NAME: KHUSHI HAMIRANI & SHUBHAM MOHITE

ROLL NO: 16 & 34

CLASS: SY BBA (IB)
SUBJECT: BUSINESS ETHICS

Examine following situations, decide whether actions in them are ethical or unethical and
justify your decision:

1) Faced with stiff competition from cheap, imported goods, a business reduces its staff
by 50%. Arun, its 50 year old accountant is unable to get any other job and runs
into financial trouble.

The action of reducing the staff by 50% to cope with competition from cheap imported
goods could be considered as a business decision that may be viewed as necessary for the
survival of the company. However, the impact of this decision on the lives of the
employees who lost their jobs must also be taken into account.

In the case of Arun, it is unethical for the business to terminate his employment without
offering adequate support or compensation, especially considering his age and difficulty in
finding new employment. The business should have provided assistance in finding new
employment or provided a reasonable severance package to help Arun manage his
finances until he can find a new job.

Therefore, the action of reducing staff without adequate support for those who lost their
jobs can be considered unethical, and in the case of Arun, the business acted unethically
by not providing any assistance or compensation to him.
2) Newspapers report that battery chargers for mobile phones are overheating and
some have exploded. The mobile phone company decides to recall the entire batch
from the market.

The action taken by the mobile phone company to recall the entire batch of battery
chargers from the market is ethical. The company's decision is driven by concerns about
the safety of its customers, which is a crucial ethical consideration. By recalling the
chargers, the company is taking responsibility for the potential harm that could be caused
by the overheating and exploding chargers.

The company's decision to recall the chargers also shows that it values the well-being of
its customers more than the potential profits it could make by continuing to sell the faulty
chargers. This is an ethical approach that prioritizes customer safety and satisfaction over
financial gain.

Furthermore, it is the responsibility of the mobile phone company to ensure that its
products are safe for use. If the company is aware of a defect in its product that could
harm customers, it is obligated to take immediate action to rectify the situation. Failure to
do so would be unethical and could result in legal liability and reputational damage.

In conclusion, the mobile phone company's decision to recall the entire batch of battery
chargers from the market is ethical and demonstrates a commitment to customer safety
and satisfaction.
3) Erection of a new factory building is going on. A construction worker falls down and
is injured. The factory maintains that the worker was a contractor’s man, not on
factory pay-roll and so it is not liable to pay compensation.

In the following case the actions can be ethical or unethical because a factory owner who
hires an independent contractor is generally not liable for injuries sustained by that
contractor’s employees in performing their work, as long as the risks are disclosed and/or
clearly incidental to the work. However, there are some exceptions to this rule, such as
when the factory owner actively participates in or exercises direct control over the work
or when the work involves an inherently dangerous activity.

In addition, there is another law that may be relevant to construction workers in India: The
Building and Other Construction Workers Act, 1996. This is a social welfare legislation
that aims to benefit workers engaged in building and construction activities across India.

The Act provides for registration of workers, welfare boards, excess funds, safety and
health measures, and other benefits for construction workers. Therefore, based on these
sources, it seems that the factory may or may not be liable to pay compensation to the
injured construction worker depending on various factors.

In conclusion, the factory's refusal to pay compensation to the injured construction worker
is unethical. The factory had a moral and ethical responsibility to ensure the worker's
safety and should take responsibility for any injuries that occurred on its premises during
the construction process, regardless of whether the worker was on the payroll or not.
4) As per Factories Act, any employee who is in continuous employment for 240 days
or more, becomes permanent. A business gives termination notice to new workers on
the 239th day of their work.

The Factories Act is a legal framework that sets minimum standards for workplace
conditions and employee rights. It provides job security to workers who have completed
240 days of continuous employment by making them permanent. By terminating workers
on the 239th day of their work, the business is exploiting a legal loophole to avoid
fulfilling their legal obligations to provide job security to employees who have completed
the required period of continuous service. The business's actions can be seen as an attempt
to evade their legal responsibility to provide job security to their employees, which is
unethical. These actions also violate the trust that the employees have placed in the
company and may cause them to feel undervalued, leading to a negative impact on
employee morale and motivation.

Therefore, it is important for businesses to follow the legal requirements and ethical
principles when dealing with their employees. Companies must provide job security to
their employees who have completed the required period of continuous employment and
must not engage in unethical practices that exploit legal loopholes to evade their
responsibilities towards their employees.

Overall, the action of terminating workers on the 239th day of their work to avoid
granting them permanent status is unethical and can lead to negative consequences such as
decreased morale among employees, loss of productivity, and damage to the company's
reputation. Instead, employers should focus on treating their employees fairly and with
respect, and providing them with the job security and benefits they are entitled to under
the law.
5) An employee of a company uses office stationery for personal use. When his boss
gently points it out, he says that the amount is small and he contributes much
greater value to the company.

Using office stationery for personal use is generally considered unethical, as it amounts to
stealing company resources. It's the employer's property, and the employee is only
authorized to use it for work purposes.

The employee's response, however, makes the situation even more problematic. By
suggesting that his personal use of the stationery is insignificant in comparison to his
contributions to the company, he's essentially attempting to justify his unethical behavior.
This type of rationalization may indicate a disregard for the company's policies and a
sense of entitlement to company resources.

Therefore, the employee's actions can be considered unethical, and his justification is not
valid. It's important for employees to respect company property and resources and to
follow policies and guidelines, even if they believe their contributions to the company
outweigh any potential harm caused by their actions. The boss should take further steps to
ensure the employee understands the importance of ethical behavior and to prevent such
incidents from occurring in the future.

6) A chemical company discharges its effluents in a nearby river stream. Flora, Tauna
and Marine life are affected, fishermen lose their livelihood. The company maintains
that it is not liable to compensate them.

The actions of the chemical company are unethical. Discharging harmful effluents into a
nearby river stream is an irresponsible and reckless act that poses significant risks to the
environment and people's health. The fact that the flora, fauna, and marine life are
affected, and fishermen lose their livelihood is evidence of the severe harm caused by the
company's actions.
The company's refusal to compensate those affected by its activities further compounds
the unethical nature of its actions. The company has a responsibility to ensure that its
operations do not harm the environment and the people living in the surrounding areas.
When such harm occurs, the company must take responsibility and compensate those
affected appropriately.

Therefore, it is crucial for the chemical company to take responsibility for its actions and
compensate those who have been affected. This compensation should take into account
the harm done to the environment, the livelihoods of those affected, and the potential
long-term impacts of the company's actions. It is the ethical responsibility of companies to
ensure that their activities do not cause harm, and when they do, they must take
responsibility and make amends.