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Tuesday, 20 December 2022

The bosses who silently nudge out workers

 By Alex Christian in BBC.com

Employers are often reluctant to fire employees for myriad reasons. But quietly side-lining them in the hope that they’ll quit often leads to even greater harm.
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When marketing manager Eliza returned from holiday, she received an email from her boss asking her to arrive at work early the next day. “I instantly feared the worst,” she explains. “I knew the job wasn’t the best fit. I’d had my probation previously extended; there was an expectation of weekend working and post-work drinking that didn’t suit me. I thought he’d used my time off as an opportunity to fire me.”

However, when Eliza arrived at her boss’s office, she wasn’t immediately let go. Instead, she was informed of a company restructure – her job description was being completely rewritten. Someone else would take over her tasks, and she would be expected to work remotely in a new admin role. 

In the weeks that followed, Eliza’s professional life became much quieter. Instead of formulating the London-based events agency’s marketing strategy from the office or attending live shows as part of her remit, her main duties now consisted of simply being available between 0900 and 1800, sending the occasional email and completing the odd routine task from home. 

Eliza had effectively been frozen out by her employer. Barely a month later, she quit. “It was humiliating – I was made to feel worthless,” she says. “It was the worst experience of my career: I’d rather have been just fired on the spot and paid off than have to go through that.”

There may not always be a good fit between jobs and the workers hired to do them. In these cases, companies and bosses may decide they want the worker to depart. Some may go through formal channels to show employees the door, but others may do what Eliza’s boss did – behave in such a way that the employee chooses to walk away. Methods may vary; bosses may marginalise workers, make their lives difficult or even set them up to fail. This can take place over weeks, but also months and years. Either way, the objective is the same: to show the worker they don’t have a future with the company and encourage them to leave. 

In overt cases, this is known as ‘constructive dismissal’: when an employee is forced to leave because the employer created a hostile work environment. The more subtle phenomenon of nudging employees slowly but surely out of the door has recently been dubbed ‘quiet firing’ (the apparent flipside to ‘quiet quitting’, where employees do their job, but no more). Rather than lay off workers, employers choose to be indirect and avoid conflict. But in doing so, they often unintentionally create even greater harm.

The path of least resistance

For myriad reasons, bosses have long tried to nudge workers they perceive as underperforming or being a bad cultural fit out the door. “This has been happening in workplaces for decades,” says Christopher Kayes, professor of management at the George Washington University School of Business, based in Washington, DC.

The tactic means firms and managers can end up saddled with workers they don’t want, leading to managers engaging in behaviours often seen as passive-aggressive

The reasons for this are complex. If workers behave in ways that violate their contracts, for example, companies can terminate their employment. But if bosses simply dislike workers, or see them as middling or mediocre performers, taking action to remove them is more complicated, often requiring lengthy processes involving performance management programmes and multiple warnings.

“Companies are usually reluctant to let a worker go,” says Kayes. Firing leads to an “immediate sense of sides being created” which, at worst, can land the company in court if the worker contests it, potentially generating negative headlines about the working environment. “It’s often easier to simply let the underperforming employee stay in the job than to go through the process of firing and potential litigation.”

Employers often don’t want to expose themselves to risk or conflict, adds Suzanne Horne, partner in employment law at legal firm Paul Hastings, based in London. “Subtly encouraging someone to leave is seen as the easier option. If the employee eventually resigns, it’s the ‘no-fault approach’: severance doesn’t need to be paid, conflict is avoided and both parties are ultimately happy.”

Managing perceived poor performance, working with the employee to improve their output and turning them into a useful resource for the company would be an alternative way to deal with the problem. However, Kayes says bosses are often ill-equipped to do this, whether through a lack of time or training. “Organisations tend to be bad at preparing leaders to take on the responsibilities they’ll need in the job. So, they often find themselves without the resources they need to be effective and deal with employee underperformance.” 

In this situation, with firing seen as a last resort and managers unable – or unwilling – to turn the employee into what they want them to be, they often follow the path of least resistance: quiet firing. “Much of it is ultimately an avoidance behaviour and comes down to procrastination: managers in most cases are wanting to avoid having difficult conversations,” points out Kayes. “Ironically, they worry that firing a worker will reflect poorly on them, so they quietly fire them instead.”

To push out workers, managers may sometimes set up workers to fail with impossible tasks, or take away their jobs altogether (Credit: Getty Images)

To push out workers, managers may sometimes set up workers to fail with impossible tasks, or take away their jobs altogether (Credit: Getty Images)

Why it often backfires 

By engaging in quiet-firing behaviours, managers are likely to be playing the long game. In theory, it’s low risk and minimal effort; the hope is that by withdrawing support, the worker soon realises they don’t have a future at the company and moves elsewhere.

However, this approach can have collateral damage. The tactic means firms and managers can end up saddled with workers they don’t want, leading to managers engaging in behaviours often seen as passive-aggressive, says Kayes. “You stop offering the employee opportunities to advance; you stop inviting them to certain meetings; you stop providing them important work and feedback.” 

There is also the risk of creating an ‘us and them’ mentality, potentially harming workers not targeted for quiet firing. “You have the engaged employees, and then those just quietly left there, sometimes without their knowledge,” says Horne. “It doesn’t create an inclusive or high-performance workplace culture.” 

Quiet firing can affect a firm’s reputation, too, even if a worker departs without apparent conflict; employees may well share their experience in an online review. “There’s a greater awareness of employment rights today,” says Horne. “People are now more willing to call out workplace issues, especially following the pandemic.” 

An employee subtly nudged out the door isn't without legal recourse, either. “If you were to look at each individual aspect of quiet firing, there’s likely nothing serious enough to prove an employer breach of contract,” says Horne. “However, there’s the last-straw doctrine: one final act by the employer which, when added together with past behaviours, can be asserted as constructive dismissal by the employee.”

More immediate though, is the mental-health cost to the worker deemed to be expendable by the employer – but who is never directly informed. “The psychological toll of quiet firing creates a sense of rejection and of being an outcast from their work group. That can have a huge negative impact on a person’s wellbeing,” says Kayes. 

Eliza agrees. “I was made to feel worthless and useless being quietly fired,” she says. Now happily employed elsewhere, she’s realised that her experience “was a reflection of having a terrible boss, rather than me”. But other people who experience quiet firing over the longer term, in more insidious ways, may not see things so clearly.

I was made to feel worthless and useless being quietly fired – Eliza

“Over time, an employee may figure out something isn’t right if their one-to-one meetings are always cancelled, their manager never makes time to talk about development and performance or they’re always overlooked for promotion,” says Horne. “They face a daily drip feed of their employer trying to make them resign – it’s absolutely gruelling.” 

'A self-fulfilling prophecy'

Quiet firing may be the easiest option on the table for bosses – especially in a remote-work world, where excluding employees is even easier – but it’s not a good solution for firms or workers.

“Employers can end up damaging their business’s morale, productivity and culture while risking litigation proceedings anyway,” says Horne. “For employees, there’s a mental-health impact of feeling excluded, frustrated or angry. They can lose their confidence and it becomes a self-fulfilling prophecy: their performance declines even further.” 

Fixing it requires better-resourced managers, greater HR support and the acceptance that workplace confrontation is sometimes best. However, the time and cost needed to educate managers on how to better motivate employees and deal with difficult situations means that, realistically, quiet firing may be here to stay. “Training is expensive,” says Kayes. “It takes huge investment and requires leaders to be open to it; an acceptance that they need to ask themselves hard questions.

Human psychology plays its part, too. Ultimately, quiet firing is the avoidance of difficult emotions. “There can be the implication that the manager is being nasty or manipulative when they quietly fire an employee, but there is a person on either side of the table,” says Horne. “And people generally like to avoid hard conversations.” 

Eliza is using one name for career-security reasons

Sunday, 18 December 2022

The Chinese are targeting India's greatest strategic vulnerability-- its broken politics


 

Usury, Interest and Islamic Banking

Pervez Hoodbhoy in The Dawn

FINANCE Minister Ishaq Dar has taken on the ungodly, un-Islamic, interest-charging banks of Pakistan. Your days are numbered, he thunders, because our government will implement the Federal Shariat Court’s ruling to end bank interest by Dec 31, 2027. On his orders, appeals challenging the FSC judgement made by the State Bank and National Bank will be withdrawn.

Some will applaud Mr Dar’s new-found religious zeal; others will find this crass opportunism. With national elections around the corner — and with PML-N’s arch-rival Imran Khan having pushed politics rightward — this smells of one-upmanship. Every politician in the government or opposition, clean or corrupt, wants to prove his sainthood.

But most readers will simply yawn — they’ve heard it before. Way back in 1991, the FSC had ordered Pakistan’s economy to dump interest within 12 months. Nothing happened. So recycling an order from 30 years later is no big deal.

Let’s imagine that Dar wins. Rewards or penalties for him in the Hereafter cannot, of course, be known. But this will not end ideological bickering on what interest-free banking actually is. Its two versions, soft and hard, are totally incompatible opposites. 

In the first, at the end of a stipulated period the depositor expects — and receives — a sum exceeding his initial deposit. In another country, the excess is known as interest but in Pakistan they call it profit.

The depositor is clueless about wheeling-dealings inside board rooms and management offices. Nevertheless, heavy use of Arabic words and absence of ‘interest’ gives an Islamic veneer to the bank.

The hard version is uncompromising. In 2014, the top ulema of the Fiqhi Majlis declared that so-called Islamic banking merely re-labels interest as profit and so is hiyal (legalistic trickery).

They point to the explicit Quranic injunction: “Allah has permitted trade and has forbidden interest” (2:275). ‘Forbidden’, they say, is not negotiating low or middle or high. Forbidden means zero — haram is haram and interest is usury.

The influential Maulana Taqi Usmani, among others, takes this position. Bangladesh’s finance minister Dr Abul Muhith is blunter. He says Islamic banking deceives Muslims and is ‘all fraud’.

Early Muslim scholars thought similarly and had equated interest with usury. Since banks rely on income, banking in Muslim lands was absent until very recently. This impeded industrialisation, leaving Muslim countries far behind Europe. Eventually, realising that global trade and commerce are impossible without these Western innovations, Turkish and Egyptian rulers soft-pedalled religious restrictions.

The very first bank in a Muslim country was the Imperial Ottoman Bank (1856) followed by the Egyptian Arab Land Bank (1880).Pragmatic rulers first sought muftis willing to rubber-stamp European-style banking. Else they found those who could invent new definitions or rules.

Pakistan is doing similarly. Commercial banks repackage global financial products with some changed conditions. After a board of clerics chosen by the bank approves a product, it is advertised as Sharia-compliant.

This sanctifies credit cards, derivative products, cross-currency swaps, equity swaps, adjustable mortgages, etc. Are Bitcoin and cryptocurrency halal or haram? Believe whichever you prefer; muftis abound on either side.

One central fact, however, cannot be hidden. Commercial banks in a capitalist economy are profit-making businesses for their owners and shareholders. For this to happen, customers must be drawn into owning more cars, bigger houses, and fancy stuff. If fish could somehow pay, banks would be advertising deals for underwater TVs with 60-inch plasma screens.

Hence a much larger question: is it morally right for a bank to encourage conspicuous consumption amidst an ocean of poverty? The poorest and richest Pakistanis are denizens of different worlds that are poles apart in literacy levels, health outcomes, and living standards.

Urban slums reeking in misery stand in stark contrast to DHAs for the ultra-rich or those just out of uniform. When banks — Sharia-compliant or otherwise — persuade people to borrow more and consume more, does it signify devotion to God?

The answer, of course, should be an emphatic ‘no’. Indeed, the larger FSC judgement states that Pakistan as an Islamic state must have “an equitable economic system free from exploitations and speculations”. But what on earth does riba have to do with present-day inequities of wealth? Even as it flaunts religious symbols, Pakistan’s rapacious elite enriches itself through state capture.

According to the 2021 UNDP report, insider dealings yielded a staggering $17.4bn in the form of subsidies to the military, corporate sector, property developers, feudal landlords, and the political class.

Even this enormous figure pales before the vast wealth of Pakistan’s real estate, estimated at around $300-400 billion. Much of this came from kicking peasants off the lands they once tilled. Land reforms promised by Ayub Khan and Zulfikar Ali Bhutto never happened.

The FSC drove the final nail in the coffin in March 1990. Decreeing that land reform violates Islamic principles, it asserted the absolute right of a Muslim to limitless wealth. This flatly contradicts its own ruling on creating “an equitable economic system”.

Mr Dar’s victory will open another question: how is Pakistan to deal with the outside world after Jan 1, 2028? The FSC judgement is explicit: “the government is directed to adopt Sharia-compliant modes in the future while borrowing either from domestic or from foreign sources.”

Realistically, can Pakistan actually choose who to borrow from? For a country teetering at the edge of default, the answer is no. FSC’s religious scholars optimistically say, “China is also willing to utilise the Islamic mode of financing for CPEC projects”. But do they know how intensely China dislikes Islamic symbols? And that it is deliberately erasing the Islamic identity of Uighur Muslims?

To conclude: Mr Dar’s jihad to eliminate bank interest is a bid to distract from the grimness of the present economic landscape and the damning inequities therein. In fairness to him, fixing fundamental problems such as the small tax base, high indirect taxation, and heavy consumption of imported luxury items is beyond his pay scale. But such posturing could further embolden those — such as the fast rising TTP —who seek to dismantle Pakistan and recreate it as a theocratic state. As such it is a step backward.

Why were the media hypnotised by Sam Bankman-Fried?

John Naughton in The Guardian

So Sam Bankman-Fried (henceforth SBF) was eventually arrested at his multimillion-dollar residence in the Bahamas, a tax haven with nice beaches attached. The only mystery about this was the unconscionable length of time that it took the Bahamian authorities to measure him for handcuffs. The police said that he was arrested at the request of US legal authorities for “financial offences” under US and Bahamian laws connected with the FTX cryptocurrency exchange that he co-founded in 2019 and Alameda Research, a hedge fund that he set up in 2017. On Tuesday, a local court denied him bail, which suggests that an extradition request from the US will be granted and he will soon be appearing in a New York courtroom.

The grisly details of what SBF is alleged to be guilty of will emerge in forthcoming criminal proceedings. But already expectations are high: Amazon has announced that it is working on a series about the scandal in partnership with the Russo brothers, the makers of Marvel movies.

For the moment, though, a brief outline will have to do. FTX was a cryptocurrency exchange that provided an easy way for people to buy and sell these virtual currencies. Many people had invested billions of “real” money in it to facilitate their participation in the crypto casino. But in early November, rumours of problems with FTX surfaced after Binance, another crypto exchange, dramatically refused to bail it out, citing “corporate due diligence” and reports of “mishandled customer funds”.

There then followed, as the night the day, a run on FTX, as panicking investors tried to withdraw their money, which in turn led to its insolvency and a filing for bankruptcy. The big puzzle, though, was why couldn’t FTX have just given its investors their money back? The answer appears to be that it wasn’t there; in some way, SBF’s hedge fund had been treating FTX as its piggy bank, possibly even playing the hedge fund market with investors’ money.
The thought SBF might be as manipulative as any oil mogul or tobacco executive never occurred to the poor dears

Once it was clear that this particular game was up, SBF then embarked on an astonishing apology tour on every media outlet he could find. In almost every interview he was touchingly apologetic while at the same time maintaining that he had no knowledge of potentially fraudulent activities at his own company, including using billions of dollars of customers’ deposits as collateral for loans for other purposes. He had, he explained ruefully, been out of his depth. On some occasions, he also seemed to be trying to deflect blame on to Caroline Ellison, the former CEO of his other company, Alameda Research.

The biggest question prompted by this apology tour is: why did so many apparently serious media outfits let him get away with it? The interview questions were often softball ones, occasionally toe-curlingly so. Some interviewers confessed apologetically that they knew nothing about the complex businesses he had run and allowed themselves to be bemused by the incomprehensible bullshit he was emitting. Often, they seemed hypnotised, as many otherwise sensible people had been before the crash, by this tech wunderkind with big hair and baggy shorts who had, until recently, been promising to give away his phenomenal wealth to good causes, while in fact he had seemingly been presiding over the vaporisation of billions of dollars of other people’s savings.

But this embarrassing failure of mainstream media was really just the encore to an even bigger failure – their wilful blindness to what had been going on while SBF was in his prime. It turned out that earlier in the year the Securities and Exchange Commission (SEC) had written to FTX seeking to determine if the company was as flaky as some observers (mainly on the web) had suspected. As Cory Doctorow pointed out, the SEC never got an answer, because eight US lawmakers – four Republicans and four Democrats – wrote a letter to the SEC chairman demanding that he back off. And five of these eight, according to Doctorow, had received substantial case donations from SBF, his employees, affiliated businesses or political action committees.

There was a real story here, in other words, long before FTX imploded. But it wasn’t told because the mainstream media were so invested in the founder-worship that is the curse of the tech industry, not to mention some of those who cover it. The thought that “the poster child for the libertarian ethos that crypto profits accrued to those most capable”, as one commentator described SBF, might be as politically manipulative as any oil mogul or tobacco executive never occurred to the poor dears. Sometimes, societies get the mainstream media they deserve.