“Being good is easy, what is difficult is being just.” – Victor Hugo, French poet, novelist, and dramatist

Do you think you are just, or fair, with other people? Does everyone see “fairness” the same way? When we are trying to be fair, how do we balance treating people equally with rewarding star performers based on merit or being compassionate with people based on their needs? After all, if we give top performers more salary, or have sympathy for workers faced with terrible circumstances and give them special consideration, doesn’t that mean we are not treating everyone equally? The idea of being fair or just as a leader may not be as simple as it first seems.

What is Fair and Just?

When we ask people to think about desirable leadership traits, justness or fairness will inevitably make it on the list. Just about everyone would agree that leaders should exhibit fairness…but what is “fair” or “just”? One good place to begin to understand this important leadership trait would be with the “Golden Rule.” The Golden Rule can be expressed either in the positive—behave toward others as you want them to behave toward you—or in the negative—don’t behave toward others as you don’t want them to behave toward you. It shows up in many cultures, signifying its basic resonance with humans as a morally right principle that articulates our sense of fairness or justice. Below are some of the various occurrences of the rule in different times and places:

Perhaps a converse of the Golden Rule is “Do as I say…not as I do” (in Thai, ทำตามที่ฉันสั่ง แต่อย่าทำตามฉันนะ). Following a double standard, one for us and one for our workers, introduces a disease of unfair treatment into workplaces that can destroy morale and effectiveness.  The hypocrisy of “Do as I say, not as I do” can introduce many problems:

• Resentment or Animosity
• Loss of Respect and Moral Authority
• Confusion
• Non-Compliance
• Loss of Team cohesion
• Poor work performance

If we as the leader don’t “walk our talk,” followers will disregard what we say, and disregard the rules of the workplace, as they follow our own example in lacking respect for rules. Fairness is everyone following the same rules, no exceptions.

In the social psychological theory known as “moral foundations theory,” fairness is listed as one of the five basic moral foundations common to humanity, along with care, loyalty, respect, and purity. Fairness in this context is seen as executing justice according to shared rules. Its opposite is cheating, or not abiding by the established rules. Cultural anthropologists and ethologists (scientists who study animal behavior under natural conditions) also link fairness to the concept of reciprocity, which has been observed in primates. In this moral foundations theory, our sense of fairness is an innate characteristic that has evolved in human society. Take a look at this clip of capuchin monkeys demonstrating a sense of fairness, from a presentation by ethologist Frans de Waal. The two monkeys have been given the task of exchanging a rock for a treat. At first, both monkeys were given a piece of cucumber for performing the task, which was perfectly fine with them. But then, one monkey is given a sweet grape, while the other is offered the cucumber for the same task. See how the monkey reacts to unequal pay for equal work.

 

And another example from the BBC documentary “Capuchins: The Monkey Puzzle”….

 As we see from the monkeys’ reactions to distribution of different types of food, fairness is about the “proper” or “morally right” allocation of limited goods or services in a society or organization. One well-known theory defining fairness comes from American political philosopher John Rawls’ concept of “Justice as Fairness.” Rawls offers a thought experiment, in which a people setting up a just and fair society start by choosing the principles of that society from a ‘veil of ignorance,’ meaning that they have no idea about their own status, gender, ethnicity, or even conception of good as they consider what principles should govern their society. From that original position, he believes that people would choose “justice as fairness” in two basic principles: the liberty principle and the equality principle. The liberty principle states that every individual has an equal right to basic liberties (although what makes the list of basic liberties is not universally defined). The equality principle is divided into fair equality of opportunity and the difference principle. Fair equality of opportunity means that everyone should have an equal opportunity for “offices and positions” as any other individual of similar natural ability. The difference principle attempts to deal with inequalities, including in natural abilities, by stating that society should permit inequalities only if it works to the advantage of the worst-off. Particularly with this last principle, Rawls argues that the ideal society, as imagined from the original position created behind a veil of ignorance, would support “distributive justice.”

Distributive justice, or distributive fairness, is one of three major areas into which we can divide the concept of fairness, along with procedural fairness and interactional fairness. Distributive fairness refers to how rewards are allocated in an equitable or fair manner. In a business organization, for example, fair distribution would be that wages of every individual are perceived as being justly assigned. It is concerned with the outcome of the allocation of limited goods or services, rewards or punishments. Procedural fairness is about the perception of the fairness of the process that determines how those rewards (or punishments) are given. A fair process usually requires transparency, opportunity to make inputs, and clear communication. Interactional fairness involves the emotional sense that individuals are being treated with respect in the execution of the process of allocating rewards or punishments. Someone at work may feel that the rewards are distributed fairly, and that the process is fair, but still feel slighted by the attitude of those running the process and making the distribution decisions.

The concept of fairness in the workplace has been studied for many decades already, particularly since behavioral psychologist J. Stacy Adams proposed the Equity Theory in the early 1960s. Her theory sees fairness as a primary motivator of workers, who continuously make a cost-benefit analysis to their work effort. They compare the inputs that they make to work, such as time, effort, loyalty, etc., to the outputs that they receive, such as compensation, respect, development opportunities, etc., and then compare to relevant others in or outside the organization. If a worker perceives that her inputs are not being fairly rewarded, compared to other people, she will lose motivation to perform as effectively as possible in the organization. In fact, she can react to the unfair situation in one or more of six ways:

• Change inputs, such as putting in less time or effort, so that her costs to work go down.
• Change the outcomes, such as asking for higher salary or seeking more praise and recognition.
• Distort her self-perception, so that she lowers her own evaluation of her self-worth.
• Distort her perception of others, attributing comparatively more deserving qualities to them.
• Choose a different person to compare to.
• Leave the company.

Of course, none of these situations is ideal for an organization.

Employees may even make seemingly irrational economic decisions in the face of perceived unfairness, if we interpret the results from one widely-used economic game. In the Ultimatum game, played in one round only between two people, the first person is given a certain amount of money. He must propose to share part of it with the second person, between 0 and 100% of the amount. If the respondent accepts the offer, they split the money according to the terms. If the respondent rejects the money, neither gets to keep it. According to the most economically rational action, the respondent should accept any amount, because having some amount of money is better than having none. But in about half the cases in multiple studies, respondents reject any offer less than about 30%. Just like the capuchin monkeys, who would just as soon not eat than take a morsel of food that they thought was unfairly distributed, a worker who feels unfairly treated may forego economic benefit if it means that the offending entity is punished. The lesson? It pays to treat people fairly.

Research has found links between the perception of fairness in the workplace to employee performance, retention, work engagement, and organizational loyalty. One study of 100 French companies found a strong correlation between transformational, change-inspiring leaders and their reputation for fairness. A 2006 study in the Australian banking industry found a relationship between perceptions of fairness (in which distributive and procedural fairness were closely linked) and both organizational commitment and turnover intention. In a study of retail business managers in Japan, China, Hong Kong, Malaysia, and Thailand, another research team found that procedural fairness, and transparency of the Human Resources practices “significantly influenced job satisfaction as a whole group.”

Application—How to be Fair?

So we all agree that it’s important to be fair. But what makes being a fair and just leader so challenging? There are many types of decisions that leaders must make regarding employees, customers, suppliers, and perhaps other stakeholders, that are subject to being scrutinized as fair or unfair:

• wages and other compensation
• job evaluations
• promotions
• job assignments
• extra project assignments
• training
• bonuses
• vacation or personal time given
• office location
• downsizing
• dispute resolution
• punishments for rule breaking or bad behavior
• vendor selection

In each of these types of decisions, and many more, a leader must allocate limited resources, or choose one individual over others. Let’s look at a few suggestions that may help make these types of decisions clearer and more methodical, which hopefully leads to being fairer. Psychologist Gerald S. Leventhal suggests six criteria for making a decision-making process just and fair. I have transformed his criteria into a list of questions that we can ask ourselves when we need to make fair decisions:

Criteria for Making a Fair Process Decision

• Is my decision consistent with others between people and over time?
• Have I acknowledged and suppressed my own biases?
• Have I avoided the practice or appearance of favoritism?
• Has my information been complete and accurate?
• If I’ve made an error, would this decision be able to be corrected or appealed?
• Have I allowed the representation of the basic concerns, values, and perspectives of all involved individuals?
• Does my decision conform to ethical and moral standards?[i]

 

Another research team, Kim and Mauborgne, have established a three-principle approach to making fair decisions, known as “the 3 E’s” of fair process:

• Engagement – involving all affected individuals and allowing them to appeal
• Explanation – Clearly communicating the final decision and the reasoning behind the decision.
• Expectations – Articulating the rules of the game, and roles and responsibilities of all involved in the decision.

In order to make our decisions more just or fair from a distributive fairness aspect, philosopher-authors Tom Beauchamp and Norman Bowie have proposed six principles of distributive justice. These in fact are more “considerations” than principles, as their application is situational. The list highlights the fact that different people will see a “fair” solution from a different perspective. In making decisions on allocating rewards, one must balance the following:

Shares of rewards or opportunities are shared

• equally
• according to individual need
• according to an individual’s rights
• according to a person’s effort
• according to one’s societal contribution
• according to one’s performance or merit

The activity below provides an opportunity to apply the above principles in making a fair decision.

Activity: Making a Fair and Just Decision to Assign a New Branch Manager

You are the boss of a small retail company that employs 50 employees. You have just opened a new branch, in a high-traffic area that is sure to make a lot of money for the manager of this branch, as compensation includes volume of business generated. The branch is also in a very convenient location; thus, the competition for the new position is fierce. You can hire only one manager, although five of your strongest employees have applied, all of whom have the basic qualifications:

1. Manager A recently had the tragedy of losing his wife to breast cancer, and he now has three young children to feed. He demonstrates the greatest need of the candidates.
2. Manager B is one of only a very few minorities in your entire company. She just missed the last promotion step, and you sympathized with her greatly, promising you would do whatever you could to help her get the next promotion. She strongly feels that she has the greatest right to be hired for this position.
3. Manager C, although not the best skilled worker, has the highest amount of working hours in the company, has been with the company since its inception, and has consistently volunteered for overtime and worked extremely hard. He feels that he deserves the job because he has put in more individual effort than any other candidate.
4. Manager D has contributed in many ways to the company, volunteering whenever needed, and has done a tremendous job of running corporate charitable activities, which have greatly elevated the brand image of the company. She feels she should get the job because she has made the highest societal contribution.
5. You consider Manager E, although young and less experienced, to be the best hands-on manager in the company. He comes with an impressive academic and training background, is exceptionally bright (and knows it), and most importantly, has been the top performer since his arrival, far outpacing his colleagues in productivity and innovation. He feels that he should get the job because he is the best performer of all the candidates.

Which one of these will you hire? Which do you believe is most “fair” in this situation—to hire based on need, rights, effort, social contribution, or performance? Explain your decision.

Conclusion

As a leader, it is important to develop a trait of fairness and justness within oneself, and to cultivate a culture of fairness in the business. Being fair and just can require a delicate balance—there will always have to be people selected for limited rewards or benefits, and people who will not be selected. Of those who don’t make the cut, we’re probably bound to have dissatisfaction and complaints. But we can work on living the Golden Rule, avoiding double standards, and following standard criteria that will make our decisions as fair and just as possible. As Victor Hugo said, “Being good is easy, what is difficult is being just.”

Copyright © 2017 by Robert Cummings All rights reserved.

[i] Ludo Van der Heyden, Christine Blondel, Randel S. Carlock, “Fair Process: Striving for Justice in Family Business,” Family Business Review, vol. XVIII, no. 1, March 2005, p. 4.