It seems unavoidable these days that it is all about dot com or tech company going through downsizing or layoff due to economy hard times, evolving business climate, product profitability and operation cost decision. Although corporate downsizing is an existing and accepted management tool but the morality is still in doubt. Sadly, most of the time it is unclear at the worker level why he or she is being terminated at an already profitable business.
All forms of downsizing are unethical and there is no evidence shows that there is real upside to the company after eliminating the employee in terms of profit increase. In any case, the affects can be serious for the company business itself and employee. How a company treats immorally downsized employee has in impact to the company itself: It hurts business’s reputation and affects business partner’s confident of whether their financial support is warranted.
If downsized or doing layoffs are used repeatedly without a thoughtful strategy, it can destroy an organization’s effectiveness in terms of employee’s morale, Regardless of the severance pay for downsized employee, company usually executed with a brisk, compassionless efficiency that leaves laid-off employee angry Surviving employees feeling helpless and demotivated which produces a work environment of withdrawal, risk-averse decisions, severely impaired morale and excessive blaming Often the lack of advance notice about downsizing would also increase mistrust of management among surviving workers.
Trust is base on mutual respect and by not giving employees information on the downsizing would create disrespect of each other in the company. Many managers believe that after a layoff, the less said about it is the better. The more the company tries to hide this discussion and act as if nothing has happened, the more subversive the discussion becomes. In all case of downsizing, the corporation has ethical obligation to its people and here are some of the principles: Help employees to keep themselves employ and be competitive in the market : Ex.
Nokia Bridge Incubator Program, to help those departing employees with financing of up to US185,000 to pursue new startups. Provide reasonable transition assistance – Ex: provide departing employee a one month period to look for internal transfer where they could still leverage their skill sets within the company Create a philosophy of open communication and transparency during a layoff. Business owner also need to show remaining employees that they have a plan to turn things around. Ex.
Communicate to the public and company staffs of what are the criteria for the decision making: job performance, seniority, job location and function. For employees who survived layoff, management should try to balance the workload due to fewer people and also think about how to streamline the work. Also, have a discussion with remaining staff to discuss the change and to receive constructive advices. Finally, HR, ethics and compliance functions should work closely together. They have to be absolutely interrelated. Employees only want to work in an organization that values and appreciates the management team and treat people fairly.
Personally, I think the most important elements a business ethical person should comprises of – respect, dignity, consistency and transparency. Reference Materials: Nokia Bridge: Nokia’s Incubator Gives Departing Employees €25k And More To Pursue Ideas That Nokia Has Not http://techcrunch. com/2012/07/10/nokia-bridge-nokias-incubator-gives-departing-employees-e25k-and-more-to-pursue-ideas-that-nokia-has-not/ Good Ethics is Good Business http://www. halfcostproducts. com/good_ethics_is_good_business. htm Ethics During Difficult Financial Times http://www. ethics. org/ethics-today/0909/interview. html