This essay will explain the three ethic models, which are the utilitarian model, moral rights model and justice model (Waddell et al. 2007, 166), the application of these ethic models pertaining to the case study, and which ethic model would be best referred to in deciding the course of action to take to solve the problem that has arisen due to the circumstances that happened due to the employers forcing minimum wage exemption of their employees. (Roberts 2013) Waddell et al. (2007, 164) suggests that ethics as how people or groups perceive decisions as right or wrong differently.
An ethical decision made according to the utilitarian model is defined by the most benefit for the most number of individuals. (Waddell et al. 2007, 166) Jardins and McCall (1985, 368) suggest that to further understand the meaning of employee rights, one would look at what both the managers and employees would goods both parties are aiming for in an employment agreement. Both parties will have differing aims and strategies to create changes or benefits from and for the company, resulting in a conflict of interest. Gill 2003, 308) For instance, managers would set a target to maximize the profits of the company and “maintain the firm’s long-term growth and stability (Jardins and McCall 1985, 368); while employees may aim to gain benefits and have a comfortable life, which is obtained by receiving at least minimum pay, or even “higher wages”. (Jardins and McCall 1985, 368) Managers have the responsibility to analyze the situation carefully, and make a decision that would benefits the highest number of stakeholders, i. . the employees. (Waddell et. Al 2007, 166) If wage rates were to be increased, the company would make lower profits. (Jardins and McCall 1985, 368) Wage increments would add to the production costs, so customers would not want to purchase the products if they become too expensive, therefore decreasing profits over time. Granting benefits could potentially “threaten long-term stability” in the long run. (Jardins and McCall 1985, 368) Suppose the manager decides to reject the employees’ requests and demand.
In which case, the company’s profits and stability will be sustained, customers are kept happy with low product costs, but the employees will barely survive on low wages, even more so if they are receiving less than minimum wage. A ethical decision made according to the moral rights model is a decision made on a basis that it preserves and conserves the basic human rights and privileges of the individuals as best as possible. (Waddell et al. 2007, 166) People are morally responsible to ensure that each other are able to have a life that is minimally good. Jeurissen 2007, 3) Stakeholders make up the organization, so it is important to know and understand their interests in the company. (Jeurissen 2007, 3) Takemura (2009, 27) stated that the United States’ delegate support that people have to respect the rights of objectors, so ensuring minimum wage is the highest priority. Dealing under the Fair Trade standards means that companies must treat its stakeholders in a fair and just manner, with employers granting its employees their workers’ rights, such as minimum wages, good safety standards, and proper housing. Fair Trade International 2013) For the protection of their rights, every worker has the right to affiliation with trade unions. (Kallstrom and Eide 1999, 489) Trade unions exist for the purpose of “maintaining or improving the conditions of their employment”. (Webb and Webb 1920, 28) Under the moral rights model, managers should take the course of action that best maintains the rights and principles of the organization’s stakeholders. (Waddell et al. 2007, 166) For instance, any course of action taken that has a great negative impact on a stakeholder would be considered unethical. Waddell et al. 2007, 166) Hence, trade unions will strive to uphold the rights of the employees, while managers cannot implement the minimum wage exemption without the consent of the workers. (Roberts 2013) Since the workers did not give their consent, they have the right to receive nothing less minimum wages. (Roberts 2013) The justice model defines decisions made that distribute both negative and positive outcomes among stakeholders in a fair and impartial manner as an ethical decision. (Waddell et al. 2007, 166)
A right is usually nothing more than a claim or demand, unless there is a tool that enables the implementation of the right or is built into the “institutional structure”. (Halstead and Pike 2006, 29) Rights have been constituted as the best way to maintaining the “just resolution of conflict and general human well-being”, and is recognized by the law. (Halstead and Pike 2006, 29) The right to minimum wages is a socio-economic right. (Jeurissen 2007, 3) Jeurissen (2007, 3) stated that rights are requisite when it comes to individuals cooperating within in a corporate organization.
There are several examples of socio-economic rights, such as “legislation and collective labour agreements”, a category of rights in which the right to minimum wage is included. Every individual is able to exercise their rights, as resolution by the law. (Opsahl and Dimitrijevic 1999, 633) The resolution was made so that rights could be recognized and respected, in order for justice to be possible, should any of these rights be violated or disrespected by the relevant authorities. (Opsahl and Dimitrijevic 1999, 633) Rights should not be restricted in order to have social equilibrium within an organization. Opsahl and Dimitrijevic 1999, 634) Furthermore, “a justice approach to the minimum wage would enable us to consider our values”. (Levin-Waldman 2000, 43) A manager referring to the justice ethic model should consider that rights are recognized by the law, and therefore should abide by the law by respecting the employees’ rights; otherwise the governmental authorities would have to take action on the manager. Based on the analysis of all three ethic models, the best ethic model to apply to the case study is as per the thesis statement, which is the moral rights ethic model.
The workers of the Nike factories in Indonesia should be allowed their minimum wage. As stated earlier, minimum wages are a fundamental right of an individual. The activist Jim Keady also stated that forcing minimum wage exemption on workers is a “clear violation of Nike’s code of conduct. ” (Roberts 2013) Also, the workers should be able to enjoy at least minimum comfortable living conditions, as well as be protected from harsh treatment in the workplace. The manager of Nike should recognize and respect the rights of the workers and not force the exemption of minimum wage upon them.
The management could perceive the company to lose some of its customers, and potentially be at a financial loss in the long-run. On the other hand, the trade unions and activists are satisfied that their principles and values are being upheld, and the workers’ rights are protected. Indeed, Employees should be treated fairly and their rights should be upheld. People are morally responsible to ensure that each other are able to have a life that is minimally good. (Jeurissen 2007, 3) Stakeholders make up the organization, so it is important to know and understand their interests in the company. Jeurissen 2007, 3) In which case, the workers can be considered important stakeholders in the organization, so it is unethical to enforce a minimum wage exemption against their will. Should the manager be proven guilty of forcing employees to sign a contract implementing the exemption of minimum wages, he or she should question their values as to whether or not their actions adhere to Nike’s claims that they “care about the welfare of their workers” and “want to see them have decent lives”. In short, the manager should respect the employees’ right to minimum wage. Reference List
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