Ethical Dilemma on the Case of Plant Relocation

422 Words2 Pages
Facts: • Production costs are up due to: salary/benefits increase, stringent safety regulations, environmental regulations • Profits are declining and shareholders are complaining • Company is a major employer in the US • Other companies of similar business have moved operations to overseas sites (less developed countries where labor is cheaper) Decision Situation: • Whether or not the company should keep its operations in the US considering the declining profit and stringent regulations Alternatives: Alternatives Values/Principles Consequences Keep operations in the US Employment protection for US workers Decline in profit due to costly labor and stringent regulations (e.g. environmental regulations) Shareholders are consequently complaining In the long run, business may be shut down due to high operating cost Relocate operations in overseas sites and pay prevailing wage in those countries (Mexico, Philippines, South Africa) Business/Profit Sustainability Employment Opportunities in overseas sites Lost employment for US workers Health/environmental hazard Potential labor issues due to unjust compensation (since the rates cited in the case are not the minimum wage requirements but only pertain to prevailing wage), possible child labor in the Philippines Recommendations: • Under the utilitarian approach, I would recommend for the plant relocation to overseas sites as this would practically entail business sustainability and employment opportunities elsewhere. However, we have to recognize that there are possible consequences as listed above which should be addressed accordingly to avoid problems: o Loss of employment for US workers Rights approach- They should be entitled to the proper/mandatory severance package as provided by law Care approach- It was mentioned that the US workers may find it difficult to find an

More about Ethical Dilemma on the Case of Plant Relocation

Open Document