What are employees owed?

Updated Thursday 26th February 2009

Instead of reducing the workforce in times of difficulty, Anja Schaefer asks whether there are more ethical alternatives

The UK economy is going through a tough time and this is affecting many businesses very directly. Several well known businesses have already floundered in recent months, others are reporting a severe drop in business. It is not obvious that the world economy is going to recover very quickly, so we must expect to see more businesses struggling in the coming months, perhaps even years.

Struggling businesses all too often translates directly into job losses. Thousands of people lost their jobs when Woolworth’s closed, many more are being made redundant from struggling car manufacturers. RBS has also announced its intention to lose a large number of jobs as part of its restructuring.

Is it right for companies to make thousands of workers redundant or do they have a duty to protect their employees in difficult economic times? This is actually not an easy question. Business ethics suggests different answers to it, depending on the ethical perspective you take, and also depending on the circumstances in which the company and its employees find themselves.

p> A detail from a twenty pound note Copyrighted image Icon Copyright: Alan Mather | Dreamstime.com On the one hand, a utilitarian perspective suggests that companies must do what brings the greatest benefit and the least costs for all concerned. This might well mean having to reduce their workforce if this means the company can stay afloat and thus continue to offer employment to the remaining employees.

 

On the other hand, care ethics suggests that companies have a particular responsibility to those who are dependent on them, which would normally include their employees.

It may not be reasonable to expect companies to keep employing people if there is a serious downturn in business, which is expected to be more than a momentary blip. But if the company is not actually facing closure and particularly if it is a large and profitable company, perhaps it is not unreasonable to expect it to put some thought into how it can help employees threatened by unemployment, so that the transition is eased and they may find other employment more easily.

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