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HRM Incident 1: An Ethical Dilemma

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    HRM Incident 1: An Ethical Dilemma

    Amber Davis had recently graduated from college with a degree in general business. Amber was quite bright, although her grades might lead a person to think otherwise. She had thoroughly enjoyed school—dating, tennis, swimming, and similar stimulating academic events. When she graduated from the university, she had not found a job. Her dad was extremely upset when he discovered this, and he took it upon himself to see that Amber became employed.

                Her father, Allen Davis, was executive vice president of a medium-sized manufacturing firm. One of the people he contacted in seeking employment for Amber was Bill Garbo, the president of another firm in the area. Mr. Davis purchased many of his firm’s supplies from Garbo’s company. After telling Bill his problem, Allen was told to send Amber to Bill’s office for an interview. Amber did as instructed by her father and was surprised that before she left that day she had a job in the accounting department. Amber may have been lazy but she certainly was not stupid. She realized that this job was obtained because of the hope of future business from her father’s company. Although the work was not challenging, it paid better than the other jobs in the accounting department.

                It did not take long for the employees in the department to discover the reason she had been hired—Amber told them. When a difficult job was assigned to Amber, she normally got one of the other employees to do it, inferring that Mr. Garbo would be pleased with them by helping her out. She developed a pattern of coming in late, taking long lunch breaks, and leaving early. When the department manager attempted to reprimand her for these unorthodox activities, Amber would bring up the close relationship that her father had with the president of the firm. The department manager was at the end of his rope.

    From an ethical standpoint, how would you evaluate the merits of Mr. Garbo employing Amber?
    As per the ethical standpoint, all the employees including those from various castes, religions, socioeconomic background, gender, etc, need to be treated equally and given an equal opportunity to develop and grow in the organization.  Each employee would be given equal amount of work and responsibilities and in turn, have to perform their duties and obligations towards the company.  Mr. Garbo has offered Amber Davis the post even before interviewing her.  This demonstrates that the sole purpose of employing her was to gain tenders and supply from Mr. Davis’ company.  This demonstrates that Mr. Garbo did not offer equal opportunity to other candidates and other employees during the interview and subsequently during the employment of Amber Davis.  As Amber was not performing her obligations and duties in the company and was making others do her work, it suggests that others were not treated equally (But given importance to her socioeconomic status).  Amber also threatened the Department manager when he said that he would report her behavior in the office to the higher authorities.  This amounts to unethical behavior on the part of Amber.  Also, making others do the work of one staff member would be unreasonable and unethical (Bennett, 2005).

    Now that she is employed, how would you suggest that the situation be resolved?
    Considering that Amber is competent at doing her work and that it would not be very nice for the company manager to sack Amber, it would be advisable to warn her of  her unethical behavior and ensure that she would be performing her responsibilities in the office.  She should be informed of all her duties and obligations.  If Amber has any difficulty in performing her tasks, she should be given training to ensure that she is competent.  The department manager should also ensure that Amber is given all the help at her workplace, but no unreasonably transferring the work to other staff members.  Unreasonable transferring Amber’s responsibilities to others would create an unhealthy working environment (Bennett, 2005).

    Do you feel a firm should have policies regarding such practices?
    Yes, it is very important that Mr. Garbo’s firm develop a Code of Ethics for all the employees to follow.  Each employee should be given a Code of Ethics that need to be read, understood, signed and followed at the workplace. This Code of Ethics document would address several issues including Objectives, Responsibilities of the staff members, Employment practices, work practices, anti bribery rules, equal opportunities, fair dealings, confidentiality, proper use and protection of the company’s property, meeting with the rules and regulations, non-engagement in business of conflicting interests, safety and health at the workplace, reporting unethical behavior, raising a concern, etc (Bennett, 2005).

    HRM Incident 2: It Sure Is Different Now!

    Maxine Vincent is the new HR manager of Developmental Technologies, Inc., which was once the research and development division of a large long-distance phone service provider. Developmental Technologies, Inc. became a separate business entity so the long-distance provider could prepare for the competitive changes resulting from the deregulation of communication services. Maxine was the assistant to the vice president of HR for the long-distance carrier before the reorganization, so she believed she was well prepared to deal with her new responsibilities. However, the new company does not have the unlimited resources of the previous company, and therefore reducing operating costs is a necessity.

                Although Maxine is not totally enthusiastic about the idea, outsourcing of certain HR functions appears to be a solution. Even though Maxine had no previous experience with outsourcing, she believed that it would be one way of relieving the burden on her rather small staff. Just as she was to meet with a potential outsourcing provider, her boss called to set up a meeting to discuss her role as a strategic partner in upper-level planning. This was the first Maxine had heard of being a strategic partner, and she was both apprehensive, and somewhat excited about the opportunity to influence the future direction of Developmental Technologies. It is evident that there will be a new way of doing things now.

    What human resource management might Maxine outsource?
    Maxine was working as a HR manager to Developmental Technologies Inc when it was the research ad development division of a large long-distance phone service provider.  Following the separation, the company had some problems as the size of the staff was larger and there was a need to reduce the operating costs.  She was called by her boss to discuss her role as a strategic partner in upper level planning.  She was very much interested in the new post.  She was going to exert more interest in the upper level planning.  There was also a good chance that Maxine would outsource certain operations in the lower and middle level human resource (research and development) tasks.  This is because Amber is aware that there is a shortage of staff in that area (ASTD, 2007).

    What should Maxine’s role be as a strategic partner?
    Maxine would be playing a vital role in Developmental Technologies Inc as a strategic partner:-

    ·         Would be identifying strategic opportunities

    ·         Would be reviewing and reframing requests in which recognizing strategic opportunities are made

    ·         Implementation of strategic programs

    ·         Ensure the beneficial business strategies are developed

    ·         Developing a HR strategic plan and integrating it into the business plan

    ·         Ensure that the interests of the employees and the people are implemented into the business plan (ASTD, 2007)

    HRM Incident 3: Downsizing

    As the largest employer in Ouachita County, Arkansas, International Forest Products Company (IFP) is an important part of the local economy. Ouachita County is a mostly rural area of south-central Arkansas. IFP employs almost 10 percent of the local workforce, and there are few alternative job opportunities available. Scott Wheeler, the human resource director at IFP, tells of a difficult decision he once had to make.

                Everything was going along pretty well despite the economic recession, but I knew that sooner or later we would be affected. “I got the word at a private meeting with the president, Mr. Deason, that we would have to cut the workforce by 30 percent on a crash basis. I was to get back to him within a week with a suggested plan. I knew that my plan would not be the final one, because the move was so major. But I knew that Mr. Deason was depending on me to provide at least a workable approach.

                “First of all, I thought about how the union would react. Certainly, workers would have to be let go in order of seniority. The union would try to protect as many jobs as possible. I also knew that all management’s actions during this period would be intensely scrutinized. We had to make sure that we had our act together.

                “Then there was the matter of the impact on the surrounding community. The economy of Ouachita County had not been in good shape recently. Aside from the impact on individual workers who were laid off, I knew that our cutbacks would further depress the area’s economy. I knew that there would be a number of government officials and civic leaders who would want to know how we were trying to minimize the harm done to the public in the area.

                “We really had no choice but to make the cuts, I believed. First of all, I had no choice because Mr. Deason said that we were going to do it. Also, I had recently read a news account that one of our competitors, Johns Manville Corporation in West Monroe, Louisiana, had laid off several hundred workers in a cost-cutting move. To keep our sales from being further depressed, we had to ensure that our costs were just as low as those of our competitors. The wood products market is very competitive, and a cost advantage of even 2 or 3 percent would allow competitors to take many of our customers.

                “Finally, a major reason for the cutbacks was to protect the interests of our shareholders. A few years ago we had a shareholder group that disrupted the annual meeting to insist that IFP make certain antipollution changes. In general, though, the shareholders seem to be more concerned with the return on their investment than with social responsibility. At our meeting, the president reminded me that, just like every other manager in the company, I should place the shareholders’ interest foremost. I really was quite overwhelmed as I began to work up a personnel plan that would balance all of the conflicting interests that I knew about.”

    List the elements in the company’s environment that will affect Scott’s suggested plan.  How legitimate is the interest of each of these?
    There are several issues that company needs to consider about the environment in which the company is functioning in:-

    ·         The company was a major employer, employing about 10 % of the local workforce – There was a greater chance of the people being laid-off not to find a job in another company.

    ·         The company was located in a rural area – Hence there were poor chances of the staff being laid off not to find another job.  Besides, the competitors were also laying off staff

    ·         There was a strong union who would close monitor to every move of the management and raise sufficient objection if required – The Union are trying to retain as many staff as necessary and are also capable of going to an unreasonable extent to prevent the staff from being laid off

    ·         The economy of the area was not very good – there was a strong chance that the laid-off staff members may not find alternative mechanisms of earning a living.

    ·         There would be sufficient amount of objection raised by the civic leaders and the local government regarding the way in which the jobs were laid-off – This may be a strong reason as to why the company would have to reassess the need for laying off.  The local government may not like the rate at which the staff members in the company are being laid-off and hence may object by not providing licenses required by the company to perform normal work.

    ·         There local competitors have also laid-off several staff as a cost cutting measures (to ensure that the costs of the company’s products were reduced) – The company should also think of other means by which profits can be raised and cost can be reduced.  Laying-off staff may not be the only mean of reducing costs.  The staff members can be given slightly more amount of work to ensure better control of costs.

    ·         There were the interest of the shareholders existing

    Is it true that Scott should be concerned first and foremost with protecting the interests of the shareholders?
    Scott considers that the shareholders may not have much concern with the laying off process, as it would not be impeding on the profits they are earning.  However, it really depends on the identity of the shareholder.  In the previous occasion, the shareholders insisting on incorporating certain antipollution measures. This suggests that the shareholders had social obligations in mind also.  The shareholders are also likely to object to the laying of process as they are giving importance to social responsibilities.  Besides, if the shareholders include a governmental organization, social organization or the government itself, there would be a lot of opposition to the laying off process.


    ASTD (2007). Taking Performance Consulting to the Next Level: The Strategic Partner Role, Retrieved on January 8, 2008, from ASTD 2007 Web site:

    Bennett, R. (2005). Code of ethics and professional conduct, Retrieved on January 8, 2008, from Trican Web site:

    Missouri University (2008). Lay-off Fact Sheet, Retrieved on January 8, 2008, from Missouri University 2007 Web site:


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