Ethical Issues of Case 

Ethical Issues of Case

Laying off or elimination of workers in a company is sometimes a very painful and hard decision, especially when the company had created a family-like work atmosphere. Still, sometimes a company may be forced to (Mintz, 65). This is the case with British Airways. In as much as a company may be forced to lay off some of its workers or all of them, there are several ethical issues that it must consider during the process to avoid damaging its reputation since one day, the company may need the same workers or workers from the same place.

During the laying off process, first of all, early notification is a critical ethical issue. There is a need for the management and the stakeholders involved with offering employment to tell the workers about to be laid off that they have done their best and that they are not the blame for the termination. The information given to the employees during the termination process should be well scrutinized so that it cannot be used against the company in a wrongful termination suit (Mintz, 63). The company should discuss with their attorney or their employment experts on what to say and what not to say during the termination meeting and also to review any documents that need to be signed and how the final payment will be handled.

British Airways should also ensure that it has fulfilled all the promises it made to its workers before laying them off. It is one of the main ethical issues in today’s business world. This is achieved by reviewing all the details in the contracts that the employer signed with the employees and if any promises were anything that the company was to do for the employees before the contract was over, then the company should do it before termination of the contract (Mintz, 65). This should be done regardless of whether the company will make losses or not since it was not the fault of the employer to leave the job.

Another ethical issue is severance, and this is an ethical issue that is meant to help the people who are laid off. It is always advisable that an employer should provide a severance payment to workers that they are letting go of. This would include cash or pay for their output replacement training, which will significantly help those workers to update their resumes and job search skills (Christensen et al. 12). The whole of the severance process can be made regardless of whether the company is making losses. This shows that the company genuinely cared for the well being of its workers. The severance may include paying the employees a certain amount of money on a monthly basis until they secure another job.

The Relevant Stakeholders in the Case

Stakeholders are any individual, group of people, or the society at large that affect the operation of a business. They can either be internal or external to the business. The main stakeholders in British Airways are the government, shareholders, customers, employees, suppliers and the people from the community. To begin with, the people from the community are stakeholders that have made the existence of British Airways in Hong Kong possible (Christensen et al. 12). The ability of the people to people around the airport to peacefully coexist in harmony is what had made international customers flock in the airports. Also, the ability of the people to relate well with foreigners has much helped British Airways to be able to operate in Hong Kong.

Customers are also one of the main stakeholders of the company. They are the ones that finance everything through the monies that they pay as the air tickets. They are the ones that have determined even the laying off of the Hong Kong-based cabin crew and probably the reason why the cost went up to the extent that the company was not able to retain all the workers was that probably the customers were not satisfied. This made them look for other airline companies where their needs would be met.

The government is also another very crucial stakeholder in the company. The existence of the company or the ability of the company to operate in Hong Kong is due to the relationship that Hong Kong has with the British government (Mills, 54). Probably one of the reasons why there is a rise in operating costs of the airline in the city would be unfavorable government policies in the land. The laws and policies that the government puts in place can significantly affect the operation of the company. Such policies and rules would include increasing tax that would maybe influence the ticket prices. Increased ticket prices would eventually make the customers look for other cheaper airlines operating in the city, and this would make it uneconomical to run the airline, thus increasing the operating costs.

Proposal of Alternatives Based on the Three Major Schools of Ethics in the Babson Framework for Ethical Decision Making

There are three primary schools of ethics in the Babson framework for ethical decision making. Under each school, there can be several proposals on how to handle the situation in case one instead of only laying off the cabin crew members from Hong Kong. To begin with deontological ethics, instead of closing down the cabin crew, the company should work on its services to ensure that customers come and can pay a reasonable amount that will sustain the company (Mills, 76). This is because it is never a principle to close down the whole business in certain parts because it has not worked for a few months. This is not how the leaders should act. The company should instead maintain part of the workers and work on themselves to ensure that they can have maximum profit and minimize the cost of operation. Also, based on utilitarianism ethics, there can be an alternative of not closing off the Cabin crew in Hong Kong by the end of October. This is because such an action would pose more danger to the Hong Kong society than benefits (Ortiz, Luis & Sam, 68). Laying off of workers would mean unemployment for 85 people and this can lead to an increase in unemployment levels in the city. The best alternative here is at least to lay off a few workers and wait till the attendance rises again to employ other people.  Lastly, based on virtue ethics, the best option would be to maintain the same number of employees or just lay off a few and reduce the salaries of the remaining ones than to lay off all of them and at least reduce their prices.

Consequences

All the alternatives have their implications for the relevant stakeholders. The alternative of not laying off the workers but working on their service to have maximum profits and minimize the cost of operation will come with several negative impacts to shareholders of the company. The result of this is that the shareholders will not get as much profit as they used to get, but instead, they will get an amount that will help them to sustain their business (Ortiz, Luis & Sam, 65). The British Airways will be forced to provide their transportation services as they used to with the same number of employees, but the employees will be forced to accept a little bit lower payment compared to what they used to get aforetime. Some of them will be forced to be paid half of what they used to be paid. This will now force them to cut down their expenditure for them to be able to acclimatize with the situation.

The Most Commonly Used School in the Business World

The most commonly used school in the business world today is deontology. Several reasons make it be widely used and one of the reasons is that the ethical theory uses rules to distinguish between bad and good. Sometimes in many life situations, it gets to a point whereby a person finds it difficult to differentiate between what is wrong and what is right (Plante, Thomas & Selena, 76-80). In such a circumstance, an individual will have to refer to what rules and laws say concerning that situation. Deontology has it that all ethical actions follow universal moral laws. For instance, in a business, an individual may be in an awkward position that the only possible solution that he or she sees ahead is to lie. In such a circumstance, deontology theory that has a law ‘Don’t lie’ will be of great help. The ethic approach has also significantly helped people in the business world not to engage themselves in malpractices such as stealing and cheating because of the strong moral foundation that it has on the ground.

Another reason why the theory is mostly used is that it is straightforward to apply compared to consequentialism. The only requirement that is of great importance is the ability of the people to follow the rules and do their duty. It does not require any complicated processes. Once a person has followed all the rules, then that is all. This approach tends to fit well with our natural intuition about what is and what is not ethical. Also, deontology is among the best theories in the business field because of its ability to weigh the costs and benefits of a situation. In the business field, for one to make the right decision, there is a need to determine or to know whether the benefits that come with the decision out weight the costs (Plante, Thomas & Selena, 76). If that is the case, then one can take the decision. This is not the case with other theories like consequentialism, which mostly judges actions by their results and as a result, there is a lot of uncertainty and subjectivity because there is no set of rules to follow.