THE DETERMINANTS OF ORGANIZATIONS USAGE OF EMPLOYEE DISMISSAL - EVIDENCE FROM AUSTRALIA

Substantial variation exists across organizations in their use of dism issal. While it has been suggested that this variation reflects organi zational-level factors relating to disciplinary issues, little evidenc e exists regarding the effect of these factors. Using data from 1,596 workplaces in the Australian Workplace Industrial Relations Survey we examine how organizational-level factors that reflect the incidence of disciplinary problems as well as the expected costs and benefits of d ismissal are related to dismissal usage. For each organization, data w ere collected on organizational characteristics and practices in inter views with the employee relations manager and the senior line manager Data were also collected on whether or not dismissal was used by the f irm and on the number of employees dismissed. Using both logistic regr ession and tobit analysis, our results suggest that dismissal is affec ted by procedural and institutional restrictions on the use of discipl ine, interactions among those restrictions, compensation level, labor market factors, workforce human capital, operating capacity work group influence, the use of incentive pay, workforce size, and industry cla ssification.