Project 3: Icelandic Freeze In The Third Assignment ✓ Solved

Project 3: Icelandic Freeze In the third assignment, you have

In the third assignment, you have the opportunity to gain an understanding of the ethical practices in a business related to wages. You will research and identify the ethical issue presented in the case scenario, identify the ethical dilemma associated with the presented case scenario and assess the scenario in terms of ethical relativism and moral universalism.

Read the Case Scenario:

Josh Garrett is Head of Packaging and Distribution at Biotech Health and Life Products (Biotech). Josh is in charge of all the branches the company has throughout the world. Josh has been reviewing cost reports for the different branches. He is concerned with some of the results. His main concern is with the rising costs of unskilled labor at the Germany branch. Many of the employees in the Packaging Department are classified as unskilled laborers making minimum wage. Josh decided to research the matter further and found that the current US federal minimum wage is $7.25 per hour, which has not changed since 2009. Interestingly, the German government recently raised its minimum hourly wage by 4% to 8.84 euros per hour ($9.79 – USD). This information weighs heavily on Josh since another raise would be costly for the company.

Additionally, the shipping crisis of 2016 has caused distribution costs between Europe and North America to rise considerably. Josh, who loves Iceland, considers relocating the majority of the Packaging and Distribution Department from Germany to Iceland, where production and distribution costs would be lower. He believes that by moving operations to Iceland, he could create jobs in one of Europe’s poorest countries while also reducing the overall costs for Biotech. However, this proposed relocation has raised ethical concerns among workers regarding Josh's employment practices.

Assume Josh’s employment practices are unethical.

• Explain the meaning of an ethical issue.
• Identify and explain the ethical issue in the case scenario using course material to support the reasoning and conclusions made.
• Identify the one non-ethical issue in the case scenario. Explain why.
• Identify and explain the ethical dilemma. Use course material to support the reasoning and conclusions made.
• Define ethical relativism and moral universalism.
• Does this case scenario illustrate ethical relativism or moral universalism? Explain why or why not.

Paper For Above Instructions

In the realm of business, ethical practices serve as the foundation for responsible decision-making, impacting both organizational success and societal welfare. The ethical issue presented in the Biotech case scenario revolves around the employment practices of Josh Garrett, who strategically seeks to minimize labor costs by relocating operations to Iceland, with a focus on hiring younger workers. This scenario raises significant ethical concerns regarding fair compensation, job security, and the exploitation of vulnerable populations.

The primary ethical issue can be articulated as the exploitation of young workers under the guise of job creation and economic assistance. Given that labor standards and compensation vary globally, Josh's decision to relocate and creatively hire young workers, whom he believes can be negotiated down to lower wages, creates a scenario that exploits socio-economic disparities. The ethical implications ensue as this strategy undermines the essence of fair labor practices, effectively prioritizing corporate profitability over the welfare of employees.

Moreover, a notable non-ethical issue in this case relates to the company’s objective of reducing operational costs through geographical transition. Unlike ethical concerns, this financial strategy focuses solely on profit maximization without a moral conflict. While financial sustainability is essential for any business, differentiating between profit-driven decisions and those that consider ethical ramifications represents the fundamental challenge in this case.

Identifying the ethical dilemma arises from Josh's position, where he must balance business profitability against the ethical treatment of employees. This dilemma encompasses several layers of decision-making, including potential backlash from the affected workforce. The direct conflict involves whether cutting labor costs to facilitate business expansion is justifiable, despite the evident adverse impact on employees' job security and rights. Consequently, discussions surrounding ethical relativism and moral universalism arise.

Ethical relativism refers to the concept that moral standards are defined by cultural context and societal norms, suggesting that actions deemed unethical in one culture may not hold the same weight in another. In contrast, moral universalism posits that certain ethical principles are universally applicable, regardless of location or cultural differences. In evaluating the Biotech situation, ethical relativism may be evident, as Josh’s decisions are influenced by Iceland’s unique economic landscape and labor market conditions. However, the core of the ethical issue here underscores a fundamental breach of universally accepted labor rights, which would categorize the scenario as emblematic of moral universalism.

The case accentuates the complex interplay between ethics and business strategies in a globalized world. Josh's intentions, while perhaps rooted in the best interests of corporate health and youth employment, inadvertently reflect a broader systemic issue concerning the ethical treatment of workers. As corporations consider relocation for cost-saving measures, they must also grapple with the moral implications of their operational decisions.

Furthermore, it is essential to assess the labor market competitively. It is ethically questionable for Josh to exploit economic vulnerabilities in Iceland to reduce labor costs, particularly when juxtaposed against fair labor practices in other regions. This ethical malaise invites scrutiny and potential backlash from workers who contend that they are unjustly treated compared to their counterparts elsewhere, leading to an escalatory response, including demands for fair pay and job security.

In conclusion, the ethical issue surrounding Josh Garrett’s decision-making at Biotech Health and Life Products emphasizes the need for a conscientious approach to global business practices. Understanding the dynamics of ethical relativism and moral universalism is pivotal for ensuring that corporate strategies do not transgress established ethical boundaries. By fostering a culture of ethical responsibility, organizations can maintain integrity while pursuing their business goals, ultimately supporting both their workforce and the communities in which they operate.

References

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• Boatright, J. R. (2011). Ethics and the conduct of business. Pearson College Division.
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• Ciulla, J. B. (2004). Ethics, the heart of leadership. Westport, CT: Praeger.
• Nash, L. (1993). Good intentions aside: A manager’s guide to resolving ethical dilemmas. Harvard Business Review Press.
• Hursthouse, R. (1999). Virtue ethics for beginners. Philosophy 76: 40-66.
• Garriga, E., & Mele, D. (2004). Corporate social responsibility theories: Mapping the territory. Journal of Business Ethics, 53(1-2), 51-71.
• Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford University Press.
• Miller, D. (2014). Ethics in business: A global perspective. Routledge.
• Lindsay, J. (2003). The conceptualization of ethical dilemmas in business. Journal of Business Ethics, 44(3), 217-230.