you are the manager of a company that has been worst affected by the lockdown due to covid19 pandemic all the businesses of the company have been halted and there is no source of revenue generation in the company during the lockdown due to this the

Question

You are the manager of a company that has been worst affected by the lockdown due to Covid-19 pandemic. All the businesses of the company have been halted and there is no source of revenue generation in the company during the lockdown. Due to this, the company will not be able to sustain for long and pay full salaries to all of its employees. Moreover, the government plans to extend the lockdown period in order to tackle the spread of the infectious disease.

As a manager, you have to decide on cutting down the salaries of the workers and lay off some of them in order to keep the company running. However, your decision will leave many poor workers without any source of income.

a. Identify the ethical dilemmas involved in the case.

b. What are the possible courses of actions available to you? Which one do you think will be the most appropriate step that can be taken and why?

Melissa Berg · Answer

a. Ethical Dilemmas

Employee Well-being vs. Company Survival:
- On one hand, you need to ensure the company’s survival to provide future employment opportunities.
- On the other hand, cutting salaries or laying off workers adversely affects their immediate livelihood, especially during a pandemic.
Equity and Fairness:
- Deciding who gets laid off or whose salary gets cut can raise issues of fairness and equity among employees. Some might feel unjustly targeted.
Transparency:
- Balancing between being transparent with employees about the company's financial struggles while avoiding panic and demoralization.
Social Responsibility:
- The company has a social responsibility towards its employees and their families' well-being vs. fulfilling its business obligations and long-term sustainability.

b. Possible Courses of Action and Recommended Approach

Salary Cuts Across the Board:
- Implementing a temporary, uniform salary reduction for all employees might prevent layoffs but could be deemed unfair by higher earners.
Tiered Salary Reductions:
- Differential cuts based on salary levels, where higher earners have a larger percentage cut, safeguarding lower-income employees to some extent.
Voluntary Leave or Reduced Hours:
- Offering voluntary unpaid leave, reduced working hours, or job sharing to spread the impact across the company and avoid layoffs.
Layoffs:
- Letting go of some employees, which may be necessary if finances are critically strained, but it must be done with careful consideration of who gets laid off.
Government Assistance Programs:
- Exploring any government relief or wage subsidy programs available to support companies affected by the pandemic.
Employee Loans or Advances:
- Offering loans or salary advances to employees in dire need to tide them over during this period, which can be repaid gradually once the situation improves.
Transparent Communication:
- Clearly communicating the financial situation of the company, the need for drastic measures, and the steps being taken to ensure the long-term survival of the company.

Recommended Approach

Combination Approach:

Tiered Salary Reductions:
- Implement a tiered salary reduction where higher earning employees experience larger cuts. This respects equity by protecting lower-income workers.
Voluntary Programs:
- Offer voluntary unpaid leave or reduced hours to minimize the number of employees needing to be laid off.
Utilize Government Programs:
- Aggressively pursue government relief programs to supplement wages and support the business.
Transparent Communication:
- Maintain clear and honest communication with employees about the company's financial challenges and the rationale behind every decision made. Encourage feedback and be open to suggestions from employees.

This combination ensures a balanced approach that considers fairness and the company’s longevity while addressing immediate financial challenges. Such transparent and inclusive strategies can help maintain the trust and morale of employees during these tough times.

Questions

Answers :

Your Answer

Reply as a guest

Try Now AI powered Content Automation