Designing a Progressive Discipline Policy

Although some HR experts question the efficacy of progressive discipline, there is general agreement that when such a system is used it must be designed carefully, backed up by clear procedures and administered by well-trained supervisors.

“In the context of at-will employment, progressive discipline policies are a bit of a double-edged sword,” said Dan McCoy, a partner with the law firm of Fenwick & West. “On the one hand, if such policies are mandatory, [requiring the employer to] follow a series of steps before certain terminations occur, the policies arguably hinder an employer’s ability to take swift termination action,” he told SHRM Online. “On the other hand, such policies can go a long way to helping—indeed, forcing—an employer to build a strong nondiscriminatory and/or nonretaliatory basis for a termination or other adverse employment action, through performance improvement plans, warnings and the like.”

Chris D’Angelo, Esq., a management attorney with Vandenberg & Feliu LLP, agrees that progressive discipline policies have pros and cons. For example, he said, such policies give employees “some level of assurance that they will not be severely disciplined or terminated for even the most minor infractions,” and thus can be useful in setting employee expectations and creating a stable, comfortable and productive work environment.

Yet in states where an employee handbook or manual creates contractual or enforceable rights, the existence of a progressive discipline policy might be construed to require employers to follow that policy no matter the circumstances, D’Angelo said.

Jason Greer, a labor relations consultant in St. Louis and former National Labor Relations Board (NLRB) agent, said he has witnessed employee union organizers going out of their way to be disciplined with the hope that the company will fail to properly use the stated progressive discipline procedures. “When this happens, and it does happen quite often, the labor union will then create a ‘campaign’ issue out of the company’s negligence,” he told SHRM Online.

For example, Greer said, a prominent health care union learned that an assisted living facility had a progressive discipline system that was used by a particular supervisor to weed out “problematic” employees. “If the supervisor happened to like an employee, then [the employee] would usually not be written up for arriving to work late or having failed to complete a work assignment,” he said. “However, for employees the supervisor did not like, she would use the progressive discipline policy as aggressively as possible, which often led to terminations.”

The result, Greer said, was that the employees who feared for their jobs reached out to the union. “The union coached them on what to say and what to do in order to provoke the supervisor; within three weeks time the supervisor had either fired or written up 10 employees,” he explained. “It didn't take long for the union to accumulate union authorization cards from 65 percent of the employees in order to proceed to an NLRB secret ballot election,” he said.

But D’Angelo noted that progressive discipline policies can be “a useful tool for warding off potential unionization in the non-union setting, since most unions typically point to unfair disciplinary actions to promote the benefits of unionization.”

“Perhaps the best reason to have such a procedure is that it forces employers to look at every disciplinary action, and document the same, which is the best evidence an employer can provide regardless of what forum they find themselves in” (e.g., unemployment hearing, arbitration, court), said Robert J. Nobile, chair of Seyfarth Shaw LLP’s Workplace Counseling & Compliance Solutions Practice Group and author of Guide to HR Policies and Procedures Manuals (West Group, 2008). “Such procedures also help to ensure uniformity and consistency in the administration of disciplinary action, and thus minimize exposure to discrimination claims.”

Well-Designed and Flexible

“There must be at least a dozen vital policy and procedure issues that companies never look at” when designing a discipline policy, said Dick Grote, founder of Grote Consulting and author of Discipline Without Punishment (AMACOM, 2006). For example, supervisors often lack guidance on how to answer the kinds of questions employees are likely to ask, such as “How long does this stay in effect?” and “Is this going to be a black mark on my record forever?” and “If I develop a different problem do I move to the next phase of the process or does it start over?”

Supervisors who lack such procedural guidance are more likely to make ad hoc decisions, Grote told SHRM Online, which is why discipline policies are so often inconsistently applied. And inconsistent application is more likely to expose a company to legal risk, he noted.

“I have seen progressive discipline policies work very effectively,” said Cornelia Gamlem SPHR, president of GEMS Group Ltd., a Washington, D.C., area HR consulting firm. But she said there are some necessary elements required for success. “The policy needs to have some flexibility so that the type of discipline is appropriate for the breach of conduct,” she told SHRM Online.

“Policies cannot anticipate every situation, so the role in HR is to create a policy or procedure that works in multiple situations,” Maureen Mack, a business services consultant at H.R. Principal LLC in San Francisco, agreed. “For example, there will be situations where you will use each step in the process—a verbal warning, a written warning, maybe a final warning depending on the policy and the circumstances—and then termination.”

Yet in some instances employers might need to take more severe measures of disciplinary action for certain offenses than is typically allowed under the progressive discipline policy for the offense committed, said Damon Kitchen, a partner with Constangy, Brooks & Smith’s Jacksonville, Fla., office.

He said an oral warning might be given the first time an employee is late for work in most cases but that extenuating circumstances—such as a theft that occurs because a security guard is not at his post due to tardiness—might cause an employer to take a more serious form of disciplinary action. Thus, the employer’s progressive discipline policy should give the employer the latitude to go beyond the typical discipline when circumstances warrant.

D’Angelo said he has found that employees in unionized settings expect a new series of progressive discipline steps to begin if a second infraction is different from the first, such as if violation of a safety rule occurs after an employee is disciplined for tardiness. “Thus, employers must make sure that employees and unions understand that once an employee is disciplined for any infraction, application of the progressive discipline process has commenced with respect to all subsequent infractions,” he said.

But Grote said discipline issues fall into one of three mutually exclusive categories: attendance, performance or conduct. Therefore, his approach is to treat a new incident as a new series of disciplinary steps only if the infraction falls into a different category of behavior and then only if the individual is in the early stages of discipline.

D’Angelo said progressive discipline policies “should have provisions which permit the company to modify and/or apply the policy in any manner it deems appropriate under the circumstances, including acceleration of steps, exclusion of steps or repetition of steps.”

During the policy design phase Grote suggests employers ask themselves other relevant questions such as:

• When can a supervisor act independently and when does he need his boss’s approval?
• When does HR get involved?
• What is HR’s role—to be advised of discipline or to approve it?
• Does there have to be a witness present?
• How many different sequences of discipline can an employee receive?
• Is an employee eligible for a merit increase while being disciplined?

Legal Considerations

A progressive discipline policy that does not appear with a disclaimer stating that the policy is not intended to constitute a contract and that all employees are considered employees-at-will could support an employee’s argument that such a written policy constitutes a contract between the employer and employee, said John F. Rossi, a Boston-based employment lawyer. “In such a case, any failure by the employer to adhere to the company's progressive discipline policy could give rise to an employee claim for breach of contract.

“In addition, a failure to abide by a progressive discipline policy could give rise to an unlawful discrimination claim,” he added. “This is particularly likely if the employer follows the policy in most, but not all, cases without any reasonable basis for the disparity.”

“Even when a reason for treating two employees differently is completely valid and legal, the lack of consistency in treatment provides a ‘hook’ upon which an expensive lawsuit can be hung,” Cheri Baker, SPHR, president of Emergence Consulting in Seattle, told SHRM Online.

Gamlem said managers should receive training so they understand the policy and realize they have the flexibility to use some judgment in determining the level of discipline to be used for the circumstances. The training should explain how to create effective and defensible documentation, she added.

D’Angelo agreed. If a company has such a policy it has to make sure that the managers and supervisors executing it understand how to do so, and do so consistently. “Treating two or more employees inconsistently for similar offenses will likely lead to a lack of faith in the policy among the employees, and lower employee morale, and if the employees are not in the same protected category, could also provide a basis for claims of unlawful discrimination,” he said. “Training is key.”

Rebecca R. Hastings, SPHR, is an online editor/manager for SHRM.

Related Articles:

Is Progressive Discipline a Thing of the Past? SHRM Online Employee Relations Discipline, Jan. 19, 2010