Business Ethics and Organization Social Responsibility

Case study
Scenario: The Layoff

Pat is the plant manager at one of ABC Company’s five plants. She has been with the company for 15 years and worked her way up from the factory floor after the company sponsored her college education. Recently, her boss confided in her that the company will need to lay off 200 workers due to financial difficulties. While her job is secure, rumors about potential layoffs are spreading within the plant.
One day, an employee who is also an old friend approaches Pat and asks, “Pat, is the plant shutting down? Am I going to lose my job? My family and I are supposed to close on a new house next week, and I need to know if I should back out.”

Pat now faces a serious ethical dilemma. If she tells the truth, she is betraying the company’s trust and could face disciplinary action. However, if she remains silent or lies, she may be hurting her friend, who could make a financial decision based on false assumptions.

Answer the following questions:

Should Pat prioritize loyalty to the company or honesty to her friend? Why? (2.5 Marks)

Who are the key stakeholders in this situation, and how might they be affected by Pat’s decision? (2 marks)
What are some alternative ways Pat could respond to her friend without violating company policies? (2.5 Marks)
Apply the following ethical theories to analyze what Pat should do (3 mark):

a) Utilitarianism – What would be the best course of action based on maximizing overall benefits?
b) Deontology – What is Pat’s moral duty, regardless of consequences?
c) Virtue Ethics – What action aligns with Pat’s integrity and moral character?
Answers

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