Managers should not be given more autonomy to make personnel decisions such as hiring, appraising and compensating subordinates. The main problem that can result from giving the managers more autonomy over the employees is an abuse of the power. The abuse of power can lead the managers to constantly remind the employees that they can fire them even for small mistakes because they are the final authority and there is no one to question their decision. Because the employees are likely to be reminded of being fired by the manager, they will be working in fear, and it can highly affect their productivity at work (Baard, Deci & Ryan, 2004).
The managers are also likely to favor the employees they like and discriminate against the employees they dislike and the ones that they feel are challenging their authority by opposing some of the ideas that originate from the manager. Some managers are also likely to bring personal differences at work and end up working towards ensuring that the employees that they perceive to be a threat to them are dismissed from the workplace (Langfred, 2007). For example, if a manager and his and his or her subordinate went to the same school and had been competing over who is best among them, the same competition can take place at the workplace leading to the manager to look for ways to undermine the competitor and lead to the firing of a productive employee. A manager can create a fake emergency that will require everyone to report to work targeting the employee they dislike and whom they know is on leave. The manager may be aware that the employee has traveled and later accuse them of not replying emails and phone calls because the company policy says calls must be answered even when someone is on vacation.
Another problem that is likely to sprout if the managers are given more autonomy to make decisions such as hiring, appraising and compensating subordinates is corruption.
When the manager is the only one responsible for hiring with no one to question the process, a company may end up with an incompetent workforce that cannot respond to the company’s needs (Fenton-O’Creevy, Gooderham & Nordhaug, 2008). When a system is introduced giving the manager more autonomy to hire new staff members, it is likely to encourage the manager to hire his or her friends or relatives without placing much emphasis on the qualifications and skills. The disadvantage of such a system is that highly skilled and talented candidates might not make it through the selection process and therefore the company suffers from loss of talent.
Giving the managers the power control the compensation of employees also can lead to inequality of payment for people that are doing the same job depending on their relationship with the managers. For example, in a company where employees are compensated and given allowances for attending sponsored training and conferences, the manager can use his influence during the selection to ensure his or her friends never miss such conferences while his or her perceived enemies are left out.
Giving managers autonomy to hire and fire employees to a greater extent means that things must be done exactly the way the managers wants them to be done and therefore can affect the spirit of innovation and creativity in the employees. An employee that has a good idea but one that goes against what the manager expects will most likely choose to keep quiet about instead of risking being sacked.
Baard, P. P., Deci, E. L., & Ryan, R. M. (2004). Intrinsic need satisfaction: A motivational basis of performance and well‐being in two work settings. Journal of applied social psychology, 34(10), 2045-2068.
Fenton-O’Creevy, M., Gooderham, P., & Nordhaug, O. (2008). Human resource management in US subsidiaries in Europe and Australia: centralization or autonomy?. Journal of International Business Studies, 39(1), 151-166.
Langfred, C. W. (2007). The Downside of Self-Management: A Longitudinal Study of the Effects of Conflict on Trust, Autonomy, and Task Interdependence in Self-Managing Teams. Academy of management journal, 50(4), 885-900.