Business Ethics, Government and Society EXAM #3
devil07
BUS_166_slides_week_13.pdf
1. Rights of employees
2. Wages and income inequality
3. Diversity and inclusion
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Rights of employees
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The employment relationship
Employees are an important market stakeholder.
• Responsible for carrying out the work of the company.
• Dependent on the employer for their livelihood.
Nature of the employment relationship conveys rights and duties on both sides.
• Right: someone is entitled to be treated a certain way; they confer duties on others.
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Good vs. bad employers
Based on your own experience as an employee:
• What are some attributes of a good employer?
• What are some attributes of a bad employer?
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Rights of employees and employers
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Rights of employees and employers
Note that the basis for some of these rights is legal, whereas other rights are social or ethical in nature.
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Legal rights of employees in the USA
Employees in the United States enjoy important legal guarantees.
They have the right to:
• Organize and bargain collectively.
• A safe and healthy workplace.
• Job security.
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Right to organize and bargain collectively
Labor unions: Organizations that represent workers on the job.
Question: What does society gain, if anything, from labor unions? Do we still need them?
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Right to organize and bargain collectively
Employees have a fundamental legal right to organize labor unions and to bargain collectively with employers.
• Workers have a right to hold an election to decide which union will represent them.
Labor unions have the right to negotiate wages, working conditions, and other terms of employment.
• Employers are required to bargain with unions in good faith.
• If agreement cannot be reached, a strike might occur.
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Right to organize and bargain collectively
Influence of labor unions has varied during periods in U.S. history:
• In 2017, the median weekly pay of full-time workers who were members of unions was 20% higher than that of nonunion workers.
• In 2017, only about 11% of all U.S. workers were union members. The percentage was higher, 34%, in government employment (7% were unionized in the private sector).
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Right to organize and bargain collectively
In the wake of the Great Recession, elected officials in several states sought to weaken unions by limiting the rights of public sector workers.
Example: In 2015, Wisconsin joined 24 other states in adopting right-to-work laws, e.g. making it illegal to require all workers to pay union dues whether they are part of the union or not.
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Right to organize and bargain collectively
Although unions overall remain weak, some groups of workers continue to organize—e.g., “Google buses” by Teamsters union.
Labor law reform, to make it easier for workers to organize, is a major legislative goal of unions.
• Shortening the time before an election (i.e., when workers decide whether to unionize and who will represent them).
• Stiffening penalties for employers who intervene unfairly in the election process.
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Union membership rates across countries
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Right to a safe and healthy workplace
Ergonomics = adapting the job to the worker, rather than forcing the worker to adapt to the job.
Annually, slightly more than 3 million workers in private industry are injured or become ill while on the job according to the U.S. Department of Labor.
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Right to a safe and healthy workplace
Occupational Safety and Health Act, passed in 1970, gives workers the legal right to a job “free from recognized hazards that are causing or likely to cause death or serious physical harm.”
• This law is administered by the Occupational Health and Safety Administration (OSHA). https://www.osha.gov
• Since the agency’s creation in 1970 the overall workplace death rate has fallen by more than two-thirds.
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Right to a secure job
Employment-at-will = the principle that workers are hired and retain their jobs solely “at the will” (i.e., at the sole discretion) of the employer.
• Several important exceptions now exist—employees cannot be terminated because of race, gender, religion, national origin, age, disability, or union activity.
In addition, many union contracts say employees can be fired only “for just cause” and workers have a right to appeal the employer’s decision through the union grievance procedure.
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Right to a secure job
Our expectations about how employers and employees should behave are also informed by cultural values, traditions, and norms.
Social contract: the implied understanding between an organization and its stakeholders. This is not a legal contract, but rather a set of shared expectations.
• A basis for determining what is fair and what is not.
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Wages and income inequality
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What constitutes a fairpay level for workers?
Who or what should determine wages?
• The free market?
• The employer acting unilaterally?
• Collective bargaining negotiations between employers and unions?
• Government mandates such as minimum wage laws?
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What can, or should, employers do about income inequality in the USA?
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Wages and income inequality
What can companies do to address income inequality?
• Increase wages of their employees. • Reduce pay differentials within their organizations.
Living wage = a wage “that enables workers, for their labor during a standard work week, to support half the basic needs of an average-sized family, based on local prices near the workplace” (Ethical Trading Initiative).
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Percentage of living wage covered by minimum wage How well does the minimum wage enable a family of two working adults with two children to sustain themselves?
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Diversity and inclusion
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The changing face of the workforce
Diversity = variation in the important human characteristics that distinguish people from one another.
• Primary dimensions: age, ethnicity, gender, mental or physical abilities, race, sexual orientation.
• Secondary dimensions: characteristics such as communication style, family status and first language.
Workforce diversity = diversity among employees of a business or organization.
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The changing face of the workforce Today, the U.S. workforce is as diverse as it ever has been:
• Immigration—By 2023, more than one in seven residents are expected to be foreign-born; they are concentrated in the U.S. West and South.
• Ethnic and racial diversity—Asians are now the fastest-growing segment of the labor force.
• Longevity—Between 2006 and 2016, the number of persons aged 65 to 74 who are still working is expected to jump 84 percent.
• Generational change—more technologically adept generation entering the workforce.
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Diversity among Silicon Valley employers
From 2016: • PBS Newshour, “How Silicon Valley is trying to fix its diversity problem” https://www.pbs.org/news hour/show/how-silicon-valley-is-tryin g-to-fix-its-diversity-problem
From 2018: • The Guardian, “Ex-Facebook manager: black staffers face discrimination and exclusion”: https://www.theguardian.com/technology /2018/nov/27/facebook-race-black-emplo yees-discrimination-accusation
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The gender and racial pay gap
Pay gap = women and persons of color on average receive lower pay than white men do.
• This gap has narrowed over the past quarter century.
• In 2013 black men still earned only slightly more than three‑quarters of white men’s pay; black women earned about 69 percent, and white women 82 percent.
• The pay gap for both Hispanic women and men declined by about 5 percent since 2000.
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The gender and racial pay gap
Median weekly earnings, in 2017, of full-time workers, as a percentage of those of white men.
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The gender and racial pay gap
Question: What explains the gender and racial pay gap? What can be done about it?
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The gender and racial pay gap
Occupational segregation = inequitable concentration of a group, such as minorities or women, in particular job categories.
• Workers of Hispanic origin, 16% of the workforce—55% of drywall installers; 50% of agricultural workers; 44% of private household cleaners.
• Women—98% of preschool and kindergarten teachers; 98% of dental hygienists.
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Breaking the glass ceiling
Although women and minorities are as competent as white men in management, they rarely attain the highest positions in corporations.
Glass ceiling = invisible barrier that exists in reaching these higher levels has been named the glass ceiling.
• Recent advances show some cracking of the ceiling.
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The gender and racial pay gap Women as a percentage of members of boards of directors in 2016.
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Breaking the glass ceiling
Reasons for the glass ceiling:
• Glass walls: fewer opportunities to move into positions that lead to the top; many women and minorities start in staff rather than line positions.
• Recruiters fill positions by word of mouth, using “old boys network.”
• Companies lack commitment to diversity.
• Too little accountability for equal employment opportunity at top management levels.
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Breaking the glass ceiling
Recent studies have shown:
• Companies with a higher proportion of women on their boards were less likely to be involved in corruption and earned higher scores for management of carbon emissions and toxic releases.
• Adding even a single woman to a board of directors improved corporate governance practices, with a particularly strong effect in traditionally male-dominated industries like mining and energy.
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Diversity and inclusion
DiversityInc is a nonprofit organization that produces an annual ranking of the Top 50 Companies for Diversity: https://www.diversityinc.com/di_top_50/
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Diversity and inclusion
What policies do employees actually want? See results from recent survey in Harvard Business Review: https://hbr.org/2019/02/survey-what-diversi ty-and-inclusion-policies-do-employees-act ually-want
• Visible role models in the leadership team (ranked 5th by women vs. 17th by men).
• Individual roadmaps for advancement (ranked 14th by employees of color vs. 28th by white men).
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Diversity and inclusion What can businesses do?
• Articulate a clear diversity mission, set quantitative objectives, and hold managers accountable.
• Spread a wide net in recruitment, to find the most diverse possible pool of qualified candidates.
• Incorporate selection techniques that diminish the opportunity for bias.
• Identify promising women and persons of color, and provide them with mentors and other kinds of support.
• Set up diversity councils to monitor the company’s goals and progress toward them.
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Diversity and inclusion Strategic advantages of managing diversity and inclusion effectively
• Having a widely diverse workforce boosts innovation, many executives believe.
• The global marketplace demands a workforce with language skills, cultural sensitivity, and awareness of national and other differences across markets.
• Companies with effective diversity programs can avoid:
• Costly lawsuits. • Damage to their corporate reputations from charges of discrimination or cultural insensitivity.
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- Rights of employees
- Wages and income inequality
- Diversity and inclusion
