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Sears Auto Center Scandal - Research Paper Example

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In the report “Sears Auto Center Scandal” the researcher discusses the problems surrounding Sears’ unethical actions and the multiple cases brought against the company, focusing on providing solutions to the decrease in profits for the company. …
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Sears Auto Center Scandal
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Sears Auto Center Scandal

Download file to see previous pages... This forced the administrators to begin to apply massive expense cuts throughout the company.
 Many of the expense cuts directly impacted how work was performed by the auto service center at Sears locations. The salesmen and auto mechanics received a decrease in fixed wages and were instead offered a commission-based wage system that provided additional payment for specific types of parts sold and installed, as well as demanding a specific amount of these parts sold during a working shift. Employees began to concentrate on ways to make the most money instead of concentrating on the best quality for the customer. As consumers began to file formal complaints, a California audit and inspection was performed on Sears chains to discern the work involved. It was determined by government officials that the quality of work was below approved standards and the company’s employees were purposely misleading the consumers.
 While the CEO of Sears issued statements contradicting these inspections results, the company issued changes in wage programs and earnings for the salespersons at Sears but did not change the commissions-system for auto mechanics. Chuck Fabbri, a Sears auto mechanic, wrote a letter to the U.S. Senate telling the truth about Sears’ wages program for auto mechanics and the dangers that it creates for consumers. These actions were performed by upper-level management at Sears to increase overall profits for the company as well as to provide increased earnings to company shareholders. The community was negatively impacted by these decisions because consumers were taken advantage of and misled. The government placed a 3-year probation on Sears and the company settled on nation-wide class-action cases amounting to multi-billion dollars worth.
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