Ethics and Business Introduction Velasquez's Thesis: Ethical behavior the best long term business strategy

Merck & Co. a case in point Ethical behavior is the best long-term business strategy means
o o o

in the long run & for the most part ethical companies enjoy significant competitive advantages over unethical ones

Why ethical behavior pays off in the long run & for the most part
o

customers more likely to buy from a business known to be honest & trustworthy

employees are more likely to loyally join & faithfully serve a company that treats its workers with loyalty and respect

Assuming that it pays to do the right thing . . . still it's not easy to know what that is: e.g., how to balance
o o o o

duties to shareholders rights of employees needs of customers obligations to society

1.1 The Nature of Business Ethics

What does ethical mean: Study of businessmen

o

"What my feelings tell me is right" (50%): Doing what your conscience tells you.

"What is in accord with my religious beliefs" (25%): Doing what the church or bible says.

What "conforms to the golden rule" (18%)

Inadequacy of all these answers in theory & practice

o o

"conscience" sometimes commands wrongly or not at all religion: sometimes commands wrongly

especially others' religions, we're inclined to think Salmon Rushdie fatwah example "You shall not suffer a witch to live"?

the golden rule:

perhaps commands wrongly: different strokes for different folks hard to interpret it

Morality

Definition: "the standards an individual or group has about what is right and wrong, or good and evil" Contrast: standards we hold about things that are not moral
o o o

legal standards etiquette: rules of politeness aesthetics: good & bad art; what's beautiful, ugly, etc.

Five Characteristics of moral standards

1.

deal with matters we think can seriously injure or benefit human (& other sentient?) beings

2.

not established or changed by the decisions of authoritative individuals or bodies

3.

are overriding: take precedence over other standards & considerations (especially of self-interest)

4.

are based on impartial considerations: like my momma said

"what if you were them?"; " "how'd you like someone to do that to you?"

5.

associated with special emotions and vocabulary

emotions like guilt, shame, & remorse vocabulary like "wrong", "right", "ought", "good", "bad", "immoral"

We absorb these standards as children from a variety of influences and revise them as we mature

Ethics

Definition: the activity of examining one's moral standards or societies' and asking
o o

how these standards apply to our lives whether they are reasonable or unreasonable

Ethical v. Social Scientific Study of morality

o

Social scientific study is descriptive: what there standards are & how they came by them (not, e.g., whether they're reasonable): Is

anthropologists: taboos of the Trobriand Islanders social scientific: the value system of neo-nazi groups in the U.S. psychological: the moral development of the child

Ethics is a normative (i.e., evaluative study of morality): Ought

questions about consistency & rationality completeness & adequacy

Business Ethics

Definition:
o

V: normative study of moral standards as they apply to business policies, institutions, and behavior

LH: the ethical analysis of business practices

Business defined
o

preliminary definitions

a society = people who have common ends and whose activities are organized by a system of institutions designed to achieve those ends

institutions = relatively fixed patterns of activity economic = pertaining to the production & distribution of goods and services

businesses = the primary economic institutions through which people in modern societies carry on the tasks of producing and distributing goods and services

Corporations: the most significant kinds of modern business enterprises

o

"dominant life form on our planet in the 20th century" (Wm. Gibson)

top 500 U.S. companies: account of 80% of all industrial profits & hold 80% of all industrial assets

corporations = immortal "fictitious persons" with rights, in their own name, to

sue & be sued hold & sell property

enter into contracts

Organizational structure

stockholders

contribute capital own the corporations liability limited to capital contributed

directors or officers

administer the corporation's assets run the corporation, typically through various levels of middle managers

employees: do the basic work related to the production of goods & services

Three kinds of Issues for Business Ethics (arising from the purposes & structure of Corporations)
1.

systemic: concerning the economic, political, and other social systems within which businesses operate.

2. 3.

corporate: concerning issues & practices of a particular company individual: concerning particular individuals within companies

Applying Ethics to Corporate Organizations

Problem: are corporations moral agents capable of acting morally & immorally just as people are
o o

are corporations as a whole morally responsible for their acts? or does moral judgment & responsibility apply only to the individuals who make up the corporations?

Corporate responsibility theory: Corporations have moral responsibilities as such.

Pro: the rules that tie corporations together allow us to say

they "act" as individuals and have "intended objectives" hence, they are "morally responsible" for these acts & objectives

Con: Organizations don't really "act" or "intend" as persons do

Corporate nonresponsibility theory:

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Pro: Corporations are morally nonresponsible. Con: Moral responsibility percolates up.

The humans that comprise the corporation can make responsible moral decisions.

so can the corporation.

Velasquez's "Intermediate" View

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When an organization's members collectively, but freely and knowingly pursue some objective it makes perfect sense to say the acts they perform for the organization are "moral" or "immoral" and that the organization [n.b.] is "morally responsible" for these acts.

Nevertheless individuals are the primary bearers of moral responsibility since "corporate acts originate in the choices and actions of human individuals"

Organizations have moral duties, etc. in a secondary sense: A corporation has a moral duty to do something only if its members have a moral duty to make sure its done.

Velasquez's Concession: corporate policies, culture, norms, and designs can & do "have an enormous influence on the choices, beliefs, and behaviors of corporate employees" [& officers?!]
o

Not so concessive

But these corporate policies, etc., do not make the individuals' choices for them.

So the policies or the corporation are not responsible for these individuals' actions.

How to square with this: "corporate actions flow wholly out of [human] choices and behaviors."

Globalization, Multinationals, and Business Ethics

Most large companies today are multinationals: firms that maintain operations in many different countries. The fact that multinationals operate in more than one country produces ethical dilemmas
o

Able to shift operations out of one country & into another that offers more favorable conditions, e.g.,

cheaper labor less stringent laws: e.g., environmental regulations lower rates of taxation

Enabling them to playing off one government against another (as happens even between U.S. states)

to escape social controls (e.g., minimum wage laws, safe working condition laws & environmental laws)

even taxes

Moral Dilemmas Posed by these Abilities: requires choosing between the needs & interests of the business & those of their host countries. Their ability to relocate v. the expense of relocation, threat of confiscation, etc. by host countries means they can face hard choices:
1.

To go along with ethically questionable local practices (e.g., apartheid as previously practiced in South Africa) v. risk their operations & market in the host country

2.

To practice tax avoidance to the maximum of their abilities v. paying what might be viewed as their fair share

3.

Benefits of technology transfer v. risks

Business Ethics and Cultural Differences

Ethical Relativism (ER) holds

o

Negative thesis: there are no ethical standards that are absolutely true for all societies

Positive thesis: something is right within a given society if it accords with that societies moral standards.

"When in Rome do as the Romans." But what if what the "Romans" practice is routine bribery of government officials, gender discrimination, or the like?

Counters to ER
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Fact of cultural disagreement over the likes of

polygamy & homosexuality infanticide & abortion slavery and racial & sexual discrimination genocide & the torture of animals

Doesn't necessarily mean there are no objective standards that are universally true

there is disagreement over whether the human species evolved from apes

still there's plain truth about the matter (regardless of whether we could find it out)

not true for creationists that we did and true for evolutionists that we didn't

either we did or that we didn't is just plain true, for everyone & either the evolutionists or the creationists are just plain mistaken

similarly there's plain truth about the matter of genocide

not right for nazis but wrong for us just plain wrong: nazis are just plain mistaken

Some norms or standards are universal in the sense that every society must have them

norms forbidding indiscriminate injuring and killing of other members of society

norms forbidding theft norms enjoining truth telling & censuring lying

Seeming different practices may express shared underlying values

Inuit abandonment of the aged v. our nurture of the aged might reflect similar value on community survival

Cannibals who eat their dead and we who bury or cremate our dead may share an underlying value of honoring the dead (just have different opinions in how to go about it).

Most telling criticism: Absurd Consequence

If ER were correct then the moral standards of a society are above criticism

either internal criticism by members of that society or external criticism by those outside of that society

But the moral standards of societies are not above criticism in this way

So ER is not correct

Technology and Business Ethics

"Technology consists of all those methods, processes, and tools that humans invent to manipulate their environment." Radical technological transformation poses special ethical challenges
o o

being disruptive of former economic & social structures such transformations engender challenges & conflict

Ethical issues therein raised concern (LH)

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Utility: risk vs. promise: costs v. benefits of the transformations Justice: fairness of the distribution of resulting costs or risks & benefits Culture & Character: human habitability of the world as transformed ... do we really want to go there (1984? BNW?)?

Notable Technological Revolutions

o

Agricultural revolution: "humans developed the farming technologies that enabled them to stop relyuing on foraging and on the luck of the hunt": growth of affiliated technologies (e.g., irrigation, tool-developments, etc.) and social stability "eventually allowed humans to accumulate more goods than they could consume, and out of this surplus grew trade, commerce, and the first businesses."

Industrial revolution: "transformed Western society and business, primarily through the introduction of electro-mechanical machines powered by fossil fuels such as the steam engine, automobile, railroad, and cotton gin."

subsequent nationalization and now globalization of markets and trade mass production and giant enterprises the rise of "the large corporation that came to dominate our economies and that brought with it a host of ethical issues for business including"

exploitation of the workers who labored under these new conditions

manipulation of financial markets producing massive damage to the environment

New Technologies Now Transforming Society

o

Information technology including the internet and cyberspace.

issues of privacy issues of property: copyrights v. "fair use"

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Nanotechnology poses unknown risks Biotechnology and especially genetic engineering poses dimly understood ecosystemic risks

1.2 Moral Development and Moral Reasoning Moral Development (skip) Moral Reasoning

Reasoning by which actions or policies are judged to accord with or be in violation of moral standards Has two essential components
o

Evaluative component: beliefs concerning what the relevant moral standards are

A factual component: evidence or information about which courses of action meet or fail to meet the standards

Example

Racial & sexual discrimination is wrong. (Evaluative premise.)

Affirmative action is (reverse) racial & sexual discrimination. (Factual premise)

Affirmative action policies are wrong.

Not always easy to separate the two

o o

Different opinions concerning the facts May mask different understandings of the standards

faux factual question?: whether reverse preferences are discriminatory. masked evaluative question: whether discrimination against dominant or historically advantaged classes is wrong.

Analyzing Moral Reasoning 1. Logical validity

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does the conclusion really follow from the premises? given some hidden assumptions?

2. Concerning the factual evidence

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Is it accurate? Is it relevant? Is it complete?

3. Concerning the moral standards

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Are they consistent with other acknowledged moral standards Are they being consistently applied

Consistency requirement: If I judge that a certain person is morally justified (or unjustified) in doing A in circumstances C, then I must accept that it is morally justified (or unjustified) for any other person to perform any act relevantly similar to A in any circumstances relevantly similar to C.

Method of Hypothetical Counterexamples

How would you like it if your brother did that to you? Ought to be willing to receive what you dish out: compare the Golden Rule.

Moral standards should be such that you would be willing to accept regardless of whether you were on the giving or the receiving end.

1.3 Arguments for and Against Business Ethics Three Arguments Against Bringing Ethics into Business (skim)

Perfectly free markets insure maximum social benefits better than anything else
o

Pro

leads most efficiently to the production of goods & services that the buying public needs and wants.

attempts by managers to impose their moral convictions only gets in the way of the workings of the marketplace

so managers should single-mindedly pursue profit to the exclusion of all else (including what they take to be morality)

Con

Questionable assumptions:

in fact industrial markets are not perfectly free not all profit increasing practices are socially beneficial

unconstrained pollution deceptive advertising price fixing

the buying public <> the public: distribution of goods & services also an essential purpose of economic institutions

Inconsistency: the conclusion that managers should single-mindedly pursue profit to the exclusion of all else (morality included) is itself a normative ethical judgment

Loyal Agent's Argument

o

The Argument
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A loyal agent's duty is to serve his/her employer as the employer wants to be served.

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An employer wants to be served in whatever ways will advance his/her self-interest.

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Therefore, as loyal agents of their employers (stockholders) managers have a duty to serve their employers in whatever ways advance their employers self-interest.

Objections

Inconsistency

the argument rests on an normative/ethical assumption (an agent's moral duty being asserted)

to argue that ethical considerations don't apply in business

Assumes there are no limits to an agent's duty to serve his employer, but

the managers duty to serve his employer are limited

by duties as citizen, etc. by morality & even law

law of agency

"when considering whether or not orders . . . to the agent are reasonable . . . business or professional ethics are to be considered"

"in no event would it be implied that and agent has a duty to perform acts which are illegal or unethical"

Nuremberg Principle: "Following orders" does not excuse immoral actions.

Business ethics is essentially just obeying the law

o

Pro:
11 11

Wrongful business practices are those forbidden by law. Therefore following the law is sufficient to prevent wrongful conduct in & by businesses

Con: legality <> morality

some correspondence: laws prohibit rape, murder, & fraud (which are also immoral)

but some illegal acts are not immoral

due to insignificance of what's regulated: e.g., parking laws because the laws are unjust

laws enforcing slavery & later racial segregation in the U. S. South

Nazi laws against harboring Jews

some immoral acts are not illegal

e.g. killing & raping slaves was not illegal in the U. S. South lying to your spouse deceptive promotions, e.g.,

Publishers Clearinghouse style "you have already won" promotions

Telemarketing aimed at bilking the elderly

morality couldn't shape our laws if morality equaled legality

if legal equaled moral then whatever the law enjoins is moral by definition

and whatever it forbids would be immoral by definition Examples

Abortion is not illegal. Therefore, it's not wrong, so it shouldn't be made illegal.

Marijuana possession is illegal. Therefore it is wrong; so it should be against the law.

Compare the objection to Ethical Relativism: Law would be beyond criticism.

Nevertheless, most hold there is a prima facie moral obligation to obey the law

exception to be made only in cases where what the law enjoins is seriously wrong or unjust

distinction to be made between:

between civil disobedience:

Rosa Parks not going to the rear of the bus (but note -- a "piddling matter" this seems too: "My feet are tired" was Rosa Parks' reason for not giving up her seat)

draft resistance during the Vietnam War Harboring Jews in Nazi Germany

mere scofflawism

shoplifting underage drinking most illegal drug use

The Case For Ethics in Business

Simple Argument
o o o

Ethics should govern all human activities. Business is a human activity. Therefore, ethics should govern business too.

Argument from Businesses Need for Ethics

o

Businesses can't survive without ethics

business requires at least a minimal adherence to ethics on the part of those involved in the business: e.g., the honoring of contracts by customers, managers, & employees

business requires a stable society in which to carry on its dealings: morality is a stabilizing force in society.

Therefore it is in the best interests of businesses to promote ethical behavior (and practicing it is the best way to promote it).

Argument from the Consistency of Ethical Considerations with Business Pursuits (of profit)
o

Observed evidence

example of Merck, Inc. and others shows business can have exemplary ethics & still be very profitable

no studies have found a negative correlation between socially responsible behavior and profits.

Reasons behind the profitability of ethical behavior (cited earlier in connection with the Merck example): ethical behavior cultivates good will & loyalty

among customers among employees

Game theoretic considerations: "the prisoner's dilemma" lesson: "when people deal with each other repeatedly, so that each can later retaliate against or reward the other party, cooperation is more advantageous than continually trying to take advantage of the other party."

Unethical businesses become targets of moral outrage which works to their detriment.

1.4 Moral Responsibility and Blame

Two sorts of moral questions

o o

about the rightness or wrongness of actions about who to blame for wrongdoing: especially sticky in cases of corporate wrongdoing: questions about responsibility & blame

People are not blamed for every unfortunate consequence of their actions
o o

some bad consequences are accidental unforeseen or even unforeseeable consequences

Conditions of Moral Responsibility: A person is morally responsible only for those acts and their foreseen injurious effects of deliberate acts or ommissions
o

commission

knowingly and freely performing or bringing about what it was morally wrong for the person to perform or bring about

omission

knowingly and freely failing to perform or to prevent

which it was morally wrong for the person to fail to perform or prevent

Excusing Conditions & Mitigating Conditions

o

Excusing Conditions: Total absolve the agent of blame: Eliminate responsibility

ignorance: didn't know asbestos exposure was carcinogenic inability: workers refused to wear protective masks & company was unable to force them

Exceptions to Excusing Conditions

Willful ignorance: carefully avoided studying up on the effects of asbestos exposure because they didn't want to know.

Ignorance of Principle vs. Ignorance of Fact

Example

Principle: bribery is wrong Fact: by tipping a customs official I was actually bribing him into canceling certain import fees

Both exculpatory to they extent that they are not willful

Mitigating Conditions: partially absolve the agent of blame: diminish responsibility

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Circumstances which leave a person uncertain but not altogether unsure about what they're doing

person may have doubts about the facts and the seriousness of the standards involved

examples:

wrongdoing -- e.g., what gets "winked at" in a certain corporate culture -- so it doesn't seem so bad (everyone's doing it)

11

your not from around here

circumstances making it difficult but not impossible to avoid doing it

decisions taken under threats or other kinds of duress e.g., middle managers getting pressured from above to disregard safety standards or impose unrealistic production goals (less culpable than a middle manager who did this on their own initiative)

11

circumstances that minimize but do not completely remove a person's direct involvement in the act: diminished instrumentality

Commission vs. omission: generally people are held to be more responsible for things brought about by their action than by their inaction: e.g., drowning someone vs. failing to rescue them (at no risk to oneself).

"Not my department": omission or acts that are not your specified responsibility judged less serious:

if an accountant specifically hired to audit a companies books chooses not to report discrepancies they're more seriously to blame

that a bookkeeper who suspects irregularities but says nothing

11

Factoring in the seriousness of the wrong

if the wrong is very serious, then uncertainty, duress, and lessened involvement are less mitigating: with so much at stake the agent

ought to have found out the score

ought to have done the right thing regardless of duress should have made it their business to do something

Example: my employer says sell this lemon or you're fired

I know the car's cd-player is about to go. I know the car's brakes are about to go out.

Critical Contentions about mitigating factors

o o

duress is no excuse (some say) there's no real difference between omission and commission: letting die is as bad as killing (some say)

Corporate Responsibility

Corporate acts: acts brought about by several actions or omissions of many different people all cooperating together so that their linked actions and omissions jointly produce the corporate act.

Question: Who is morally responsible?

o

"Traditional" Individual Responsibility View: those who knowingly & freely did their parts are each morally responsible for the act.

Alternative Corporate Responsibility View: the corporate group and not the individuals who make up the group must be held responsible.

Pro Corporate Responsibility

o

We (and the law) say EXXON was responsible for the Valdez oil spill: not just the Captain (though he was drinking) + the person who hired this captain + . . .

More often than not . . . employees of large corporations cannot be said to have "knowingly and freely joined their actions together" to bring about a corporate act or pursue a corporate objective. Employees of large-scale organizations follow bureaucratic rules that link their activities together to achieve corporate outcomes of which the employee may not even be aware.

engineers may design a product with certain weaknesses not knowing that marketing dreamt up an application for which the product is unfit and plans to sell the product for that application (without knowing its unfit for that application)

Traditionalist rejoinder: in such cases ordinary mitigating factors suffice to mitigate the employees responsibility without appeal to any such notion as "corporate responsibility"
o

Example:

e.g., the engineers didn't know it would be used that way e.g., the marketing dept. didn't know it couldn't safely be used that way

Amply mitigates the individuals: but isn't there some responsibility left over that belongs to no particular individual but rather the Corporation: say due to its corporate culture engineers don't talk to marketing

Subordinates' Responsibility

Corporations generally have hierarchical authority structures in which

o o

those above issue orders & directives which those below them are expected -- on pain of dismissal -- to follow & carry out

One view: those who are "only following orders" are not responsible for the acts that result (only those who gave the orders): the Nuremberg defense.
o

When a subordinate acts on the orders of a legitimate superior this absolves the subordinate of all responsibility for the act.

They were only "following orders"

The Post Nuremburg Principle

o o

A subordinate has no obligation to obey an immoral order -- quite the contrary The subordinate's responsibility

may be mitigated by the duress: "Do it or I'll find some one who will," the Boss says.

but they are not excused.

The superior bears unmitigated responsibility

the fact that the superior used a "human instrument" (the subordinate) to do the act

does not diminish the superior's own "instrumentality" in bringing it about.

Cases for Discussion Slavery in the Chocolate Industry 1. What are the systemic, corporate, and individual ethical issues raised by this case? 2. Is child slavery absolutely wrong (no matter what) or only relatively so (depending on whether your culture disapproves of slavery)? 3. Who shares the moral responsibility for the slavery occuring in the chocolate industry? Enron (ABC News Video) 1. What are the systemic, corporate, and individual ethical issues raised by this case? 2. Who was morally responsible for the collapse of Enron? 3. If Enron had not collapsed and Enron's accounting practices had adhered to the letter if not the spirit of the Generally Accepted Accounting Principles would there have been anything wrong with what Enron did?

Ethical Principles in Business Introduction

Background
o

Apartheid

system of racial segregation & oppression designed to maintain

the total subjugation of the black majority (80%) and the supremacy of the white minority (20%)

Caltex, a jointly owned subsidiary of Texaco & Standard Oil

maintained extensive & growing refinery operations in South Africa which greatly benefited the South African

economy: which relied on oil for 25% of its energy needs & government

S.A. law required refineries to set aside some of their oil for the government

and profited from stiff corporate taxes on Caltex (& other corporations)

The Issue Raised: Should Caltex break off relations with the S.A. Government & even leave S.A. altogether?
o

PRO:

By continuing & even expanding operations in S.A. Caltex gives aid & support to the government and its oppressive system of apartheid.

Caltex has a moral duty to discontinue its S.A. operations

to cease activities that helped the regime with its unjust & repressive policy of apartheid

to bring pressure on the government to eliminate apartheid

CON:

The continued operation of Caltex brings income to both blacks and whites

If the company ceased operations the hardship & economic losses would be borne mainly by the companies black employees who would lose their jobs

The company has a responsibility for the well being of its black workers.

As an example of a moral debate: Considerations appealed to

o

considerations of justice: apartheid unfairly apportions burdens to blacks & benefits to whites

considerations of rights: black South African's rights to freedom & well-being were not being respected.

considerations of benefit or utility: Caltex's operation confers economic & other social benefits

considerations of character: the admirable characters of Desmond Tutu with his passion for justice and the courage and thoughtfulness of Nelson Mandela invested their opposition to apartheid with moral authority.

2.1 Utilitarianism: Weighing Social Costs

The Ford Pinto "TNT"

o

rushed onto the market after only 2 yrs. in development (rather than the usual 4)

when struck from the rear at >20 mph the gas tank sometimes ruptured tests show

Question: whether to modify the design or go ahead with production The social cost-benefit analysis
o o

Costs: $11 x 12.5 million autos = -$137 million Benefits:

less 180 deaths x $200,000 less 180 injuries x $67,000 less 2100 burned vehicles x $700 TOTAL BENEFITS: $49.15 million

Cost-benefit analysis typical of utilitarianism Utilitarianism

o

consequentialist: actions derive their moral value (or disvalue) from their consequences

o o

altruistic: for all who are affected whatever course of action maximizes benefits over costs for all concerned is right

Compare Egoism: whatever course of action maximizes benefits over costs for me (the agent) is right.

Many hold that "the best way of evaluating the ethical propriety of a business decision -- or any decision -- is by relying on utilitarian cost-benefit analysis."

Traditional Utilitarianism

Jeremy Bentham (1748-1832) generally considered the founder The utilitarian principle: An action is right from an ethical point of view if and only if the sum total of utilities produced by that act is greater than the sum total of utilities produced by any other act the agent could have performed in its place.

Utilitarian Moral Reasoning vs. Rule-based moral reasoning

o

Rule-based approaches view morality as a kind of "higher law" & moral reasoning on the model of legal reasoning.

question what are the statutes (moral principles) and which apply to the action in question

Consequentialist approaches view morality as a kind of "higher economics" & moral reasoning on the model of economic calculation. (Marx derided Utilitarianism as "the ethics of English shopkeepers")

Assumptions & Clarifications

o o

assumes the commensurability of various benefits & costs cost-benefits compared for different possible courses of action

does not say that any action whose benefits outweigh its costs is right says that the action that produces the greatest benefit (or least cost) in comparison with any alternative course of action is right

impartially considers cost-benefits for all concerned

not just for the individual or company considering the action (that's egoism)

egoism, due to its partiality, is not a moral theory or policy at all

includes long term not just immediate benefits & losses: calculation of longterm benefits & costs needs to be adjusted for probability of the outcome

Intuitive appeal
o

fits nicely with intuitive criteria invoked in discussions of public policy & personal conduct

we do consider the benefits & costs we frequently do judge policies & actions that cause avoidable harm or loss of benefits to be morally questionable.

plausibly explains why certain types of activities we regard as generally immoral generally are so, but are not so without exception

lying & theft are generally wrong because they diminish trust and impede cooperation & so are socially costly

However, in certain situations -- when more harm would result from telling the truth than from lying or theft -- lying or theft could be morally justified.

promotes efficiency, i.e., doing what produces the most benefits at the least cost: effort is a cost.

Example application: Clinton's Choice Technical applications (skip)

o

Economist's calculations & economic theories assume

idealized individuals & corporations always acting so as to maximize utility

objection . . . their own utility!

Doubtful that this explanatory application of utilitarian-style calculation supports the normative claims of the theory -- is v. ought

This application is supportive of egoism, not utilitarianism . . . it's their own utility that economic theory assumes individuals & corporations seek to maximize.

Use of economic cost-benefit projections to determine the advisability of projects, e.g. whether to build a dam.

assign cost values to the estimated long-term costs: environmental destruction, population displacement, etc.

assign cost values to the estimated long-term benefits "If the monetary benefits of the a . . . project exceed the monetary costs and . . . the excess is greater than that produced by any other feasible project, then the project should be undertaken."

Measurement Problems

Comparative measures of the values things have for different individuals cannot be made, e.g.,
o o o

the benefits I would derive from getting the job -- what it's worth to me. the benefits you would derive from getting it -- what it's worth to you. so the method couldn't be applied to determining who to hire (all else being equal)

Some benefits and costs seem immeasurable, e.g., life & health
o o

won't any price you assign be arbitrary? isn't putting a price on life morally inappropriate in its own right

Many of the benefits & costs of an action are unpredictable: e.g., benefits from basic research.

Unclear what's a "benefit" and what's a "cost"

o o

is the suffering of prisoners a cost (as Bentham thought)? or a benefit (as Kant thought)?

Critics contend these measurement problems undermine the would-be objectivity of utilitarian calculation
o

morally crucial benefits like beauty & happiness not quantifiable like economic benefits and costs

example: corporate "social audits" stymied by

inability to place monetary values on intangible outcomes: e.g., loss of scenic beauty due to new construction

differences over opinion over what should be counted as a benefit -not another golf course!?

Utilitarian Replies to Measurement Objections

Accurate measurement not essential

o

it's still desirable to lay out the consequences of an contemplated course of action as clearly as possible

one may usefully rely on shared common-sense judgments of comparative value & disvalue: e.g., death a more serious cost than a hangnail

Common sense criteria

o

Intrinsic goods trump instrumental goods all else being equal

intrinsic: desired for their own sake, e.g., happiness, wisdom, beauty, pleasure, health

instrumental goods: desired for the sake of other things: e.g., money, medical treatment

Needs -- especially basic needs -- trump mere wants:

needs are things without which one will suffer harm

basic needs are things without which one will suffer fundamental harm such as injury, illness, or death

wants are things one desires

needs can also be wants: I need to eat & want to too though they needn't be wants: the alcoholic needs to quit but doesn't want to

mere wants: are things one desires but does not need: I don't need to eat steak.

Quantitative measurement is more feasible than the critics think

o

the price someone would be willing to pay for them on the open market is a measure of things' values

values like health and life are not immeasurable

we regularly do put a price on them any time people place a limit on the amount they are willing to pay to reduce the risk that something poses to life they set an implicit price on that life

such pricing is inevitable so long as we live in a world where risks can be eliminated only by trading off other things we may want

nonmonetary measures may also be used: e.g., opinion surveys

Problems with Rights & Justice

Objection: in a wide variety of circumstances applying the Utilitarian Principle would dictate actions that are unjust and violate peoples rights.
o

Framing an innocent man to prevent rioting that would cost many lives.

o o

The pornographic police photos scenario The Pinto case: What went wrong?

not that they made mistaken utilitarian calculations but something intrinsic to all utilitarian calculation: it ignores

considerations of justice or fairness:

better that everyone should bear the additional $11 cost & fix it rather than make the 180 who were projected to die (& to a lesser degree the 180 burn victims who wouldn't die & the 2100 whose vehicles would be destroyed) bear THE WHOLE COST

even though that whole cost was less than the cost of fixing the Pinto

considerations of rights

people were buying a car that was less safe than they might have expected

without their informed consent

if they'd known about the problem they could have decided for themselves whether to take this added risk

by not telling them Ford deprived them of their right to decide

Conclusion: Utilitarianism seems to ignore certain important aspects of ethics.

o

Considerations of justice: which look at how burdens and benefits are distributed

Considerations of rights: which look at individual entitlements to freedom of choice and well-being

Utilitarian Replies to Objections on Rights & Justice

Bite the bullet (if needs be) or spit it out

o

Framing an innocent man

Bite: it really would be right to frame an innocent man if the situation were as described

Spit: there can't be a situation like the one described: always a high probability that such a conspiracy would be found out -- which would have very grave costs (loss of respect for law & authority).

Taking & distributing nude photos of someone without their consent

it really would be right to take & distribute nude photos without the woman's consent if there were no chance of her finding out

but there always will be considerable likelihood that it will be found out; that these guys will be encouraged to do the same in the future (which again may be found out); etc. -- which would have very grave costs (individual's mortification, mistrust of police, etc.)

Rule Utilitarianism: take the principle of utility to define a procedure for evaluating rules not particular acts. (skip)
o

Stated

An action is right from an ethical point of view if and only if the action would be required by those moral rules that are correct.

A moral rule is correct if and only if the sum total of utilities produced if everyone were to follow that rule is greater than the sum total utilities produced if everyone were to follow some alternative rule.

Counterargument: Why not rules with built in exceptions.

Don't bear false witness against your neighbor (as in the framing case) except when that would produce the most utility.

So rule utilitarianism boils down to act utilitarianism & the problems with rights & justice (shown by the counterexamples remain).

Rule Utilitarian Response

since human nature is weak & selfish allowing exceptions would leave everyone worse off

in effect: change "if everyone were to follow that rule" to "if society were to adopt that rule" for a realistic assessment of what rule is best

2.2 Rights & Duties

The concept of a right and the correlative notion of duty . . . lie at the heart of much of our moral discourse.
o

In practice

employees often assert that they have a right to a fair wage business owners complain that plant takeovers -- as in sit-down strikes -- violate their property rights

consumers claim they have a right to know

In Law and Tradition & Theory

1st 10 amendments to the U. S. Constitution are a Bill of Rights The U. S. Declaration of Independence declares that "all men . . . are endowed by their creator with certain inalienable rights" including

life liberty the pursuit of happiness

U. N. Universal Declaration of Human Rights asserts that all human beings are entitled, among other things, to

the right to own property alone as well as in association with others

the right to free choice of employment, to just and favorable conditions of work, and to protection against unemployment

the right to just and favorable remuneration ensuring for [the worker] and his family an existence worthy of human dignity

the right to form and join trade unions the right to rest and leisure, including reasonable limitation of working hours and periodic holidays with pay

the right to freedom of thought, conscience and religion; this right includes freedom to change his religion or belief, and freedom, either alone or in community with others and in public or private, to manifest his religion or belief in teaching, practice, worship and observance.

The Concept of a Right

Rights are entitlements

o o

to act in certain ways (without blame or punishment) to be treated in certain ways (with mistreatment being subject to blame & punishment)

Legal vs. Moral rights

o

Legal rights are entitlements under law

e.g. the rights specified in the Bill of Rights

to freely speak & assemble to keep & bear arms

legal rights, or course, are limited to the particular jurisdictions in which the laws are in force

Moral rights or human rights

are universal rights -- of all people based on moral norms, ideals, and values

In the most important sense rights involve

o

prohibitions or requirements on others (duties)

to allow the individual to pursue certain interests or activities: "protective function"

or even enable the individual to pursue certain interests or activities: "enabling function"

Three features of the protecting and enabling functions of rights

1.

Rights impose correlative duties on others

of noninterference correlated with protective rights: if I have the right to do something other people have a duty not to interfere with my doing it

of enablement: if I have a right to have someone do something for me then someone has a duty to do it for me

2.

Rights provide individuals with autonomy and equality in the free pursuit of their interests

rights identity activities or interests people must be left free to pursue or not as they choose

and whose pursuit must not be subordinated to the interests of others except for extraordinary & very weighty reasons

3.

Rights provide a basis for justifying one's actions and invoking the aid or protection of others

If I have a moral (or legal) right to do something then I have a moral (or legal) justification for doing it: "I'm within my rights.".

And others have

no justification for interfering with me and justification for assisting me, i.e., defending my rights.

Contrast with Utilitarian Considerations

o

express the requirements of morality from the standpoint of the individual rather than society as a whole

rights limit the validity of appeals to social benefits and numbers

the perceived benefit to society is generally not enough to override my rights

but it's a limited limitation: great enough social benefits can sometimes justify violations of rights

e.g., declaration of martial law in times of national emergency imposition of quarantines (during disease epidemics) & curfews (during time of civil unrest)

Negative and Positive Rights

Defined
o

Negative rights can be distinguished as those which impose only the negative duty of noninterference on others.

the right to privacy: means no one has the right to interfere in my personal affairs

the right to property: means no one has the right to interfere with my using & disposing of it as I choose

Positive rights impose positive duties on others -- not just to refrain from interfering with me -- but to do something to assist me in the exercise of that right if needs be

right to health care

right to employment

Controversy

Conservatives often loath to recognize positive rights: would like to limit the role of government to preventing violation of negative rights:

maintaining law & order protecting property

Liberals eager to assert positive rights which are apt to impose duties (on consequently expenses) on governments since the onus of assisting often falls there

guaranteeing rights to health care impose a duty of providing medical assistance to the poor

rights to housing impose a duty of providing housing assistance rights to jobs impose a duty offer training and placement

Contractual Rights and Duties

Aka special right and duties

o

i.e. limited rights and correlative duties that arise from agreements between parties

Distinguishing marks (in contrast to the unlimited or universal & nonvoluntary character of legal & moral duties)

speciality: they attach to specific individuals and are imposed by specific individuals: the parties to the agreement

arise out of specific transactions between individuals depend on a publicly accepted system of rules that define the transactions that give rise to those rights and duties

clear in the legal case

but perhaps even in the moral case:

promising depends on the social institution of making promises

the joke: a verbal agreement isn't worth the paper it's written on.

Such agreements crucial to the practice of business, obviously. Special duties arising from acceptance of a position or role in an organization or social institution
o o o

e.g., parents have special duties toward their children spouses have special duties toward each other Doctors have special duties to care their patients and keep their patients' confidences.

etc.

"Ethical rules" underlying & legally limiting contractual obligation

o o

Both parties must have full knowledge of the nature of the agreement Neither party must intentionally misrepresent the facts of the contractual situation.

o o

Neither party must be forced to enter the contract under duress or coercion. The contract must not bind the parties to an illegal act.

ON THE EDGE: Working for Eli Lily & Co (p.73)

Drug testing is necessary & required by the FDA, but

o

Hard to get healthy volunteers: "Test subjects can die, suffer paralysis, organ damage, and other chronically debilitating injuries"

So, Eli Lily recruited homeless alcoholics from soup kitchens, shelters, and jails

Particulars
o o o o o

Free room & board & medical care $85/day tests run for months so the men can make up to $4500 they leave drug and alcohol free with money in their pockets "When asked, one homeless drinker hired to participate in a test said he had no idea what kind of drug was being tested on him.

A Basis for Moral Rights: Kant

Doubtful that Utilitarianism can provide a satisfactory basis for moral rights
o

Weak: "People have moral rights because conferring moral rights on them maximizes utility."

Because: a right entitles you to do something regardless of the benefits it provides or costs it imposes on others.

Immanuel Kant (1724-1804) and his theory.

o

Moral rights and duties all human beings possess regardless of any utilitarian benefits or costs

Based on the categorical imperative: a philosophical adaptation of the Golden Rule: "Do unto others as you would have them do unto you."

First Formulation of the Categorical Imperative

o

Act only on that maxim through which you can at the same time will that it should be a universal law.

a maxim is the policy -- or expression of the policy -- governing your act: your reason for doing it

to will it to be universal law is to will that everyone should follow the same policy.

Two criteria for determining the moral rightness or wrongness of a maxims and acts done on them.

UNIVERALIZABILITY

Must be willing that everyone should act on that maxim. My mama used to say to me, "What if everyone did that?"

REVERSIBILITY

Crucial case where "the shoe would be on the other foot": whether you would be willing to be done unto by others as propose to do unto them.

My mama used to say, "How would you like it if your brother did that to you?"

Discussion:

Kantianism focuses on the person's interior motivations for their actions not expected consequences (like Utilitarianism).

maxims express those motivations "nothing is absolutely good except a good will" says Kant

Central concept is not "goodness" (as of results) but "duty"

our moral duty is to act as the Categorical Imperative says our actions have moral value -- are good deeds -- only insofar as they are motivated by duty not from inclination (because you want to or find it pleasant)

even if you have good inclinations: you're kind & generous, say

your acts are morally creditable only insofar as your motive was a belief that what you're doing is the right

way for all people to behave, as the categorical imperative would have you.

Second Version of the Categorical Imperative

o

Act in such a way that you treat humanity, whether in your own person or in the person of any other, never simply as a means, but always at the same time as an end.

Never treat people solely as means. Don't use people.

Kant thought the two versions of the CI were equivalent: just said the same thing in other words.

1st version says that what's morally right for me is morally right for others: everyone is of equal value.

"If this is so," Velasquez suggests, "then no person's interests should be subordinated to the interests of others so that the person is used merely to advance interests of others.

What the second version emphasizes is

respecting other peoples autonomy: their right to choose for themselves

not doing things to or for them without their consent

Kantian Rights

Based on the fundamental right of each rational agent or person to set and pursue their own aims (as expressed by the second version of the CI): to be (allowed to be) free autonomous agents.

The different kinds of rights previously identified flow from this fundamental moral right of freedom:
o

positive rights to food, clothing, housing, & medical care exist as preconditions of the exercise of freedom

if you're sick or starving you can't very well pursue your aims if you're dead or deranged you can't even set them

rights flowing from right to be informed pursuant to self determination

negative rights (both choice and pursuit of ends requires information)

freedom of speech freedom of association

positive right to education

contractual rights

flowing most forcefully from the CI's first formulation Kant's favorite example of a nonuniversalizable maxim:

Break your promises when it suits you. If universally adopted promises wouldn't be credited. Not just -- you wouldn't like it if others did that to you. Universalizable in an even stronger sense

self-contradictory in a way: it cuts off the branch it sits on.

the possibility of breaking promises depends on the existence of the institution or custom making promises

but this would be destroyed by the universal adoption of the maxim.

Problems with Kant

Imprecise & Impractical

o

Not so easy to figure out

what maxims I'm acting on

not clear we generally do or should act on maxims or set policies

Can imagine someone saying, "my life is jazz man, . . . not classical

improvisation is where it's happenin' man not your fusty old playin' from a score

or which you'd be willing to universalize

especially on the fly.

Nor so easy to know when you're using someone merely as a means

is the used car salesman who sells me a lemon using me only as a means to line his pockets

"Let the buyer beware," he contends.

He didn't make me not take it to a mechanic to get checked out. he was just respecting my freedom to be a chump who didn't beware.

Heteronymy (Different Strokes) Counterexamples & Rejoinder

o

The racist employer who discriminates against blacks: he seldom hires & never promotes them.

Such a fanatical racist he's willing to accept the proposition that if he were black he should be discriminated against (Maybe he's a fanatic fundamentalist Mormon: the "Book of Mormon" commands it, he thinks.)

So CI licenses a maxim of racial discrimination, which is immoral.

Kill the weak, is my maxim, says Nazi Ned.

"But if you were weak you wouldn't want others to kill you," says Kant, blanching in horror.

"Better to die than live as a sniveling weakling," says Ned eyes ablaze with sincere fervor,

"I would want someone to kill me." "Do the right thing and put me out of my shame" (weakling I'd be I probably wouldn't have guts to do it myself).

So CI in this case licenses a Nazi Ned's maxim: and that's immoral.

Rejoinder: biting the bullet

if Nazi Ned genuinely and conscientiously would be willing to universalize his principle

then his acting on the maxim is morally right

insofar as he is striving to be true to his sincerely universally willed principles

he is acting conscientiously & in a moral manner. justifies R. E. Lee (perhaps) but Hitler? Surely not!

would-be rejoinder itself encapsulates what's most wrong with Kantianism IMHO

conscientious & sincere villainy possible: it's the worst kind as Nazism showed

nothing inherently redeeming about a moralizing & maximizing style as opposed to Jazzman's style (for instance)

shown by Ken Starr:

He probably wouldn't mind having his sex life similarly scrutinized

"If you've nothing to hide you've nothing to fear"

morality v. moralism

The Libertarian Objection: Nozick (skip) 2.3 Justice & Fairness

Justice and fairness are essentially comparative: concerned with the comparative treatment given to members of a group when
o o o o

benefits and burdens are distributed rules and laws are administered individuals cooperate and compete with one another individuals are punished for misbehavior

Considerations of justice generally taken to trump utilitarian considerations of benefit & cost
o o

greater benefits (or lesser costs) cannot justify injustices unless the benefits (or savings) are very great, e.g., we seem to feel that

some degree of inequality may be traded off for major economic gains that leave everyone better off.

Considerations of justice doesn't ordinarily trump individual rights since, to some extent, justice is based on rights
o o

violations of rights are thought to be themselves unjust however, extreme injustice may justify restricting some individuals' rights

Three categories
o

distributive justice: concerned with the fair distribution of society's benefits and burdens

retributive justice: concerned with the fair imposition of punishments on those who do wrong.

compensatory justice: concerned with fair recompense of individuals for losses suffered due to others misconduct or mistakes.

Distributive Justice

Issues typically arise

o

when individuals put forth conflicting claims on societies benefits & burdens and all cannot be satisfied

two cases

scarcity of benefits (e.g., jobs, food, housing, medical care, wealth) compared to individuals desires for these benefits

superfluity of burdens (e.g., unpleasant work, military service, risks) compared to individuals willing to take them on.

The fundamental principle -- equals should be treated equally & unequals unequally -requires
o

Individuals who are similar in all relevant respects should be given similar benefits and burdens

Individuals who are dissimilar in relevant respects should be treated dissimilarly in proportion to their dissimilarity.

Purely formal nature of the fundamental principle (which is why it's acceptable to all)
o

based on the purely logical idea of consistency: identical cases should be treated identically

but doesn't specify what respects are relevant or material to determinations of similarity

application of the fundamental principle requires adoption of some material principle

differing theories of Distributive Justice differ with regard, precisely, to this

Justice as Equality: Egalitarianism

Overview
o o

There are no relevant differences among people that justify unequal treatment. Therefore: Every person should be given exactly equal shares of society's benefits and burdens.

PRO
o

Workers who receive equal treatment compensation cooperate better and feel greater solidarity with each other

A traditional American ideal that "All men are created equal" as the Declaration of Independence says

A good ideal leading to good results

emancipation of slaves prohibition of indentured servitude elimination of racial, sexual, & class discrimination e.g., in voting requirements

institution of system of free universal public education

CRITICISMS
o

Simply not true that all are equal

no two individuals are really equal in every respect, much less all individuals

humans differ in many relevant respects: e.g., in abilities, intelligence, virtues, needs, and desires

more like they're unequal in all respects than equal

Ignores relevant differences of need, ability, and effort

Examples of injustices egalitarianism would lead to

handicapped individuals would be expected to bear burdens equal to nonhandicapped

lazy slackers would be compensated just as much as hard workers

Productivity argument: since individuals would have no incentive to work so economic productivity and efficiency would decline.

REPLIES
o

Distinguish between political and economic equality

Political equality refers to equal control of, participation in, and treatment by governmental and other public agencies.

Economic equality refers to equality of income, wealth, and opportunity.

The Reply: Egalitarianism is the right principle for distribution only of political benefits and burdens.

the criticisms leveled against equality apply only to economic equality the benefits cited in defense of equality are mainly improvements in political equality

Limited economic egalitarianism proposes

everyone to be compensated equally up to some set minimum standard of living

beyond that unequal pay for unequal work should be practiced for productivity's sake.

Justice Based on Contribution: Capitalist Justice

Overview
o

Benefits should be proportional to what the individual contributes to society or the group.

In theory, the principle used to establish salaries and wages in most American companies

o o

Pure expression of the principle: piecework style compensation. Drawback: tends to promote an uncooperative and even competitive workplace atmosphere

resources and information less willingly shared status differences arise & solidarity falls

Main question: How is contribution to be measured? Proposed measures of contribution

o

work effort

The greater the quantity of the individuals effort the greater their compensation should be: the harder you work the more you should paid.

problems: ignores how effectively you work

the incompetent drudge would be rewarded more than someone who produced more by working less.

would remove incentive for individuals to acquire skills & education that would make them more productive workers.

productivity

The better the quality of the individual's contributed product the more compensation they should receive.

problem: ignores peoples' needs

the needs of handicapped & other disadvantaged people will not be met

problem: hard to place an objective value on contributed products

especially in certain fields such as

artistic production science -- especially basic research education religion health care

would-be fix: appeal to market forces: the value of a person's contributed product is whatever it would sell for on the open market.

criticism: still ignores needs markets ignore the intrinsic values of things, e.g.,

athletes & entertainers vs. firemen, nurses and health-care workers etc.

when products are made through the joint efforts of many workers

the usual case how do we determine how much of the products value is due to whose efforts?

Justice Based on Needs and Abilities: Socialism

Overview:
o

"From each according to his ability, to each according to his need."

Burdens should be distributed according individuals' abilities to bear them and benefits according to individuals' need for them.

The distributive principle that tends to be least acknowledged in business.

PROS
o

From each clause encourages productivity: the best person for the job gets it

individuals would be encouraged to develop and exercise their particular talents

to realize their potentials through their work

To each clause: social benefits go to those who will benefit most -- those with the greatest need

best promotes human health, welfare, & happiness basic needs should be me first (vs. jewel encrusted Faberge eggs) what's left over should go to meet nonbasic needs

Same principle as in the family

CRITICISMS
o

Productivity argument: remuneration would not depend on effort or productivity so economic productivity of would fall: workers receive the same no matter how hard or how productively they work

Unrealistic to think that whole societies can employ the distributive principles appropriate to the family: the "All for one and one for all" spirit only goes so far.

The claim

human nature is essentially self interested and competitive outside the family people can't be sufficiently motivated by brotherly/sisterly willingness to pitch in (with the burdens) share (in the benefits)

Socialist rebuttal

competition and selfishness are learned

not unchangeable features of human nature they're undesirable character traits instilled & encouraged by the capitalist system itself

the "all for one and one for all" spirit would be nurtured and instilled under a socialist system: a "new socialist man" would arise under socialism.

Oppressive collectivism would obliterate individual freedom: for instance

a person's occupation would be determined by his (socially recognized) abilities not by his free choice.

a person's compensation would be determined by their (socially recognized) needs not their free choice.

substitutes paternalism for freedom in the best case scenario results in centralization of power & authority that invites abuse

Justice as Freedom: Libertarianism (skip) Justice as Fairness: Rawls (skip) Retributive Justice

Concerns blaming or punishing individuals for wrongdoing (particularly violation of group norms) Conditions of Responsibility or Desert
o o

the individual knowingly did wrong and freely chose to do so

Due Process

aims to guarantee a high probability that the punishment is going to the real offender

Proportionality & consistency of punishment.

o o

consistency: everyone is given the same penalty for the same infraction proportional: the penalty inflicts a harm no greater in magnitude than the harmfulness of the infraction

Compensatory Justice

Concerns restoring to individuals what they have lost due to being wronged by another Insofar as possible the wrongdoer should restore the loss Relevant conditions on compensatory responsibility
o o o

the action was wrong or negligent the action was the real cause of the injury the infliction of the injury was voluntary

foreseen desired

Controversial case: preferential treatment to remedy past mistreatment of groups, e.g. affirmative action

2.4 The Ethics of Care Partiality and Care

Impartiality & Traditional Ethics Utilitarianism & Kantianism agree: moral behavior is impartial behavior
o o

Utilitarians: each counts one, none counts more than one Kantians: universalizability accords no special concern for me & mine

Doubts concerning impartiality

o o o

Freud: to love everyone equally is not to give a damn about anyone "I love humankind. It's people I can't stand!" Counterexample

save your father from drowning vs. some stranger (a heart surgeon) Utilitarianism says you have a moral duty to rescue the stranger!

In Defense of Partiality or Care

o

View intimacy & relationships as values in their own rights

emphasizes these over abstract principles & societal benefits the web of relationships

each individual has a moral obligation to perceive & nurture the web of relationships within which they exist

and to give special consideration to and exercise special care for those with whom they are so linked

argument from identity of the self: "no man is an island"

a good life is a connected life to love and work we need others to love and work with

Communitarian ethics: endorses person-to-group as well as person-to-person partiality

Objections to Care Ethics

can degenerate into unjust favoritism (e.g., nepotism) or factionalism in the Communitarian case: R. E. Lee excess of care can result in self-neglect or "burnout" case for care more compelling at the level of individual than of institutional morality

possible conflicts with other values

o o

with justice: the South Africa case of Caltex possible conflicts with utility

hire the most qualified applicant hire your useless brother-in-law

2.5 Integrating Utility, Rights, Justice, and Caring

Conflicts cut both ways

o

if it's an objection to care based ethics that care can conflict with justice & rights it's an objection to justice & rights based ethics that these considerations can conflict with care

o o

likewise utility v. care likewise utility v. justice & rights

Conflicts ye have always with ye: for that matter,

o o

rights can conflict with rights & caring for one with caring for another

Points up the need to weigh the relative importance of different types of considerations in specific situations.
o o

no hard & fast general rule for doing so seems available only rough criteria & subjective judgments of comparative value

rights generally trump utility but sometimes utilitarian costs & benefits become sufficiently large trump rights: When?

right to privacy (not to have one's phone tapped, etc.) vs.

social utility of surveillance groups & persons who are terrorist threats

2.6 An Alternative to Moral Principles: Virtue Ethics

Virtue ethics focuses on character as opposed to conduct.

o o

not the person one ought to be not the kind of actions one ought to perform

Conduct will take care of itself:

o

Good (kind, loving, generous, brave) people do good deeds regardless of their moral convictions:

Huck Finn example "Love and do as you will."

Bad (cruel, hateful, stingy cowardly) people do bad things in spite of the lofty moral principles they espouse

witch hunters "The mercy of the wicked is cruel."

The Nature of Virtue (skim)

Acquired dispositions
o

valued as part of the character of a morally good human being (seen as desirable)

o o

exhibited in a persons habitual behavior to do as good (admirable) persons do for right reasons

E.g., truthfulness
o o

disposed to tell the truth feels wrong about lying

etc.

Acquired: virtues are regarded as praiseworthy, in part, because their acquisition requires effort

The Moral Virtues (skim)

Aristotle: a mean between two extremes (or vices) of excess & defect
o

generosity

defect: stinginess excess: wastefulness

courage

defect: cowardice excess: rashness

pride

defect: false humility excess: boastfulness

Aquinas
o o

pride a vice: humility a virtue theological virtues

faith hope charity

Virtues Actions and Institutions

Knock on virtue ethics is that it is an insufficient guide to action Key action guiding implications:

do what exercises or develops morally virtuous traits of character: the morally right actions are those

avoid doing what exercises or develops vicious traits of character: the morally wrong actions are these.

Also applicable to the evaluation of institutional arrangement

o

ask what kind of character traits do the institutional arrangements foster

if virtuous, the organization is good if vicious, the (form of) organization is bad:

e.g., corporate cultures that encourage back-stabbing as the path to advancement.

capitalism encourages greed communism encourages laziness & incompetence

Virtues & Principles (skim)

No fundamental conflict in the conduct judged to be right & wrong.

o

e.g., utilitarianism would commend acts of the sort associated with generosity & industry

Kantianism would commend acts of the sort associated with integrity & consistency

Care would comment acts of the sort associated with loyalty & friendliness

Main difference: focus on issues related to motivation & feeling that are largely ignored by an ethic of principles

2.7 Morality in International Contexts (skip) CASES FOR DISCUSSION Publius

Analyze the ethics of marketing Publius using utilitarianism, rights, justice, and caring. In your judgment, is it ethical to market Publius? Are the creators of Publius in any way morally responsible for the criminal acts that criminals are able to carry out and keep secret by relying on Publius? Is AT&T in any way morally responsible for these?

In your judgment, should the U.S. government allow the implementation of Publius? Why or why not?

Unocal in Burma (ABC News)

Assess whether from a utilitarian, rights, justice, and caring perspective, Unocal did the right thing in deciding to invest in the pipeline and then in conducting the project as it did. According to your assessments, did Unocal do the right thing?

Is Unocal morally responsible for the injuries inflicted on some of the Karen people? Why or why not?

Do you agree with Unocal's view that "engagement" rather than "isolation" is "the proper course to achieve social and political change in developing countries with repressive governments"?

Chapter 7 Outline The Ethics Job Discrimination Introduction Mend it don't end it. (Bill Clinton 1995 ) {5th edition}

complete text Guiding Principles

o o

all are created equal & endowed with inalienable rights, to life, liberty, and to pursue happiness

Our historical trajectory

1. 2.

to establish & preserve these principles for white male property holders to make extend them to all and make them real in the lives of all our citizens

Our present situation: examples of enduring inequities due to past discrimination

o

senior management positions:

.6% African-Americans .4% Hispanic-Americans .3% Asian-Americans 4% Women 95% White Males

home loan application: likelihood of rejection given identical credentials

African-Americans: 2 times more likely than whites Hispanic-Americans: 1.5 times more likely

Diagnosis: there persists "the kind of bigotry that can affect the way we think even if we're not conscious of it, in hiring and promotion, and business"

Prescription: Affirmative Action (beyond provision of equal opportunity) subject to the following constraints
o o o o

no preferences for unqualified individuals no quotas "no illegal discrimination of any kind, including reverse discrimination" as soon as a program has succeeded, it must be retired

End Preferential Treatment (Pete Wilson) {5th edition}

Guiding principle: "Equal rights for all, special privileges for none." (Jefferson) History:
o o

"Pursuit of that ideal has been the key to American success since 1776. " "Today that fundamental American principle is being eroded by preferential treatment on the basis of group membership rather than individual merit in connection with jobs, awarding of public contracts, and college admissions."

Diagnosis: AA is "by definition, discrimination" and, as such, "It's not fair." Prescription: Abolish Affirmative Action

Michigan {6th edition}

Supreme Court ruling: Grutter v. Bolinger (2003)

o

UM's affirmative action program for undergraduate admissions unconstitutional because it was not "narrowly tailored"and so weighed race too heavily.

UM's affirmative action policy for law school admissions upheld as "flexible enough to ensure that each applicant is evaluated as an individual and not in a way that makes race or ethnicity the defining feature of the application"

Majority Opinion reasoned that "diversity is a compelling state interest that can justify using race in university admissions" due to its

political utility: "because universities, and in particular, law schools, represent the training ground for a large number of the Nation's leaders"

and economic utility: "Major American businesses have made clear that the skills needed in today's increasingly global marketplace can only be developed through exposure to widely diverse people, cultures, and viewpoints"

Amicus curiae ("friend of the court") brief by a who's who of major corporations had argued that "individuals who have been educated in a diverse setting are more likely to succeed" due to
11

"unique and creative approaches to problem-solving arising from the integration of different perspectives"

11

being "better able to develop products and services" and "market offerings in ways that appeal to [a variety of] consumers"

11

being "better better able to work with business partners, employees, and clientele in the United States and around the world"

11

being "more likely to contribute to a positive work environment by decreasing incidents of discrimination and stereotyping"

Justice Thomas's Dissent: "racial classifications are per se harmful and ... almost no amount of benefit in the eye of the beholder can justify such classifications"

it's impossible to "tell when racial discrimination benefits (rather than hurts) minority groups"

there's no evidence "that racial discrimination is necessary to remedy general societal ills"

there are ills that racial discrimination itself engenders

"attitudes of superiority" or feelings of being "entitled" on the the part of the favored

"feelings of resentment" on the part of the disfavored

7.1 Job Discrimination: Its Nature

Its reality: paired interviewees:

o

Male (Chris) v. Female (Julie): Chris offered better paying more responsible jobs (ABC "a few years ago")

White v. Black & Hispanic: Blacks & Hispanics only 1/2 as many job offers ("early 1990s")

Discrimination
o

original (morally neutral) meaning of the term: "to distinguish one object from another"

acquired judgmental (morally accusatory) connotations

unfair distinctions underwriting unjust treatment: "the wrongful act of distinguishing illicitly among people not on the basis of individual merit but on the basis of prejudice or some other morally invidious attitude." (371)

historically directed against members of certain out-groups

African-Americans (racial discrimination) women (sexism) Hispanics, Asians, Native Americans the disabled

Discrimination in Employment
o

Definition: "to decide adversely against members of a certain class because of a morally unjustified prejudice against members of that class."

Three elements: a decision toward one or more (prospective) employees

11

that is not based on individual merit, e.g.,

 11

seniority & experience, educational qualifications & job performance ratings.

that derives from some morally unjustified attitude

such as racial or sexual prejudice or false stereotypes

11

that has a harmful or negative impact on the interests of the employees, e.g., by costing them

jobs promotions pay

Past & Present Victims of Discrimination

o o o o

religious groups: Catholics, Jews ethnic groups: Italians, Poles, Irish racial groups: African Americans, Hispanics, Asians sexual groups: women, homosexuals

Forms of Discrimination: Intentional and Institutional Aspects FORMS OF DISCRIMINATION Intentional Unintentional a single individual unwittingly discriminates due to their unthinking acceptance of prevalent practices, stereotypes and attitudes.

Isolated

a single individual deliberately discriminates on the basis of personal prejudices.

Institutional routine behavior of an institutionalized routine behavior of an institutionalized group group deliberately discriminates on the unwittingly discriminates due to institutionalized

basis of the prejudices of the group

practice, stereotypes, attitudes, or corporate culture

Historical Shift
o

away from identifying & remedying instances of isolated intentional discrimination

Title VII of the Civil Rights Act of 1964 "It shall be an unlawful employment practice for an employer to fail or refuse to hire or discharge any individual, or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment because of such individuals race, color, religion, sex, or natural origin; or to limit, segregate, or classify his employees or applicants for employment in any way that would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee because of the individual's race, color, sex, or natural origin."

toward attempting to root out institutional unintentional discrimination

evidenced by:

disparities of a minority's representation within the ranks of a firm

as compared to the minority's representation in the general population.

Dept. of Labor Guidebook of 1970 calls for

"goals and timetables . . . to . . . increase materially the utilization of minorities and women at all levels and in all segments . . . where deficiencies exist."

"Under utilization" is defined as "having fewer minorities or women in a particular job classification than would reasonably be expected by their availability."

shift back again advocated by some

the brief for turning back

discrimination is an act directed at a specific individual, therefore, we should not say discrimination exists unless we can point to a specific individual who has been discriminated against.

difficulty: it's generally impossible to know (or show) that a particular individual was discriminated against

many randomizing factors enter into who wins out in hiring and promotion decisions

who the competitors were quirks of the interviewer:

maybe it was your haircut or tie or their personality clashed (with you) or meshed (with some competitor)

generally impossible to tell. for a given individual whether their loss of the job, raise, or promotion

was due to systematic discrimination or random factors

it's only possible to detect systematic discrimination en masse

by looking at statistical measures of what happens to groups

in hiring, compensation, and promotion

7.2 Discrimination: Its Extent

Statistical indicators of discrimination provide prima facie evidence of it

o o o

comparison of average benefits provided between groups within the institution comparison of occupants of lowest levels between groups comparison of occupants of highest positions between groups

What such comparisons show society wide

o o

sexual and racial and discrimination is present in American society as a whole "for some segments of the population . . . discrimination is not as intense as it once was"

young college-educated black males females Asians

Average Income Comparisons

Contrary to a commonly held belief: the income gap between whites and some minorities has been increasing rather than decreasing.
o

Whites v. Blacks & Hispanics: Table 7.1

In 1975: Average income

of a black family = 65% that of a white family of a hispanic family = 69% of a white family

In 1994: 63% of white for both black & Hispanic In 2001: 60% black | 62% hispanic Black unemployment 1992-1995 ran around double white unemployment.

these disparities exist at all education levels (Table 7.4)

Men v. Women: Table 7.2

In 1981 women earned 59% of what men earned: Table 7.2

In 2001 women earned 69% of what men earned: Table 7.2 These disparities cut across all education levels: Tables 7.3 & 7.4 These disparities cut across all occupations: Table 7.5

Lowest Income Comparisons

Poverty level 2003: $18,660 for a family of four: Table 7.6

o o o

Whites 8% Blacks 24% Hispanics 22%

Summary
o

Table 7.6: poverty rates among hispanics and blacks approximately 3 times those for whites

Table 7.7: families headed females more than twice as likely (27%) to be poor as households headed by males (12%)

Desirable Occupation Comparisons

glass ceiling phenomenon: "[L]arger percentages of white males move into the higher paying occupations, while minorities and women end up in those that pay less and so are less desirable."
o

although many white women and non-white men have moved into middlemanagement positions in recent years

they haven't yet been allowed into the top-paying senior management and top executive positions.

Facts & Figures (Table 7.4)

o

show differences in compensation not wholly explainable in terms of educational differences

sexual differences: 2002 average annual income (Table 7.4)

female college graduate: $47,747 male high school graduate: $46,252

racial differences: 2002 average income

with bachelor's degree: white: $63,609; black: $47,612; hispanic: $47,714

with high school diploma: white: $35,168; black: $28,179; hispanic: $28,984

Even when we factor out other causes these only account for about 1/2 the difference
o o

work experience & work continuity self imposed work restrictions & absenteeism

Current & expected trends unfavorable to women's and minorities' prospects

o

most new entries into the workforce during the 1990s were women & minorities

impediments to advancement

women

concentration of women in traditionally female (and traditionally low paid) jobs (Table 7.9)

exclusion from top management positions: the "glass ceiling" child-bearing & child-rearing responsibilities

interfere with career continuity & advancement fall predominantly on women:

in two professional families woman 6 times more likely to stay home with sick child

52% of married women VPs vs. 7% of married men VPs are childless

sexual harassment in the workplace: 42% of women report some

minorities: underskilled & undereducated relative to requirements for high-paying jobs

fastest growing fields: professions with extremely high educational requirements

e.g., technicians, engineers & health professionals

decline in jobs with relatively low educational requirement

e.g., factory laborers, miners, farmers

significant portions of nonwhites are educationally disadvantaged due to

inferior primary & secondary schooling

poorer neighborhoods have poorer public schools

poorer families have less ability to send their children to private schools

diminished access to higher (college & technical) education

academic handicaps (including lower test scores) due to inferior primary & secondary education

significant up front expenses poor individuals and families are less able to afford

summary: "future new jobs will require steeply increasing levels of skills and education" yet "minorities are falling behind in their educational attainment"

Overall Summary

American business institutions incorporate some degree of systematic discrimination

o o

much of it, perhaps, an unconscious relic of the past evidence

existing differences not wholly due to difference in preference & abilities

in average income in % of groups at lowest occupational/income levels in % of groups at highest occupational/income levels

ominous trends

small progress has yet been made at decreasing these differences

outlook for progress in the immediate future is not rosy

Conclusion: "American business institutions incorporate some degree of systematic discrimination, much of it, perhaps, an unconscious relic of the past." (387)

Re: discriminatory practices of particular firms: employers are currently required to report to the government the numbers of women and minorities they employ (as percentages of totals) in nine categories:
1. 2. 3. 4. 5. 6. 7.

officials and managers professionals technicians sales workers office and clerical workers skilled craftworkers semiskilled operatives

8. 9.

unskilled laborers service workers

7.3 Discrimination: Utility, Rights, and Justice

Prima facie inequalities of status, position, power, wealth & income Prima facie violation of principle All are created equal & endowed with inalienable rights
o o o

to life: poor people die earlier, on average to liberty: lack of finances forecloses options to pursue happiness: money can't buy happiness; but it helps with the pursuit

extreme poverty is a miserable condition poverty to whatever degree is disadvantageous

Historical violations of this principle underlie present disadvantaged status of women and minorities
o

African-Americans

brought to country as slaves: bought & sold & treated like cattle were not recognized as people

had no legal powers: no rights to their bodies or their labor deemed to be "beings . . . so far inferior that they had no right's that the white man was bound to respect" (Dred Scott v. Sanford: 1857)

Women: through much of the 19th century

could not vote, hold office, serve on juries, or bring suit in their own name

once married, could no hold property in their own names

deemed by the Supreme Court to have "no legal existence apart from her husband , who was regarded as her head and representative in the social state"

Utility

Utilitarian argument: Discrimination (in employment) is wrong because it is inefficient.

o

Social productivity is optimized to the extent that jobs are awarded on the basis of competency or "merit": this best promotes the general welfare.

different tasks require different skills, knowledge, and temperaments maximal efficiency will be achieved by assigning to these tasks the people who most possess the skills knowledge, and temperaments the jobs require.

selection on grounds other than merit will cause productivity to decline.

Race, sex, & religion (among other things), being generally unrelated to job performance, have nothing to do with merit.

So, assignment of tasks on these other bases -- i.e., discrimination in employment -- is inefficient.

Hence, wrong

Replies
o

Liberal Reply:

there's more to the general welfare than economic efficiency. Racial or sexual discrimination might better promote the general welfare in some cases

and may be warranted in those cases where other factors outweigh economic efficiency.

perhaps assignment on basis of need would be advantageous -a kind of economic affirmative action.

loss in productivity (if any) outweighed by benefits

"the poor man's farthing is worth more than all the gold on Afric's shore" (Blake)

diminishing returns on enrichment: $ 10,000 to me vs. Bill Gates.

goods are most beneficial to those most in need of them

perhaps assignment on basis of race or sex could be advantageous

loss of productivity outweighed by benefits:

of diverse workplaces where citizens of all stripes interact & are culturally enriched

Conservative Objection: Division of labor on sexual lines -- few would dare suggest racial nowadays -- best promotes the general welfare.

traditional sex roles actually assign tasks most crucial to the general welfare most efficiently

tasks of childcare & homemaking

assigned to women who are by nature and nurture most suited to these tasks

being more nurturing, sensitive, & emotional

tasks of exercising authority & control over business matters and money

are best assigned to men who are by nature most suited to these tasks

being aggressive, competitive, & rational

Rights

Kantian argument: Discrimination is wrong because it violates a person's basic moral rights.
o o

Every individual has a right to be treated as an "end" not merely as a "means". Discrimination treats people as means to whatever ends the discrimination is supposed to serve, and not as ends

Bad Old Fashioned Discrimination (BOFD)

to keep the negroes/women "in their place" to prevent "race-mixing" and "mongrelization" to preserve "the sanctity of the home"

Affirmative Action & Reverse Discrimination

to achieve diverse workplaces to compensate the disadvantaged

BOFD: treats those discriminated against solely as means

based on stereotypes that undermine the self esteem of the disadvantaged

which discourages them from pursuing their own ends economic impoverishment: deprives them of the means to pursue their ends

educational impoverishment: withholds from them the means to refine their ends & effectively target them

Related Kantian point: discrimination is a nonuniversalizable practice

o

those who discriminate would be unwilling to be similarly discriminated against if things were reversed

they'd be unwilling to consent to the universalization of their discriminatory maxim or preferential treatment

basic idea

we have a duty to treat others as we ourselves want to be treated others have this corresponding right: to be treated as we ourselves would want to be treated

Justice

Rawl's Argument: The Principle of Equal Opportunity is a fundamental principle of distributive justice
o o

a principle that everyone would choose from "behind the veil of ignorance" The Principle: Social and economic inequalities are to be arranged so that they are attached to offices and positions open to all under conditions of fair equality of opportunity.

Discrimination violates this principle.

lucrative & authoritative jobs are not equally open to those discriminated against

Conclusion: Discrimination is unjust.

Argument from the first principle of justice

o

The First Principle of Justice: Individuals who are equal in all respects relevant to the kind of treatment in question should be treated equally.

Discrimination violates this principle: race & sex are generally irrelevant to job performance

Conclusion: discrimination is unjust.

Discriminatory Practices

BOFD continues to exist & be perpetuated in effect & for several reasons is wrong Various practices widely recognized as discriminatory
o

Recruitment Practices

reliance on word of mouth referrals of present employees

tends to perpetuate under representation of minorities if minorities are already under represented

when desirable job positions are advertised in media (or through job referral agencies) that are not used by minorities or women

English newspapers not read by Spanish speaking minorities "mens-only" publications

Screening Practices

requiring job qualifications irrelevant to the task.

e.g., requiring a high school diploma for strictly manual labor: discriminates against minority groups with higher high school drop-out rates

aptitude or intelligence tests measuring aptitudes & abilities not required for the job

may serve to disqualify qualified minority members disadvantaged by the test

due to their inferior education (on average)

due to cultural biases of intelligence tests dealing with unfamiliar language, concepts, & social situations

biased interviewers basing judgments on racial and sexual stereotypes

the kinds of work appropriate for women or minorities the sort of time burdens that may be placed on women the propriety of putting women in "male" environments the assumed affects of female or minority employees on employee morale or customer attitudes

stereotypical assumptions about intelligence and abilities of women & minorities

women aren't strong enough to be cable splicers & firefighters

Hispanics aren't smart enough to be managers

Promotion Practices

tracking systems where, predominantly, white males get on the executive fast track

seniority: perpetuates effects of past past discrimination if this has excluded women or minorities

reliance on subjective recommendation of immediate supervisors who are biased

Conditions of Employment: payment of unequal wages to people doing essentially the same work

traditional inequities of pay for "pink collar" (predominantly female) occupations

as compared to "blue collar" (predominantly male) jobs involving comparable abilities & labor

Discharge

firings based on race or sex due to the negative recommendations of a biased supervisor

reliance on seniority for determining layoffs perpetuates the effects of past discrimination

Sexual Harassment

A kind of discrimination directed primarily at women difficult to define and hence to police and prevent Equal Employment Opportunity Commission (EEOC) 1978 Guidelines: sexual harassment includes "unwelcome sexual advances and requests for sexual favors & other verbal or physical contact of a sexual nature"
o

when 1. "submission to such conduct is made either explicitly or implicitly a term or condition of an individual's employment" 2. "submission or rejection of such conduct by an individual is used as a basis for employment decisions affecting that individual" 3. or "such conduct has the purpose or effect of

unreasonably interfering with an individual's work performance or creating an intimidating, hostile or offensive working environment." (393)

o o

such conduct is prohibited an employer is strictly liable for sexual harassment engaged in by employees, regardless of whether the employer "knew or should have known" the harassment was occurring

 regardless of whether it was "forbidden by the employer"

Immorality of harassment
o o o

inflicts psychological harm on the harassed individual violates employees most basic rights to freedom & dignity is an unjust use of the unequal power that an employer or supervisor wields over an employee

Controversial points
o

vagary of what constitutes an "intimidating, hostile or offensive working environment" this prohibition goes beyond specific harassing acts to attempt to prohibit an harassing work atmosphere but when does rudeness & stupidity become a hostile atmosphere

Did you hear that after the hubbub died down, Monica Lewinsky met a nice man & got married.

On their wedding night they had great sex and her husband turned to her and said, "That was the greatest sex I ever had in my life, how about you?"

Monica looked at him and replied, "Close, but no cigar."

Have I created an intimidating, hostile classroom environment?

What if I told a cruder one? or a similar joke everyday?

subjectivity of the "unreasonable interference with an individual's work performance" test subjectivity complaint: this makes what counts as harassment too dependent on purely subjective judgments of the alleged victim

who's to decide what's unreasonable? did my telling that joke unreasonably interfere with anyone's classroom performance?

I hope not, but, What if

someone were so sensitive

that they were mortified by the joke & felt uncomfortable ever coming back to class for fear I'll tell another like it.

someone were so politically correct

that they got so angry with me for ever after my telling that "dirty sexist joke"

that they can't keep their mind on the lecture

what's unreasonable to one may be tolerable, even enjoyable, to another

what one person takes as innocent flirtation another might interpret as an offensive come-on

Reply: law courts are experienced in defining what's reasonable in terms of what an average competent adult would find reasonable.
o

Free speech rights issues arise about prohibiting verbal conduct for such atmospheric & subjective reasons especially on college campuses political correctness restraints seem a dangerous impediment to free speech

colleges are supposed to be forums for free unbridled discussion

since the pursuit of truth requires considering all sides of issues, including unpopular sides

off campus (in business)

the argument is less strong in where pursuit of truth is not the goal

still can be argued that restraints on peoples speech just because it

11 11

may offend some people create an atmosphere some would find hostile

is an unwarranted restraint on this fundamental right: According to J. S. Mill (On Liberty)

the law is entitled to restrain people from acts & speech that is harmful to others

but not entitled to restrain people from acts & speech that's merely offensive to others

"Strict Liability" of the employers who are held accountable even if they did not know and could not have been expected to know what was going on and had expressly forbidden it.
compare strict product liability

contrary to principles of retributive & compensatory justice: an individual is generally not held to be punishable for, or responsible for compensating victims of, harms

if they were unaware that these harms were being caused and were actively trying to prevent them

replies to the plea for excuses

utility based: strict liability makes employers extra vigilant & internalizes external costs of harassmenT

justice based: effects of harassment can be so devastating

fairer that the company should pay than the harassing individual

company is better able to pay due to its "deeper pockets"

Beyond Race and Sex: Other Groups

Other groups liable to be discriminated against & victimized by false stereotypes Currently Protected by Law
o

Older workers: age-ism:

Age Discrimination Employment Act of 1967

Prohibited discriminating against older workers because of age until they reached age 65.

Modified in 1978: raised the age to 70.

1986 legislation prohibits forced retirement at any age.

Disabled individuals: Americans with Disabilities Act of 1990

bars discrimination on the basis of disability requires employers to make "reasonable accommodation" for disabled employees and customers

As yet unprotected (but aspiring to be)

o

Persons with unorthodox sexual preferences or identities: homosexuals & transsexuals

Liberty Mutual Insurance Co. judged within its rights in refusing to hire a man on the grounds that he was "effeminate"

Budget Marketing, Inc. judged within in rights in firing a male who began to dress as a female prior to a exchange operation.

AIDS

qualifies as a "handicap" under the federal Vocational Rehabilitation Act of 1973

nevertheless, many companies have found pretexts to illegally discriminate against AIDs victims

by firing them and/or canceling health benefits motivated by irrational fear of the disease itself, and by homophobia

The Overweight

many companies have policies against hiring overweight persons Example: The Philadelphia Electric Company was judged within its rights when it refused to hire Joyce English solely on the grounds of her weight (300 lbs).

6.4 Affirmative Action

Compare & Contrast: Equal Opportunity Policies & Affirmative Action (AA)
o

Equal Opportunity Policies combat the continuing practice and effects of BOFD by negative means, e.g.,

by prohibiting sexually and racially discriminatory practices to ensure that employment decisions are blind with respect to race & sex

Affirmative Action Policies combat the continuing effects of BOFD through positive measures

to achieve more representative distributions of minorities and women within firms

by giving preferences to women and minorities

in hiring, promotions, lay-offs, etc.

Motivation for Affirmative Action Policies

perceived insufficiency of Equal Opportunity to remedy continuing effects of BOFD

Monopoly game comparison

early in the game (under BOFD) you are only allowed to own RRs & Utilities

now we institute Equal Opportunity after I've bought up most of the choice property on the board

we end the discriminatory practices: institute a procedurally "level playing field"

but we don't undo the disadvantaging effects of the past discrimination.

Principal Means of enforcing AA : Utilization analysis

UA is essentially a comparative analysis comparing

representation of minorities & women in various job classifications in the company in nine categories
11 11 11 11 11 11 11

officials and mangers professionals technicians sales workers office and clerical workers skilled craftworkers semiskilled operatives

11 11

unskilled laborers service workers

compared to representation of women & minorities in the available labor pool

Underutilization: deemed to be present when the percentage of minority representation in some category is less than the percentage of representation in the labor pool.

If underutilization is determined then the firm must take measures to remedy this

by establishing goals and timetables for correcting these deficiencies, which are

specific & measurable designed in good faith to correct the underutilization

though these goals and timetables must not be rigid quotas in practice: the firm "undertakes special efforts and programs to increase the recruitment of women and minorities so as to meet the goals and timetables."

Tangled legal situation

The basic principle of AA has been endorsed by the courts

1979 ruling: firms can use affirmative action programs to redress imbalances of utilization

2005: universities may use AA programs to achieve diversity

But permissible corrective measures have been more circumscribed by various court decisions

California v. Bakke ( 1978): outlawed quotas, e.g.

20% of positions reserved for minorities

50% of positions reserved for women

seniority may not be set aside during layoffs

as long as the seniority system was not adopted with a discriminatory end in view

means that gains from affirmative action are likely to disappear in hard times

the "last hired, first fired" rule of seniority would hit hardest minorities & women

due to BOFD they will be disproportionately represented among the recent hires

set asides: another banned practice by which a government or governmental agency earmarks a percentage of its budget exclusively for hiring minority contractors

banned by Richmond v. J. A. Croson Co. ( 1989)

for state & local governments "except as a last resort" in "an extreme case"

banned for Federal government: Adarand Constructors, Inc. v. Pena (1995)

Moral & Political Dispute

o

Objection to Affirmative Action as "reverse discrimination" against white males

using characteristics irrelevant to job performance to make hiring & promotion decisions toward these individuals

that negatively impact them and is immoral because it

unjustly violates rights of white males to equality of opportunity in employment

inefficiently in awards jobs on grounds other than merit

Defenses of Affirmative Action

Justice based: backward-looking

it's justifiable compensation for past injuries suffered by women & minorities due to BOFD

Utility based: forward looking

it's a necessary and effective instrument for achieving socially desirable goals

Social justice argument Velasquez thinks best

looks backward to explain presently unequal opportunity for success on the part of women and minorities

looks forward to social justice -- equal opportunity for success -- a socially desirable goal

Affirmative Action as Compensation

Compensatory Justice Argument

o

People have an obligation to compensate those they've intentionally and unjustly wronged.

o o

White males intentionally and unjustly wronged women & minorities. Therefore, white males have an obligation to fairly compensate women & minorities.

Therefore women and minorities are justly entitled to "affirmative action"

to be temporarily discriminated in favor of in admissions, hiring, and promotion,

where they were previously discriminated against

That white males are disadvantaged by this is not unjust since they are the ones who have benefited from BOFD.

Reply: it ain't me babe: you got the wrong man

o

present white males are not the ones who intentionally and unjustly wronged women & minorities.

and present women and minorities aren't the same individuals that past white males unjustly & intentionally wronged.

therefore, present white males owe no compensation to present women and minorities.

Would-be rejoinders to this reply

o

Judith Jarvis Thompson: "even those who were not themselves downgraded have suffered the consequences of the downgrading of other blacks and women" (401)

Martin Reddish: regarding the obligations of present white males: "whether or not . . . [they] have themselves participated in acts of discrimination they have been the beneficiaries."

Assessment of the rejoinder

The first leg: the present women and minorities are victims is strong. The second leg: that present white males are beneficiaries is weaker

only perpetrators, not just beneficiaries, owe compensation

if Nicole Bobbit benefited from an injury Tonya Harding harding inflicted on Nancy Kerrigan

only Tonya owes compensation, not Nicole

have to argue that present white males are consciously or unconsciously in collusion with past discriminators.

Affirmative Action as an Instrument for Achieving Utilitarian Goals and Equal Justice

Utilitarian Argument
o o

We are obliged to do whatever best promotes the general welfare. Affirmative Action best promotes the general welfare:

Past discrimination has produced a high degree of correlation between race and poverty. as statistics cited earlier show

mechanism: minorities excluded from better-paying jobs become impoverished & this poverty has become "hereditary": especially pertinent in the case of African Americans

minorities tend to intramarry for blacks and whites

until recently it was illegal to marry in most southern jurisdictions

and strongly socially disapproved of everywhere

This impoverishment has led to many disadvantages highly correlated with being black

unmet needs, resentment & lack of self respect social discontent & crime: overutilization of minorities as prison inmates

The general welfare will be promoted by undoing the effects of past discrimination.

This will be best accomplished by giving discriminated against minorities special educational and employment opportunities through affirmative action.

This will remedy the impoverishment and hence alleviate the harmful effects of unmet needs, resentment, lack of self respect, social discontent & crime.

Utilitarian Objection & Utilitarian Reply

Objection: Race is an irrelevant selection criterion:

it has nothing to do with merit hence race based selection decreases productivity which diminishes the general welfare

Reply: Need is relevant and race is highly correlated with need

not only total production but distribution matters

same amount of goods more widely distributed can satisfy more preferences & yield greater happiness

law of diminishing marginal utility

the very same goods (e.g. a bowl of rice) can be more beneficial to individual X than to individual Y

if X's need is greater (e.g., if Y is well fed but X is starving)

Other objections

The social costs outweigh the benefit

costs: white & male frustration & resentment

not just white males mothers & sisters & wives of white males share their frustrations despite the evidence that affirmative action programs have primarily lifted females.

Race is not an appropriate indicator of need

There are rich blacks & women (Oprah) and impoverished whites

Based on need, shouldn't a poor white sharecropper's son be given preference over Oprah's daughter?

Certainly not vice versa -- if the real criterion is need. Proposal: affirmative action ought to be based on some more direct indicator of need (e.g., wealth)

Strongest reply: the psychological harm due to the explicitly race based and sex based nature of the discrimination can only be undone by race based and sex based reverse discrimination.

Rejoinder to this reply: receiving race & sex based preferences actually does psychological harm

the affirmative action recipient knows they didn't get the position on merit

even if they did they will have doubts: "Was I hired because I was the best candidate, or because I'm a black woman?"

so it takes away self respect

others know the the recipient didn't get the position on merit

and even if they did others will have doubts so they get diminished respect from others which can also negatively impact self respect

Equal Justice Argument:

o

Agrees with critics of Affirmative Action (AA)

The distribution of benefits and burdens (pay & jobs) is just only insofar as it is based on morally relevant criteria.

Criteria relevant to the just distribution of benefits and burdens (pay & jobs) are

ability effort contribution need

Sex and race are not in themselves relevant criteria

so sex based and race based distribution is unjust that's what was wrong about BOFD

Nevertheless

Since statistics show that jobs in our society are still distributed on the basis of sex and race.

there is a sex-linked and race-linked needs AA fulfills

To achieve a just distribution we need to neutralize institutional and psychological mechanisms that perpetuate unjust race based and sex based discrimination:
11

subtle racist and sexist attitudes that bias the judgment of those (usually white males) who make hiring and promotion decisions

11

lingering effects of economic and educational privation giving whites (and males) a head start

monopoly analogy: even if you're playing by the same rules . . . on a "level playing field"

if you start off behind, you don't have an equal opportunity to win

11

lack of role models that subtly discourages female and minority aspirations

AA effectively neutralizes these causes of continuing distributive injustice

11

subtle racist & sexist attitudes are counteracted by legally mandated counterpreferences

11

counteracts lingering effects of impoverishment

ultimately: by curing the underlying poverty in the interim: temporarily tilting the playing field in favor of the previously disadvantaged gives them a more equal opportunity to succeed.

11

raises up women and minority to positions of power and prestige provides role models .

Replies to the Equal Justice Argument Countered:

11

Objection: AA programs wrongfully discriminate against white males. Reply: from the definition of wrongful discrimination

it was: "to make an adverse decision against a group because members of that group are wrongly considered inferior or less worthy of respect

but that isn't the underlying motive or belief in the case of reverse preferences

it's not about disrespecting white males like BOFD was about disrespecting minorities & women

it's about giving those who aren't white males an equal opportunity to succeed.

11

So, reverse preferences are not wrongful discrimination

Preferential treatment violates the principle of equality itself

Argument

Principle: Individuals who are equal in all respects relevant to the kind of treatment in question should be treated equally.

Race & Sex are irrelevant to job allocation. Therefore, in giving race & sex weight in job allocation decisions affirmative action treats individuals equal in all relevant respects unequally.

Which is directly contrary to the principle.

Reply: race & sex at the present juncture are relevant

they are only irrelevant to productivity race & sex are relevant to achieving the social justice: an equal opportunity to succeed (EOS) for all

EOS is defensible

as an intuitively warranted principle of social justice

and on utilitarian grounds

social purpose of of maximizing overall utility depends on distribution as well as production of goods

distribution by need serves best affirmative action distributes opportunities on the basis of need

women & minorities need to have the playing field tilted in their favor if they're to have an equal opportunity to win

this need is directly related to their being women & minorities

11

Objection: AA has hidden social & psychological costs for minorities and women: it reinforces negative stereotypes about their inferiority

which further undermines their self esteem and diminishes respect of others for their accomplishments Reply:

that's for them to say: If AA is so bad for them, why do minorities overwhelmingly support these programs?

AA counteracts lingering BOFD caused biases so

conscious reverse preference just counterbalances these lingering unconscious BOF preferences

to result in selection processes that are more approximately nondiscriminatory on balance than they otherwise would be

it's actually not reverse discrimination in effect insofar as it merely counterbalances lingering BOFD

so women & minorities needn't apologize for their AA aided attainment

nor have others any just & true reasons to devalue these attainments

it's just false to say that being the beneficiary of preferential treatment diminishes an individuals self esteem

it hasn't hurt white males' self esteem any! on the contrary: people tend to believe that they deserve benefits received whatever the reason

honors & benefits make people feel good about themselves

regardless of whether they're really worthy

Velasquez's Assessment of Equal Justice Argument & Replies

o o

AA is a morally permissible means to achieve social justice AA is not morally required as means to achieve social justice.

Implementing Affirmative Action and Managing Diversity

Legitimate worries about implementation of AA

o

if race and sex are weighted very heavily this will result in assignments of tasks to unqualified people

in critical occupations (airline pilot, surgeon) where crucial human interests hang mightily in the balance weighting anything besides merit is questionable

weighting sex and race in socially important decisions makes us more race conscious and sex conscious, not less as we ought to be striving to become.

Suggested guidelines
1.

minimum levels of competency: no one to be promoted unless they come up to these levels or are capable of coming up to them in a reasonable amount of time.

2.

racial and sexual preferences should be allowed to trump slight competency differences

3.

where competency differences are more considerable a. in critical occupations: competency should trump sex based & race based preferences

if performance of the job directly affects peoples lives and safety

or has a substantial and critical effect on the entire firm's efficiency

b. in noncritical occupations: minorities & women should be given preferences.

4.

preferences should be extended to minority & women candidates only to redress underutilization in comparison to their representation (as a percentage) in the job pool in specific job nine categories (1-9)
11 11 11 11 11 11 11 11 11

officials and mangers professionals technicians sales workers office and clerical workers skilled craftworkers semiskilled operatives unskilled laborers service workers

example: women

in a corporation Y

60% of all office and technical workers 10% at all officers and managers

in the labor pool: 50% women policy recommendation under the guideline

AA should be applied in hiring for & promotion to manager

AA should not be applied in hiring for & promotion to office & technical staff positions.

Accommodation of special needs of women & minorities in the workplace an essential adjunct to AA-based preferences.
o

for women: due to their special childbearing and child rearing responsibilities

maternity & family leave policies mommy-tracking v. fast tracking: controversial

injects invidious status differences into the workplace -- a class of second class managers

unfair that women who choose motherhood should be shunted off onto the slow track (to nowhere)

flexible work schedules

minorities: due to ( 1 ) poverty linked educational disadvantages (2) cultural differences

job linked educational opportunities

to upgrade basic skills & knowledge and job related skills and knowledge

cultural sensitivity training for managers

disabled: special accessibility needs

Comparable Pay for Jobs of Comparable Worth

A radical solution to sex-based earning differentials

o

compare & contrast

AA: tries to get women into high paid positions CPCW: proposes to make the positions women already hold higher paid.

proposal: individuals should be comparably paid for doing jobs of comparable worth

regardless of the going labor market rate for the performance of that task

example: secretaries and repair technicians

jobs have the same relative value in terms of problem solving, know how, & accountability

so they should be paid the same but they're not

Implementation
o

each job rated for its compensation worthy features, e.g. required

effort: including prior educational or apprenticeship efforts required productivity accountability

fix compensation for various jobs on the basis of these ratings

higher the rating the higher the pay equally rated jobs equally paid

Justification: employees who are in all respects relevant to compensation worthiness are equal should be equally compensated.

Objections

fair market value is the most appropriate determinant of compensation worthiness

assigning salaries by assigning points to jobs

will not only be a bureaucratic nightmare but is actually more arbitrary and less objective than reliance on job market forces

women could apply for the higher paying "male" jobs if they chose to, but they don't

they choose instead to be secretaries, receptionists, PBX operators, etc., despite their lower salaries

so they must be getting other benefits: the work is cleaner, less arduous, perhaps more personally fulfilling

Reply labor market is not some objective impersonal force

"women's work" is lower paid because women predominantly do it (for historical discrimination based reasons)

not because labor market factors of supply and demand so the job market valuation is not fair & appropriate

Conclusion

Businesses have strong reasons for accommodating women and minorities in the workplace from a self interested business perspective current population trends. white males are rapidly shrinking as a percentage of the workforce
o o o

rising female employment rates immigration higher birth rates -- another correlate of poverty -- among minorities

women and minorities have to be incorporated into the workplace to meet staffing needs
o

companies that effectively meet the special needs of women and minorities will enjoy a competitive advantage in meeting staffing needs

over those who don't.

Cases for Discussion

ABC News: Should Kroger Pay Now for What Ralph's Employee Did Then?

In 1998 Kroger company acquires Ralphs, an independent chain of 450 supermarkets. At this time a sexual harassment case involving former Ralphs manager Roger Misiolek & six female employees was ongoing
o

harassment occurred when Misiolek was manager of Ralphs' Escondido store: 1995-6

harassment included unwelcome touching & suggestive, vulgar, and deprecatory speech

when the women complained to higher management management responded by transferring the women to different stores

at the trial the women showed that 80 harassment complaints had been filed against Misiolek at four different stores since

Misiolek & Ralphs

o o

Misiolek "had a history of boosting profits at the stores that he managed" Ralphs claimed they hadn't known about Misiolek's conduct until Diane Gober took her complaint directly to company headquarters in April of 1996.

Whereupon Misiolek was transferred to Mission Viejo

June 1998 verdict

o

guilt: Ralphs found liable for

"gender harassment" "failure to prevent gender harassment" "malice or oppression based on a conscious disregard for for the rights or safety of others"

penalty

compensatory damages: $550,000 each plaintiff

punitive damages: $3.325 million each each plaintiff

Subsequent developments
o

the penalty phase verdict was set aside due to the jury's reliance on knowledge of Ralphs' net worth (which they weren't supposed to have) to determine damages

o o

the guilt phase verdict, however, was upheld Misiolek continued to deny any wrongdoing

1999: demoted to working on a loading dock 2000: Ralphs' management sent him disciplinary letter and suspended him, and Misiolek subsequently quit

Retrial of the penalty phase in 2002

o o o o

jurors had available the price that Kroger had paid for Ralphs compensatory damages: $550,000 each punitive damages: $5 million each total award: $33.3 million

Retrial verdict set aside by Judge Anello who ruled

o o

the award was "grossly excessive" due to the jury's "passion and prejudice" "evidence was insufficient to support the conclusion that Misiolek was the managing agent of Ralphs, and the evidence was insufficient to support the conclusion that Ralphs approved of or ratified Misiolek's conduct"

reduction of punitive damages to 8.25 million total to be divided as follows:

Gober: $3 million Swann: $1.5 million Papiro: $1.25 million

Finton: $934,500 Lang: : $934,500 Noland: $750,000

Subsequent developments
o o o

Gober & Swann accepted the reduced damages the other four decided to contest the smaller awards at the time of publication these cases were still pending in the California court system

March 1, 2006 a California court reduced the remaining four's awards:

economic damages: $250,000 total punitive damages: 1.5 million total Source: http://www.nctimes.com/articles/2006/03/02/news/top_stories/20_56_ 173_1_06.txt

Questions for Discussion 1. Assuming that the store and district managers of Ralphs received complaints about Misiolek;s behavior starting in 1985, but that these complaints did not reach Ralphs' headquarters in Compton, do you believe that the judge is right in holding that the company as a whole should not be held responsible for his actions? Should the company be held responsible for policies that prevent complaints from reaching headquarters? 2. What sort of penalty do you believe would be appropriate for Ralphs? In your view, was the $33.3 million penalty excessive? Explain. 3. Should Kroger have to pay for events that happened before it took over the chain of supermarkets?

4. Many states (but not California) adopt federal rules that place a cap of $300,000 on punitive damages in harassment cases. Is such a cap a good idea from an ethical point of view? Explain. 5. What can a company do to make sure that a situation like Misiolek's does not occur? Why do you think Ralphs allowed Misiolek to continue managing stores? 6. What other issues do you believe this case raises or what else to you think it shows? Wall Mart's Women 1. What financial impact do you think the lawsuit could potentially have on Wal-Mart? 2. What are the major moral complaints of the women suing Wal-Mart? Do you believe these moral complaints are justified? Why? 3. What factors do you think might account for the discrepancies the Drogin report uncovered? 4. What, if anything, do you think Wal-Mart should do to correct these discrepancies? Should the company institute an "affirmative action" promotion program for female employees? If so, what should this program be like? 5. Do you think the women deserve to win their lawsuit? Why or why not? 6. What other issues do you believe this case raises or what else to you think it shows?

Chapter 8 Outline

The Individual in the Organization

Introduction

Three Cases: Two unhappy campers & one happy one

o

Assembly Line worker: unhappy camper

the labor: boring, tedious, stupefyingly repetitive, fractionated nature of his task

loss of dignity and disempowerment: has to ask to go to the bathroom lack of status: at the bottom of the corporate pyramid lack of hope for advancement: "When a man becomes a foreman, he has to forget about even being human as far as feelings are concerned."

Plant Manager: happy camper

conducts unscheduled tours & inspections of the plant

tries to keep in touch with the workforce: "always stopping to talk to foremen or even hourly fellas"

delegates assignments to supervisors & foremen: "Did you call maintenance?"

shoots trouble: "Call me on this", "Can you help me on that?" meets with the operating committee to plan operations

Conglomerate Ex-President: unhappy camper

job insecurity pressures of office politics: caught in a squeeze

"men working for you" who are "shooting for your job" "the guy your working for" who's afraid you are out to "shove him out of his job"

job pressures: one major slip-up & you're history: plus it's on your permanent record

life-style pressures off the job: fit into the mold: always be on guard

you've got to be careful when you go to corporate parties: e.g., don't drink too much

even your wife & children have to behave properly be careful who your friends are: "when I was president of this big corporation . . . [the] corporation specified who you could socialize with, and on what level."

Internal Organizational Problems

o

workers

negatives: alienation, feelings of oppression positives: camaraderie with fellow workers (you're not competitors)

middle management

estrangement

loss of camaraderie: you're no longer one of the guys you may have more in common with than you have in common with the "suits" above you.

not really one of the bigwigs

yet your job is to impose their directives even against the perceived interests of the workers below you

issues of authority: burdens of responsibility & potential for abuse

upper management

estrangement: the higher you get in the pecking order the more intense the pecking

issues of authority: burdens of responsibility & potential for abuse

Preview: Three Models of the Organization

o

The traditional "rational structure" model

duties of the employee to the firm duties of the firm to the employees

Political Structure Model

employee rights organizational politics

The Caring Organization

8.1 The Rational Organization

Velasquez's Take: Defines the Organization as

o

a structure of formal relationships

explicitly defined

openly employed

to achieve some technical or economic goal

E. H. Schein
o

a rational coordination of the efforts of a number of people

through division of labor and function and a hierarchy of authority and responsibility

for the achievement of some common explicit purpose or goal

Organizational Chart: describes the core features of the organization

o

representing the formal hierarchy of authority within the organization

who is responsible for what and to whom are they accountable

typically an organizational chart is pyramidal

"higher ups" have authority over "underlings" pyramid is wide at the bottom narrow at the top: few "chiefs" & many "indians"

three levels
o

operating layer: employees who directly produce the goods and services that constitute the essential outputs or products of the organization:

the line-workers such as the spot-welder (in the example). and their immediate supervisors: the line foremen (in the example)

middle management

direct the operating layers below them directed in turn by "higher ups"

top management

Vice Presidents Chief Executive Officer Directors

how such organizations work (supposedly)

o

general policy decisions get formulated at the top: the goals of the firm: "build a better widget"

these decisions get passed down & "amplified" through the hierarchy as commands

to the research dept.: test new materials & widget designs to marketing: survey customers widget preferences

further decisions get passed down to the operating layers

purchase 100 lbs of molybdenum, and 200 board feet of mahogany

Contractual Basis of Organization

o

Authority of higher ups and responsibilities of underlings based on contractual agreement between employees and the organization.

employees freely & knowingly agree

to accept the organization's formal authority and to undertake to pursue the organizations goals

the organization agrees, in exchange, to give the employee

payment: an agreed upon wage working conditions that enable the employee to perform the assigned tasks

Moral force of this employment contract: each party takes on a duty to keep their promises

employee has a duty obey the orders of superiors employer has a duty to

pay the employees the wages agreed on supply them with working conditions that enable them to carry out the tasks assigned them

Buttressing utilitarian consideration: organization is essential to efficiency & productivity of any enterprise

all members of the firm pursuing the corporate goal following the same plan

Focus on two reciprocal sets of obligations

o

Employees

to obey organizational superiors to pursue the organization's goals not to pursue conflicting goals

Employers

to provide employees with a fair wage and fair working conditions

8.2 The Employee's Obligations to the Firm

Main Duty: to work towards the goal of the firm

o o

obedience to superiors avoidance of activities which might be harmful to these goals, e.g.,

"white collar crime" = illegal pursuit of activities harmful to these goals

mismanagement of funds malingering, absenteeism, etc.

Law of Agency: "agents" = employees; "principals" = employers

"an agent is subject of a duty to his principal to act solely for the benefit of the principal in all matters connected with his agency"

and not for the benefit of "persons whose interests conflict with those of the principal in matters in which the agent is employed" (353)

Preview: Several ways in which an employee may fail to work towards the goal of the firm
o o o

By acting on conflicting interests Theft Abuse of privileges of one's position: e.g., insider trading

Conflicts of Interest

Definition: A conflict of interest exists when an employee or officer in in company is engaged, for the company in carrying out a task in which the employee has a private interest
o o o

possibly contrary to the interests of the company substantial enough that it reasonably might affect the employee's judgment Examples

Financial: a corporate officer involved in deciding on bids from subcontractors when he or she holds stock in one of the bidding companies

Non financial: a personnel officer involved in hiring decisions involving close relatives

Actual vs. Potential Conflicts of Interest

o

Actual: an employee actually discharges his or her duties in a way that is prejudicial to the firm out of self interest.

Example: as a personnel officer I hire my incompetent brother over other more competent candidates because I want to help out my brother

Immorality of actual conflicts of interest

employment involves accepting an implied contract to endeavor to advance the goals of the firm in performance of your duties

in trying to advance your own interests to the detriment of the firm you're violating the implied contract.

Merely Potential: an employee is has motives that might tempt him or her to act in ways prejudicial to the firm out of self interest, but doesn't

Example: as a personnel officer I hire my wonderfully qualified brother (who I want to help out) over other less competent candidates

Morality depends on how likely they are to become actual conflicts

preceding example: should I recuse myself?

How close am I to my brother? How fair-minded am I: would I have hired my brother if he hadn't been the best qualified?

yes?: then it was only by luck (no better qualified applicants) that I didn't transgress

no: then I was less culpable in not recusing myself

corporate policies meant to address uncertainties in this area

limits on interests (e.g., stock) employees are allowed to hold in supplier firms

prohibiting specified relations between employees and competitor and supplier firms

full financial disclosure requirements for key officers

Commercial Bribes and Extortion

o

commercial bribe: a consideration given or offered to an employee by a person outside the firm with the understanding that when the employee transacts business with the giver or their firm the employee will deal favorably with them

example: a supplier who offers a purchasing agent a "kick back" for placing orders with them rather than competitors

extortion: when the employee demands a consideration from an agent outside the firm as a condition for dealing favorably with them

example: purchasing agent who demands a "kick back" from suppliers as a condition for placing orders with them rather than competitors

Gifts
o

Commercial gifts: considerations given or offered to an employee by a person outside the firm with no understanding that the employee will deal favorably with them.

Moral issue: the fine line (sometimes) between a gift and a bribe

commercial gifts often given in hope of favorable treatment even some expectation by the giver of favorable in their dealings with the recipient

Factors to be considered when evaluating the morality of accepting a gift (suggested by Vincent Barry)

11

The value of the gift: is it substantial enough to influence one's decisions? (bad)

11 11

The purpose of the gift: was it intended as a kind of quasi-bribe? (bad) The circumstances of the gift

was it openly given? (good) was it given on some reasonable pretext: e.g., to celebrate some special event like X-mas? (good)

11

The position of the recipient: was the recipient in a position to advance the interests of the giver in the giver's dealings with the recipient's firm? (bad).

11 11

Accepted business practice in this area: Is it accepted practice? (good) Company policy regarding the acceptance of such gifts: Policies against it? (bad).

11

Relevant laws: Is the gift forbidden by law? (bad)

Employee Theft

Employer contracts to supply the employee only with the means to do the job and wages & benefits explicitly agreed to Appropriation of other assets of the employer is theft: taking property from its rightful owner without their consent.
o o

petty theft: small tools, office supplies, etc. at the managerial level

petty: manipulation or padding of expense accounts "white collar crime"

embezzlement & forgery fraud in the handling of trusts and receiverships

Common theft in business settings is uncontroversially immoral

Computer Theft
o

Unauthorized examination, use or copying of computer information or programs constitutes theft

information & programs are intangible property of the company taken without their consent notwithstanding

the intangibility of the property the fact that the "taking" didn't deprive them of what they possessed: if I make a copy MS-Excel off my office computer to install on my home computer it's still there on the office computer.

Discussion: What is property?

Characterization: a bundle of rights that attach to some identifiable asset

to exclusive use to decide whether and how others may use it to sell trade or give it away to modify or change it. within limits imposed by rights of others: e.g., I don't have the right to remove my car's catalytic converter & operate it in that condition

claim: unauthorized employee appropriation of computer data and programs usurps these rights

Trade Secrets
o

aka "proprietary information": example the formula for Coca Cola nature

definition: nonpublic information that

11

concerns a company's operations which, if it were to be known by competitors, would materially affect the companies ability to compete against these competitors: e.g., information concerning

activities & plans policies, records, & technologies

11

is owned by the company because it was either

developed by the company for its private use or purchased by the company for its private use

11

that the company clearly indicates that it does not want others, outside the company, to have

by security measures explicit directives & contractual agreements

limitation: skills acquired by working for a company do not count as trade secrets

skills aren't information: considered parts of the employee's person not property of the employer

controversial point: where does skill leave off and information begins

Example: I'm a research scientist working for Biotech Inc. who gets a better offer Genetic Engineering Ltd

Discussion: how do you draw the line between

what I know about Biotech's lab procedures my ability to perform those procedures

attempted corporate safeguards:

employee contract provisions:

agreement not to work for competitors for some fixed period after leaving the company

courts have generally rejected such provisions

pay offs: continued remuneration or retirement benefits offered to departing employees on the condition that they continue not to reveal proprietary information they have.

Insider Trading

Insider trading: buying or selling stock in a corporation on the basis of "inside" information about the company
o

Inside information: confidential or "proprietary" information about a company

information not available to the general public outside the company which would have a material or significant impact on the price of the company's stock

Example: CEO of Boeing Aircraft, has advance knowledge of impending award of a large government contract to Boeing

anticipates rise in value of Boeing stock as a result uses advance knowledge to buy Boeing before the price rises or tells his brother-in-law to buy & his brother-in-law buys Boeing

Dubious Morality
o

illegal: a crime for which not a few bankers, stockbrokers, and managers have been prosecuted

unethical, it's claimed, because the inside trader in effect "steals" proprietary information to gain an unjust advantage over others without this information

famously tempting: the very nature of investment is such that success depends on informational advantage

Defenses of Insider Trading

o

modulates stock prices:

market works most efficiently when corporate share prices truly reflect the assets & prospects of the corporation

insider trading sends "signals" to others about discrepancies in share prices

insiders buying signals the stock is underpriced insiders selling signals the stock is overpriced

harms no one because inside traders trade at current market values

those who buy shares from insider aren't harmed

will, no doubt regret it after the value goes down (as the insider knew it would)

but they would have bought at the stock at the same price from someone else, anyhow

those who sell to an insider aren't harmed

will, no doubt, regret it after the value goes up (as the insider knew it would)

but they would have sold the stock at the same (market) price to someone else, anyhow.

it's not true that the inside trader's advantage is unfair

nature of the stock market that some have more and better information than others

because they are (or can afford to hire) expert stock analysts

because they're well connected

inside information is just one (among many other) ways of being informationally advantaged

there is nothing unethical or unfair about having an informational advantage

Indictments of Insider Trading

o

The information the trader uses does not belong to him or her but is, essentially stolen: it's not just one way, among others, of obtaining an informational advantage: the other ways don't involve theft

Not true that insider trading is beneficial to the market and harms no one

reduces size of the market

those lacking inside information perceive the game as rigged against them, so they leave or don't enter the market

decreases market efficiency: fewer traders cause, among other things

decline in liquidity of stocks increase in the variability of stock prices increased concentration of risks

increases the costs of buying and selling stocks

on the NYSE stocks are bought through intermediaries called specialists who

buy stocks from those who want to sell hold stocks for those who want to buy them later

holding stocks bought from insiders is risky

insiders must think they'll go down

so specialists have to raise the fees they charge in order to cover these losses

Illegality: fairly settled except for the exact scope of what constitutes "inside information"
o

SEC has prosecuted many cases: according to these court decisions in these cases "insider trading" is held to consist in

trading a security while in possession of

nonpublic information that can have a material effect on the price of the security

and that was acquired, or known to have been acquired, in violation of an individual's duty to keep this information confidential

notable point: second parties can be guilty of insider trading

even if they themselves didn't wrongfully acquire the information if they were in possession of information they knew to be wrongfully acquired by someone else

8.3 The Firm's Duties to the Employee

The basic moral obligation the employer owes to the employee on the "rational structure" view are 1. to provide them with the compensation they have freely and knowingly agreed to receive in exchange for their services 2. to provide them with working conditions they have freely and knowingly agreed to accept

Main issues relate to the question of how free and knowing the worker's consent. o the fairness of the wage

the fairness of the working conditions

Wages

Dilemma: What's a fair wage?

o o

employees want higher wages employers want to minimize production costs (including labor)

for competition's sake and profit's sake

A complicated question: the fairness of wages depends on several factors

o

public supports available to workers, e.g. social security, Medicare, unemployment compensation, public education, welfare

o o

the freedom of labor markets (effects how freely the parties contract) other things: worker contribution, worker needs, competitive position of the firm

Factors to be taken into account in determining wages and salaries

1.

going rate in the industry and the area:

labor markets provide rough indicators of what's fair if we assume competitive markets are just

going rate a function of supply & demand

if the supply of workers is low and demand for their work is high employers bid wages up

if the supply of workers is high and demand for their services is low workers wages down

2.

the firm's capabilities

the higher the firm's profits the more generously it can afford to pay its workers

it's exploitative when a highly profitable firm takes advantage of cheap labor in a closed market

3.

the nature of the job: higher compensation warranted for jobs involving

greater health risks or heavier physical or emotional burdens less security job security more required training and experience or greater required effort

4.

minimum wage laws set a floor beneath which wages are both unlawful and unfair

5.

relation to other salaries: workers doing roughly similar work should receive similar salaries within the organization

6.

the fairness of the wage negotiations: relates how freely and knowingly did parties enter the contract?

absent deceit: e.g., management "cooks the books" to hide profits absent coercion: e.g., International Brotherhood of Godfathers makes management's negotiator "an offer he can't refuse"

Working Conditions: Health and Safety

Facts and Figures

o

Workplace Injuries

4,700,000 workplace injuries and 5,000 fatal on-the-job accidents/yr

10% of the workforce suffers an job related injury or illness each year

resulting in loss of over 31 million work-days annually

additionally there are "delayed occupational diseases" caused by factors in the workplace (e.g., chemical exposure) but only developing after the worker has left the workplace.

Costs of worked-related deaths & injuries in 2002

$40 billion of direct costs (medical costs and payments to workers)

$240 billion of indirect costs (lost productivity, overtime, etc.)

Workplace Hazards: a lot of workplaces are hazardous to your health

very serious hazards include

exposure to toxic chemicals, pathogens, carcinogens: radiation

less serious (but more common) hazards include

even moderately high levels of noise cause hearing loss over time

repetitive stress injuries, carpal tunnel syndrome, etc.

OSHA (the Occupational Safety and Health Administration) created by act of congress in 1970
o

Aim: "to assure as far as possible for every working man and woman in the nation safe and healthful working conditions."

Criticisms of OSHA: inadequate number of field inspectors (800) & inefficient regulation

Good results according to one poll

36% of firms surveyed had implemented safety programs as a result of OSHA

72% said OSHA had influenced their safety efforts

Trends in on the job deaths & disabling injuries 1970-2001

deaths: trended downward from 18 per 100,000 to 4 per 100,000 disabling injuries: totals rose from 2.2 million to 3.9 million

Some unavoidably risky occupation

o o

examples: race-car driver; deep-sea diver; bridge construction worker not objectionable so long as they are
11 11

fairly compensated for assuming the risks freely and knowingly accept the risks in exchange for the compensation

Problematic Cases:

workers might incur risks unknowingly in accepting the work

because they lack the time and expertise to fully research & understand the hazards of a job they accept

because the risks are unknown: e.g., asbestos mining, painting watch dials with radium paint

workers accept known risks out of desperation due to uncompetitive labor markets, e.g., coal miners in Appalachia

where no other well-paid positions are available who lack of mobility to relocate to where less risky work is available or lack of information on available alternatives

Employer Guidelines
o

general: insure that the worker is not being unfairly manipulated into accepting risks without

full knowledge

full consent due compensation

specific guidelines
11

offer wages that reflect the risk-premium prevalent in other similar but competitive labor markets

e.g., coal mine owner might compare risk-premiums paid asbestos removal workers

11

provide workers with suitable health insurance programs to protect against unknown hazards

11

research the health hazards that accompany each job and make all such information readily available to workers.

"sweatshops" and "outsourcing"

o

sweatshops: workplaces featuring poor working conditions and low wages: prevalent in developing nations where health and safety laws are lacking or ill enforced

outsourcing:

the export of labor to low-wage unsafe-workplace countries usually the work is contracted out: somebody else owns the factory and employs the workers that make Nike shoes (e.g.)

A U.S. company is responsible for working conditions in foreign factories it hires to make its products if

the company can and should do something to change working conditions at the factory

knows about these working conditions

workplace violence

1 million workers nonfatally assaulted & 600-700 killed in their workplace annually

7% of all occupational deaths are homicides, making homicide the 3rd leading cause of occupational death

70% of workplace homicides occur during robberies of taxicabs, convenience stores, etc.

13% due to angry co-workers 7% due to customers 10% due to assorted others: spouses, acquaintances, relatives, etc.

Employers have an obligation to take steps to reduce risks from workplace violence as with other risks

Working Conditions: Job Satisfaction

The Rational Structure of the Organization

o o

an ordering towards some economic or technical goal as represented by the organizational chart

vertical dimension: authority relations: horizontal dimension: division of labor

since specialization is often most efficient, organizations tend to incorporate highly specialized tasks

vertical specialization: restriction of the range of control and decision making over the activity the job involves

horizontal specialization: restricting the range of tasks & increasing the repetition

Onerousness of job specialization

As noted by Adam Smith: job specialization negatively impacts mind and body

"The man whose whole life is spent performing a few simple operations has no occasion to exert his understanding" and "generally becomes as stupid and ignorant as it is possible for a human creature to become."

"It corrupts even the activity of his body, and renders him incapable of exerting his strength with vigor and perseverance, in any other employment than that to which he has been bred."

Kornhauser's findings on auto workers

40% of auto workers suffered some sort of mental health problem only 18% could be considered to have good mental health

Sanislav Kasl: factors related to both low job satisfaction and poor mental health
11 11 11 11

lack of control over work inability to use skills and abilities highly fractionated, repetitive tasks involving few diverse operations no participation in decision making

only 24% of blue collar workers say they'd choose the same sort of work if they could start over

Problem of compensating those who do boring, tedious, and stupifyingly repetitive work for the psychological injuries it does
o

the most specialized work is the most unskilled: the fewer & more repetitive the tasks: the less skill and training required

unskilled labor (since anyone can do it} commands the lowest level of compensation

unskilled workers often have no real freedom of choice: they must accept fractionated work or not work at all

Three determinants of job satisfaction (Hackman, Oldham, Jansen, and Purdy)

o

Experienced meaningfulness: workers perceive their work to be meaningful according to some system of values they accept.

Experienced responsibility: workers believe they are accountable for the outcomes their efforts.

Knowledge of Results: workers can regularly determine whether the outcomes of their work are satisfactory.

One proposed remedy: work teams

o

giving workers greater involvement in and control over a variety of work tasks has been shown to increase productivity

vertical deepening: allowing more employee control over tasks, e. g., giving worker teams responsibility for scheduling their own work assignments, breaks, & inspection procedures

horizontal enlargement: e.g., replacing single workers performing single repetitive tasks with small teams who are jointly responsible for (a certain number of) complete assemblies

8.4 The Political Organization

The rational model is views the corporation in the abstract: a kind of idealized organization
o

an organization

hierarchy: lines of command role assignments: division of labor

for some economic or technical purpose

Real corporations and workplaces are far from this ideal

o o

more like Dilbert's workplace behaviors and situations that don't seem to fit within the orderly pattern of the rational model

personal intrigues & personality clashes arbitrary treatment by superiors

Dilbert's pointy haired boss Catbert evil director of Human Relations

o o

scrambles for career advancement. interdepartmental battles for company resources.

Political Model of the Organization: focuses on real (not just official) relations of authority
o

contrast with rational structure model

dynamic vs. static: power is constantly shifting

through power struggles & authority clashes unlike the static formal authority relations portrayed by the organizational chart

does not assume all organizational behavior is rationally ordered toward a given economic goal

alternative characterization of political model

elements

a system of competing power coalitions and formal and informal lines of influence and communication that radiate from these coalitions.

characterization of the organization in these terms

individuals seen as grouping together to form coalitions coalitions viewed as competing with each other for resources the direction or "goal" of the organization is established by the historically most powerful or dominant coalition

goals are not dictated by "rightful" authority but negotiated among more or less powerful coalitions

fundamental organization reality is power

not formal authority or contractual relations power: the ability of the individual or group

to modify the behavior of others desired ways (to take) without having to modify their own in undesired ways (without giving).

Discussion
o

formal authority, of course, is a major source of real power: the boss's say so is backed by sanctions

the foreman can make you hold it . . . or else the plant manager can make the foreman make you do it . . . or else

informal sources of power & information "may travel completely outside (even contrary to) formal lines of authority and communication."

issues connected with acquisition of informal power are not issues of contractual obligation

Principal moral issue: "What, are the moral limits to the exercise of power within an organization?"

Employee rights: What are the moral limits on the power superiors acquire & exercise over subordinates?

Office politics: What moral limits are there on the power employees acquire and exercise over each other?

8.5 Employee Rights

Similarity of Corporate Management to Government: Corporations are little Fiefdoms

o

Defining features of government or political authority 1. centralized body of decision-making officials 2. who have the power and recognized authority to enforce their decisions on subordinates 3. making decisions that determine the public distribution of social resources

of benefits: rewards of burdens: tasks

4. having a monopoly on such power.

o

All these feature also seem characteristic of corporate management: within the organization 1. top level management: a centralized body of decision-making officials 2. has the power and recognized authority to make business decisions subordinates must obey or else 3. decisions determining distribution of

status, power, perks, position, and pay and assigned tasks and responsibilities

4. and they're the only one's in the organization that have these powers

Thesis: there are moral limits to the power that corporate managers may exercise over subordinates analogous to recognized limits on governmental authority.
o

Civil rights of citizens: to speak and assemble freely; to keep and bear arms; privacy rights; etc.

parallel moral rights of employees: privacy rights, free speech rights, etc.

Disanalogies & Objections

o

Different bases of the two kinds of authority Political authority (in theory) based on the consent of the governed: a social contract

civil rights come from limited nature of citizens' consent civil rights are, in effect, negotiated limitations on the citizen consent

Corporate authority based on ownership of the business

owners have right to impose whatever conditions they choose on employees

since in accepting employment employees freely and knowingly contracted to accept owners' authority

Unions limit the power of corporate management: there is no similar countervailing power to authority of government.

Greater voluntariness of employment very hard to change citizenship

"love it or leave it" they say: but leaving is generally not that viable an option

so citizens need civil rights for protection against abuses of political authority

 much easier to change employers, so there's no comparable need for employee rights

Replies to the Objections

o

The distributed nature of corporate ownership nowadays undercuts the prerogatives of ownership ownership commonly dispersed nowadays among many stockholders managers do not simply function as the owners agents as the idealized picture painted by the rational structure view suggests so appeal to property rights is no longer sufficient to warrant absolute managerial authority

not all workers are unionized: and if managers had their way a lot fewer would be

changing jobs is sometimes nearly as hard and traumatic as changing countries: many people switch countries to keep their jobs!

Question: what specific rights are employees owed

Right to Privacy

Right to privacy, broadly speaking, is the right to be left alone. Narrowed sense for this discussion:
o o

the right not to have others pry into your private life the right to determine the type and extent of disclosure of information about yourself.

Practices, policies, and technologies threatening employee privacy

o

corporations legally entitled to monitor employee

computer use, including e-correspondence telephone conversations

polygraph testing: not admissible in courts of law but

can be legally used in some circumstances -- e.g., internal investigations of employee theft -- in most industries

in "exempt industries" can be used more widely: e.g., as part of preemployment interviewing

computerized databanks enable companies to obtain personal information about employees, even, supposedly "confidential information"

medical records credit histories criminal and arrest records

genetic testing: vast intrusive potential: e.g., could be used for screening prospective employees for genetic predispositions which might add to company health insurance costs

urine tests allow companies to screen employees for alcohol use, drug use, & tobacco use at home.

written tests, psychological inventories, and "honesty" tests pry into personal characteristics and tendencies, that employees might rather keep private, e.g., "level of honesty," sexual orientation.

Two types of privacy:

o

psychological: right to keep your thoughts to yourself

hopes & fears religious beliefs, political persuasions, etc.

Physical: right not to be physically surveiled

partly for the sake of psychological privacy: since our deeds (even our tics) can reveal our thoughts

partly valued for its own sake: intrusions on physical privacy may be objectionable in themselves

e.g., use of hidden cameras & microphones in the bathroom to protect against employee theft or malingering

Moral Importance of Privacy

o

protective functions

inhibits others from obtaining information about us that could be used to harm us

e.g., to blackmail us, to expose us to shame or ridicule, etc.

inhibits others from interfering in our plans & pursuits

because they're opposed to them or offended by them to "back-stab" us in competition for promotions, from sheer cussedness, or whatever

protects loved ones from being confronted with things they might not want to know

protects us from self incrimination & involuntarily harming our own reputations

enabling functions

enables formation of personal relations of friendship, love, and trust: intimacy involves self revelation

it presupposes individuals have private lives to share information about us that is not for everyone & activities not for public exhibition

necessary to the formation & maintenance of certain professional relations

e.g., doctor-patient & attorney-client

enables individuals to separate their professional & private personal lives

gives individuals control over their own self presentation or image

Like all rights privacy rights need to be balanced against other rights and needs

employers' needs to know the qualifications and work-experience of prospective hires

employers' rights to protect themselves against employee theft, fraud, etc.

Three elements should be considered in considering collecting of information that threatens an employee's privacy:
11 11 11

relevance of the information consent of the employee method by which the information is obtained

Relevance: the employer should limit the inquiry to what's material to the issue at hand
o

inquiry into matters unconnected with job performance is wrongful invasion of privacy

if potentially damaging information unconnected with job performance is discovered

it should be destroyed, not kept and certainly not revealed or "leaked"

in general lower-level employees warrant less scrutiny -- are entitled to a greater zone of privacy

due to the irrelevancy to their job performance {by and large) of factors like

marital problems, political affiliations, emotional characteristics

the higher up in the managerial hierarchy you go, the cloudier the issues of relevance become

top managers are called on to represent their companies to others personal characteristics -- like the above -- are potentially relevant to their performance of this representative function: personal problems might be seriously bad for business

VPs drinking problem membership in a disreputable association (the Michigan Militia)

Consent: employees must be given the opportunity to consent to or refuse investigation

o

consent often regarded as a condition of taking the job on the grounds that one is otherwise free to refuse the job

surveillance: employees should be informed of surveillance measures in effect

Method:
o o

ordinary & reasonable, e.g., normal supervisory oversight extraordinary & unreasonable:

hidden microphones & cameras, wiretaps, use of spies personality tests, polygraphs

extraordinary circumstances: extraordinary measures may be reasonable & acceptable if

11

the firm has a problem that seems to be solvable by no other means

11

the problem is serious & the firm has good reason to think the extraordinary means will solve it

11

the use of the extraordinary means is not prolonged beyond the time needed to solve the problem (apprehension of the culprits, or whatever) or beyond the time it becomes clear that the problem won't be solved by these means

11 11

all immaterial information must be disregarded and destroyed failure rates of extraordinary devices (e.g., drug tests & polygraphs) are taken into account: "information" derived from fallible sources should be verified by means not subject to the same failure rates

e.g., more expensive drug tests independent investigation of discrepancies "revealed" by liedetector tests

Freedom of Conscience

Employees may discover, in the course of doing their job, that a corporation is doing something wrong or injurious to society commonly insiders are the first to become aware of matters of potential moral concern, e.g.,
o o o o

defective products polluting practices unsafe working conditions illegal activities

Employee options
o

bring the matter to the attention of superiors who

may want to know & do something about it but also might not

other options are legally limited: if the employee goes public with the information this is just cause for termination

under law such disclosure considered a breech of the employee's duties of loyalty and confidentiality to the firm

in extreme cases employers may put the matter on the employees record & attempt to see to it that the employee is black-balled throughout the industry

Complaint: this situation in in violation of individuals right of conscience:

o o

a right individuals have to adhere to their religious and moral convictions hence not to be forced to cooperate in activities they believe to be wrong

Whistleblowing

An attempt by a member or former member of an organization to disclose wrongdoing in or by the organization. Internal vs. external
o o

internal: disclosure to superiors external: disclosure to outsiders, e.g., legal or regulative authorities, or the press

High personal costs of {external?) whistleblowing: studies show

o o o

100% who worked for private businesses were fired many reported subsequent difficulty finding work many symptoms of anxiety, stress, and other life setbacks reported

Argument against external whistleblowing

o

employee has a contractual obligation to be loyal to their employers and keep inside information confidential

external whistleblowing is a violation of that obligation

so, external whistleblowing is always wrong

Reply contractual obligations aren't unqualified:

o o

contracts that require parties to do something illegal or immoral are void. so, external whistleblowing is morally permissible or even obligatory under certain circumstances

if necessary to prevent a wrong one has a moral right to prevent, it's permissible

if necessary to prevent a wrong one has the moral duty to prevent, it's obligatory, especially if

it's specifically your duty because it falls within the sphere of your professional responsibilities

it's reasonably certain that if you don't do anything, no else one will

the wrong-doing or harm that will be prevented is very substantial.

if necessary to bring about a good that one has a moral right or a moral duty to bring about

permissible if one has the moral right obligatory if one has the moral duty, especially if

it's specifically your duty because it falls within the sphere of your professional responsibilities

it's reasonably certain that if you don't do anything, no else one will

the good that will be brought about is very substantial.

provisions limiting the moral right (and sometimes duty) to blow the whistle externally

there is clear, substantiated, and reasonably comprehensive evidence of harmful activity or wrongdoing on the part of the firm

reasonable attempts to stop the harm or wrong through internal whistleblowing have failed

it is reasonably certain that the external whistleblowing will stop the harm or right the wrong

the wrong or harm that the whistleblowing prevents is greater than the harm that the whistleblowing will cause to other parties, e. g., stockholders, superiors, and fellow employees.

Justified occurrences of external whistleblowing can be seen as indications of failures of an organizations internal communication systems.
o

a symptom of structural problems that prevented the employee from redressing the situation through internal channels.

companies should have clear policies or procedures to enable employees to voice their moral concerns outside the standard chain of command

the problem might originate with or otherwise concern your immediate superiors so that complaining to them (up the chain of command) may be pointless or even counterproductive

going over one's immediate supervisors head is generally resented by supervisors & may lead to reprisals against the employee

the absence of internal whistleblowing policies and procedures often leaves employees with no way of taking there concerns to anyone in the organization who is willing and able to do something: making their only live options

quitting external whistleblowing

Some companies provide channels and procedures to facilitate internal whistleblowing, e.g.,

by establishing a company "ethics hotline" (say an 800 number) by having a company "ethics officer"

to whom employees can report their concerns while remaining anonymous if they choose

giving authority of the ethics officer

to fully investigate allegations reports the results to higher management including, if necessary, the board of directors

subject supervisors who retaliate against (suspected) whistleblowers to discipline

The Right to Participate and Participatory Management

Workplace Democracy
o

Features of Democracies

majority rule: decisions that effect the group are made by a majority of its members

freedom of discussion: decisions are made after full free and open discussion

Features for the most part lacking in business organizations: little fiefdoms (not democracies):

one person (or small group) rule not by consent of the governed by right of ownership or appointment by ownership

Proposals for democratization of the work place a "moral imperative": 3 levels of participation
11

worker right of consultation on decisions directly affecting them

merely consultative function encourages employee input in the form of criticism & suggestions

implies right of employees to access to information relating to such decisions

11

granting workers decision making power in decisions directly affecting them, e.g.,

working hours & breaks organization of tasks and assignments

11

allowing workers to participate in major policy decisions

11 11

through consultation decision-making

Controversy:
o

Organizational democracy unpopular with management . . . especially in U. S.

Managers cite lack of employee enthusiasm & interest Ideological appeal to the difference between governmental and business authority

government authority is legitimized by consent of the governed & so should be democratic

management authority is legitimized by right of ownership & so may be authoritarian

Counter concern: business organizations are now playing a greater and greater role in our lives

which means, if our workplaces are undemocratic

democratic values, practices, and attitudes will become more and more peripheral to the actual conduct of our lives and the decisions that affect them.

Participatory Leadership Management Style

o

Management dictates more benevolently and consultatively: similar to approach 1

Various analyses (Rensis Likert): 4 management styles or "systems"

11 11 11 11

exploitative authoritative benevolent authoritative consultative participative

Evidence for claims that more participative management styles improve productivity in organizations that use them is inconclusive.

The Right to Due Process versus Employment at Will

Employment at will principle

o

unless employees are protected by explicit agreement (as with a union contract)

employers "may dismiss their employees at will . . . without being thereby guilty of legal wrong" whether

"for good cause , for no cause, or even for causes morally wrong." (461 )

Theoretical Justification: prerogatives of property ownership

o

as owner of the business the employer the right to decide who will work for the business

as nonowners employees have no right to decide how the business will be run and whom it employs

1.

Objections to "employment-at-will" principle based on a false assumption:

that employees "freely" accept employment and are "free" to find employment elsewhere

falsity of it: workers bear heavy costs of job search and going unpaid while doing so

2.

considerations of reciprocity support worker rights to fair treatment

workers generally make a conscientious effort to contribute to the firm with the implicit understanding that the firm will deal fairly and conscientiously with them in return

workers therefore have a quasi-contractual right to fair treatment based on this implicit agreement.

3.

workers have a right to be treated with respect as free persons: to nonarbitrary treatment, and not to be harmed unfairly

Waxing recognition of employee rights to "due process"

o

due process guarantees employees rights not to be treated arbitrarily, capriciously, or maliciously, in business decisions affecting them

particularly important area of application: grievance procedures

due process requires explicitly defined policies for handling employee grievances

Trotta & Gudenberg's five elements of an effective grievance procedure 1. three to five steps of appeal (depending on organization size)

2. a written account of the grievance when it goes past the first level 3. alternate routes of appeal so the employee can bypass their immediate superiors if necessary 4. a time limit at each step of the appeal to assure employee that their grievance will be dealt with in a reasonable amount of time 5. permission for employee to be accompanied by coworkers (1-2) at each interview or hearing

helps overcome fear of reprisal assures employees that the procedures are being followed and honored

Employee Rights and Plant Closings

Plant closings due to any number of factors are not always avoidable in a market economy
o

competition from other firms

with newer or better equipment: Japanese steel mills cheaper labor: U. S. Steelworker $23/hr. vs. Latin American Steelworker $2/hr

o o

product and plant obsolescence competition from more productive plants within the same firm

due to newer or better equipment cheaper labor: exportation of jobs

Employees can be seriously negatively impacted Ethical Concerns

Rights: workers rights to be treated only as they freely & knowingly consent to be treated

implies right to information about impending shutdowns that will affect them

legally recognized in other countries which require extended advance notification, including Great Britain, Germany, Sweden

Utility: harm should be borne by the party who will suffer least

the corporation or corporate owner usually has greater resources than the individual workers

the corporation should bear many of the costs of plant closure, e.g., worker transfer & worker retraining

Justice

workers and communities have made substantial contributions to the business

should be assured that companies will not abandon them by unfairly terminating

worker pension plans, health plans, & retirement plans corporate contributions to the local community

Ethical recommendations (of William Diehl)

1. 2. 3. 4.

advance notice: at least 12-18 months severance pay: l wk/yr of service health benefits extended at least 1 yr. beyond employee's date of dismissal early retirement: with full benefits for workers within 3 yrs. of their normal retirement with years of service with benefits computed as if they had worked up to that date

5.

transfer opportunities at no loss of pay with company payment of moving expenses

6. 7.

job retraining: company sponsored training & counseling employee purchase opportunity: the workers and community should be offered the chance to purchase the plant and operate it under an employee stock ownership plan (ESOP) . . . if viable

8.

phasing out local taxes over a five year period

Unions and the Right to Organize

Derivation of the right to organize: what gives us the right?

o

general right to freely associate implies a right to freely associate with fellow workers to pursue common interests

right to be treated as free and equal person implies a right to countervailing organization

"what force on earth is weaker than the feeble strength of one, but the union makes us strong"

workers need this organization to countervail the corporate might of management

Right to strike:
o

right of each worker to quit his/her job at will implies the right of all strike

so long as it violates no prior agreements: e.g., nonstrike clauses previously agreed to

and so long as does not violate the rights of others: e.g., citizens whose rights to protection & security might be violated as in strikes by firefighters & other public workers.

Recent History of Union Decline

o

1947: 35% of the workforce unionized

o o

early 1990s: down to 16% 2004: 14%

Causes of Decline
o

increases in percent of workforce comprised of white collar & female workers

at one time 75% of all unionization votes passed: used to be presently 55% of all unionization votes fail

o o

decline in public confidence in unions management opposition

legal tactics include aggressive propagandizing against unionization & lobbying for laws impeding unions

use of illegal tactics widespread

illegal interference with would-be organizers' rights reprisals against employee-organizers for attempting to exercise their right to organize

Consequences of this decline

o

increasing dependence on legislative means to protect the rights of workers: workers are increasingly dependent on governmental regulation for protections previously afforded under union contracts.

increasing appeals to the legislatures and courts

to secure legal remedies against abuses of managerial power that the countervailing powers of unions used to provide in a more flexible & negotiable way

8.6 Organizational Politics

formal power relations based on contracted relations described by the organizational chart
o o

relations of authority, deference, and responsibility that are sanctioned and overt

essential features: inscribed in contracts and job descriptions that define employee duties to the firm & recognized by law

additional features: openly employed by superiors & generally acknowledged & accepted by subordinates

informal power relations

o

lack the essential features by definition: "power tactics" are defined as the use of not-formally-sanctioned tactics to advance your aims within an organization

may also not lack the additional features

may be covertly employed & not necessarily by superiors may not be generally acknowledged or even known about

Political Tactics in Organizations

Power tactics: use of not-formally-recognized tactics to advance one's aims within an organization
o

one's aims needn't be opposed to the aims of the organization: coalescence tends to be brought about by

employees seeing that their own careers and success depends on success of the firm

bonds generated by employment -- especially over the long haul

loyalty to the firm friendship with others in the firm

can be legitimate disagreements between employees about what's best for the firm

conflicts of interest: sometimes selfishly motivated, sometimes not

Perils of power tactics: wherever power is used informally & even covertly there's increased potential for abuse
o o

by definition power exercised by power tactics is informal and the exercise frequently is covert: power tactics often the result of power struggles between individuals or factions with competing interests or agendas.

Catalogue of tactics
1. 2. 3. 4. 5. 6. 7.

blaming or attacking others controlling information: gossip a special case of this developing a base of support for one's ideas image building ingratiation (kissing up) association with the influential (schmoozing) forming power coalitions and alliances: "you scratch my back I'll scratch yours"

8.

creating obligations: "you owe me"

Attempt to boil several of these tactics down to two kinds

o o

getting control over scarce resources desired by others establishing favorable relations

The Ethics of Political Tactics

Utility: Do the tactics promote the general welfare?

o

general welfare

of society is served by efficiently functioning organizations

of organizations is impaired by employee pursuit of individual or group aims in conflict with the best interests of the firm: factionalism

immoral use of political tactics

almost surely wrong when used deliberately for ends you know to be contrary to the best interests of the firm

example: trying to undermine a rival group's research project to preserve your own research prerogatives by making deliberately unhelpful input & recommendations.

Rights: Are political means consistent with moral rights?

o o

Deceptive & manipulative tactics are generally morally wrong Because they violate individual rights to be have things done to and through them only with their knowledge & their consent

Justice Issues: Are the results of the use of the political consequences equitable?
o

Political tactics are generally morally wrong when used to bring about unfair distribution

of benefits like advancement & burdens like blame (for a failed project, say)

unjust because not based on relevant considerations

irrelevant considerations: e.g., who you know & what favors you can call in

relevant considerations: what you know, have done & can do

The Impact on Caring

o

Political tactics are morally suspect when they undermine worker bonds of friendship, respect, cooperation, & care

gossip, backbiting, backstabbing, etc. do not a caring organization make

8.7 The Caring Organization

Contrast: "rational structure" and "political" takes on the organization

o

"rational structure" approach emphasized formal relations of authority: command

political model emphasized real power relations: conflict

formal informal

"caring organization" approach emphasizes non-power relations: cooperation

friendship, respect, care

Organizations have a heart

o o

as well as a head as the rational structure model emphasizes as well as an overabundance of testosterone as the political model emphasizes

Descriptive thrust: to leave this out would be to miss an important part of the picture. Normative thrust: organizations should have more of a heart
o o

should rely more on cooperation & sharing less on compulsion & competition

Potential Competitive Benefits for Organizations

o o o

increased productivity due to reduced friction recruitment advantages: due to desirability of working conditions better customer relations: customer loyalty, repeat business, word-of-mouth recommendations

Cases for Discussion

ABC News CD-ROM: The Gap's Labor Problems

Gap, Inc. sells casual apparel

o o o o

also owns Old Navy & Banana Republic 2003 total sales: $15.85 billion 2003 profits: $1.03 billion in over 4000 stores

Almost all Gap merchandise is made by foreign companies under contract. Gaps code of ethics for these suppliers as updated in 1993
o o o o o o o o

no discrimination no use of forced or prison labor no use of children under the age of 14 provide a safe working environment pay the local industry standard or legal minimum wage: whichever is greater meet all local environmental regulations no threats or penalties against workers who try to organize unions obey all local laws

History of troubles
o

at the Taiwanese owned Mandarin International plant in El Salvador

workers paid 12 cents for assembling a turtleneck that retailed for $20 in the U.S.

workers' pay averaged 56 cents per hour harassing workers for trying to organize

hiring 15 years to work full time (though E.S. law sets limits of 18 years of age for full time work)

failing to pay overtime (though E.S. law states that overtime rates must be paid for work over 44 hrs. per week

National Labor Committee (NLC) and other human rights organizations agitation & initiatives

NLC was concerned with working conditions of foreign garment workers because U.S. garment workers have to compete with them

started a campaign highlighting the plight of foreign garment workers generated enormous negative publicity for Gap detailing various violations

young female workers being forced to undergo pregnancy tests workers being forced to work overtime without pay workers not being denied access to bathrooms use of child labor: 13 year old girls working 13 hour shifts harassment of workers trying to organize

NLC summation: Gap clothing workers everywhere were poorly paid and not unionized

Gap eventually acceded to NLC demands that it hire an independent third-party to monitor working conditions at Mandarin International plants

The Saipan Suit against Gap and 17 other retailers

brought by NGOs & and the AFL-CIO Union of Needletrades Industrial and Textile employers on behalf of 50,000 garment workers in foreign-owned Saipan factories

Saipan itself is a located in the Commonwealth of the Northern Mariana Islands (CNMI)

most U.S. labor laws -- e.g., those governing overtime pay and worker health and safety -- apply

however CNMI was exempted from federal minimum wage laws & immigration restrictions

Saipan's garment factories are all foreign owned: mainly by Asian companies

Saipan's garment workers are 91% foreign -- mostly Asian women recruited outside CNMI

The suits accusations

workers were hired under false pretenses and bound to exploitative agreements

ads promised "well-paying jobs in the U.S.A. had to pay recruitment fees of $5000 to be deducted from their paychecks

had to agree not to marry, not to participate in political or religious activities, not to marry, not to ask for salary increases, not to unionize, not to seek other employment

forced to live in "company towns" -- veritable shantytowns

overpriced at $200/month with overcrowded and unsanitary conditions

forced unpaid overtime widespread violations of U.S. health and safety laws

deceptive advertising of the clothes as "Made in the USA" which implied to consumers that the garments were made in compliance with U.S. labor laws and guidelines when

80% of consumers polled say they would pay extra for clothes made in the USA

78% say they would avoid shopping in stores whose clothes they knew to be made with sweatshop labor

Gap's response

added labor code previsions

safe and healthy working and living conditions for foreign workers are to be maintained

foreign workers must be allowed to seek other employment & to return home at will

all future contracts with Saipan factories to

require safe healthy working conditions uphold workers' rights to marry and engage in political, religious, & union activities

prohibit of recruitment fees

Other abuses elsewhere continued to surface

in Lesotho South Africa: forced overtime, below subsistence wages, harassment of union organizers

in Indonesia: harassment of workers for trying to organize in Cambodia: harassment including violence against union organizers

Gap commissions a public report to provide full details of all the problems the company faced, the companies attempts to deal with the plight or garment workers, and detailed data on conditions in all factories supplying Gap

admitted "few factories, if any, are in full compliance [with the Gap labor code] all of the time"

noted that 25-50 percent of its Central American suppliers had been cited for paying below-minimum wages

noted that 25-50 percent of its sub-Saharan African and Indian factories had workweeks longer than 60 hours

made this troubling admission" "that [union rights] abuses are difficult to discover and prove and even harder to resolve ... violations of our code's freedom of association requirement are rarely as straightforward as other issues, such as health and safety problems"

Charles Kernaghan of the NLC's reservations: "In economies that are paying poverty wages, when people have no rights and no power, what you end up monitoring are well-run prisons. Sure, factories will be cleaned up. They'll have bathrooms where the water runs. But when it comes to wages, to having a democratic voice on the shop floor, monitoring and codes of conduct are a dead end."

Questions for Discussion 1. In your view, should Gap have given in to the union's 1995 demand that it should hire a third-party independent group to monitor the Mandarin plants instead of relying on its own inspectors and the word of factory owners? Should Gap have done anything more? Explain. 2. Is a company like Gap morally responsible for the way its suppliers treat their workers? Why or why not? 3. Should companies like Gap attempt to get their suppliers to pay more than the local industry standard when it is insufficient to live on? Should they pay wages in the Third World that are equivalent to U.S. wages? Should they provide the same levels of medical benefits that are provided in the United States? The same levels of workplace safety? 4. In your view, is Gap's use of the labels "Made in the USA" or "Made in Northern Mariana Islands (USA)" deceptive? Explain.

5. In your view, and in the light of the fact that Gap's own monitors had not reported the sweatshop conditions and unpaid overtime in its Saipan factories that these were in compliance with all applicable worker health and safety laws, was it right for Gap to settle the lawsuit? Should Gap have settled the lawsuit? Explain. 6. In light of the long history of labor problems that Gap has had to contend with, what recommendation or recommendations would you make to Paul Pressler concerning what the company should now do to deal with these and future problems? Explain how your recommendations will effectively solve these problems for Gap. 7. In your judgment, how effective would you expect the release of the company's Social Responsibility Report 2004 to be? From an ethical point of view, in in light of the company's responsibilities to its various stakeholders, should the report have been released? 8. From an ethical point of view, assess Kernaghan's ending statement concerning the issue of unions. Should Gap require unions? 9. What other issues do you believe this case raises or what else to you think it shows?

Who Should Pay?

1. In your judgment, and from an ethical point of view, should Turner Construction and/or B&C Steel pay for all or part of the $2,428,000 (if part, indicate which part)? Explain your view. 2. In your judgment, and from an ethical point of view, should Elliot be held wholly or partially responsible for his injuries and left to shoulder all or part of the $2,428,000 cost of his injuries (if part, indicate which part)? Explain. 3. In your judgment, is the Colorado worker's compensation law to which Turner Construction appealed fair? Explain your view. 4. What other issues do you believe this case raises or what else to you think it shows?