Scenario Summary The senior human resource executive of a firm had succeeded in

Question

Scenario Summary The senior human resource executive of a firm had succeeded in increasing the diversity in its workforce substantially. However, the firm had some unfortunate financial setbacks and the senior human resource executive has no choice but to lay off 300 employees for a period of 6 months. The senior human resource executive is currently puzzled over the criteria to use in selecting people for layoffs. If the senior human resource executive uses strict seniority, women and ethnic minorities will bear the brunt of the layoffs because they are all among the newest employees in the firm. If the senior human resource executive uses strict performance, however, the older and more senior (and predominantly white-male) workers will bear the brunt because the newer employees have the most current training and job skills. The senior human resource executive also wonders what role loyalty should play, because many of the older workers could have left for higher-paying jobs a few years ago but chose to stay.

1. What are the ethical issues in this situation?

2. What are the basic arguments for and against the different criteria in selecting employees to be laid off?

3. What do you think most managers would do? What would you do?

Explanation / Answer

1. The ethical issues arise from the conflict of morality and principles and from the conflict of duty and morality. The ethical issues in this case arise from the conflict between the duties of serving the best interests of the organization versus the moral obligation of doing a justice to every employee while implementing the layoff decision. Clearly the issues are whether to layoff according to strict seniority or strict performance. In both cases, Interests of some of the employees are compromised and diversity of the human resources will be lost, for which the senior human resource executive had specifically worked for.

2. There are two criteria discussed in the case for selecting employees to be laid off. These are strict seniority and strict performance. Strict seniority is preferred, if the organization is at a stage of maturity to decline and the organization needs the expertise of experienced senior personnel who understand the business inside out and have been loyal through the thick and thin. Relationship is more valuable than the potential benefit of keeping fresh, young talent. However a growing organization requires aggression, innovation, flexibility and agility in employees as well in their approach to business. Therefore such an organization needs a performance oriented younger and agile workforce.

3. In this situation most managers would go by the rule of strict performance. I think that is in the best interests of the employees as well as the business. In difficult times, organization requires more focus on productivity and performance. And if the organization lays off people who are younger, more productive and performance oriented, then it does more harm than good. And the remaining senior employees will not be able to steer the organization out of the financial crisis. So in the long run, both the organization and the employees will face more severe challenges. The best approach is this situation, as I would adopt, is to layoff the personnel as per strict performance criterion. The organization would perform better and would be able to survive the financial crisis. When the things get back to normal, then the personnel, who were laid off, could be hired again, if needed. Therefore this will be the best ethical decision, which will be in the best interests of the existing employees, personnel who are laid off as well of the organization in general.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.