of the letter or not.
Since a written reprimand is more permanent than an oral one, it is
considered a more severe offence and the penalty levied accordingly.
Denial of increments, promotions and pay hikes: On some incidents the
management may refuse promotions, increments or pay hike by blacklisting
the employee for a specific period of time. This is usually treated as a
punishment for a certain period of time.
Pay reductions and disciplinary demotion: This is usually more severe
than the denial of pay hikes and promotions because the employee loses
part of existing benefits and privileges received by him from the
organisation.
In the case of demotion, an employee loses social status.
Suspension:
A few offences normally require the direct suspension of the employee
without any prior warning, depending upon the nature of the misconduct

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committed by the employee. The decision regarding suspension is generally

made by higher authorities.
Discharge or dismissal:
This is the severest punishment of all. Both discharge and dismissal
culminate in termination of employment.
When the conduct of an employee is deemed to be mismatched with the
faithful discharge of his duties, and undesirable or against the interest of the
employer to continue him in employment, dismissal will be justified.
In case of discharge, an employer terminates the employment of an
aberrant employee either by giving agreed advance notice or by paying
money in lieu of such notice.
Mc. Gregors Red Hot Stove Rule:
One effective way to approach the disciplinary process is to follow what is
popularly known as the red hot stove rule.
It suggests that administering discipline is more like touching a hot stove.
According to Mc. Gregor, action should be immediate, impartial and
consistent with a warning such as the results of touching a red hot stove.

Immediate: The burn happens as soon as a person touches a red hot

stove; like that an employee should be made to realise immediately if
he/she is going against the norms or the rules.

Impersonal: Regardless of who touches it, the stove causes burns. In

the same way the rule applied for a particular act of indiscipline should
reflect the offence and not the person who committed it.

Consistent: Every time a person touches a red hot stove he receives

burns. That is, the result is consistent. In the same way discipline should
be enforced and ensured across every employee and for every situation.

Foreseeable: The red hot stove warns the individual through the heat it
generates, that it will burn if touched. In the same way employees
should be made aware that poor conduct or indiscipline will result in
specific, predetermined consequences.

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Self Assessment Questions

10. The supervisor must know his or her employee in determining how to
give a ________________.
11. Since a written reprimand is more permanent than a
________________ one, it is considered a more severe penalty.
12.

Both discharge
employment.

and

dismissal

culminate

in

__________

of

12.6 Procedure for Disciplinary Action

In the previous section, we discussed the disciplinary - action penalties. Let
us now discuss the procedure for disciplinary action.
Though there is no specific procedure to be followed, different organisations
use a variety of formal and informal methods to resolve these matters. The
following steps are recommended.
The different stages in the disciplinary procedure of an Indian organisation
are discussed below:
Forming and issuing a charge sheet: When the management of an
organisation wants to initiate an enquiry against an employee for alleged
misconduct, the concerned employee is issued a charge sheet.
The charge sheet should clearly indicate the charges against the employee
and seek an explanation for the employees misconduct.
Considering the explanation: If the employee admits his misconduct or if
the management is satisfied with the explanation offered by the employee in
response to the charge sheet, there is normally no further enquiry.
Issuing the notice of enquiry: If it is decided that an enquiry be held. A
notice of enquiry has to be issued to the worker. The notice must mention
the time, date and place of enquiry. An enquiry officer is also appointed,
preferably a person who has good knowledge in law.
Holding a full-fledged enquiry: The enquiry should be in conformity with
the principles of natural justice and the employee concerned must be given
an opportunity to be heard. If it is felt that the offence is serious or that the
employee concerned might influence the enquiry proceedings, he might
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either be asked to go on leave or may be suspended without pay, pending

enquiry.
Final order of action: The appropriate authority, based on the findings of
the enquiry officer, makes the judgment. He either acquits the employee or
judges him guilty of the charges. Based on the decision taken, the
punishment for the employees misconduct is determined. Before that, the
manager should consider the employees previous record.
In case the employee feels that the enquiry is biased or improper, and that
the disciplinary action is unjust, he should be given a chance to make an
appeal.
Follow-up: After administering disciplinary action, there should be proper
follow-up. The punishment for misconduct should be conveyed to the
employee.
Self Assessment Questions
13. When the management of an organisation wants to initiate an enquiry
against an employee for alleged misconduct, the concerned employee
is issued a ________.
14. The _________ should clearly indicate the charges against the
employee and seek an explanation for the employees misconduct.
15. In case the employee feels that the enquiry is ____________ and that
the disciplinary action is unjust, he should be given a chance to make
an appeal.

12.7 Summary
Let us recapitulate the important concepts discussed in this unit:

Good employee conduct might be described as orderly behaviour based

on definite standards catalysed by effective leadership.
Disciplinary measures have serious repercussions on employees. Hence
they should be based on certain principles so that they must be fair, just
and acceptable to employees and their union.
As far as possible, all the rules should be framed in cooperation and
collaboration with the representatives of employees.
All the rules should be appraised at frequent and regular intervals.
Rules should be uniformly enforced if they are to be effective.

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A disciplinary policy should be preventive rather than punitive.

It is essential that these rules and regulations are properly and carefully
formulated and communicated to employees.
Identical punishment should be awarded for identical offences,
irrespective of the position or seniority of the employee.
If the penalty is imposed long after a violation of rules has been
committed, it loses its positive and corrective influence.
The ultimate purpose of a disciplinary action is to maintain discipline, to
ensure productivity and avoid a repetition of the offence.
A disciplinary action should be evaluated in terms of its effectiveness
after it has been taken.

12.8 Glossary

Discipline: The practice of training people to obey rules or a code of

behaviour, using punishment to correct disobedience.

Disciplinary action: Action taken by the management invoking a

penalty against an employee who fails to meet organisational standards
or comply with organisational rules.

Suspension: The official prohibition of someone from holding their usual

post or carrying out their usual role for a particular length of time

Charge sheet: It is the proposed statement of charges against an

employee.

12.9 Terminal Questions

1. Define discipline. What are its objectives?
2. What are the basic principles to maintain discipline?
3. Enumerate the steps for disciplinary procedure.
4. Explain the action-penalties of discipline.

12.10 Answers
Self Assessment Questions
1. Discipline
2. Richard. D. Calhoon
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3. Poor discipline
4. Representatives
5. Rules
6. preventive
7. Line Executive
8. Everyone
9. Consequence
10. reprimand
11. Oral
12. Termination
13. charge sheet
14. Charge sheet
15. biased
Terminal Questions
1. Discipline is employee self-control which prompts him to willingly cooperate with the organisational standards, rules, objectives, etc.
Objectives of discipline are to
ensure and enable employees to work in accordance with the rules
and regulations of the organization and to
ensure that employees follow the organisational processes and
procedures in spite of their different personalities and behavior.
Refer section 1.2 for more details.
2. Since, disciplinary measures have serious implications for employees;
they often are based on the principles of being fair, just and acceptable
to employees and, where applicable, the union as well. It cannot be
enforced or imposed on employees, as history has proved, it never
benefits anyone. Refer section 12.3 for more details.
3. The different stages in the disciplinary procedure of an Indian
organisation are discussed below: Forming and issuing a charge sheet,
Considering the explanation, Issuing the notice of enquiry, Holding a
Full-fledged Enquiry, Final order of Action, Follow-up. Refer section 12.6
for more details.
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4. There are varying penalties for first, second, and third offences of the
same rule. Following are the commonly practiced actions in business
Organisation:
a. Oral reprimand
b. Written warning
c. Denial of increments, promotions and pay hikes
d. Pay reductions and disciplinary demotions
e. Suspension
f. Discharge or dismissal
Refer section 12.5 for more details.

12.11 Case Study

HC Disallows Action Against Employee under Articles of Association
Chennai April 13, The Madras High Court has ruled that use of articles of
association of a State-owned transport corporation or clarifications by the
State Government cannot be used to persist with a departmental enquiry
against an employee for alleged misconduct.
If an employee had committed a loss or damage to business or property of
the corporation, it could always institute civil proceedings for recovery
notwithstanding whether the person was in service or not, Mr Justice K.
Chandru held while allowing a writ petition from R. Balraj, Managing
Director, TN State Transport Corporation.
The petitioner had joined the transport corporation as Works Manager and
served in Cheran Transport Corporation; he was later transferred to TN
State Transport Corporation and became a permanent employee from 1976
as Assistant Manager. He was subsequently promoted as Managing
Director of the corporation in 1987. While serving as MD, in relation to a
certain decision taken by him as part of the purchase committee, two charge
memos were served on him on August 28, 2002, just two days ahead of his
retirement, and he was allowed to retire without prejudice to disciplinary
proceedings, and his terminal benefits like pension, gratuity and PF were
withheld. The present petition was against the charge memos.
The petitioner contended that in the absence of any service rule, there was
no power vested on the employer to conduct an enquiry for alleged
misconduct even after his superannuation. The respondents submitted that
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there were serious charges against the petitioner, and he was allowed to
retire without prejudice to disciplinary action pending against him. They said
that though there was no specific power enjoyed by the corporation, Rule 10
of articles of association of corporation provided for the Government to issue
instructions.
The Judge said that articles of association of the corporation could not be
raised to the level of any statutory provision to proceed against employees.
Also, in the absence of any substantive power to retain an employee, the
corporation could not rely upon articles of association or any clarification
issued by the Government.
Holding that the corporation could always institute civil proceedings for
recovery of any loss allegedly caused by the employee, the Judge said
there were also enough provisions in the Companies Act for making such
recoveries from employees of Corporation.
Allowing the petition, the Judge directed the corporation to settle the
terminal benefits of the petitioner within four weeks.
Discussion Questions:
1. On what grounds did Madras High Court disallow action against
employees?
2. What were the punitive measures taken by the Transport Corporation
against the employees ?
th

(Source: Business Line April 14 2007)

References:

Fisher, S, and Shaw. (2010). Human Resources Management. New

Delhi: Cengage Publication.

Aswathappa, K. (2010). Human Resource Management. New Delhi:

Tata McGraw Hills.

Wayne, C. F. (1998). Managing Human Resource. Irwin/McGraw Hills.

Durai, P. (2010). Human Resource Management. New Delhi: Pearson

Publication.

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