Ch.

Ethical Treatment of Employees

first problem

Assumption of the intro: business firms are organized

hierarchically...

Issues here?
-difference of pre-modern institutions v modern "institutions"
-difference between top-down management and team of teams
-problems endemic to top down approach
-relevance of ethics to team of teams and top down?
second problem

assumption that employees want to be treated as genuine

partners.
-are they? reconcile with Friedman, Freeman
-reconcile with importance of autonomy (re Tech Project)
-reconcile autonomy with ethics

-can you "force" respect; "force" equal treatment; "force" ethics.

-again, consider autonomy

what is the true power of the
employee?
quit?

sue?

threat of suit?

competition?

contract?
K v employee at will

employee at will - ethical? efficient?

"master - servant" relationship. OK?

how did we deal with this? unions.

-unions are dying
-what does this mean?
-employee handbooks - binding?
--if yes, what are companies doing with these handbooks?
Federal protection

can't be fired for:

-race
-sex
-handicap
-age
-resisting unwanted sexual advances from superior
-refusing to obey order to do something illegal or immoral
--what's immoral?
the flip side

we tend to focus on the employee being treated unethically

what about unethical conduct of employees to the detriment of

the employer

there IS a fiduciary duty (duty of loyalty)...by Agency law. (An

agent is subject to his principal to act solely for the benefit of
the principal in all matters connected w/ his agency. Agent is
under a duty not to act or speak disloyally; agent to keep
confidential information acquired by him as an employee that
might damage the agent or his business.)
--why this type of emphasis?
whistle blowing

when is it justified? when does it go against a duty of loyalty?

Duska: challenges the idea that employee has a duty of loyalty;

loyalty can apply only in a relationship that transcends self-
interest and must be based on a relationship of trust and
confidence. Relationship between employee and corp cannot
be construed as such (relationship of mutual self interest;
employee has no obligation of loyalty to employer)

relate to Friedman: only concern of the firm is to manage its

assets to obtain profits for the stockholders, only concern of
worker is to get best working conditions they can.
Whistle Blowing

Freeman: corp does have a genuine obligation to its

employees. relationship between the employer and employee
(as stakeholder) is a relationship of trust and confidence that
transcends self-interest.
Whistle Blowing

Bottom Line:

Duty of Loyalty is not absolute. That an employee should be

loyal is a prima facie (at first instance; but then can be tested)
duty.

-The object of the employee's duty must be deserving if the

duty is genuine and overriding rather than prima facie

-virtue of loyalty does not require that the employee accept

blindly the boss or corp cause to which he or she is loyal.

-nor does it require that when there is a conflict of loyalty (pub

safety, etc) that the duty to the employer is always overriding
Whistle Blowing

Reality

-Whistle blowers get public acclaim, but are often blacklisted

from their profession

-how does this relate to ethical fiber; team of teams versus top
down pre-modern industry (collapse of a social
contract between a company and its employees).
Employment at Will and Due
Process
Werhane
1st question

Werhane and Radin contend that EAW is a violation of the

respect employees are due as persons. However, if employees
voluntarily accept the terms of their employment, including
being at will employees, is it proper to say that they are not
provided the respect they are due when employers are merely
following the rule of the contract that was agreed to?
2nd question

There are rather clear utility exchanges that are made

between policies of due process and EAW. What are some
ways that you can imagine that the utility losses required by a
policy of due process may be minimized (or inherent
inefficiencies you potentially see in EAW policies)?