Ethics as Unwritten Rules for Society - Research Paper Example

RUNNING HEAD: BUSINESS ETHICS Business Ethics By Introduction Generally, ethics are unwritten rules that society has devised for the way its members interrelate with one another. Some unethical behavior may amount to a crime in some areas or may be a subject of legal action but by and large, ethics goes beyond the contemplation of the law and legalities. Thus, author Marianne Jennings state that although line cutters, or people who squeeze themselves to the front of queues bypassing others who have waited in lines, may not be liable legally but they nevertheless, breached ethical conduct (2008 1-4). In business, ethics are important too, and in recent years the close connection between ethics and the law have began to surface with cases like the Enron, a company that was financially at the top of the corporate world but whose financial records and documents were in fact manipulated and fabricated to make it appear that it was making huge profits when it fact, it was swimming in debt. Many of its executives received prison sentences and the auditing firm that handled its account dissolved. The Brighton Young University School of Business developed twelve categories of business ethical dilemmas, namely: using or taking the property of others; deliberate lying; giving or allowing false impressions; engaging in conflict of interest; concealing information; taking unfair advantage; engaging in personal acts that affects the quality of work; committing personal abuse; allowing organizational abuse; violating rules; permitting unethical actions (Jennings 2008 10-14). The problem at hand shows that many of the recommendations made by the Strategic Planning Committee to solve the problems currently faced by the Company not only seem to contravene standard business ethics but may also be legally questionable. The Strategic Planning Committee recommended setting up a Claims Processing Department in a locality considerably far from the present Company Premises, which is not being serviced by public transportation. This is purportedly to resolve the problem of the workforce issue. Evidently, the secluded location viz., inaccessible to public transport, is meant to keep unwanted applicants at bay, especially city applicants. The Committee probably wanted to exclude city applicants who are at a wage premium because of their minority status. The issue here is whether it is ethical to deliberately locate the Claims Processing Department to a site where the workforce is cheaper. This recommendation is akin to the practice of many companies to outsource some of company functions overseas where there is cheaper workforce for the purpose of cost savings and a faster return of investments. Outsourcing basically means “the use of external parties to perform one or more organizational activities” according to Dibbern et al (cited Quigley p. 426). In the present problem, however, the Company retains its supervision over the claims processing and does not really purchase the services but its objectives have parallelisms with that of outsourcing, which is to save costs in operation, among others. Author Peter Schuller is of the opinion that closing a call center in Florida and relocating it in India because of the latter’s cheaper labor force is not necessarily unethical considering the “current capitalist focus on corporate profitability and competitiveness.” In this sense, Schuller argues that this current corporate practice is not only ethical but also appropriate because it meets the short-term main concern of corporate America, which is quarterly revenues and income projections (2007 pp. 95-96). In the present problem, the potential city workforce is described to be already saturated implying diminished potential sources of applicants. This aspect could provide justification per se for the relocation of the job site to another area where there are ample sources of applicants although the move may dovetail with the avoidance of a more expensive workforce. However, although this recommendation may be absolved ethically, there is a possibility that it may be assailed legally as minorities are one of the protected classes in accordance with the Civil Rights Act 1964. Section 2000e-2 (k)(A) of the same law states that: An unlawful employment practice based on disparate impact is established under this chapter only if- (i) A complaining party demonstrates that a respondent uses A particular employment practice that causes a disparate practice Impact on the basis of race, color, religion, sex, or national origin, and the respondent fails to demonstrate that the challenged practice is job related for the position in question and consistent with business necessity. In disparate impact cases, if an employment practice, policy or decision impact on any of the protected classes, such as minorities, tending to discriminate them from being hired or promoted in the workplace, the employer must demonstrate before the court that such practice, policy or decision is reasonably work-related. This is the holding in the first disparate impact case of Griggs v. Duke Power Co. 401 US 424 (1971), where the employer required a high school diploma or a minimum IQ score for positions in the Company, except for its Labor Department. This was after Congress passed the Civil Rights Act 1964, which prohibited employment discriminatory acts against race, among others. The Company had previously segregated blacks employing them only in its Labor Department effectively keeping them out of other departments. The Court held it to be a disparate impact, which had the effect of eliminating blacks from employment positions other than the Labor Department as most of them were, at that time, non-high school graduates. Since the Company cannot justify the policy as directly job-related, it was deemed a violation of the Civil Rights Act 1964. In the present case, the recommendation of the Strategic Planning Committee would surely deprive applicants from the city from employment for the clerical positions with the Claims Processing Department because not only is the contemplated site far from the city but it also cannot be accessed by public transportation. The question at this point is whether the Company can justify the move as job-related. Even if the potential job applicants are deemed by the Company to be saturated the presence of complaints against this recommended policy would imply that there are job applicants who would be deprived of potential employment in case of job site relocation and it would hardly be acceptable for the Company to present lower wage level as justification. The Company would need to establish and prove the veracity of its claim against lack of qualified applicants in the city. Another recommendation of the Strategic Planning Committee is to fill up the workforce vacancies with 50 underemployed caregivers, who are fathers and mother with school-age children, and 50 high school and college students. The first are to work on the first shift of 5 ½ hours and the other to work for the same number of hours on the second shift. This game plan is supposed to be underpinned by cost savings. The reasons for this particular recommendation is unethical because it takes advantage of the fact that such potential employees desperately needed to be employed and would probably accept anything out of desperation. The reason related to computer use is acceptable considering that it aims to solve the efficiency and accuracy of the system by reducing the error rate and at the same time allowing more people to be employed. The benefits, health and welfare, will depend on the state law involved, but most part-timers are not granted such benefits. An issue relative to this recommendation is whether or not specifically choosing mothers or fathers of school-age children or high school or college students for the clerk position breach anti-discriminatory laws. The Civil Rights Act 1964 classified certain individuals as protected on the basis of sex, religion, race, age, color, or national origin. If the basis of the employment is being a father or a mother of school-age children or being a high school or college student, this would breach a host of anti-discrimination laws such as the Pregnancy Discrimination Act, the Age Discrimination in Employment Act and various state laws which provide for their respective protected classes like marital status (in 30 states). A discrimination of any of the protected classes engendered by this particular recommendation will fall under the disparate treatment category discrimination. Disparate treatment is “intentional unequal treatment based on protected class characteristics that result in the denial or limitation of employment opportunity” (Walsh 2009 p. 64). In the present case, discriminate treatment is obviously present in an employment policy that specifically requires new hires to be either a mother or father of school-age children because this would necessarily eliminate those who are pregnant who are protected by law from employment discrimination. In addition, this would also necessarily eliminate those who are not married, which could violate certain states’ law on marital status as a protected class. Likewise confining applicants to high school students or college students would necessarily discriminate against many 40-year olds and above. Like disparate impact cases, employment cases found to be disparate treatment will also be required by the courts to prove that the criteria that caused disparate treatment is legitimate and therefore, work-related as held in Hicks 509 US 511. In the present case, it would be very difficult to justify the criteria of motherhood or fatherhood with school-age children or high school or college students because these do not directly relate to qualifications of competency for the position. As to the facility required to house the workforce, the Committee recommended either leasing or building the premises. Between the two choices, the second one is the better option unless the rundown former mills could be renovated that could provide a safe place for the workers. Workplaces and work conditions are regulated by the Occupational Safety and Health Act 1970 or OSH, which requires, among others, that employers should provide a workplace for their employees that are safe from recognized hazards that will likely cause death or serious physical injuries to them. A violation of this rule may ultimately result in a penalty to be determined by the Secretary, which is either a civil penalty or imprisonment. On the other hand, contracting with a non-union brick company does not violate any law since there is no law that compels workers to unionize. Any recommendation to the Board of Directors should only consist of those plans that do not breach any employment law or even if there is no law violated, those which are not clearly unethical. These recommendations would include relocating the claims processing to another site where there are potential qualified applicants. This would be a problematic area because if the Company stuck it out with the city, there would be less potential qualified applicants and if it does, there may be suits against it. The Company could cite statistics to prove the saturated condition of the workforce in the city. The Company could also benefit from the relatively lower workforce costs. It would also include the 5 ½ hours of two shifts to solve the error prone data entry and to classify workers as part-timers to avoid payment of most benefits but this would not include accepting only fathers and mother with school-age children and high school or college students because evidently these would violate specific anti-discriminatory laws. The criteria for selection should be primarily qualifications to ensure that the hiring process does not violate any employment laws. References: Age Discrimination in Employment Act. Civil Rights Act 1964. Griggs v. Duke Power Co. 401 US 424 (1971). Hicks 509 US 511 Moody, M. (2008). Business Ethics: Case Studies and Selected Readings, 6th Edition. Cengage Learning. Occupational Safety and Health Act 1970. Pregnancy Discrimination Act. Quigley, M. (2008). Encyclopedia of Information Ethics and Security. Idea Group Inc (IGI). Schuller, P. (2007). Ethics: Finding True North: Formulating and Deploying a Systematic Approach to Ethical Decision Making. AuthorHouse. Walsh, D. J. (2009). Employment Law for Human Resource Practice, 3rd Edition. Cengage Learning. Read More