Honesty in the Workplace

Organizational Responses to

Workplace Dishonesty

Workplace Dishonesty• Theft by Employees

Employee theft is estimated to cost $50-200 Billion per year in US

1/3 of business failures and bankruptcies are due at least in part to theft

Up to 50% of all employees likely to be involved in some employee theft, but for many thefts are small and isolated

10% of employees are thought to commit 95% of employee thefts

Theft is most serious in banking, retail sales and other contexts where there is something worth stealing on hand

Employee theft is rarely driven by need, often by norms, dissatisfaction, disputes with the organization, etc.

Corporate corruption/ white-collar crime

• Major corporate scandals in recent years, • including Barings Bank, BCCI,Orange County • Bankruptcy, Enron, WorldComm, Adelphia, etc• involve theft, fraud, • Corporate corruption (e.g., price fixing, unsafe or illegal

practices) costs $120-200 billion per year in U.S.

• Employee theft is 10 times as big a problem as street theft, white collar crime is 2-10 times

as big a problem as employee theft• White-collar crime is especially dangerous because of

opportunities for large-scale thefts - large enough to sink a company

** it is hard to steal $1,000,000 in • radios, but for an executive, it is a click away

Workplace Deviance

• Honesty researchers distinguish between property deviance (e.g. theft, misuse of property) and production deviance (e.g. taking long breaks, goldbricking, personal business at work)

• Overwhelming majority of workers engage in some production deviance, but the extent of this problem is difficult to adequately measure

• Moderate amounts of production deviance are sometimes tolerated at work, butthis depends on organizational level

• Many forms of property deviance exist (theft, sabotage, use of company property for personal purposes), but all forms seem to share

a common thread - i.e., property deviance is strongly related to attitudes toward the organization and to workgroup norms

Substance Abuse

• Up to 10% of U.S. workforce uses illicit substances (marijuana, cocaine) at work or

in settings where work might be affected

• Use of alcohol in or around work settings is much more common

$20-100 billion annual losses in US attributed to substance abuse

• However, use of legal substances may cause more serious problems than abuse of alcohol

or illicit drugs

– * antihistamines and other anti-allergy drugs cause large numbers of

• workplace accidents

– stimulant abuse common and highly dangerous in transportation industry,

and in other jobs requiring vigilance

Responses to Workplace Dishonesty

• Change the person•

• Recruitment - attract different sorts of people •• Employee screening - use tests, assessments to • screen out high-risk people

• Investigation/discharge procedures - remove• dishonest or untrustworthy workers•

• Change the situation

• Enhance security/reduce temptations

• Advertise efforts to reduce dishonesty

• Change norms that support dishonesty

Detecting Deception

• The Polygraph (“lie detector”)

Until 1988, the polygraph was widely used in U.S.work settings ; 1 million polygraphs per year in 1980’s, 3/4 of those in work settings

• Employee Polygraph Protection Act severely limits their use in work settings

•• Now most frequently used in criminal and security investigations•• The polygraph uses patterns of physiological reactions (e.g., respiration

rate, blood pressure, galvanic skin response) to infer • deception.

• Assumption behind the polygraph is that people show different physiological reactions when they are attempting to deceive than when they are telling the truth

Examination methods

• There are a wide variety of polygraph examination techniques

• * Specific-event examinations

• Guilty knowledge tests

• * Broad screens

• Control question tests

• **confessions account for very significant portion of failures

Polygraph Validity• Polygraph Validity

• Expert examiner investigating specific incident will perform better than chance when interviewing suspect for whom there is a

reasonably large probability of guilt. • Poor evidence of reliability or validity when used • for general screening vs. specific event, • especially when base rate is low.

• If confessions factored out, evidence for • usefulness of polygraph is even less • impressive

• Bottom line - polygraphs are not very effective, especially for screening purposes. They “work” best when they fool the

examinee into confessing

Voice Stress Analysis

• Microtremors in voice claimed to be associated • with deception•

• Voice stress analysis can be done via recording, • telephone - may be done without subject’s• knowledge

• There is no good evidence that voice tremors• indicate deception

Behavioral cues to deception

• Deception is sometimes inferred from• * hesitancy• * sudden movements• * grooming behaviors (straightening hair)• * frequent swallowing•

• Bottom line - no good behavioral cues to • deception are known to exist

Drug Testing

• Urine tests are the most common, but blood, hair, and saliva tests are available

• Employee drug tests are widespread and costly $2-5 billion annually in U.S.

• Top five labs process 12-15 million samples per year, and about half of large U.S. organizations test.

• Applicant testing is more common

• Drug testing is often legally mandated

What do pre-employment drug tests measure?

• Tests indicate presence of drug metabolyte in bloodstream

• * Marijuana can be detected up to three weeks after use

* Detection periods range from 3-7 days for many other drugs• Great majority of all test failures are for marijuana; test results do not

necessarily indicate use at or near work

• Substance tests vs. impairment tests• Physiological tests indicate use, but do not necessarily indicate impairment• Impairment tests indicate current performance decrements• *behavioral tests - balance, convergence• *performance tests - complex task performance

Validity of Drug Tests

• When proper procedures are followed, tests are highly accurate in detecting drug metabolytes

• • Preemployment drug tests do not detect intoxication, impairment, or

recency of use. •

• Little evidence about links to job performance

• Bottom line - pre-employment drug tests are • limited in validity and usefulness. It is • possible to measure current impairment• with some accuracy. Pre-employment drug • screening is limited in value

Alcohol Testing• Breath tests are the most common, but urine, blood, hair,

or saliva tests are available

• Behavioral impairment tests are easy to • perform, sensitive indicators of performance

• Alcohol tests provide valid and useful measures • of the presence of alcohol and/or impairment at

the time of testing.

• However, alcohol is metabolized very quickly

• Individuals will “fail” an alcohol test only if they • have been drinking within the few hours • before testing.

Assessing Honesty

• Graphology• Handwriting analysis is sometimes used to make • inferences about personality/character

• graphoanalysis involves verifying • documents, signatures, etc. Graphology • uses features of handwriting to infer • personality• Graphological signs include slant, pressure, how • you cross your “t”, etc.•• Graphology is used extensively in France, Israel,• and is becoming more common in U.S.

Why Graphology “Works”

• Handwriting sample that is analyzed often includes an autobiographical statement

•• * not clear if content, graphological features or both influence • assessments

• * people with no graphological training do about as well in making • predictions from handwriting samples as to trained graphologists

• There is little credible evidence that graphological analysis provides valid information about personality, character,

• truthfulness

•

Integrity Testing• Tests designed to measure honesty/integrity/dependability now widely

used in U.S.

• 2-5 million tests per year used in workplace

• Integrity tests may include items that refer to: • * direct admissions of illegal or • questionable activities• * opinions regarding illegal or questionable • behavior• * general personality traits and thought • patterns thought to be related to • dishonesty (e.g. the tendency to • constantly think about illegal activities)

Integrity Testing

• * reactions to hypothetical situations that may or may not feature

dishonest behavior.

• * perceived incidence of dishonesty

• * leniency toward dishonest behavior

• * theft rationalization

• * theft temptation or rumination

• * norms regarding dishonest behavior

• * impulse control

Validity of Integrity Tests

• Evidence that scores on commercially-available integrity tests are related to measures of dishonesty, production deviance, and overall

• job performance

• Validity of integrity tests is consistently high across a range of jobs

• Why do Integrity Tests Work?

• Clear-purpose: admissions are self-validating,• Willingness to admit wrongdoing• related to norms

• Veiled-purpose: conscientiousness, personality • patterns related to dependability

Background checks

• Background investigations, reference checks are very common, very• expensive

• Some organizations spend more on background investigations than on• recruitment or testing

• Most likely to provide information about criminal activity, more difficult to

learn about routine workplace dishonesty

• Many organizations are unlikely to provide meaningful information in background checks. Managers often unwilling to do more than verify employment

Legal/societal concerns• Invasions of privacy

• Polygraph exams, integrity tests, integrity interviews often ask sensitive• questions

• Drug and alcohol tests are by definition invasive,and often degrading

• Reference checks can perpetuate and inflate unfair rumors

• Voice stress analyses may be done without any sort of consent

• Privacy rights of job incumbents sometimes treated differently from privacy rights of applicants. Applying for a job often requires partial waiver of rights

• Legal challenges to honesty-related procedures based on invasions of privacy of applicants are rarely successful

Discrimination

• The likelihood of “failing” various integrity/deception tests varies as a • function of age, gender, and sometimes race

Failure is most likely from:

• * males• * younger applicants and employees• * white•

Few existing cases dealing specifically with • discrimination in honesty-related tests