Running Head: Project 3: Leading Ethically and Legally at Home and Abroad 1

Project 3: Leading Ethically and Legally at Home and Abroad

Joshua Beavers

University of Maryland Global Campus

MBA630 Leading in the Multicultural Global Environment

Professor Keith Diener

May 21, 2024

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Introduction

Electropic LLC, a successful website design and hosting company within Colossal

Corporation’s technology group, recently found itself in the midst of a heated internal rivalry. Two

experienced project managers, Melissa Aldredge and June Pyle, were being considered for a

promotion to senior project manager. The tension was palpable, and ultimately, June emerged as

the victor, adding a new layer of complexity to the company's dynamics.

Following the promotion announcement, Melissa reported internally that she discovered

June never completed her MBA degree. Electropic LLC’s policies require potential employees to

submit transcripts for all degrees listed on their resumes, but this was not a requirement when June

was hired ten years ago. June's promotion was not solely based on her academic qualifications but

on her outstanding performance and contribution to the company. She has consistently received

excellent performance evaluations and has contributed to increased revenue and positive press for

the company, proving that practical experience and skills are equally valuable in the field of

business management.

Upon receiving Melissa’s report, the director of human resources took immediate action.

Transcripts were requested from all employees hired before the policy change to verify their

credentials. June, however, did not respond to this request. When confronted in the director's

office, she admitted to not having her MBA degree. She explained that she was twelve credits

short of completing her degree when her father's health deteriorated, forcing her to abandon her

studies. June had initially included the incomplete MBA on her resume to enhance her job

prospects and had intended to return to school. However, her work commitments prevented her

from doing so. Over time, she had misrepresented her MBA status by including it in her email

signature and business cards. This severe offense could potentially lead to legal repercussions for

the company.
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When June was first hired as an assistant project specialist a decade ago, possessing an

MBA was not a prerequisite. However, the company revised its policy four years ago, making an

MBA a requirement for the senior project manager position. This change in requirement was

significant as it aimed to ensure that the company’s senior project managers possess the necessary

qualifications and skills. Currently, there are two senior project managers without MBAs, a result

of being hired before this requirement was implemented.

This report will explore this case's ethical and legal challenges and provide

recommendations for how human resources, as a crucial part of business operations, should

address this issue.

Ethical Analysis

There are a variety of ethical frameworks that can be used to analyze the problematic

questions that business professionals must regularly address. Some ethical issues present clear yes

or no answers, a clear right or wrong, but other ethical issues are much more difficult to address

(Badaracco’s Right vs Right Framework). In the Electropic LLC case, this is an example of an

instance where multiple ethical dilemmas arise, and there are no clear right or wrong answers.

Therefore, we will use Harvard Business School Professor Joseph Badaracco, Jr.’s “right vs. right”

framework to recommend how the Human Resources department should handle this issue.

Professor Badaracco uses a framework of four questions and three tests, intending to

resolve ethical dilemmas involving conflict yet legitimate moral values. Badaracco’s ethical

framework includes four fundamental questions that have stood the test of time, not just centuries,

but millennia, to aid in moral and ethical decision-making (Badaracco, 2002).

It is essential for these four questions to be asked together to make sound ethical decisions

when there are no clear right or wrong answers. These are powerful analytical tools but also

excellent communication devices. According to Badaracco (2002), answering these four questions
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allows organizations to say, “We worked hard on this problem. We had obligations to people with

rights. Given the kind of organization we are trying to be, we did this. It was a tough decision; not

everyone will like it, but this was the best and most practical choice in the world as it is”.

Question 1: Consequences (Utilitarianism)

In question number one, when faced with the right vs. right dilemma, you are asked to list

everyone who will win and lose and all the costs, benefits, and risks. Ultimately, you need to

choose the course of action that has the most favorable outcome and the least amount of harm

(Badaracco, 2002). This is a utilitarian ethical approach.

Option 1: Ignore the situation

In the case of Electropic LLC, by disregarding June’s false credentials, any potential

disruptions would be averted, and Electropic would still have a precious and productive employee.

However, if the resume fraud is not addressed, Melissa, who has an MBA and meets all the

requirements to be promoted to senior project manager, loses the opportunity to be considered for

the position. Another aspect to consider is the reputation of Electropic, LLC, and by extension,

Colossal. Suppose Electropic LLC continues to allow June to keep her new position in the

company. In that case, this undermines integrity and could establish a pattern of dishonesty in the

workplace, leading to a potential erosion of trust within the organization.

Option 2: Address the situation

By addressing June's false credentials, Electropic LLC upholds its commitment to

transparent and fair hiring practices, reinforcing the importance of honesty and accountability. This

action may lead to short-term discomfort and disruptions but will safeguard the company's long-

term reputation and trustworthiness, aligning with Electropic LLC's principles.

Conclusions

After considering the implications of both options, it becomes evident that addressing the
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situation, as outlined in option 2, is the ideal choice for Electropic LLC. The company

demonstrates a commitment to transparent and fair hiring practices by addressing June's false

credentials. This not only reinforces the importance of honesty and accountability within the

organization but also upholds its integrity and trustworthiness. While it may lead to short-term

discomfort and disruptions, addressing the situation safeguards the company's long-term reputation

and aligns with Electropic LLC's principles. Furthermore, taking action against resume fraud

ensures that deserving employees like Melissa, who meet all the requirements for a promotion, are

not unfairly overlooked. In the long run, addressing the situation is crucial for maintaining trust

and integrity within the organization, which are essential for sustained success and positive

employee morale.

Question 2: Rights

The second ethical question in Badaracco’s framework involves human rights. Which

groups and individuals have rights that must be respected and that cannot be violated, whatever

decision is made (Badaracco, 2002)? Electropic has a right to terminate June’s employment based

on her at-will employment and fraudulent resume behavior when she was hired by the company

and for her new position (Resume Fraud, n.d.). Electropic is also obligated to Melissa to ensure a

fair application, interview, and promotion process for the senior project management position.

Principles

Regarding Badaracco’s second question of “right vs. right,” there are four underlying

principles to consider:

- Respect for individual rights and autonomy

- Fair treatment and equal opportunity for all employees

- Upholding the integrity of the company's policies and standards

- Ensuring transparency and honesty in professional qualifications

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Conclusion

In conclusion, applying Badaracco's "right vs. right" framework to the situation at

Electropic LLC, it becomes evident that a demotion for June would be the most ethical course of

action. Considering the consequences of the decision, it is clear that allowing June to retain her

senior project manager position despite her false credentials would create a precedent that

undermines the company's commitment to ethical conduct and integrity. This could lead to a loss

of trust from both internal and external stakeholders, ultimately causing harm to the company's

reputation and potentially leading to legal repercussions. Therefore, in the context of Badaracco's

framework, the decision to demote June aligns with the principles of both integrity and overall

utility, ensuring that the best outcome with the least harm is achieved.

Question 3: Character (fundamental values and commitments)

Question number three of Badaracco’s ethical framework refers to the integrity or character

of an organization. What message is being sent about what the company stands for, about its ideals

and principles going forward (Badaracco, 2002)?

Principles

This step is based on the principle that our actions shape our character, and we should strive

to act in ways that are consistent with the kind of person we want to be. When faced with an ethical

dilemma, considering the impact of our actions on our character can help guide us toward a

decision that aligns with our values and principles.

This is challenging because, as a company, Electronic LLC cannot ignore the fact that June

lied on her resume and was falsely hired into her new role. If they were to ignore this, it

demonstrates that they do not value honesty and integrity in their employees as a company. On the

other hand, they also need to consider showing loyalty and value to exemplary employees who

contribute to the success of their company.

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Courses of Action

Applying this step to the possible courses of action in the Electropic LLC case, we can

consider the character implications of each choice. If the company were to demote June, they

would be sending a message that dishonesty is not tolerated, which could reinforce a culture of

integrity within the organization. Demotion would serve as a corrective measure while allowing

June to continue contributing to the company in a role that aligns with her qualifications and

experience. This could provide an opportunity for June to rebuild trust and demonstrate a

commitment to ethical conduct, thus aligning with the company's values and promoting a culture of

accountability and integrity. On the other hand, doing nothing could signal that dishonesty is

acceptable, potentially eroding trust and ethical standards within the company.

Conclusion

Considering the significance of character in ethical decision-making, a demotion would be

the best course of action in this scenario. Demoting June would demonstrate the company's

commitment to upholding ethical standards and send a clear message that dishonesty and

misrepresentation of qualifications are not tolerated. It would also align with the organization's

aspiration to maintain a culture of integrity and accountability. While demotion may seem harsh, it

is a necessary step to uphold the organization's character and ethical values.

Question 4: Pragmatism (What course of action is feasible)

The fourth and final ethical question in Badaracco’s framework deals with pragmatism.

“What will work in the world as it is” (Badaracco, 2002)? If one uses initiative, imagination, and

creativity, takes risks, and is willing to “shake the tree,” what practically should be done in the

situation (Badaracco, 2002)? June was hired before the requirement to disclose transcripts for her

degree on her resume, and the MBA was not a requirement for the assistant project specialist job

she was employed for ten years ago.

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Principles

Pragmatism emphasizes the practical aspects of decision-making. It focuses on the

feasibility of the chosen course of action and its compatibility with the organization's goals,

resources, and capabilities. This step requires a realistic assessment of the potential outcomes and

the organization's ability to execute the decision.

Courses of Action

In the case of Electropic LLC, applying the step of pragmatism to the possible courses of

action, such as demotion, termination, or taking no action, involves evaluating each option's

practicality and feasibility. For example:

Demotion: The feasibility of demoting June would involve assessing the impact on team

dynamics, client relationships, and June's future performance. It would also require considering the

potential legal implications and employee morale. A demotion for June is a good option for several

reasons. Firstly, a demotion would serve as an apparent consequence for her misrepresentation of

her credentials and would demonstrate to the rest of the employees that dishonesty is not tolerated

within the company. This could help in maintaining the integrity of the company's hiring and

promotion processes. Additionally, it would address the ethical and legal implications of her

actions, showing that the company takes such matters seriously. It could also be seen as a second

chance for June to rebuild her credibility within the company. By accepting the demotion and

demonstrating her commitment to honesty and integrity, she may have the opportunity to regain

the trust and respect of her colleagues and superiors over time. This could be beneficial for both

June and the company, allowing her to continue contributing positively while also upholding the

company's standards and values.

Termination: Badaracco's pragmatism emphasizes making tough decisions based on the

context and circumstances at hand. When it comes to the case of termination in the context of
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June's role, it's essential to consider Badaracco's pragmatic approach. This involves assessing the

feasibility of termination by evaluating its impact on the company, potential legal consequences,

and the availability of suitable replacements for June's role.

Take no action: Considering the practicality of taking no action would involve weighing

the long-term implications for the company, potential damage to its reputation, and the message it

sends to other employees. Other senior project managers have been “grandfathered in” without the

need for an MBA, and in all practicality, Electropic LLC could retain June as an employee and a

senior project manager. June was promoted based on her stellar performance and consistent

exemplary work, not because of her MBA.

Conclusions

According to Badaracco's pragmatism framework, the most suitable course of action for the

company in the Electropic LLC case would involve carefully considering the consequences, duties,

rights, and relationships involved in determining the appropriate response to June's

misrepresentation of her academic credentials.

Considering the pragmatic approach, the company should aim to balance moral values and

practical considerations. Taking no action may not align with the company's duty to uphold ethical

standards and could potentially undermine the trust of other employees and stakeholders. On the

other hand, immediate termination might not fully consider June's consequences, the impact on the

company's reputation, and the relationships within the organization.

A demotion could be a pragmatic approach that addresses misrepresentation while also

considering June's contributions to the company, the potential harm to the company's reputation,

and the legal and ethical duties of all employees. It allows the company to demonstrate a

commitment to upholding ethical standards while also considering the situation's practical

implications.
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Therefore, based on Badaracco's pragmatism framework, a demotion could be the most

suitable course of action for the company in this case. This approach considers the complexities of

the situation and aims to find a balanced response that considers the consequences, duties, rights,

and relationships involved.

Tests

In addition to these four questions, Badaracco suggests three tests that can be used in

everyday right-versus-wrong situations.

Newspaper Test

Test number one is the newspaper test, which refers to the best plan if it were to be

published on the newspaper's front page tomorrow. This test addresses consequences as well as

pragmatically what works best in the world as it is (Badaracco, 2002).

Electropic LLC could choose to take no action in response to June's actions. However, this

course of action may not be favorable in the public eye if June's actions are not held accountable. It

is essential to consider the potential impact on the company's reputation and public perception.

Electropic LLC could decide to terminate June's employment as a response to her actions.

While this may seem like a decisive course of action, it is crucial to weigh the potential

repercussions on employee morale, as well as the company's image, in the eyes of the public and

other stakeholders if they let an employee who has been an integral employee.

Electropic LLC could opt to demote June as a consequence of her actions. This course of

action may be viewed as a middle ground, but it is crucial to evaluate whether it effectively

addresses the situation and satisfies public expectations for accountability and transparency.

Additionally, demotion could impact June's future performance and attitude in the workplace.

Walk a Mile in My Shoes

Test number two addresses a person’s rights by asking you to walk a mile in the other
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person’s shoes or the golden rule, “do unto others as you would want done to you” (Badaracco,

2002). Using this case, it would be easy for Electropic to put itself in June’s shoes during a difficult

time in her life and understand why she misrepresented herself on her resume when she was hired

while upholding the integrity of the company.

Badaracco's "Walk in My Shoes" test encourages decision-makers to consider various

courses of action when faced with ethical dilemmas. In the context of Electropic empathizing with

June and understanding why she misrepresented herself on her resume while also maintaining the

company's integrity, three courses of action could be considered:

Understanding June's Perspective (Do Nothing): Electropic could choose to empathize

deeply with June and attempt to understand the circumstances that led her to misrepresent herself

on her resume. This course of action involves conducting open and honest conversations with June

to gain insight into her motivations and challenges.

Upholding Company Integrity (Termination): Another course of action involves prioritizing

the company's integrity and addressing June's misrepresentation through disciplinary action, such

as termination. This approach focuses on maintaining the organization's standards while also

holding employees accountable for their actions.

Finding a Balanced Resolution (Demotion): Electropic could take a middle-ground

approach by seeking a resolution that considers both June's perspective and the company's

integrity. This would involve demoting her to her previous position, while offering support and

guidance to June while also implementing measures to prevent similar misrepresentations in the

future. This course of action takes June’s well-being into account, while still upholding the

company’s standards.

Obituary Test

The final test is the obituary test, which refers to how people you respect and admire would
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feel about your decision, looking back over time. This speaks to your character or the character of

an organization (Badaracco, 2002). This may be the most crucial test in this case because

Electropic needs to evaluate how high-performing employees in their company will reflect on their

moral and ethical decision-making abilities, even if it causes short-term discomfort.

The final test is the obituary test, which refers to how people you respect and admire would

feel about your decision when looking back over time. This speaks to your character or the

character of an organization (Badaracco, 2002). This may be the most crucial test in this case

because Electropic needs to evaluate how high-performing employees in their company will reflect

on their moral and ethical decision-making abilities, even if it causes short-term discomfort.

Opting for termination would signal a zero-tolerance stance on ethical violations within the

organization. While it may be viewed as a solid deterrent to misconduct, the long-term perception

of this decision must be considered. From the perspective of the obituary test, termination could be

seen as a clear assertion of the company's commitment to upholding ethical standards, but it also

carries the risk of being perceived as unforgiving or lacking in empathy.

Choosing to do nothing in this situation might be interpreted as a failure to address ethical

breaches effectively. From the perspective of the obituary test, this inaction could be viewed as a

lack of commitment to maintaining a principled and ethical work environment. It might raise

questions about the organization's integrity and its willingness to confront complex issues.

Choosing to demote the employee would demonstrate a commitment to fairness and second

chances. It would show that the organization values the development and growth of its employees,

even in the face of ethical missteps. From the perspective of the obituary test, this decision might

be seen as reflective of a balanced and compassionate approach, with a focus on rehabilitation and

improvement.

Recommendations
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Using Badaracco’s four questions and three tests, the ethical recommendation would be for

Electropic LLC to remove June from the senior project manager role; however, instead of

terminating her, reinstating her in the project manager role she previously held. This allows for a

fair opportunity for Melissa to be considered for the senior project manager position. It is

recommended that she complete the twelve credits she has remaining to receive her MBA and then

re-apply for any open senior project management roles when she meets the appropriate

requirements. This demonstrates to Melissa and other Electropic employees that the company

values honesty, integrity, and compassion for June, an otherwise vital employee to the company.

The termination of June's employment may have a detrimental impact on the company due to her

exceptional job performance over the last few years. It is crucial to thoroughly examine both

ethical and legal ramifications in this particular scenario.

Legal Analysis

When considering this case from a legal perspective, it is essential to explore various legal

theories. One significant aspect to examine is the issue of fraud or misrepresentation. June

misrepresented her qualifications on her resume by falsely claiming to have obtained an MBA

degree when, in reality, she was twelve credits short. Although she intended to complete her

degree, she included this misinformation to secure a job and support her family. This

misrepresentation could have significant legal implications, particularly regarding her employment

and potential legal repercussions (Resume Misrepresentation, n.d.).

Resume fraud, a specific type of fraud, may lead to civil or criminal penalties, depending

on the state where the fraud occurred (Resume Fraud, n.d.). It involves intentionally

misrepresenting material facts in a resume, which is relied upon in the hiring process. Although

fraud or misrepresentation on a resume typically does not constitute illegality because resumes are

not legally binding documents, they present a clear distinction between legal and ethical
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considerations (Resume Fraud, n.d.). In the case being reviewed, pursuing legal action against

June's fraudulent resume may not be advisable for Colossal's human resources department.

Another relevant legal concept in this case is at-will employment. Employees in at-will

arrangements should be particularly aware of the implications of resume fraud, as it can provide

organizations with a justifiable basis for termination. Employment at will means an employee can

be fired for a good cause, wrong cause, or no cause at all (Muhl, 2001). In the case of Electropic,

June's admission of misrepresenting herself on her resume and being hired under false pretenses

provides legal grounds for Electropic to terminate her employment immediately, regardless of her

work performance.

Conclusions

Business ethics and law play pivotal roles in governing the operations of businesses

within the complex global business landscape. Business ethics encompass the fundamental values

that guide the behavior of both employers and employees in their day-to-day activities. It defines

the distinction between right and wrong, with ethical behavior involving the choice of what is

right. On the other hand, business law encompasses the comprehensive set of rules and

regulations that govern the conduct of businesses and individuals based on state, federal, or local

laws. Both business ethics and laws are indispensable for the successful operation of a business.

It is crucial for companies to recognize that while specific actions may be ethical, they may not

always be legal, and vice versa.

In the Electropic LLC case, there are no clear right or wrong ethical decisions. The

recommendations for human resources become more evident after Badaracco answers four basic

questions and examines the scenario using his three tests. Prioritizing business ethics, in this case,

is more important than pursuing legal action.

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In conclusion, the recommendation would be for the Human Resources department to

remove June from the senior project manager position and revert her to her previous position as

project manager. The company’s Human Resources department must ensure that the hiring

process for the senior project manager position meets all of the company’s established

requirements to ensure equity and fairness. Removing June from the senior project manager

position also establishes honesty and integrity as essential values of Electropic LLC.

From an ethical standpoint, there would be a great deal gained from retaining June as an

employee in the project manager role she previously held. This action not only shows

compassion for June but also demonstrates company loyalty and dedication to high-performing

employees. However, it is essential to consider the legal implications as well. The Human

Resources department has the right to terminate June’s employment based on her at-will

employment with Electropic LLC, and depending on state laws, it may be possible to pursue

legal recourse for resume fraud. Despite this, termination may not be the best course of action for

human resources as June is an otherwise excellent employee whose leadership has increased

earnings and positive press for Electropic over the past several years. It is also important to note

that if Electropic LLC were to file a legal claim for resume fraud and win, they would receive

nominal monetary damages, which may not be enough to cover the cost of litigation. It is a

complex situation that requires careful consideration of both ethical and legal aspects.
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References

Badaracco, Jr., J. (2002, January 1). Defining Moments: A framework for moral decisions. Harvard

Business School Faculty Seminar Series, Boston, MA. https://video-ebscohost-

com.ezproxy.umgc.edu/c/wk4xaf/details/1_v1g4qeqm?q=A%20Framework%20for

%20Moral%20Decisions&deviceId=&lang=en&minDate=&maxDate=

Badaracco’s Right vs Right Framework (n.d.). Document posted in University of Maryland

Global Campus MBA630 9042 online classroom, archived at:

https://leocontent.umgc.edu/content/umuc/tgs/mba/mba630/2211/learning-topic-

list/badaracco-s-rightvsrightframework.html?ou=541196

Muhl, C. J., (January 2001). The employment-at-will doctrine: three major exceptions. U.S.

Bureau of Labor Statistics. https://www.bls.gov/opub/mlr/2001/01/art1full.pdf

Resume Fraud (n.d.). Document posted in the University of Maryland Global Campus

MBA630 9042 online classroom, archived at:

https://leocontent.umgc.edu/content/umuc/tgs/mba/mba630/2211/learning-topic-list/

resume-fraud.html?ou=541196

Resume Misrepresentation (n.d.). Document posted in University of Maryland Global Campus

MBA630 9042 online classroom, archived at:

https://leocontent.umgc.edu/content/umuc/tgs/mba/mba630/2211/learning-resourcelist1/

resume-misrepresentations.html?ou=541196