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dynamic business law essentials 3e 2016 chapter 02

Chapter 2
Business Ethics and Social Responsibility

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

Copyright © 2016 McGraw-Hill Education.  All rights reserved.

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Chapter 2 Ethical Dilemma
What is the best source for ethical business practices: The
individual employee, or the business organization itself? To
what extent should individual employees be allowed to lend
input in the creation of a code of ethics for a business
organization? In the event that an individual employee’s
ethical standards differ from his/her employer’s code of
ethics, what can/should be done to resolve those
differences?

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.


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Chapter 2 Case Hypothetical and Ethical Dilemma
As hiring coordinator for Hennessey Networking Solutions, Inc., (Hennessey) Andrea Templeton knew
that her position was of utmost importance to her company in terms of hiring candidates who were
well-qualified, and who would best contribute to the company’s overall success. On her desk was the
employment application and resume of Timothy Carraway. Andrea had just finished her interview of
Timothy, who was the last in a long line of interviewees who had applied for an entry-level information
technology (IT) position at Hennessey. Hennessey only had one (1) opening available. During
Timothy’s interview, the candidate revealed that seven (7) years ago, he had been tried and
convicted in federal court for selling a significant amount of cocaine. Timothy had also revealed the
conviction on his employment application. Timothy went to great lengths to explain to Andrea that he
sincerely regretted the indiscretions of his youth, and that he had spent the last seven (7) years of his
life “paying penance,” and reforming his life. After serving three (3) years in federal penitentiary,
Timothy had earned his bachelor’s degree in Information Technology, graduating with honors
.
Timothy’s interview had gone very well. In fact, Andrea felt that in terms of his personality and
education, he was the best “fit” for the position. Andrea was obviously concerned about Timothy’s
criminal background, but she was also concerned about the young man should he not find an
employment opportunity after graduating from college. Without a legitimate employment option,
would Timothy revert back to his “criminal ways? Does Andrea Templeton and Hennessey
Networking Solutions, Inc. have an ethical obligation to hire Timothy Carraway? Should Andrea’s
“hire” decision be based exclusively on Timothy’s qualifications for the job? Why or why not?

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Chapter 2 Case Hypothetical and Ethical Dilemma
John Harrison is the owner of Harrison Enterprises, Inc., a small metal fabrication shop
located in Poughkeepsie, New York. Andrew Jameson, an employee of Harrison
Enterprises, has approached John with a request. Andrew is the proud parent of a
newborn son, and he would like to take the next two (2) weeks off from work in order to
“bond” with his new child. John knows that Andrew does not have any accrued vacation
time (shortly before his son was born, Andrew had taken a final “two-person family” trip to
Florida with his wife, Sara). He also knows that Harrison Enterprises is not legally
required to comply with the Family and Medical Leave Act (FMLA), since the company


only has seventeen (17) employees (FMLA mandates that businesses employing more
than fifty people provide their workers with up to twelve weeks’ unpaid leave every year
for a host of specified reasons, including the birth of a child)
.
John wonders whether his company has an ethical obligation to comply with the “spirit” of
the Family and Medical Leave Act, even though he does not have a technical, legal
obligation of compliance. Advise John whether his company has such an ethical
obligation. Should John Harrison allow Andrew Jameson to take his requested two (2)
weeks of leave from work?

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Business Ethics and Social Responsibility
•Ethics: The study and practice of decisions
about what is good or right
•Business Ethics: The application of ethics to
the problems and opportunities experienced
by businesspeople
•Ethical Dilemma: A problem about what a
firm should do for which no clear, right
decision is available
•Social Responsibility of Business:
Expectations that the community imposes on
firms doing business inside its borders

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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The “WH” Process of Ethical
Decision Making: W—WHO
(Stakeholders)
•Consumers
•Owners or Investors
•Management
•Employees
•Community
•Future Generations

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Primary Values and Business Ethics
•Freedom
•Security
•Justice
•Efficiency

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Primary Values and Business
Ethics: Freedom
•To act without restriction from rules imposed
by others
•To possess the capacity or resources to act
as one wishes
•To escape the cares and demands of this
world entirely

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Primary Values and Business
Ethics: Security
•To possess a large enough supply of
goods and services to meet basic
needs
•To be safe from those wishing to
interfere with your property rights
•To achieve the psychological condition
of self-confidence such that risks are
welcome
© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Primary Values and Business Ethics:
Justice
•To receive the products of your labor
•To treat all humans identically,
regardless of race, class, gender, age,
and sexual preference
•To provide resources in proportion to
need
•To possess anything that someone
else is willing to grant you
© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Primary Values and Business Ethics:
Efficiency
•To maximize the amount of wealth in society
•To get the most from a particular output
•To minimize costs

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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The “WH” Process of Ethical
Decision Making: H—HOW
(Guidelines)
•The Golden Rule
•Public Disclosure Test
•Universalization Test

© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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Six Ways To Interpret “The Golden Rule”
•Do to others as you want them to gratify you
•Be considerate of others’ feelings as you
want them to be considerate of yours
•Treat others as persons of rational dignity
like you
•Extend brotherly or sisterly love to others, as
you would want them to do to you
•Treat others according to moral insight, as
you would have others treat you
•Do to others as God wants you to do to them
© 2013 The McGraw-Hill Companies, Inc. All rights reserved.

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