Ethical Issues of Lay Offs Essay Example | Topics and Well Written Essays - 1250 words

Ethical Issues of Lay Offs - Essay Example Lay-offs are defined as â€Å"suspension or termination of employment (with or without notice) by the employer or management.† (Business Dictionary 2009) Layoffs are management’s option when faced with situations such as financial difficulties, positions are no longer required, business slow-down, or work interruption. This could be categorized as follows: to save the company, to change, and to improve the company. Regardless of the rationale, layoffs cause undue stress, emotional pain, anguish and suffering for the terminated employees. On the other hand, the managers who are assigned to deliver the blow are also faced with sorrow or guilt, as the case may be. It is in this regard that layoffs are closely evaluated in terms of ethical issues which arise due to the critical consequences that arise. Due to these consequences, layoffs become controversial ethical issues. Velasquez & Rostankowski (1982) averred that â€Å"an act with ethical or moral consequences is that such an act involves decisions freely taken that will have positive or negative consequences for others†. According to Gilbert (2000), â€Å"in some circumstances, laying off some employees is the ethical thing to do, and managers who fail to do so are guilty of unethical conduct. In other circumstances, no ethical defense of layoffs can be found, and managers who decide on layoffs in these circumstances are guilty of unethical acts. In a wide range of circumstances in between, there are ethical arguments for and against layoffs.† To determine the morality of a decision or an action, one approach is that of utilitarianism which holds that a moral decision or action is one that results in the greatest good for the greatest number of people. (ibid.) Using this approach, management justifies that it is common to layoff on the basis that terminating 1000 personnel if this move will save the organization from bankruptcy and hence preserve the jobs of 5000 others.