Understanding Grievance Pay: Definition & Best Practices for HR
The workplace is supposed to be a haven for employees where everyone can collaborate and work with each other to achieve a common goal for any company. However, there are unfortunate instances where they experience negative issues such as discrimination, harassment, and unfair treatment.
A recent study reported that 22% of US workers experienced workplace harassment—an alarming figure in today’s world. How are companies expected to handle these issues? One proven way is to offer grievance pay.
In this guide, we’ll discuss everything you need to know about grievance pay. What does it mean, exactly? When is grievance pay applicable? And how do you implement it properly? Let’s find out.
What is grievance pay?
Grievance pay refers to the financial compensation provided by companies to employees who experienced harm, violence, and unfair treatment in the workplace. Organizations enforce grievance pay as a form of upholding justice and discouraging maltreatment in employment.
With the help of grievance pay, maltreated employees are compensated for their suffering while employers are reminded of their obligation to maintain a safe and productive workplace for everybody. By addressing employee grievances promptly, the company promotes a healthy and inclusive work environment.
It is the company’s obligation to handle unexpected issues such as employee grievances and one way to do it is by implementing a strong talent management system. This allows companies to seamlessly manage their compensation system and support mechanisms like grievance pay for employees.
Is grievance pay important?
Yes, grievance pay, or grievance leave is essential in fostering a healthy working environment for employees. This could be in the form of monetary compensation, paid leave, or unpaid leave. The concept of mandating a company to properly compensate its employees for their suffering provides a sense of justice in the workplace.
Moreover, it also serves as a deterrent for employers—reminding them to always adhere to and observe fair practices in the workplace. The following are some of the most notable importance of grievance pay:
Improves employee morale
Addresses workplace issues
Promotes fairness and accountability
Preventing escalations and legal issues
Upholds good company reputation
Remember—how companies treat their employees directly reflects how they deal with their customers and business. Staying ready to properly compensate your workers using powerful salary planning strategies is key to maintaining a competent and productive workforce.
When is grievance pay applicable?
As mentioned above, grievance pay is given to any eligible employee who experienced harm, violence, and mistreatment in the workplace. Take note that this could apply to all types of employment including full-time, part-time, contractors, and sometimes even former employees.
Companies should also consider that every harmful situation leading to employees seeking grievance pay can stem from a variety of unique situations. Therefore, the due process of giving out grievances to employees ultimately depends on the company’s internal procedures.
To give you a better idea, below are some examples of common circumstances leading to grievance pay:
Workplace discrimination based on gender, age, race, or disability
Sexual and non-sexual harassment
Wrongful termination
Unfair disciplinary actions
Denial of reasonable accommodations
Retaliation for reporting misconduct
While handling employee grievances could already be morally challenging for HR, it can also present key financial bumps for the company. Utilizing the Compensation Planning Software will help you stay ready for issues such as employee grievances and make intelligent pay decisions all the time.
Grievance pay policy: Best practices
Again, how companies handle employee grievances may vary from one organization to another. After all, each company can have unique workplace policies and even collective bargaining agreements from labor unions. To handle employee grievances, you can follow these five steps for an orderly solution:
Communicate with the employee in subject: This is the first step in de-escalating the situation. Sometimes, having a proper conversation and allowing employees to speak out their thoughts or opinions already solves the problem. On the other hand, it also gives employers a clearer grasp of the situation.
File a formal employee grievance in writing: If it’s confirmed and justified that the employee experienced harm and maltreatment in the workplace, the next step would be to file a formal grievance in writing.
Evaluate the employee grievance: Analyze and assess the details of the employee grievance. This will dictate your steps in resolving the issue. If it only involves a simple fix such as erroneous paychecks, then it can be solved immediately. But if it concerns other employees, then you would need to conduct further investigations.
Conduct a formal investigation: This is the time to dig deeper into the issue by interviewing the concerned parties and collecting evidence that could help with the resolution. Remember—it’s important to keep the process fair and unbiased to reach a respectable resolution.
Implement the resolution: Once a resolution is reached, document the results based on the findings. Depending on the circumstances experienced by the employee, this could involve giving grievance pay.
Another best practice in managing issues such as grievance pay is enforcing a total compensation management system for your company. With the help of Compensation Planning Software, you can easily plan and manage your compensation process to stay ready despite the rise of employee issues, conflicts, and problems in the workplace.
FAQs
Below are common questions about grievance pay:
What are the most common employee grievances?
Several grievances are experienced by employees around the workplace. Here are some of the most common employee grievances:
Unreasonable workloads
Unsafe workplace conditions
Unfair treatment or bias
Harassment
Bullying
Discrimination (gender, race, or disability)
Can employees get fired for filing grievances?
No. It is illegal for employers to terminate, demote, or retaliate against an employee for filing a grievance or complaint. This is deemed unlawful by the U.S. Equal Employment Opportunity Commission.
Is grievance pay the same as bereavement pay?
No. Although both terms are often mentioned along with each other, grievance pay, and bereavement pay are not the same. Grievance pay refers to the financial compensation provided by companies to employees who experienced harm, violence, and unfair treatment in the workplace.
On the other hand, bereavement pay, also known as bereavement leave, is a workplace policy providing paid or unpaid time off for employees following the loss of their loved ones such as immediate family members, extended family members, or domestic partners. This allows grieving employees to handle funeral arrangements or attend funeral services for their loved ones.
Is bereavement leave paid?
Whether it's a paid or unpaid leave depends on your company's bereavement policy. A paid bereavement leave is not mandated by federal law or state laws. Therefore, some organizations still implement unpaid bereavement leave policies just to be compassionate with their employees' loss.
These paid and unpaid time offs usually range from 3 to 5 days, with some even permitting up to two weeks depending on the circumstances.
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