Business ethics and corporate

social responsibility
ethics in human resource
management
 Introduction
• Ethics ????
• Ethics are considered the moral standards by which people judge behavior.
• Ethics are often summed up in what is considered the “golden rule”—do
unto others as you would have them do unto.

• Hrm????
• "The Process of analyzing and managing an organizations human
resources needs to ensure satisfaction of its strategic objectives”
 Ethics in human resource
management
 large area of human relations management is concerned with various
ethical issues, both on the part of upper–level management in its business
decisions and lower–level management in the treatment of individual
employees. In making decisions the human resource manager should
consider alternative solutions to the needs of the business as well as the
effects the decisions will have on the lives of the employees.

 Frequently a human resource manager will be given instructions from

higher level management to take action which will be oppressive to the
employees and the manager must either present arguments to higher
management for alternate solutions which will have less impact on the
employee morale or determine the best method for implementing the
instructions which have been given.
 HR Ethics Activities
 Staffing and selection
 Fostering the perception of fairness in the processes of recruitment and hiring of people.
 Formal procedures
 Interpersonal treatment
 Providing explanation
 Training
 How to recognize ethical dilemmas.
 How to use ethical frameworks (such as codes of conduct) to resolve problems.
 How to use HR functions (such as interviews and disciplinary practices) in ethical ways.
 Performance appraisal
 Appraisals that make it clear the company adheres to high ethical standards by measuring and
rewarding employees who follow those standards.
 Reward and disciplinary systems
 The organization swiftly and harshly punishes unethical conduct.
Employees rights and duties
 Right to work.
 Right to just remmuneration.
 Loyalty towards organisation.
 Right to participation.
 Freedom of speech.
 Right to healthy nd safe
working condition.
 Right to privacy and to
normal family life.
Employers rights and duties
 No discrimination rules for
recruitment and hiring.
 Duty to fair compensation.
 Duty to inform and to
consult worker.
 Duty to improve quality of
work.
 Requirement of the correct
behavior at the workplace.
 IMPORTANCE OF ETHICS IN
HRM
ETHICS is important in human resource management, for several reason:

1. ethics corresponds to basic needs.

2. values create credibility with the public.

3. value gives the management credibility

with its employees.

4. Values helps better decision making.

5. Ethics and profit together.

6. laws cannot protect the society, ETHICS can

 HR ETHICAL ISSUES
 EMPLOYEE RESPONSIBILITY

 Responsibility to employer V/S Obligation to public safety.

 Responsibility towards oneself or towards family clashes

with responsibility towards employer.

 An issue i.e. gaining increasing importance these days.

 CASH AND INCENTIVE PLANS

 Annual incentive plans.

 Long-term incentive palns.

 Executive perquisites.
 PERFORMANCE
APPRAISAL
 Assessment of an individual’s performance is based on observation
and judgment.

 Yet HR managers assign performance on the basis of unrelated

factors.

 Ethics should be a part of Performance appraisal.

 Objective of ethical performance reviews should be to provide an

honest assessment of the performance.
 RACE, GENDER & DISABILITY

 Minorities should be respected and given fair treatment.

 Employees suffering from illness or disability should be treated equal.

 Sexual harassment issues should not be over looked.

 JOB DISCRIMINATION
 It refers to making adverse decision against employees

 The main 4 common discriminatory practices are:-

1. Individuals discriminate on the basis of stereotype.

2. Organizations also discriminate.
3. Discrimination on the ground of sex and race.
4. Workplace Harassment.
 PRIVACY ISSUES
 Use of technology at times breach the privacy of employees.

 Drug testing should be done only when it is relevant to the job.

 Protection to the whistle blowers.

 SAFETY AND HEALTH
 Industrial work is hazardous.

 Accidents, injuries and illnesses occur.

 New categories of accident and illness have emerged, including

the fast growing job safety problem.

 Ethical Issues involved here:

1. Assessment of Risks.
2. Role of Government in Safety and Health.
RESTRUCTURING AND LAYOFFS
 It should be constructed in the atmosphere of fairness
and equity.

 Decisions should not be taken under personal

grudges.

 Alternatives to layoffs should be tried.

 Ethical committees
Many companies have ethics committee to advise on ethical issues .such a
committee can be a high – level one comprising the board of directors , chaired by the
CEO of the company.
Such committees help the company in establishing policies in new or
uncertain areas, advise the board of directors on ethical issues, and oversee the
enforcement of the code of ethics.
Following are the committees

1.EthicsHot Lines
2.Whistle Blowing
 Whistle blowing in action
SR.NO. NAME OF THE WHISTLE BLOWER CONSEQUENCES
ORGANISATIO
N

1 Enron Sherron Watkins Liquidation of the

company

2 Kellogg India Senior executive Dismissal of two senior

(name not known) executive who were
promoted for excellent
performance a few
month before
3 Director FBI,US Coleen Rowley Attack on the world trade
centre, US
4 World com Cynthia cooper Company gone bust

5 Xerox - CFO made to pay $5.5

million in fines and
banned by the SE from
practicing accountancy

6 Johnson and Installed whistle No incident is reported

johnson,bayer Blowing systems
India
7 LG India 10 -12 cases have Not known
been reported to
head office, south
Korea
 CODE OF ETHICS FOR HUMAN RESOURCE
MANAGERS

 High standards of professional and personal conduct.

 Continuation of personal growths in the field of human resource.

 Upload all laws and regulations relating to employer’s activities.

 Maintain the confidentiality of privileged information

 Refrain from using personal position for in appropriate gain

Example_
 CODE OF CONDUCT IN TATA

For the company For the employees

 Customer satisfaction  Moral and ethical standards

 Accounting and financial  Non-disclosure of

reporting important information about
 Interest of country company
 0pen market economy  Whistle blowing

 Unfair practises  Protects the interest of

 Enviornmental rules and company

regulations
 Conclusion
 Hence, HR professionals are responsible for adding value to the
organisations and serve and contribute to the ethical success of those
organizations. They should accept professional responsibility for their
individual decisions and actions.They also advocate for the profession by
engaging in activities that enhance its credibility and value.
 Ethics –branch of philosophy
 Highest standard of competence
 Individual leadership
 Fairness and justice
 Protect the interest of stakeholders
 Protect the rights of individuals