Q: In secret, one of my employees negotiated a special deal allowing him to work less for the same pay. The manager who approved this deal has since left the company. I found out about this when the employee began to brag about the arrangement to others on my team. Understandably, my team is irked that they were not offered similar deals. When I spoke to our HR department about rolling back this deal, I was told to let it stand. What can I do to rebuild the morale of my team if I have to keep this employee and his inequitable compensation structure? 

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Work Ethic is a twice-monthly column on BBC Capital in which we consider the ethical and interpersonal dilemmas that workers face around the world. We welcome knotty questions from readers at workethic@bbc.com.

A: This question touches on the bane of human resources departments: idiosyncratic deals, in which one employee has negotiated a unique arrangement.

“There’s nothing inherently unethical about such a negotiation,” said Maureen Ambrose, the Gordon J Barnett Professor of Business Ethics at the University of Central Florida, in Orlando, in the US, in an email. Rather, the issue here is fairness, in particular how the sweetheart deal was conceived, executed and walled off to everyone else.

“Fairness in organisations is not just about equitable compensation. It’s also how those rewards and arrangements are determined and “how information about those decisions is provided to employees,” she said.

Don’t assume that this employee’s arrangement is inherently unfair. Perhaps he is extremely talented in a specialised area, or performs exceptionally well or agreed to work an inconvenient schedule. Or maybe this arrangement is designed to allow the employee to take care of a crisis situation at home: a sick child, for instance. It could also be that this person was deserving of a raise, but no money was available — so an alternate deal for time was made.

“Without knowing why the original manager struck the deal, it’s hard to say whether it’s fair or unfair,” she cautioned.

What we do know: the situation has been handled poorly and it’s causing problems. Team members are annoyed that they weren’t allowed to access similar deals. Since HR is fine with it, and you haven’t noticed the employee’s performance suffering, “one option for restoring morale is to offer employees the opportunity to negotiate a similar work arrangement,” Ambrose said.

You could also address the imbalance in communications by telling the whole team why this employee was able to work out this arrangement (if you can find out the real story). “However, it’s important to note that providing information about the basis for the  deal implicitly identifies the factors on which other employees might strike similar deals,” she said.

If you discover that the only reason for the deal is this employee’s superior negotiating skills, not performance, accommodation or personal hardship, and you’re not allowed to offer similar deals to others, you may have to go back to HR and insist the policy be rolled back. Be aware that this measure will likely make the employee feel he’s being treated unfairly if he loses his work arrangements just because his previous manager left. You might even lose him if he feels slighted enough.

If your only option is status quo — the employee stays on with his current arrangement, but no one else can be offered an alternative deal — then “honesty with the other employees is the best policy,” Ambrose says. Start by explaining to the employee that he simply can’t talk about his work arrangements anymore as they are engendering resentment throughout the team. Then have a team-wide conversation about what happened, in an empathetic and apologetic manner. Next: everybody back to work.

“The manager may not be able to change the current situation, but he or she can be committed to treating the team members with respect, sharing information about his or her constraints, and acting fairly in the future,” Ambrose said.

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Work Ethic is a twice-monthly column on BBC Capital in which we consider the ethical and interpersonal dilemmas that workers face around the world. We welcome knotty questions from readers at workethic@bbc.com.