bus ethics final

Many European countries and Japan have laws that extend

"just cause" protections to all workers, whether or not they are covered by a union contract.

Although problems remain, four decades of occupational safety and health regulation in the United States and efforts by businesses and unions have significantly lowered deaths and injuries on the job. In many developing nations, however

, conditions remain brutally dangerous. In Bangladesh, for example, a fast-growing garment and textile industry—mostly sourcing apparel to Western companies—has been the site of numerous tragedies, including a terrible building collapse at the Rana Plaza garment factory complex in 2013 that killed more than 1,100 workers.

Just as what constitutes a fair wage varies across cultures and economies, so do other terms and conditions of work. For example, in some countries,

, unions are legal and the right to organize is protected; in others, unions are illegal or actively discouraged. Excessive overtime (usually defined as more than 60 hours or six days a week) is not permitted

ways of family friendly corporation

-Job advantages would not be granted or denied on the basis of gender. -People would be hired, paid, evaluated, promoted, and extended benefits on the basis of their qualifications and ability to do the tasks assigned. The route to the top, or to satisfaction in any occupational category, would be open to anyone with the talent to take it. -The company's stakeholders, regardless of their gender, would be treated in a bias-free manner. -All laws forbidding sex discrimination would be fully obeyed. -Programs to provide leaves or financial support for child care, elder care, and other family responsibilities would support both men and women employees and help promote an equitable division of domestic work. -persons could seek, and achieve, career advancement without committing to a full-time schedule, year after year

While audits can provide considerable insight into conditions in supplier factories, they also have drawbacks

-On-site inspections are expensive and time-consuming -Audits are not always unannounced -Workers sometimes distrust auditors, not knowing if the inspectors represent the supplier, the brand, or an independent third party

Employee Rights/Employer Duties

-Right to organize and bargain -Right to a safe and healthy workplace -Right to privacy -Duty to discipline fairly and justly -Right to blow the whistle -Right to equal employment opportunity -Right to be treated with respect for fundamental human rights -Right to fair and decent wages

Arguments Favoring Employee Drug Testing

-Supports U.S. policy to reduce illegal drug use and availability -Improves employee productivity -Promotes safety in the workplace -Decreases employee theft and absenteeism -Reduces health and insurance costs

Why would lead firms decide to engage in capability building, rather than simply give their contracts to someone else—or even do the work themselves?

-cost of switching suppliers may be too high. -The lead firm may feel a moral obligation to the workers and local community not to cause job loss .-Or, other suppliers may not be readily available to take over the contract. -a lead firm may find it preferable to work with a supplier to improve its performance

One study found that even after taking into consideration differences in education, experience, race, industry, and occupation, women still earned

5 to 7 percent less than they otherwise would have—presumably the remaining effect of outright gender discrimination

What explains the sharp differences in board diversity

A key factor is that several nations in Europe have passed laws that set quotas for women's representation on boards of directors in 2015 Germany required companies to give 30 percent of board seats to women, joining Norway, Spain, France, Iceland (with 40 percent quotas), Italy (one-third), and Belgium (30 percent).

affirmative action

A positive and sustained effort by an organization to identify, hire, train if necessary, and promote minorities, women, and members of other groups who are underrepresented in the organization's workforce

supplier has an advantage to its leads firm when

A supplier that is a sole source for a key component or natural resource

electronic monitoring

A wide range of technologies—e-mail and messaging, social media sites, cell phones, location tracking, Internet browsing, and digitally stored video—enable companies to gather, monitor, and analyze information about employees' activities

Employee drug testing is controversial

Although businesses have an interest in not hiring, or getting rid of, people who abuse drugs, many job applicants and employees who have never used drugs feel that testing is unnecessary and violates their privacy and due process rights.

particular challenges facing workers in the so-called sharing economy

An important duty of employers is to pay a fair and decent wage. Yet, how wages should be determined, and what exactly is fair or decent, remains contentious This issue has taken on greater prominence in recent years, as public attention has turned to growing income inequality in the United States and other developed nations.

glass ceiling

An invisible barrier to the advancement of women, minorities, and other groups in the workplace

glass walls

An invisible barrier to the lateral mobility of women, minorities, and other groups in the workplace, such as from human resources to operations, which could lead to top management positions.

Companies that manage diversity and promote inclusion effectively take a number of related actions, in addition to obeying all relevant laws. Research shows that these actions include the following

Articulate clear diversity goals, set quantitative objectives, and hold managers accountable. Spread a wide net in recruitment, to find the most diverse possible pool of qualified candidates Identify promising women and persons of color, and provide them with mentors and other kinds of support. Set up diversity councils to monitor the company's goals and progress toward them

The workforce will continue to get older

As the baby boom generation matures, birth rates drop, and people live longer and healthier lives, the population will age. Many of these older people will continue to work, whether out of choice or necessity. After the Great Recession, many older workers postponed retirement—or even re-entered the workforce—to recoup losses in their savings and home values

The pay gap for both Hispanic women and men declined by about 5 percent since 2000. The one group that tops white men in median weekly earnings is

Asian American men; they make about 20 percent more, on average.

Ethnic and racial diversity is increasing

Asians are now the fastest-growing segment of the labor force. The proportion of African Americans is expected to hold steady at around 12 percent. By 2022, the U.S. workforce is projected to be about 39 percent nonwhite (this category includes persons of Hispanic origin). In some states, such as California, these trends will be much more noticable

Upper Big Branch Mine Disaster

At the time of the explosion, Massey Energy Corporation, the owner and operator of the Upper Big Branch mine, was one of the leading coal producers in the United States. resulting waste was frequently dumped into adjacent valleys, polluting streams, harming wildlife, and contaminating drinking water. Poor ventilation had likely caused methane to build up near the longwall shearer, providing the fuel for the initial fireball, investigators found.

Immigration has profoundly reshaped the workplace

Between 2000 and 2010, nearly 14 million immigrants entered the United States, making it the highest decade of immigration in U.S. history; by 2023, more than one in seven residents are expected to be foreign-born. Asians have surpassed Hispanics as the largest group of immigrants overall. Immigrants now make up almost 17 percent of U.S. workers, increasing linguistic and cultural diversity in many workplaces

Discussion Case: Unauthorized Immigrant Workers at Chipotle Mexican Grill Restaurants

Chipotle Mexican Grill acknowledged that it was still under investigation by the Securities and Exchange Commission and the U.S. attorney for the District of Columbia for possible failure to comply with laws on employee work eligibility. being an unauthorized immigrant is unethical and against the law In addition to terminating workers it found to be undocumented, Chipotle ordered all its restaurants to use the federal E-Verify system, even in states where this was not required also adopted an electronic Form I-9 to reduce errors

external audit disadvantage

Company may find that the information is delayed, and it does not directly control the quality of the audit.

The commitments that employers and employees make to each other go beyond mere legal obligations, however. Cultural values.....

Cultural values, traditions, and norms of behavior also play important roles.

What are the interests—and sources of power—of suppliers?

Despite their tremendous diversity most suppliers share an interest in -obtaining orders that will enable them to make money, -use their productive capacity efficiently - build long-term and stable relationships with business customers

goal of public policy in the United States for four decades

Eliminating workplace discrimination and ensuring equal job opportunity

codetermination

Employee representatives are often included on boards of directors, in a practice sometimes

OSHA has developed recommendations to help employers reduce the risk of violence

Employers should try to reduce high-risk situations, for example, by installing alarm systems, convex mirrors, and pass-through windows. they should train employees in what to do in an emergency situation

The major agency charged with enforcing equal employment opportunity laws and executive orders in the United States is the

Equal Employment Opportunity Commission (EEOC

What can companies do to combat sexual and racial harassment—and protect themselves from expensive lawsuits? The Supreme Court has ruled that companies can deflect lawsuits by taking two steps

First, they should develop a zero-tolerance policy on harassment and communicate it clearly to employees. Then they should establish a complaint procedure— including ways to report incidents without retaliation—and act quickly to resolve any problems. Companies that take such steps, the court said, would be protected from suits by employees who claim harassment but have failed to use the complaint procedure

racial harassment example

For example, YRC/Roadway Express, the nation's largest lessthan-truckload freight hauling company, had to pay $10 million to settle charges of racial harassment at two Illinois facilities. African American workers there charged that they had been subjected to multiple incidents of racist graffiti, comments, and cartoons—and even a hangman's noose, long a symbol of violence against blacks. Despite their complaints, the company had failed to take corrective action

ex of Lack of jurisdiction of home country governments

For example, in the United States, the Department of Labor and the Occupational Safety and Health Administration (OSHA) establish rules governing wages, overtime, child labor, safety conditions, and other workplace matters. The reach of these regulatory agencies normally does not extend beyond their national borders, however. For example, if blocked fire exits threatened worker safety in a factory in Indonesia making clothes for an American retailer, OSHA would have no authority to intervene.

combination of public and private regulation ex

For example, private companies can rely on local laws to give legitimacy to demands for workplace changes, and government regulators can benefit from detailed workplace record keeping required by private companies' codes of conduct. Public and private regulators can also share the work.

An example of a family-friendly corporation is General Mills, long admired for its support of working parents because

Forty-four percent of managers and executives are women, and half of the company's employees use a flextime schedule. The company has a special program to allow women to ramp up their hours gradually when they return to work after the birth or adoption of a child

office romance poses problems for employers

If the relationship goes sour, one of the people may sue, charging sexual harassment— When one person in a relationship is in a position of authority, he or she may be biased in an evaluation of the other's work, or others may perceive it to be so

Today, the U.S. workforce is as diverse as it has ever been, and it is becoming even more so. Consider the following major trends

Immigration has profoundly reshaped the workplace Ethnic and racial diversity is increasing The workforce will continue to get older Millennials are entering the workforce

Audits are not always unannounced

In many cases, suppliers receive advance notice and are able to stage conditions to pass the inspection.

Some have recognized the demand for family caregiving—of both children and elders—as a business opportunity

Many firms offer: referral services, dependent care accounts, long-term care insurance, time off to deal with the often unpredictable crises that occur in families caring for children and elders

case: profiting from pain business and us opioid epidemic

Mckenson agreed to pay $150 million in fines company failed to implement effective controls to prevent the diversion of prescription opiods for nonlegitamate uses

The U.S. workforce is as diverse as it has ever been and is becoming more so

More women are working than ever before, many immigrants have entered the labor force, ethnic and racial diversity is increasing, the workforce is aging, and millennials are entering the workplace.

What do companies do when an audit reveals a gap between their social, ethical, and environmental standards and a supplier's practices?

Most audits turn up at least some instances in which a company's global operations are not in compliance. For example, inspectors may uncover underage workers, violations of environmental commitments, or discriminatory hiring practices. Sometimes, a company will terminate a supplier, if the supplier is unwilling to change or the deficiencies are egregious

transporting products bad, ex

Much of the coffee, fruit, and fish from Latin America; toys, electronics, and garments from Asia; and wine, meat, and wool from Australia, for example, is shipped to Europe and North America on enormous container ships, which now carry more than half of global seaborne trade. These ships, which burn dirty bunker fuel, emit about three percent of all greenhouse gas emissions.

what has emerged to complement, and in some cases even substitute for, national-level regulation

Mutually agreed-on standards, developed by private firms—often working in collaboration with nongovernmental organizations and United Nations affiliates such as the International Labor Organization—have emerged to complement,

Weak regulatory capacity in developing countries

Nations with growing export-oriented manufacturing sectors often lack the institutional capacity, resources, and staff to regulate their own workplaces adequately. In some cases, business elites are so politically powerful that they can effectively block regulation.

Employee Duties/Employer Rights

No drug or alcohol abuse No actions that would endanger others To treat others with respect and without harassment of any kind Honesty; appropriate disclosure Loyalty and commitment Respect for employer's property and intellectual capital

This Occupational Safety and Health Act law is administered by the

Occupational Safety and Health Administration (OSHA). Congress gave OSHA important powers to set and enforce safety and health standards.

pay gap

One persistent feature of the working world is that women and persons of color on average receive lower pay than white men do

inclusion

Policies and practices that tap into the diverse perspectives, life experiences, and approaches that every individual brings to the workplace

Typically, drug testing is used on three different occasions.

Preemployment screening Random testing of employees Testing for cause

Private regulation often takes the form of ....

Private regulation often takes the form of company and industrywide codes of conduct that establish standards governing labor, human rights, environmental, and related practices within global supply chains

Dodd-Frank Act of 2010

Requires the government to pay a reward to whistle-blowers who voluntarily provide information that leads to successful prosecutions for violations of federal securities laws

Preemployment screening

Some companies test all job applicants or selected applicants before hiring, usually as part of a physical examination, often informing the applicant ahead of time that there will be a drug screening

causes for glass walls

Sometimes women voluntarily choose to step off the career track to care for children or elderly relatives. Other causes include a company's lack of commitment to diversity and too little accountability at the top management level for equal employment opportunity. However, recent advances by both women and minorities in the executive suite suggest that the glass ceiling may finally be cracking

Limited enforcement power of transnational institutions.

The United Nations has several affiliates that are deeply concerned with labor and human rights; among them are the International Labor Organization (ILO), the United Nations Children's Fund (UNICEF), and the Global Compact. All of these have developed important global standards, promoted them globally, and sought to implement them.

Lack of jurisdiction of home country governments

The authority of governments in the home countries of lead firms normally does not extend to supplier factories in other countries.

Child labor

The hiring of children in a way that deprives them of their childhood, their potential, and their dignity, and is harmful to their physical and mental development

four main conditions must be satisfied to justify informing the media or government officials about a corporation's actions. These are

The organization is doing (or will do) something that seriously harms others. ∙ The employee has tried and failed to resolve the problem internally. ∙ Reporting the problem publicly will probably stop or prevent the harm. ∙ The harm is serious enough to justify the probable costs of disclosure to the whistleblower and others Only after each of these conditions has been met should the whistle-blower go public.

Workers sometimes distrust auditors, not knowing if the inspectors represent the supplier, the brand, or an independent third party

Therefore are reluctant to share their experiences.

On-site inspections are expensive and time-consuming

Therefore cannot be scaled to cover a brand's entire supply chain

Testing for cause

This test occurs when an employee is believed to be impaired by drugs and unfit for work. It is commonly used after an accident or some observable change in behavior.

Random testing of employees

This type of screening may occur at various times throughout the year. In many companies, workers in particular job categories (e.g., operators of heavy machinery) or levels (e.g., supervisors) are eligible for screening at any time

risk for human rights abuses by their suppliers

Transnational companies that depend on resources that are farmed, extracted, or mined—such as the cocoa, natural gas, metals, and minerals

parental leave

When a mother or father is granted time off when children are born or adopted and during the important early months of a child's development

what can threaten the reputation of companies at the top of the supply chain?

When a supplier of raw materials, parts, or finished goods contributes to climate change, dumps toxic chemicals, emits air pollution, or reduces biodiversity

for crowd-sourced data to be reliable and useful

Workers must trust the process and participate widely

Although several steps removed, distant suppliers can still have a

a big impact on a company's reputation and bottom line

audit fatigue

a challenge faced by factories of being audited multiple times with only slight differences in the standards being addressed

sweatshops

a derogatory term referring to factories where workers toil long hours, at low wages, and under unsafe conditions—its reputation can be harmed

diversity council

a group of managers and employees responsible for developing and implementing specific action plans to meet an organization's diversity goals

Analysts of recent pullbacks in women's labor force participation have pointed to

a lack of family-friendly policies, which have made it far more difficult for mothers to work

Employment-at-will

a legal doctrine that means that employees are hired and retain their jobs "at the will of"—that is, at the sole discretion of—the employer. However, over time, laws and court decisions have changed this

t in today's complex supply networks, the presence of such forced labor can pose

a serious reputational and legal risk

Violations of human rights by suppliers are

a serious risk, particularly for companies that use suppliers in agriculture and natural resources-based industries, such as mining

living wage

a wage "that enables workers, for their labor during a standard work week, to support half the basic needs of an average-sized family, based on local prices near the workplace.

ergonomics

adapting the job to the worker, rather than forcing the worker to adapt to the job For example, ergonomically designed office chairs that conform to the shape of the worker's spine may help prevent low productivity and lost time due to back injuries.

if workers are covered by a collective bargaining agreement, it may impose

additional restrictions on an employer's right to terminate

Some companies have responded to environmental concerns by

adopting a policy of local sourcing

Affirmative action has long been controversial. Some states have passed laws banning or limiting affirmative action programs in public hiring and university admissions, and the issue has been debated in Congress and in the courts. Critics, however, argued that

affirmative action was inconsistent with the principles of fairness and equality. In some cases, one group could be unintentionally discriminated against in an effort to help another group. For example, if a more qualified white man were passed over for a job as a police officer in favor of a less qualified Hispanic man to remedy past discrimination in a police department, this might be unfair to the white candidate.

One way to promote equal opportunity and remedy past discrimination is through

affirmative action.

The primary dimensions of diversity are

age, ethnicity, gender, mental or physical abilities, race, and sexual orientation

In the former Soviet Union, many enterprises felt

an obligation to provide social benefits, such as housing and child care, to their workers. These benefits declined with the advent of privatization in these formerly state-run economies

Companies that manage diversity effectively have a strategic advantage because they

are able to foster innovation, serve a diverse customer base, and avoid expensive lawsuits and public embarrassment

Tier-1 suppliers (sometimes called contractors)

are hired to manufacture products and provide them directly to the company may in turn work with tier-2 suppliers

Successful diversity and inclusion management includes

articulating goals and measuring progress, recruiting widely, mentoring promising women and persons of color, and establishing mechanisms for assessing progress

Nike's supplier audits turned up repeated instances of excessive overtime in apparel manufacturing factories, particularly in China, despite rules prohibiting this practice. When the company studied the problem, it found that the biggest root cause was style proliferation...

asking factories to make too many different styles and to switch frequently from one style to another. Each change reduced efficiency and required extra work hours. Nike also found other root causes, such as miscalculations in placing orders, last-minute changes in colors and fabrics, and poor forecasting of customer demand.

"Silence as Complicity"

asses what conditions are plausible to speak of corporations of silently complicit in human rights abuses

Increasingly, bonds between employers and employees have weakened. Companies aim to

attract and retain employees not by offering long-term job security, but rather by emphasizing interesting and challenging work, performance-based compensation, and ongoing professional training. For their part, employees are expected to contribute by making a strong commitment to the job task and work team and to assume a share of responsibility for the company's success. But they cannot count on a guaranteed job

arrangements can benefit employers by

attracting and retaining valuable employees, reducing absences, and improving job satisfaction

audit fatigue, in which supplier factories must endure

audit after audit conducted by different buyers, and spares companies from duplicating efforts and incurring unnecessary costs.

Increasingly, companies are working together to

audit major suppliers and to share results.

Employers are not required by law to agree to the union's demands, but they are required to

bargain in good faith. Sometimes, if the two sides cannot reach agreement, a strike occurs, or employees apply pressure in other ways, such as appealing to politicians or refusing to work overtime

As supply chains have globalized, their social, ethical, and environmental impacts have

become increasingly complex, and their potential risks to corporate reputation heightened

Employees' responsibilities for aging parents and other older relatives will

become increasingly important to businesses in the coming decade as baby boomers pass through their forties and fifties, the prime years for caring for elderly family members.

During the New Deal period in the 1930s, many workers, particularly in manufacturing industries such as automobiles and steel, joined unions, and the ranks of organized labor grew rapidly. Unions negotiated with employers for

better wages, benefits such as pensions and health insurance, and improved job safety—significantly improving the lot of many workers

Research has shown that capability building initiatives work best where interactions

between buyer and supplier are frequent and ongoing, and where the two parties have a long-term relationship

Although suppliers are diverse, they share a common interest in

building long-term, stable relationships with buyers

Eliminating the pay gap will require, therefore,

business programs and government policies that create opportunity for women and people of color to move out of more segregated jobs into ones where the pay and chances for upward mobility are greater

in this view of Mommy track or Daddy track businesses will need to

businesses will need to undergo a cultural shift, to value the contributions of people who are prepared to make a serious, but less than full-time, commitment to their careers.

crowd source audit Workers provide information directly by responding to questions generated

by a recorded voice on their mobile phones when they are away from work.

An emerging approach to auditing involves

bypassing the factory inspection process entirely

Effective supplier development often involve

careful study to determine the underlying cause of repeated violations of particular code requirements or standards. This is known as root cause analysis

elderly care is a concern for employers because

caregivers often have to go to work late or leave early to attend to these duties, or are distracted or stressed at work by their responsibilities

A 2014 study found that many companies offered some kind of flexible work schedules, such as allowing employees to

change starting or quitting times periodically (81 percent), work from home at least occasionally (67 percent), compress workweeks into fewer days (43 percent).

A special concern for many brands is

child labor

Most management experts recommend that employers, at the very least,

clearly define their monitoring policies, let employees know what behavior is expected, and apply any sanctions in a fair and evenhanded way

The Promise and Limits of Private Power, Richard M. Locke argues that the most effective way to assure socially responsible practices in global supply chains is a

combination of public and private regulation. Either, when used alone, is insufficient; they work best, he believes, when "layered" on top of each other in a kind of hybrid system.

Balancing Work and Life Families have adopted a wide range of strategies for

combining full- and part-time work with the care of children, elderly relatives, and other dependents. How to help employees trying to balance the complex, multiple demands of work and family life has become a major challenge for business

free lancing- temporary work sector is sometimes referred to as the "gig economy." The rise of the gig economy has allowed

companies to become more cost-efficient, but it has also shifted risk to workers, sowed anxiety, and in many cases driven down incomes. And although some workers preferred the flexibility of jobs in the gig economy, many ended up there simply because they could not find stable, permanent employment

what helps avoid audit fatigue?

companies working together to audit major suppliers and to share results.

Recently, a number of large accounting firms such as PricewaterhouseCoopers have developed specialized services in which they will

conduct a social or environmental audit for clients (rather than a financial audit, which is their traditional specialty)

A small proportion of companies (about 5 percent) require their managers to sign a document, sometimes called a

consensual relationship agreement

Supply chain transparency can give

consumers confidence in the positive impacts of products they buy

An advantage of an internal audit is that the company

controls and manages the process. It can train its own compliance officers, determine what factories need to be audited, and learn immediately about any problems uncovered.

In part in response to employer criticisms, OSHA has entered into

cooperative partnerships with employers, aimed at improving occupational safety and health for the benefit of both companies and their workers

Another recent study found that adding even a single woman to a board of directors improved

corporate governance practices, with a particularly strong effect in traditionally male-dominated industries like mining and energy

Although research on the effects of board diversity on performance has yielded mixed results, a 2014 study by MSCI, an investment research firm, found that companies with a higher proportion of women on their boards were less likely to be involved in

corruption and earned higher scores for management of carbon emissions, toxic releases, water, labor, and health and safety issues than other firms

Failure to manage social, ethical, and environmental risk in supply chains can be very

costly, managers have learned.

A 2013 survey of senior supply chain management executives in almost 800 companies around the world found that the leading reason why their firms had invested in supplier social responsibility was to

create a positive customer image and enhance brand equity

demands placed on suppliers may run at

cross-purposes

Suppliers are caught in a bind, not knowing which set of expectations is more important. These contradictory demands sometimes reflect

divergent priorities within the lead firm itself. Departments of supply chain management or procurement may be focused on one set of goals, and departments of citizenship, sustainability, or social responsibility on another.

Workforce diversity

diversity among employees—thus represents both a challenge and an opportunity for businesses

Some evidence suggests that in the wake of the global financial crisis, the number of suppliers has

dropped

business has protected itself from drug risks risks through

drug testing

in most developed countries. Yet, in some settings, workers are

eager to work as many hours as they can, to save for marriage, for example, or to remit earnings to family members. Finding the right balance can be a challenge

Naturally, suppliers' power, relative to lead firms, varies. Suppliers may have both

economic and informational power

(Asian American women make 93 percent of what white men earn.) An important reason is

education; almost half of Asian American adults hold a bachelor's degree or above, far more schooling than any other ethnic or racial group

Others have taken steps to improve

efficiency in their supply chains. For example, when Patagonia, the outerwear company, made the simple decision to switch its port of entry for products coming from Asia from Long Beach to Oakland, California, it reduced the distance the goods traveled by truck to its Reno, Nevada, distribution center—reducing its carbon emissions on the route by 31%

In addition to caring for children, many of today's families have responsibilities for

elder care

Company programs for drug abusers and alcohol abusers are often combined. Many firms recognize that they have a role to play in helping alcoholic employees. As with drug rehabilitation programs, most alcoholism programs work through

employee assistance programs (EAPs) that offer counseling and follow-up

Many union contracts say

employees can be fired only "for just cause," and workers have a right to appeal the employer's decision through the union grievance procedure.

The issues discussed in this chapter illustrate forcefully that today's business corporation is open to a wide range of social forces. Its borders are very porous, letting in a constant flow of external influences. Many are brought inside by

employees, whose personal values, lifestyles, and social attitudes become a vital part of the workplace.

In the United States, since the late 1800s, the legal basis for the employment relationship has been

employment-at-will

A growing trend is for companies to

engage collaboratively with suppliers to build capability. This benefits both the firm and supplier, creating shared value. Suppliers are more likely to engage with lead firms with which they have stable, long-term relationships.

Some firms have realized that openly revealing supply chain information can

enhance brand loyalty among consumers concerned about social, ethical, and environmental responsibility.

When businesses invest in their employees by providing a well-structured career, job security, and benefits including pensions, they reap the rewards of

enhanced loyalty, productivity, and commitment.

The demand for child care is

enormous

Millennials are entering the workforce

entering the workforce in large numbers, bringing fresh perspectives and practices. In 2015, millennials became the largest generation in the U.S. workforce, and more than a quarter say they are already in management positions. managers found millennials were quick learners and more technologically adept than their seniors. But they also found millennials to be narcissistic (self-centered) and said it was hard to retain them. More than half of millennials themselves said they expected to stay in their jobs fewer than 3 years

Beginning on a major scale in the 1960s, U.S. presidents issued executive orders and Congress enacted laws intended to promote equal treatment of employees—that is

equal employment opportunity

Some workers have even complained of "BlackBerry thumb," hand strain caused by using their thumbs to tap out messages on the small keyboards of their smartphones when working away from the office. In response, many businesses have given greater attention to

ergonomics

supply chain codes of conduct

establish rules for their suppliers

Racial harassment is also illegal, under Title VII of the Civil Rights Act. Under EEOC guidelines

ethnic slurs, derogatory comments, or other verbal or physical harassment based on race are against the law, if they create an intimidating, hostile, or offensive working environment or interfere with an individual's work performance. Although fewer racial than sexual harassment charges are filed, their numbers have more than doubled since the early 1990s and employers have been liable for expensive settlements.

Job safety and health concerns have increased as a result of rapidly changing technology in the workplace. U.S. employers must comply with

expanding OSHA regulations and respond to the threat of violence at work

Companies that fail to follow the laws often find themselves facing

expensive lawsuits costly lawsuits can involve other forms of discrimination as well, such as those based on age, race, or disability ex: Supreme Court ruled in a 5-4 vote against the plaintiffs in a huge class action sex discrimination lawsuit against Walmart—the largest ever brought in the United States. The women who brought the suit claimed that female employees at Walmart were paid less than men in comparable positions, in spite of having greater seniority and equal or better qualifications. If the class action suit had prevailed, Walmart could have been required to pay hundreds of millions of dollars to current and past female employees

All businesses, of course, are required to obey the laws mandating equal employment opportunity and prohibiting sexual and racial harassment; those that fail to do so risk

expensive lawsuits and public disapproval

Blowing the whistle on one's employer is often a last resort to protest company actions considered harmful to others. In recent years, U.S. legislation has

extended new protections to whistle-blowers.

The key change here has been the move of persons of color, in recent decades, into a wider range of jobs as barriers of discrimination and segregation have

fallen; minorities have become better represented in the ranks of managers, professionals, and the skilled trades.

What would such a cultural shift look like?

family-friendly corporation

The rise in income inequality, has many causes, and some have little directly to do with business practices. These include

federal and state minimum wage laws, taxation policy, economic growth, unionization rates, and other factors.

glass walls ex

fewer opportunities to move sideways into jobs that lead to the top. Female and minority managers are often found in staff positions, such as public relations or human resources, rather than in line positions in such core areas as marketing, sales, or production where they can acquire the broad management skills necessary for promotion

The use of drug tests has fallen somewhat in the past decade, as

fewer people have tested positive (The one class of drugs whose use has recently risen is prescription opiates—medicines such as hydrocodone that are used to treat pain.)

Companies that do not manage supply chain risks effectively can suffer

financial and reputational damage; conversely, those that manage these risks well can benefit.

Employers found in violation of the Occupational Safety and Health Act can be

fined and, in the case of willful violation causing the death of an employee, jailed as well. for example, OSHA fined BP $87 million—on top of $21 million the company had already paid—for safety violations linked to an explosion of a refinery in Texas that killed 15 workers and injured 170, the largest fine ever levied by the agency.

family-friendly corporation

firms that would fully support both men and women in their efforts to balance work and family responsibilities

Companies have also accommodated the changing roles of women and men by offering workers more flexibility through such options as

flextime, part-time employment, job sharing, and working from home (sometimes called telecommuting because the employee keeps in touch with coworkers, customers, and others by phone or over the Internet).

Because of the importance of the relationship to both parties, it must be carefully managed, with consideration

for both legal and ethical obligations

Some women and minorities have evaded the glass ceiling and risen to the top by

founding or taking over their own businesses. By the mid-2010s, of the 28 million small businesses in the United States, 36 percent were owned by women, and 15 percent were owned by minorities, according to the Small Business Administration

Another area where employer and employee rights and duties frequently conflict involves

free speech

employees are dependent on their employers for their livelihood—and often much more, including

friendship networks, recreational opportunities, health care, retirement savings, even their very sense of self.

crowd-sourced audit

gathers information about factory conditions directly from workers using their mobile phones.

The use of honesty tests, however, like polygraphs, is controversial. The American Psychological Association noted there is a significant potential for these tests to

generate false positives, indicating the employee probably would or did steal from the company even though this is not true. Critics also argue that the tests intrude on a person's privacy and discriminate disproportionately against minorities

Managers and other business professionals need to be aware of these employee-imported features of today's workforce. The employment relationship is central both to

getting a corporation's work done and to helping satisfy the aspirations of those who contribute their skills and talents to the company

Many social, ethical, and environmental issues arise in

global supply chains These include low wages, unsafe conditions, child and forced labor, unethical sourcing from conflict areas, and adverse environmental impacts of resource extraction, production, and transportation

Since the mid-1950s, the proportion of American workers represented by unions

has declined In 2014, only about 11 percent of all employees were union members. The percentage was higher—36 percent— in government employment than in the private sector, where just 7 percent were unionized

Employers' right to discharge "at will" has been limited, and employees now

have a number of bases for suing for wrongful discharge. The expectations of both sides in the employment relationship have been altered over time by globalization, business cycles, and other factors.

The tax preparation software company Intuit has estimated that as high as 40 percent of the U.S. workforce could

have at least some income from freelancing or work as independent contractors or temporary workers by 2020

A supplier may

have critical capabilities such as technical expertise in making a specific product, or other attributes that the lead firm values, such as relationships with other firms farther upstream in the supply chain.

Employees' privacy rights are frequently challenged by employers' needs to have information about their

health, their work activities, and even their off-the-job lifestyles

But a study of four retail chains that paid above-average wages by MIT professor Zeynep Ton found that these firms had achieved

healthy growth and excellent shareholder returns. They had done so because they had "invest[ed] in their employees with the expectation that they [would] get even more back in terms of labor productivity, customer service, cost-cutting, innovation, and flexibility during difficult times," In short, a high-road strategy had paid off for these socially responsible companies.

management has a responsibility to act ethically toward employees while continuing to work for a

high level of economic performance

Corporate wage policies contribute to growing income inequality. Pursuing a high-wage "good jobs" strategy can benefit a company through

high productivity, strong customer service, and innovation.

One area of the economy where racial and gender discrimination seems stubbornly persistent is

high technology

Workers are more _______ in some countries than in others

highly unionized

external audit or a third-party audit

hire another organization to carry out the audit and report back to the company carried out by someone other than the company or the managers of the factories that produce its goods.

Under U.S. laws, most private and public workers have the right to

hold an election to choose what union they want to represent them, if any.

Speaking out against an employer can be risky; many whistle-blowers find their charges

ignored—or worse, find themselves ostracized, demoted, or even fired for daring to go public with their criticisms

social contract

implied understanding (not a legal contract, but rather a set of shared expectations) between an organization and its stakeholders. This concept includes, perhaps most significantly, the understanding between businesses and their employees.

A growing trend is for lead firms to work collaboratively with their suppliers to help them

improve their social, ethical, and environmental performance.

Some companies have invested directly in

improving the lives and professional skills of their suppliers' workers. This initiative went beyond the factory walls to empower women and build communities

OSHA has had considerable success in

improving worker safety and health

As the ILO points out, whether or not work can be considered child labor depends on a number of factors

including the child's age, the type and hours of work performed, and the conditions under which it is performed, and may vary among cultures and countries

What can companies do to address income inequality? The simple answer is to

increase wages—and to reduce pay differentials within their organizations

But who is to say that they, and their suppliers, are actually living up to these rules? Many now conduct

independent audits to determine if a code's standards are being met.

whistle-blowing

informing the press or government officials about unethical practices within one's organization

Having a widely diverse workforce boosts

innovation

Some forward-thinking companies have directly addressed this problem. They have developed organizational mechanisms to resolve differences in priorities internally, and they have tried to communicate expectations more clearly to suppliers. One trend is the use of

integrated supplier scorecards

Companies have several choices in carrying out an audit

internal audit external audit or a third-party audit

Rather than terminate or punish a supplier, a lead firm may choose instead to

invest time and resources to build the supplier's capabilities. Such an approach starts from the premise that many suppliers wish to comply, but simply lack the managerial skill, technical knowledge, or resources to do so

On the other hand, if a company's customers believe that its products are made in sweatshops

its reputation can be harmed. Workers who believe they are treated unfairly can quit, go on strike, or produce poor quality work

The global marketplace demands a workforce with

language skills, cultural sensitivity, and awareness of national and other differences across markets.

A study by the World Bank found that the crisis had accelerated lead firms' preference for

larger, more capable suppliers with whom they had ongoing strategic relationships.

supply are more likely to engage when

lead firms are prepared to offer them stable, long-term contracts, so they feel that investing in compliance is worthwhile

An important step businesses can take is to support their

lesbian, gay, bisexual, and transgender employees.

some women and persons of color called for ______ on affirmative action, preferring to achieve personal success without preferential treatment

less emphasis on affirmative action

Smaller companies, not covered by the FMLA, usually do

less for expectant and new parents and for those with ill family members.

For many years, big Japanese companies offered a core group of senior workers

lifelong employment; in exchange, these workers felt great loyalty to the company. This practice has declined in recent years

Transnational companies Often, their choices of where and from whom to source their supplies are

limited. Under these conditions, these companies must take special precautions to avoid complicity in ethical violations in their supply chains.

One approach, taken by a small minority of companies, has been to commit to paying all employees what is called a

living wage

Discussion Case: The Ugly Side of Beautiful Nails

low pay, abusive working conditions, and constant exposure to dangerous chemicals that threaten to ruin their health Many workers had limited English proficiency, and a significant proportion were undocumented immigrants The Times' exposé also reported that sometimes workers were not paid at all; many new workers were required to pay a so-called training fee and to work without wages during an apprenticeship period. Nail technicians worked with polishes, solvents, hardeners, and glues that caused respiratory and skin ailments, reproductive harm, and even cancer. The Occupational Safety and Health Administration set standards for workplace exposure to many of the chemicals used in nail salons, and urged workers to wear protective gear like gloves and masks and to properly ventilate their salons. States also set safety and health rules

Wages in overseas supplier factories are generally much

lower than they would be in the United States, Europe, or the developed Asian economies of Japan and Korea.

Lead firms and groups of firms use several methods to audit compliance with supply chain codes of conduct. These include internal audit, third-party (external) audits, and crowd-sourced audits. Increasingly, companies are working together to audit

major suppliers and to share results, often on cloud-based platforms

Businesses cannot operate without employees to

make products, provide services, market to customers, run the organization internally, and plan for the future.

Mommy track or Daddy track

many observers believe that most careers are still structured for people who are prepared to put in 40 hours a week at the office—or 50 or 60—giving their full and undivided commitment to the organization. Many women and men have been reluctant to take advantage of various flexible work options, fearing that this would put them on a slower track,

employees are a

market stakeholder of business—and a critically important one

Suppliers are important

market stakeholders, since they provide critical inputs and often manufacture branded products.

If an electronics company places a rush, high-volume order for a popular new product, and at the same time prohibits excessive overtime, the supplier..

may be unable to fulfill both requirements at once. Or, a lead firm may pressure suppliers, on one hand, for ever-lower costs and, on the other hand, for compliance with expensive environmental standards.

Human trafficking (also called forced labor) is

modern-day slavery—the illegal recruitment and movement of people against their will, usually to exploit them for economic gain

interactions between lead firms and suppliers is a sequential process that begins with

monitoring and remediation, and then moves upward through capability building, and finally to the creation of shared value. Firms continue activities at the lower levels, even as they progress through the next two, in cumulative steps.

In a simpler time, when a firm operated its own manufacturing facilities in a limited geographical area,

monitoring compliance with an established set of standards was straightforward.

supply chain audit

monitors a supplier's performance to determine if it is in compliance with the relevant code of conduct

The lead firm may feel a

moral obligation to the workers and local community not to cause job loss.

Why would adding women to boards improve performance?

more gender-diverse boards were more likely to avoid a rush to consensus and realistically consider alternative courses of action. Women brought different life experiences to the table and were more likely to raise multiple stakeholder concerns. Having more diverse boards also signaled to the public a company's commitment to diversity and inclusion

The most prestigious and highest-paying jobs in a corporation are in top management. Because

most corporations are organized hierarchically, management jobs—particularly those at the top—are few a small fraction of workers, of whatever gender or race, can hope to reach the upper levels in the business world. White men have traditionally filled most of these desirable spots

wages are not necessarily unethical. People in developing countries

need jobs and are often willing to work at pay below what would be considered acceptable in developed nations

Private regulation refers to

nongovernmental institutions that establish rules in global supply chains. It generally takes the form of company and industrywide codes of conduct with which suppliers must comply. Private regulation tends to arise in situations where public regulation is weak, and lead firms carry significant reputational risk because of strong consumer brands.

this reflects the influence of

nongovernmental organizations and standard-setting associations that have provided templates.

Management justifies the increase in employee monitoring for a number of reasons.

not a productive use of their time Employers also fear lawsuits if employees act in inappropriate ways The employer also needs to make sure that employees do not disclose confidential information to competitors or make statements that would publicly embarrass the company or its officers used for training and quality control purposes.

But in today's more complex world,

obtaining this information can be extraordinarily difficult.

Another form of employee substance abuse—which causes twice the problems of all illegal drugs combined—is alcohol use and addiction. The problem is not just hard-core alcoholics, however. Most alcohol-related problems in the workplace, one study found, were caused by people who

occasionally drank too much after work and came in the next day with a hangover, or who went out for a drink on their lunch break. U.S. businesses lose an estimated $88 billion per year in reduced productivity directly related to alcohol abuse

Many observers agree, however, that the pay gap persists, in part, because of what is called

occupational segregation

when does private regulation occur

occurs when private companies or groups of companies voluntarily set rules of behavior for themselves and their business partners

The advantage of an external audit is that it is

often perceived by stakeholders as more objective and reliable.

Companies can adopt their own code, or agree to

one of the NGO or industrywide codes

What continues to hold women and minorities back—in the executive suite and on boards of directors?

one primary obstacle is glass walls

In all these areas—monitoring employees electronically, policing office romance, testing for drugs, and conducting psychological tests—businesses must balance their needs to

operate safely, ethically, and efficiently with their employees' right to privacy

supplier

organization that provides goods or services to another organization

Labor unions are

organizations, such as the Service Employees International Union or the Teamsters, that represent workers on the job.

Employees in the United States enjoy several important legal guarantees. They have the right to

organize and bargain collectively, to have a safe and healthy workplace and, to some degree, to have job security

In the United States, and in most other nations, employees have a fundamental legal right to

organize labor unions and to bargain collectively with their employers. The exceptions are some communist countries (such as China, Vietnam, Cuba, and the People's Democratic Republic of Korea) and some military dictatorships (such as Eritrea), where workers are not permitted to form independent unions

Some governments require foreign firms to

partner with state-owned companies in order to do business there, adding another level of risk.

corporate policy plays an important role in income inequality. When businesses decide to

pay very high executive compensation and to keep wages as low as possible for ordinary employees, they are contributing to inequality in the broader society.

The challenge for businesses, then, is to assure that their suppliers

pay wages that are perceived as fair and that permit workers and their families to achieve a decent standard of living. Minimum wages established by law may not be sufficient

But such investments are expensive, and long-term commitments make it hard for companies to adjust to the ups and downs of the business cycle. Some firms resolve this dilemma by employing two classes of employees

permanent workers, who enjoy stable employment and full benefits, and temporary workers and independent contractors, who do not.

Employee theft has emerged as a significant economic, social, and ethical problem in the workplace. Many companies in the past used

polygraph testing (lie detectors) as a preemployment screening procedure or on discovery of employee theft.

In 1988, the Employee Polygraph Protection Act became law. This law severely limited

polygraph testing by employers and prohibited approximately 85 percent of all such tests previously administered in the United States. In response to the federal ban on polygraphs, many corporations have switched to written psychological tests that seek to predict employee honesty on the job by asking questions designed to identify desirable or undesirable qualities.

Abuse of drugs, both illegal drugs such as heroin and methamphetamine and legal drugs such as Oxycontin or Xanax when used inappropriately, can be a serious problem for employers. They are much more likely than others to produce

poor-quality work, have accidents that hurt themselves and others, and steal from their employers. Some break the law by selling drugs at work to support their habits.

Although virtually all lead companies require their suppliers, at the least, to comply with relevant national laws regarding child labor, the possibility that children continue to be employed somewhere in the supply chain

poses a risk

increasingly, firms try to work in a positive way..

positive way with suppliers to help them improve their practices

Women still make up 98 percent of

preschool and kindergarten teachers, 95 percent of hairdressers, and 98 percent of dental hygienists,

In the United States and the United Kingdom, where similar legislation was unlikely, some institutional investors had started

pressuring companies to appoint more women and minorities to directorships

Private regulation also called

private governance

Business has found that child care programs, in addition to reducing absenteeism and tardiness, also improve

productivity and aid recruiting by improving the company's image and helping to retain talented employees. Most large U.S. companies provide some type of child care assistance, including dependent care accounts (77 percent) and referral services (61 percent).

privacy rights

protecting an individual's personal life from unwarranted intrusion by the employer

suppliers are an important market stakeholder of businesses, since they

provide critical inputs and often manufacture entire products that companies then sell to customers under their own brand

In this crowd source audit approach, rather than relying on inspectors—who may be deceived by factory managers who want conditions to appear better than they really are—workers

provide information directly by responding to questions generated by a recorded voice on their mobile phones when they are away from work

employers have an obligation to

provide some measure of job security, a safe and healthy workplace, and equal opportunity for all. must pay a fair and decent wage and respect workers' rights to organize and bargain collectively, as guaranteed by U.S. law (and the laws of many other nations). obliged to respect employees' rights to privacy and to some extent at least their rights to free speech and to do what they want outside the workplace

Backers of affirmative action argued that these programs

provided an important tool for achieving equal opportunity. In this view, women and minorities continued to face discriminatory barriers and affirmative action was necessary to level the playing field. Some large corporations backed affirmative action programs, finding them helpful in monitoring their progress in providing equal job opportunity

how can businesses invest in employees

providing a well-structured career, job security, and benefits including pensions

Purpose of Affirmative Action

purpose is to reduce job discrimination by encouraging companies to take positive (that is, affirmative) steps to overcome past employment practices and traditions that may have been discriminatory

∙ Under U.S. law, businesses are required to provide equal opportunity to all, without regard to

race, color, religion, sex, national origin, disability, or age. Sexual and racial harassment are illegal

integrated supplier scorecards

rate suppliers on multiple dimensions, including both traditional measures (such as cost, quality, and timeliness) and newer measures of social, ethical, and environmental performance. For example, Nike has introduced a Manufacturing Index that measures and rewards suppliers on four dimensions—quality, on-time delivery, cost, and sustainability—each of which is weighted 25 percent.

Other reasons why their firms had invested in supplier social responsibility was to

reduce costs, satisfy government regulations, avoid disruptions, increase sales, and allay public criticism

Critics of affirmative action also argued that these programs could actually

stigmatize or demoralize the very groups they were designed to help. For example, if a company hired a woman for a top management post, other people might think she got the job just because of affirmative action preferences, even if she were truly the best qualified. This might undermine her effectiveness on the job or even cause her to question her own abilities.

consensual relationship agreement

stipulating that an office relationship is welcome and voluntary—to protect against possible harassment lawsuits if the people involved later break up

Traditional measures

such as cost, quality, and timelines

Employees who are discharged in retaliation for blowing the whistle, in a situation that affects public welfare, may

sue for reinstatement and in some cases may even be entitled to punitive damages. The federal Sarbanes-Oxley Act, passed in 2002 makes it illegal for employers to retaliate in any way against whistle-blowers who report information that could have an impact on the value of a company's shares

suppliers have more leverage than others.

suppliers that control critical worker skills, technical know-how, or relevant manufacturing infrastructure have more leverage than others.

Discussion Case: Apple's Supplier Code of Conduct and Foxconn's Chinese Factories

supply chain audits had turned up some persistent problems. Eight percent of workweeks were not compliant with the company's 60-hour maximum standard, and auditors had also found instances of underage workers and excessive fees paid by foreign contract workers. As a result of the audits, workers were retroactively paid for unpaid overtime and refunded excessive fees. The company's biggest supplier was the Taiwanese firm Foxconn, two separate explosions at factories where iPads were being made (one was Foxconn's facility in Chengdu), apparently caused by a build-up of combustible aluminum dust, injured 77 and killed four Under intense public scrutiny and pressure from Apple, Foxconn made significant changes.

In the absence of effective public regulation, many companies and industries have written—and undertaken to enforce—their own voluntary

supply chain codes of conduct

As globalization has increased...

supply chains have become increasingly complex.

Because of the complexity of these systems, firms sometimes refer to their

supply webs or networks, rather than use the term supply chain, which implies a simple, linear relationship

One critical issue for business is

supporting workers with responsibilities for children and elderly relatives.

affirmative action plans must be

temporary and flexible, designed to correct past discrimination, and cannot result in reverse discrimination against whites or men.

. Affirmative action plans remain legal, but only if they are

temporary and flexible, designed to correct past discrimination, and do not result in reverse discrimination.

A supplier is an organization

that provides goods or services to another organization

On the other hand, a disadvantage of internal audit is

that stakeholders might view reports based on an internal audit as less credible, because the company would have an interest in casting itself and its suppliers in a favorable light.

gives workers the right to a job "free from recognized hazards that are causing or likely to cause death or serious physical harm."

the Occupational Safety and Health Act

Many businesses have helped employees balance

the complex demands of work and family obligations by providing support programs such as child and elder care, flexible work schedules, domestic partner benefits, and telecommuting options

Lead firms decide to engage in capability-building because

the cost of switching suppliers may be too high

Supplier development can benefit

the lead firm and the supplier

effect of OSHA

the number of workplace deaths has fallen by more than two-thirds, even as the workforce has almost doubled. Very serious occupational illnesses, such as brown lung and black lung have been significantly reduced. The rate of lead poisoning suffered by workers in smelters and battery plants, among other workplaces, has also fallen dramatically.

Few major companies, of course, knowingly tolerate human trafficking in their organizations or those of their suppliers. But in today's complex supply networks,

the presence of such forced labor can pose a serious reputational and legal risk

occupational segregation

the separation of men and women into different kinds of jobs inequitable concentration of a group, such a minorities or women, in particular job categories.

Millions of children need daily care, especially the more than half of preschool-aged children whose mothers hold jobs. A major source of workplace stress for working parents is concern about

their children; and problems with child care are a leading reason why employees fail to show up for work

companies need to understand and monitor actions by all participants throughout

their supply networks, not just those with whom they have direct relationships

The secondary dimensions of diversity are many;

they include such characteristics as communication style, ways of thinking and interacting, family status, and first language

The best-managed companies go beyond compliance;

they not only assemble diverse teams but implement a range of policies and practices to include all employees in a workplace that is welcoming, fair, and accommodating.

Low wages are, of course, one of the main reasons that brands contract with suppliers in developing countries;

they reduce overall costs and enable brands to price their products more competitively.

If employees, based on their personal points of view, were freely allowed to expose issues to the public and allege misconduct, a company might be

thrown into turmoil and be unable to operate effectively

Lead firms often categorize their suppliers according to

tier or level

As the workforce has become more diverse, business has been challenged to

to accommodate their employees' differences and to include their multiple perspectives. When people go to work they do not shed their identities at the office or factory door. When employees come from families where there are young children at home, or where elderly parents require care, companies must learn to support these roles. Businesses that help their employees achieve a balance between work and life and meet their obligations to their families and communities often reap rewards in greater productivity, loyalty, and commitment

Company information is generally considered

to be proprietary and private

If suppliers are unconvinced they will benefit from more orders or higher margins, they are less willing

to participate

Women are the targets of most sexual harassment. Sexual harassment is illegal, and the EEOC is empowered to

to sue on behalf of victims. Such suits can be very costly to employers who tolerate a hostile work environment

Other suppliers may not be readily available

to take over the contract

Although many businesses have credited OSHA with helping reduce lost workdays and worker compensation costs, others have criticized the agency's rules as being

too costly to implement and administer. For example, OSHA withdrew a proposed noise exposure standard, intended to prevent hearing loss, after employers complained it would be too expensive Some studies showed that the burdens of complying with regulations fell hardest on small businesses.

Although early codes of conduct were typically developed by and were specific to individual companies, the current trend is

toward adoption of common standards within industries.

Supplier development may take several forms, including

training, joint problem solving, and investing in equipment or infrastructure.

Another issue of concern to supply chain managers is the environmental impact of transporting

transporting products long distances from where they are made, grown, or extracted to where they are further processed or sold to consumers.

Women and persons of color have made great strides in entering all occupations, but they continue to be

underrepresented in many business management roles, especially at top levels. Both groups face a continuing pay gap.

Once a company has developed its own code of supplier conduct, or agreed to comply with an industrywide or global code, it must

undertake to enforce these rules.

the percentage of employees who are represented by unions in selected industrialized nations shows that

unionization rates are very high in the Scandinavian countries; of all countries shown, the unionization rate is the lowest in the United States.

Suppliers that provide.... tend to have more power

unique skills, resources, or capabilities

Under the Family and Medical Leave Act (FMLA), passed in 1993, companies that employ 50 or more people must grant

unpaid, job-protected leaves of up to 12 weeks to employees faced with serious family needs, including the birth or adoption of a baby.

Moreover, whistle-blowers sometimes benefit from their actions. The U.S. False Claims Act (also known as the Lincoln Law), as amended in 1986, allows individuals who sue federal contractors for fraud to receive

up to 30 percent of any amount recovered by the government. In the past decade, the number of whistle-blower lawsuits—perhaps spurred by this incentive—increased significantly, exposing fraud in the country's defense, health care, municipal bond, and pharmaceutical industries

Individuals' distinguishing characteristics clearly impact their

values, opportunities, and perceptions of themselves and others at work

Research suggests that the social contract governing the employment relationship has

varied across cultures, and also across time. For example, in Europe, employers have historically given workers and their unions a greater role in determining company policy than do most U.S. employers.

Suppliers are also known as

vendors or contractors

supply chain map

visual representation of the multiple links between a lead firm, its suppliers, and eventually its customers. It shows the movement of a particular product from the beginning of the supply chain to the end, superimposed on a geographical map.

Global supply chains have many social impacts Prominent among them are the

wages, working conditions, and health and safety of employees in supplier factories

Unions negotiate with employers over

wages, working conditions, and other terms of employment.

In the wake of the Great Recession, elected officials in several states sought to

weaken unions by limiting the rights of public sector workers. For example, the Wisconsin legislature passed a law that took away the right of public sector unions (except those representing public safety officers) to bargain over pensions and health care benefits. In 2015, Wisconsin joined 24 other states in adopting a so-called right-to-work law, which barred unions from requiring all workers they represented to pay dues or fees

Supply chain transparency

what happens in a company's supply chain is fully disclosed to stakeholders—as if seen through a clear glass window.

Companies normally do not reveal

what they spend on supply chain auditing. However, The New York Times estimated that the cost of a factory audit could range from $1,000 for a one-day, "check-the-box" audit to as much as $5,000 for a thorough, multi-day inspection.

family leave

when the care of elderly relatives is involved

When an employee believes his or her employer has done something that is wrong or harmful to the public, and he or she reports alleged organizational misconduct to the media, government, or high level company officials, ______ has occurred

whistle-blowing has occurred

tier-2 suppliers (sometimes called subcontractors)

who may in turn work with even more distant suppliers. In the automobile industry, for example, there may be six to ten levels of suppliers between the automaker and the source of raw materials, and a company may not even be aware of some of the parties that contribute at some point to the finished product

Of the estimated 2.5 million victims of human trafficking in the world, about 80 percent are

women and girls forced into prostitution. Most of the rest are coerced into working on farms and in factories in many industries, including food processing, construction, textiles, and hospitality, often for low pay or even no pay at all

Another problem is that in filling top positions, recruiters rely on

word-of-mouth—the old boys' network from which women and persons of color are often excluded

An issue of emerging importance is

worker health and safety in supplier factories Workers can be exposed to dangerous chemicals in poorly ventilated spaces. Malfunctioning or improperly guarded mechanical equipment or tools can maim and kill. In some developing countries, structurally unsound buildings have been repurposed for use as factories, with horrifying results

Arguments Opposing Employee Drug Testing

• Invades an employee's privacy • Violates an employee's right to due process • May be unrelated to job performance • May be used as a method of employee discrimination • Lowers employee morale • Conflicts with company values of honesty and trust • May yield unreliable test results • Ignores effects of prescription drugs, alcohol, and over-the-counter drugs • Drug use an insignificant problem for some companies

equal employment opportunity. These government rules apply to most businesses in the following ways

∙ Discrimination based on race, color, religion, sex, national origin, physical or mental disability, or age is prohibited in all employment practices. includes hiring, promotion, job classification and assignment, compensation, and other conditions of work. (Discrimination based on sexual orientation and gender identity is not prohibited by federal law, although it is prohibited by some state laws.) ∙ Government contractors must have written affirmative action plans detailing how they are working positively to overcome past and present effects of discrimination in their workforce ∙ Women and men must receive equal pay for performing equal work, and employers may not discriminate on the basis of pregnancy.

private regulation has assumed increasing importance, for several related reasons.

∙ Lack of jurisdiction of home country governments. Weak regulatory capacity in developing countries Limited enforcement power of transnational institutions

Scholars have hypothesized that private governance is most likely to emerge in global supply chains under several conditions. These include:

∙ Large lead firms have leverage over smaller suppliers. ∙ Firms and products have highly visible brands, and are therefore more vulnerable to reputational damage. ∙ Civil society is exerting pressure for responsible practices; for example, through campaigns, boycotts, or shareholder resolutions. ∙ A strong business case can be made for social and environmental responsibility.

A specific human rights challenge in global supply chains is

sourcing minerals and other valuable commodities from conflict zones.

Immigrants are more likely to

start a business than are nonimmigrants; over the past two decades, they have been responsible for 30 percent of small business growth

Today, employers' freedom to terminate workers has been dramatically

reduced Some of the restrictions include the following: An employer may not fire a worker because of race, gender, religion, national origin, age, or disability. An employer may not fire a worker if this would constitute a violation of public policy, as determined by the courts. For example, if a company fired an employee just because he or she cooperated with authorities in the investigation of a crime, this would be illegal. An employer may not fire a worker if, in doing so, it would violate the Worker Adjustment Retraining Notification Act (WARN). This law, passed in 1988, requires most big employers to provide 60 days' advance notice whenever they lay off a third or more (or 500 or more, whichever is less) of their workers at a work site. If they do not, they must pay workers for any days of advance notice that were missed. ∙ An employer may not fire a worker simply because the individual was involved in a union organizing drive or other union activity. ∙ An employer may not fire a worker if this would violate an implied contract, such as a verbal promise, or basic rules of "fair dealing." For example, an employer could not legally fire a salesperson just because he or she had earned a bigger bonus under an incentive program than the employer wanted to pay.

supplier development

refers to activities undertaken by companies to improve the performance of firms in their supply chains

private regulation

refers to nongovernmental institutions that govern—that is, enable and constrain—economic activities.

supply chain

refers to the multiple steps involved in the movement of a product or service from the most distant supplier to the customer

diversity

refers to variation in the important human characteristics that distinguish people from one another

what do many people believe are private matters and should be safe from snooping by the boss

religious and political views, their health conditions, their credit history, and what they do and say off the job

Sexual harassment at work occurs when any employee, woman or man, experiences

repeated, unwanted sexual attention or when on-the-job conditions are hostile or threatening in a sexual way. It includes both physical conduct—for example, suggestive touching— as well as verbal harassment, such as sexual innuendoes, jokes, or propositions

Although unions have weakened over time, they continue to

represent workers in some parts of the economy, particularly in the public sector.

Another key measure of diversity is the

representation of women on corporate boards.

An audit, whether conducted internally or externally, generally consists of a

review of documentation (such as payroll and personnel records), a facility inspection, and interviews with workers and managers.

Lead firms can provide a variety of

rewards or incentives to suppliers that collaborate to build capabilities. Cisco, for example, gives preference to otherwise qualified suppliers that meet certain sustainability standards. Starbucks offers farmers that achieve high marks in its CAFÉ (Coffee and Farmer Equity) program—which scores coffee producers on social and environmental criteria—a premium price for their coffee beans

local sourcing,

seeking to source from nearby suppliers where practical

internal audit

self-audit conducted by a staff member or consultant hire and train its own staff of auditors whose job is to inspect factories—either its own or those operated by contractors—to determine whether or not they are in compliance

In short, supply chain managers face a number of significant social, ethical, and environmental issues. How do they rank these issues in order of importance?

senior supply chain managers ranked social and environmental issues in a 2013 survey. -Health and safety was listed first, ethical issues ranked second; Product integrity Product innovation Energy efficiency Waste management Emissions Hazardous materials Supplier diversity Resource scarcity

Grouped by industry, women tend to be concentrated in

service industries and in finance, insurance, real estate, and retail businesses. Women managers have also made gains in newer industries, such as biotechnology, where growth has created opportunity

Experts disagree about the cause of the pay gap between women and men. Some believe the continuing gender disparity in pay is evidence of

sex discrimination by employers; others believe the gap reflects women's choices to pursue lower-paying jobs or slower advancement because of time off for family responsibilities.

Government regulations ban both

sexual and racial harassment. Of the two kinds, sexual harassment cases are more prevalent, and the law covering them is better defined. But racial harassment cases are a growing concern to employers

Research shows that when companies invest in suppliers and their employees, exchange knowledge, and collaborate on improvements, they create

shared value that benefits both parties

Fierce global competition and greater attention to improving the bottom line have resulted in

significant corporate restructuring and downsizing (termination) of employees in many countries. This trend has led some researchers to describe a new social contract