FACC 400 – Fall 2016

Lecture 6
Professionalism, Ethics and Contracts

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Today

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Activity 1: Is the decision ethical?
ž Ralph Sims, a senior engineer, accepted a position at a company that
produces military electronic equipment.
ž Shortly after joining the company, Ralph was informed by a subordinate
that a key quality test on a product was done using a faster and cheaper
in-house procedure rather than the one required to be conducted for such
products and requested by clients of the company.
ž After some investigation on the differences between the tests, Ralph
concluded that the test seems as effective as the specified test and
assuming that there were no safety issues with using a different test, he
did not see a need to report this discrepancy or act on it.

85%
A. Yes
B. No 15%

Yes No
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Activity 1expanded: Is the decision ethical?

Reconsider your answer knowing that after a year

into the job, upper managers and clients will be
informed of your decision to continue to use a
substitute test although the in-house procedure
does not meet the specifications.
92%

A. Yes 8%

B. No Yes No

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Activity 2: Is the decision ethical?
ž Bob Baines was hired to work in the quality control department of a
company that designs sensing devices for automobile air bags.
ž About six weeks after joining the company, he was asked to sign off on a
design that he felt very uncertain about. He checked with people involved
in the design and found the situation ambiguous. Bob told his manager
that he would not feel right about signing off, and asked that he not be
required to do so. His manager kept putting pressure him.
ž Eventually, Bob decided that he wished neither to violate his values by
doing something that he thought was wrong, nor to become involved in a
battle in which his career might be a major casualty. He thus quietly
resigned.
51% 49%

A. Yes
B. No
Yes No
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Activity 2expanded: Is the decision ethical?

Reconsider your answer knowing that after

leaving the company, other engineers continue
to be quiet about defective design impacting
the quality of sensors and putting your own
safety at risk.

84%

A. Yes
B. No 16%

Yes No

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Making ethical decisions
ž Transparence
PUBLICITY TEST: Would I want my choice of this option published in the
news paper?
DEFENSIBILITY TEST: Could I defend the choice of this option before a
committee of peers?

ž Exemplarity
COLLEAGUE TEST: What would my colleagues say when I describe my
problem and suggest this option?
EXAMPLARITY TEST: Could this choice be an example in similar cases?

ž Reversibility
REVERSIBILITY TEST: Would I still think choice of this option good if I
were directly affected by it?

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Contract basics

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Contract basics –
Focus on Employment contract
ž Form
— Oral or written, but written is better!
ž Consent
— A contract is formed upon mutual agreement
— Each party must be legally capable of
contracting the agreement and must do so freely
ž Compliance with the law
— The subject of the contract must be morally
acceptable and legal

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Contract basics…
ž Must clearly state
— The title of the position and description of responsibilities
— Compensation
— Vacation
— Benefits
— Probation period
— Performance review
— Termination
— Non-competition
— What jurisdiction the contract will apply
○ Eg. “This Agreement shall be governed by the laws of Quebec, and
Canadian laws applicable therein”
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Case law

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EXAMPLE 1 - Valid clause or not?
ž Insurance broker
— Shafron v KRG Insurance brokers
(Western), 2009 SCC 6 (CanLII)
— Non-compete clause:
○ For a period of 6 months cannot sell insurance
policies within the Vancouver metropolitan area
Area too
54% vague
46%

A. Valid
B. Non valid
Valid Non valid

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EXAMPLE 2 - Valid clause or not?
ž A chemist working in a lab of a company doing
lab analysis
— Menif v Laboratoires Kabs inc. 2008 QCCS 3713
(CanLII)
— Non-compete clause:
○ For a period of 1 year cannot work for any of the lab’s
clients
Lab’s clients are
73%
not all competitors

A. Valid 28%

B. Non valid
Valid Non valid

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EXAMPLE 3 – Valid clause or not?
ž A person occupying a leading role in the
creation of a software game
— Ubi Soft Divertissements v Champagne-Pelland,
2003 CanLII 13359 (QC CA)
— Non-compete clause:
○ For a period of 1 year, cannot work for any of the
company’s competitors in Canada, the U.S. and Mexico?
Very restrictive but
acceptable considering the
level of the person
A. Valid
B. Non valid 0% 0%

Valid Non valid

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Restricting the right to work is ethical
and legal if :
ž The restriction is expressly written;
ž The employee must understand what he signed;
ž The restriction is limited:
— In time;
— In space;
— In scope.
ž The restriction is limited to the legitimate interests
of the employer – not more.

NOTE: Non compete clauses are voided where an employee is terminated,

except when terminated for cause - that means fraud or theft or
another serious crime involving the company.
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Interesting links about average
salaries
ž http://www.reseauiq.qc.ca/en-
us/career/remuneration-survey/
ž http://www.canadavisa.com/canadian-
salary-range-c.html

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