BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

MORALITY OF
LABOR STRIKES
PREPARED BY: RICHARD LAURENTE NARCISO
STRIKE ACTION (or SIMPLY STRIKE)

describes collective action undertaken

by groups of workers in the form of a
refusal to perform work.
STRIKE is often used to describe all work
stoppages, regardless of the origin of the
dispute.
WORKERS GO ON STRIKE FOR
DIFFERENT REASONS:
for higher compensation;
to improve the workplace;
for shorter working days;
to stop their wage from going down;
for more benefits; and
because they think their company has been
unfair
WHAT ARE THE BASIC RIGHTS OF
EMPLOYEES?

Section 8, Article III of the 1987 Philippine

Constitution states that “The right of the
people, including those employed in the
public and private sectors, to form unions,
associations, or societies for purposes not
contrary to law shall not be abridged.
 WHAT ARE THE BASIC RIGHTS OF
EMPLOYEES?
PRESIDENTIAL DECREE 402, otherwise known as LABOR CODE OF THE
PHILIPPINES
ARTICLE 244. Coverage and employees’ right to self-organization. All
persons employed in commercial, industrial and agricultural enterprises
and in religious, charitable, medical, or educational institutions whether
operating for profit or not, shall have the right to self-organization and to
form, join or assist labor organizations of their own choosing for purposes
of collective bargaining. Ambulant, intermittent and itinerant workers, self-
employed people, rural workers and those without any definite employers
may form labor organizations for the purpose of enhancing and defending
their interest and for their mutual aid and protection.
 TYPES OF STRIKES
SIT-DOWN STRIKE (or SIT-IN)
GENERAL STRIKE
SYMPATHY STRIKE (or SECONDARY)
UNFAIR LABOR PRACTICE STRIKE
JURISDICTIONAL STRIKE
ECONOMIC STRIKE
WILD CAT STRIKE
SLOW-DOWN STRIKE
RECOGNITION STRIKE
WHO CAN JOIN LABOR ORGANIZATIONS
OR WORKERS ASSOCIATION

 All employees employed in commercial, industrial and

agricultural enterprises and in religious, charitable,
medical or educational institutions whether operation for
profit or not;
 Government employees in the civil service;
 Supervisory personnel;
 Security personnel; and
 Aliens with valid working permits.
 WHO ARE PROHIBITED FROM JOINING
LEGITIMATE LABOR ORGANIZATIONS

Managerial employees;
Members of cooperatives; and
Members of the Armed Forces of the
Philippines, Philippine National Police
and Firemen.
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

WHISTLEBLOWING

PREPARED BY: RICHARD LAURENTE NARCISO

 Is the disclosure by an employee of confidential
information which relates to some danger, fraud, or other
illegal or unethical conduct connected with the workplace, be
it of the employer or of his fellow employees.
A whistleblowing is someone in an organization who
witness behavior by members that is either contrary to the
mission of the organization, or threatening to the public
interest, and who decides to speak out publicly about it.
1. The disclosure of information, be it internal or external,
must be made in good faith;
2. The disclosure must be made by a current, former or
prospective employee;
3. The information must be linked with misconduct on the
part of the employer; and
4. Evidence of the misconduct should exist as well as
information regarding the identity of the wrongdoer.
1. Internal whistleblowing occurs within the organization.
2. External whistleblowing occurs outside the organization.
3. Current – those who blow the whistle on present
employers.
4. Alumni – those who blow the whistle on former
employers.
5. Open – the whistleblower discloses his identity.
6. Anonymous – the whistleblower does not disclose his
identity.
1. Before taking any irreversible steps, talk to your family or close
friends about your decision to blow the whistle.
2. Be alert and discreetly attempt to learn of any other witnesses who
are upset about the wrongdoing.
3. Before formally breaking ranks, consider whether there is any
reasonable way to work within the system by going to the first level
of authority. If you decide to break ranks, think carefully about
whether you want to “go public” with your concerns or remain an
anonymous source. Each strategy has implications: The decision
depends on the quality and quantity of your evidence, your ability
to camouflage your knowledge of key facts, the risk you are willing
to assume, and your willingness to endure intense public scrutiny.
4. Develop a plan, such as strategically-timed release of information to
government agencies so that your employer is reacting to you, instead
of vice versa.
5. Maintain good relations with the administration and support staff.
6. Before and after you blow the whistle, keep a careful record of events
as they unfold. Try to construct a straightforward, factual log of the
relevant activities and event on job, keeping in mind that your employer
will have access to your diary if there is a lawsuit.
7. Identify and copy all necessary supporting records before drawing
any suspicion to your concerns.
8. Break the cycle of isolation research and identify and seek a support
network of potential allies, such as elected officials, journalists and
activist. The solidarity of key constituencies can be more powerful than
the bureaucracy you are challenging.
9. Invest on funds to obtain legal opinion from a competent lawyer.
10. Always be on guard not to be imbellish your charges.
11. Engage in whistleblowing initiatives on your own time and your own
resources, not your employers.
12. Don’t wear your cynicism on your sleeves when working with the
authorities.
It is morally permissible if it meets the following conditions: by Richard
De George (1995)
• The company must be engaged in illegal or immoral practice or
about to release a product which will do serious harm to
individuals or to society in general. The more serious the harm,
the more serious the obligation.
• The employee should report his concern or complaint to his
immediate superior.
• If no appropriate action is taken, the employee should take the
matter up the managerial line before he or she obliged to go
public.
• The employee must have good reaction to believe that by going
public, he will be able to bring about the necessary changes.
• It is done from the appropriate moral motive-as provided in the
definition of whistleblowing.
• The whistleblower, except in special circumstances, has exhausted
all internal channels for dissent before going public.
• The whistleblower has compilling evidence that the inappropriate
actions have been ordered or have occurred.
• The whistleblower has acted after careful analysis of the danger:
How serious is the moral violation? How immediate is the problem?
• Can the whistleblower point to a specific misconduct?
• The whistleblowing has some chance of success.
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

MULTILEVEL
MARKETING (MLM)
& PYRAMIDING
PREPARED BY: RICHARD LAURENTE NARCISO
Multilevel marketing is a system of selling in which one signs up other to
assist him, and recruit others to help them. However, there are many
multilevel distributorship schemes that often call themselves a “network”
but are nothing more than sophisticated chain letters.

Pyramiding
Pyramid schemes focus on the exchange of money and recruitement.
The fraudsters behind a pyramid scheme may go to great lengths to make
the program look like a legitimate multilevel marketing program.
 MLM
1. Legal
2. Income generated only on product sales.
3. Provides a training program.
4. Consumable, reasonably priced quality products.
5. Service legitimate economic function such as a
channel of distribution for relatively small or new
companies with excellent products.
6. Sponsoring participants earn nothing by mere
sponsoring. Recruitment is optional.
7. Earning are ultimate tied to product consumption
of end-users.
Pyramiding
1. Illegal
2. Income is generated solely on the process
of recruiting others into the pyramid.
3. No training program.
4. Few retail sales and high cort, slower moving
products.
5. No legitimate economic function such as
economic benefits, but a mere transfer of money
from one person to another without legitimate
business.
6. Recruiting participants get benefit from
recruitment.
7. Earnings are tied to the act of recruitment.
 MLM
9. Largely, products are sold to the consuming
public.
10. Bonuses are based on sales to final user
who are not members of the scheme.
Pyramiding
9. Products are consumed internally within
the organization.
10. Bonus entitlements are based on goods
absorbed by members within the structure.
1. Are there legitimate products?
2. Is there an intent to sell the products?
3. Do the products have fair market value?
4. Is there a compelling reason to by the products being offered
5. Is there a product return policy?
6. Will you receive commission on the joining fees of your prospects?
7. Is there a correlation between recruiting and distributor’s
commissions?
8. If recruitment is to be stopped today, will participants still make
money?
1. Too Much Materialism and Greed
2. They Con the Public, Making Them Believe that They Are a Legitimate MLM
3. The Intentions Are Bad

The Department of Trade and Industry can take action under two
existing laws:
Art. 53 of RA 7394 (the Consumer Act of the Philippines) states that
“chain distribution plans or pyramid sales shall not be employed in the
sale of costumer products”.
RA 3883 or Business Name Law empowers DTI to cancel license of
any business which does not conform to the registered business name
or style.
1. Consult the 8-point test presented in this chapter.
2. Beware of plans the claim to sell miracle products or promise
enormous earnings. Just because a promoter of a plan makes a
claim doesn’t mean it’s true! Ask the promoter of the plan to
substantiate claims about the product or your potential earning
seem too good to be true.
3. Don’t pay or sign any contract in an “opportunity meeting” or
any other high-pressure situation. Insist on taking your time to
think over a decision to join.
4. Remember thet no amount of personal testimonial and
affirmation thet there is money to gain in pyramiding will
dispute the fact that pyramiding does not create new wealth.
The only wealth gained by any participants is a loss by another
participant.

Is competition good or bad?

1. A monopoly is defind as a market situation where there is only

one provider of a kind of product or sevice.
2. An oligopoly, on the other hand, denotes a situation where there
are few sellers for a product or service.
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

UNFAIR
COMPETITION
PREPARED BY: RICHARD LAURENTE NARCISO
 Is competition good or bad?

1. A monopoly is define as a market situation where there is only

one provider of a kind of product or service.
2. An oligopoly, on the other hand, denotes a situation where there
are few sellers for a product or service.
3. Perfect competition is a situation in which no firm or consumer is
large enough to dictate prices.
 In a war, two contenders fighting hurl directly at each other,
whereas in a business competition, two or more parties are vying for
the opportunity to provide the customer’s needs whether it’s a product
or service.

In a unfair competition consist of:

• Deceptive trade practices such as misrepresentation and false

advestising;
 In a war, two contenders fighting hurl directly at each other,
whereas in a business competition, two or more parties are vying for
the opportunity to provide the customer’s needs whether it’s a product
or service.

In a unfair competition consist of:

• Deceptive trade practices such as misrepresentation and false

advestising;
• Business interference to prevent a competitor from
continuing with its business process or bisiness
contract;
• Anti-competitive market practice such as under cost
selling to kill the competitor;
• Defamation of a competitor or badmouthing a
competitor to a customer;
• Caveat emptor or indirect misrepresentation by
withholding information from the buyer; and
• Violation of intellectual property right such as
copyrights, patents, trademarks and service marks.
 R.A. 8293 otherwise known as Intellectual Property Code of the
Philippines aims to provide an intellectual property and industrial
property system which will enhance the development of domestic and
creative activity, facilitate transfer of technology, attack foreign
investment, and ensure market access for our product.
Article 168 of RA 8293 is specifically about unfair competition
On the use of trademarks, service marks and trade names. This article
states that a person who has identified in the mind of the public the
good he manufactures or deals in, his business from those of other,
whether or not a registered mark is employed, has a property right in
the goodwill of the said goods identified, and will be protected as any
other property right.
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

MONEY
LAUNDERING
PREPARED BY: RICHARD LAURENTE NARCISO
”money laundering “ is said to originate from Mafia ownership of
Laundromats in the United States.

Money laundering is the process of disguising illegally obtained

money so that funs appear to come from legitimate sources or
activities.

1. Placement-physically placing bulk cash proceeds.

2. Layering-separating the proceeds from criminal activity from
their origins through layer of complex financial transaction.
3.Integration-providing an apparently legitimate explanation for the
illicit proceeds.
1. Street level narcotics sales occur in the U.S. (cash is the
preferred method of payment for these transactions.)
2. The cash from one or multiple sales locations is collected at a
safe or “stash” house for processing.
3. The cash is taken to a remittance business for transmission out
of the country. To avoid scrutiny by law enforcement or bank
regulatory authorities, the cash may be divided into amounts
less than $10,00 and “smurfed” (the employment of a large
number of individuals to make small deposits and
withdrawals)or structured (transfer of amounts below federal
reporting requirements)at the remittance business.
4. The funds are sent by the S.U.-based remitter to a Mexican-
based counterpart. (The remittance company will normally
utilize an offsetting book entry transfer or conduct a bank wire
transfer in order to move the money out of the United States.)
5. The remittance business in Mexico pays out in pesos.

1. Money from the U.S. drug sales is converted into money orders.
2. Money orders are shipped to Colombia via express mail.
3. U.S. funds money orders are sold to a currency broker in
exchange for pesos.
 The economic and political influence of criminal
organization can weaken the social fabric, collective ethical
standards, and ultimately the democratic institutions of
society.

a. Entry of cash into the financial system;

b. Transfers to and from the financial system; and
c. Cross-border flows of cash.
a. Proper mechanisms for handling suspicious reports;
b. A compliance culture among financial institutions; and to
ensure that they put proper systems and procedures in place;
c. Encouraging financial supervisions to apply bank licensing
procedures strictly, exchange information, and train
practitioners;
d. Increasing public awareness on the threat of money laundering;
e. Increasing coordination among the multiple agencies (national
and international) involved and improving the limited
intelligence sharing;
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

CONFLICT
OF INTEREST
PREPARED BY: RICHARD LAURENTE NARCISO
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

INSIDER TRADING

PREPARED BY: RICHARD LAURENTE NARCISO

 INSIDER TRADING
Insider trading refers to the significant fats that have not yet made
public and are likely to affect stock prices.
MORAL ARGUMENTS
Since insider trading involves the use of insider information, a lot of
moral problems are related to the employee’s (insider) use of such
information while he or she is still a member of the firm. DE
GEORGE cites two aspect of this particular problem:
1. One is that of someone within the firm using information for
his or her own private gain, at the expense of the firm (conflict of
interest).
2. The other is the use of information by someone within the
firm to secure personal advantage over those not in the firm (breach
of loyalty.
 ETHICAL ISSUES RELATED TO INSIDER TRADING

• It violates fiduciary relationships between insiders and outside

clients.
• It promotes greed and personal gain at the expense of others.
• It renders the transaction between two contracting parties as
unfair.

Professor Jennifer Moore argues that insider trading is wrong

because it undermines the fiduciary relationship, which is central to
business management.
BUSINESS ETHICS AND SOCIAL RESPONSIBILITY

TAX EVASION &

TAX AVOIDANCE
PREPARED BY: RICHARD LAURENTE NARCISO
TAX has two meanings: 1st , the financial duty or levy contributed to
the entity-be it government or any other organization. 2nd tax means
“a heavy burden”.

TAXATION is the system by which the government raises funds with

which to finance governance, and promote the general welfare of its
citizen.

DR JOSE MARIO B. MAXIMIANO (2003) cited that TAXATION is the

life blood of the nation.
Governments spend 90% portion of tax collection to fulfill each duty
towards business in general:
• To protect the free enterprise system as an integral part of
the economic order.
• To require business to comply with the commercial, industrial,
labor laws and regulations.
• To require business to pay proper taxes promptly.
Individuals in the other hand, pay taxes inter vivos and
mortis causa:
• When they earn money, in form of income taxes.
• When they spend money, in form of consumption taxes.
• When they own a house or land, in form of property taxes.
• When they die, in form of estate taxes.
 TAX EVASION
is an “international negligence” of the obligation to pay correct
taxes to the government.
THREE ELEMENTS OF TAX EVASION
1. The intention to cheat.
2. Knowledge that tax evasion is wrong.
3. By fraudulent means.
TAX AVOIDANCE
is when taxpayers exploit legally permissible alternative
methods of assessing taxable property or income in order to avoid
or reduce tax liability.
 THANK YOU
&
I HOPE YOU’VE LEARN
SOMETHING FROM ME 