Ethics in Human Resource Management

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Ethics in Human Resource Management

Myrna L. Gusdorf, MBA, SPHR 2010

Ethical Theories

Class 1

Learning Objectives


By the end of this module, students will:

>
Compare and contrast various ethical
theories.

>
Use ethical theories in the decision
-
making
process.

>
Apply ethical theories to the analysis of HR
case problems.

>
Identify various solutions to ethical case
questions.

>
Defend their recommended solutions using
the ethical theories discussed in class.

SHRM© 2010

3

Ethics Defined


A science of human choice concerned with the
basic guidelines for how one ought to live one’s
life. It answers the question, “How should I live?”



The study and philosophy of human conduct with
an emphasis on determining right and wrong.



The systematic study of general principles of right
and wrong behavior.

SHRM© 2010

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Are Ethics and Morals the Same?

>
Ethics refers to the systematic study of
general principles of right and wrong
behavior.


>
Morals and morality describe specific,
culturally transmitted standards of right and
wrong.


>
Both ethics and morality involve decisions
about right and wrong.


Johnson, (2007).



SHRM© 2010

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Deciding What’s Right and Wrong:
Philosophical Theories



Utilitarian Theory



Categorical Imperative/Principle of Rights



Distributive Justice



Ethics of Care



Aristotle’s Virtue Ethics



Ethical Relativism








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Principles of Utilitarianism

>
The action taken is ethical if it produces the
most good and the least harm for everyone
affected.

>
Judgment is based on a cost/benefit
analysis.


Some costs and benefits are difficult or impossible to
measure.

>
Focus is on the results of the action, not on
how the results are achieved.


Assumes the end justifies the means.


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Principles of the Categorical Imperative

>
Sometimes

called the Principle of Rights.

>
An action is ethical because the individual
engaging in the action has a moral right to
do so.

>
A right is an entitlement intended to protect
someone’s interests.

>
The Golden Rule:


You should engage in an action only if you agree
everyone else should do it, too.


What if the actions were reversed? You should be
willing to have the action done to you.

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Principles of the Ethics of Care


>
The morally correct action is one that
appropriately cares for the individuals
involved.

>
A person’s moral obligations are not to
follow impartial principles but rather to care
for the good of particular individuals.

>
This theory emphasizes special
relationships.


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Principles of Aristotle’s Virtue Ethics


>
The morally correct action is the one that
displays good character virtues.

>
A virtue is a character trait that manifests
itself in the actions of the individual.

>
Virtues are traits such as:



Honesty.


Fairness.


Integrity.


Loyalty.

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Principles of Ethical Relativism


>
Relativism claims there are no universal
ethical principles. Each society determines
what is morally right and wrong.

>
Because different societies have different
moral beliefs, there is no rational way to
determine if an action is morally right or
wrong.

>
Therefore, it would not make sense to
criticize any standards in a society as long
as its members conform to the standards.

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Moral Development

and Making Ethical Decisions

Class 2

Moral Development


Are individuals born with moral judgment or,
like language, does it develop over time?


How does moral reasoning develop?


Jean Piaget’s two stages of moral
development.


Lawrence Kohlberg’s six stages of moral
development.

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Kohlberg’s Six Stages of Moral Development


Stage 1:
Heteronomous

Morality

>
Obedience and punishment orientation.

>
Motivated by fear of punishment only.

>
No concern with the interests of others.

>
Doesn’t care if actions harm other people.



Stage 2: Individualism

>
Egoistic. Actions based on self
-
interest.

>
Will follow the rules if it is in own self
-
interest.

>
Motivated by incentives or fear of punishment.

>
Right is “what’s fair” or an equal exchange.

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Kohlberg’s Six Stages of Moral Development


Stage 3: Conformity and Relationships

>
Mutual relationships, desire to be a good person.

>
Approval
-
oriented, conforms to the majority.

>
Living up to what is expected by people close to you.



Stage 4: Social System and Conscience

>
Respect for authority, maintaining the social order.

>
Laws are to be upheld.

>
Values institutions and the social system as a whole.

>
Empathy for individuals with whom he/she interacts.

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Kohlberg’s Six Stages of Moral Development


Stage 5: Social Contract and Individual Rights

>
Acceptance of fundamental values and rights.

>
Willing to make personal sacrifices if sacrifice will
produce benefit for others.

>
Unlikely to engage in unethical behavior.



Stage 6: Universal Ethical Principles

>
Individual chooses to live life according to universal
moral principles; i.e., justice, human rights, respect
for individual dignity.

>
Unlikely to engage in unethical behavior.

>
Acts according to ideals regardless of the reactions
of others; the whistleblower.

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Kohlberg’s Critics


Variables in moral development:

>
Culture.

>
Gender.

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Moral Judgment and Moral Conduct

What do you think?



Is there a link between moral judgment and ethical
behavior?



Do people always behave in a way that embodies
their moral judgment?

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What Makes Moral People Behave Unethically?


Research findings:

>
The desire to conform to one’s peers.


Environmental pressures.

>
Rigid hierarchy.

>
Fear, insecurity.

>
Ambition.

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What Makes Moral People Behave

Unethically at Work?


Because ethical action takes place in a social
context, situational variables heavily influence
ethical behavior.

>
Work characteristics.

>
Organizational culture.

>
Immediate job context.


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Unethical Behavior in the Workplace


What makes people engage in unethical behavior?

>
Insecurity, fear of job loss.


Downsizing, mergers, hostile takeovers,
“rank and yank” performance evaluation
systems.

>
Psychological insecurity.


Bosses who are threatening and controlling.


Competitive environment.

>
Materialistic focus.


Focus on the bottom
-
line concerns above
values.


Bonus pay systems with earnings “at risk.”


Large pay disparities between levels.

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Making Ethical Decisions


Why are ethical decisions so difficult?

>
No one clear solution.

>
Competing interests.

>
Many unknowns.

>
Pressure
.

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A Process for Making Ethical Decisions


Recognize an ethical issue.


Get the facts.


Evaluate alternative actions.


Make a decision and test it.


Act and reflect on the outcome.







Source: Markkula Center for Applied Ethics

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Using the Principles of Ethical Theories to
Evaluate Your Options


Utilitarian

>
Which option will produce the most good and do the
least harm?


Categorical Imperative/Rights

>
Which option best respects the rights of all
stakeholders?


Distributive Justice

>
Which option produces a fair distribution of benefits
and costs for all stakeholders?


Caring

>
Which option cares for people with whom you have a
special relationship?


Virtue

>
Which option leads you to act as the sort of person
you want to be?

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Human Resource Management and
Ethical Organizations

Class 4

Ethics Compliance Programs


Written code of ethics.


Written standards of conduct.


Ethics training.


Mechanism for employees seeking advice.


Reporting network where employees can report
inappropriate behavior without fear of retaliation.


Ethical behavior as a part of the performance
appraisal system.


Discipline for violating ethical standards.


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Ethics Compliance Programs



“But we’ve been doing that …and ethical violations
are still commonplace.”



Even Enron had a code of ethics!

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Creating a Culture of Ethics


It’s not the compliance program

it’s the culture.


Management sets the tone.

>
Managers must model ethical behavior. They must
“walk the talk.”

>
Employees must trust management at all levels.

>
Employees learn appropriate behavior by what they
see managers doing.

>
The importance of ethics must be communicated at
all levels of the organization.

>
Reward ethical behavior. Assess how the job was
done, not just “making the numbers.”

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HR’s Role in Organizational Ethics


Develop policies.


Communicate with employees.


Provide training.


Handle inquiries.


Provide assistance in resolving difficult situations.

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Fostering Ethical Organizations

Strategic Management

>
Align organizational systems to support ethics.


Ethics must be an integral part of the organization’s strategy
and values.

>
Organization leaders must champion ethics.


Management sets the tone.


Leaders must demonstrate and foster integrity.

>
Champion diversity and equity across the
organization.

>
Ensure stakeholder balance that addresses
conflicting interests.

>
Focus on the long
-
term perspective.



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Fostering Ethical Organizations

Staffing: Recruitment and Selection

>
Ensure equal opportunity practices.

>
Recruit ethically responsible people.

>
Make ethics a selection criteria.

>
Interview for ethical values.


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Fostering Ethical Organizations

HR Development


Provide ethics training for all employees.


Ensure equal access to development and career
opportunities.


Performance management and employee appraisal.

>
Balanced scorecard assessment.

>
Appraise ethical behavior as well as task
accomplishment. “Hitting the numbers” is not
enough.

>
Give employees specifics on how to improve.


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Fostering Ethical Organizations

Compensation and Reward Systems

>
Decrease pay inequities.


Control executive compensation.

>
Reward group or organization success.

>
Provide incentives for cooperation.


Gainsharing.

>
Focus on intrinsic motivation.


>
Continuous learning.

>
Quality management.

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Fostering Ethical Organizations

Employee Safety and Health


Ensure safety goes beyond compliance.


Make health and safety a priority and not
just words on paper.


Provide safety training and protective
equipment.


Incorporate policies that protect employees
and the organization from risk.


Encourage open dialog and
communication.


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Fostering Ethical Organizations

Employee Relations


Full compliance with all employment and labor
regulations.


Training for all supervisory employees.


Open communication.


Equity in promotion and retrenchment
processes.


Skip
-
level interviews.


Employee grievance systems.


Whistleblower protection.


Exit

interviews.



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Fostering Ethical Organizations

Linking HR Management and
Ethical Organizations


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