Law and Ethics in the Business Environment Term Paper

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Law and Ethics in the Business Environment


Business Ethics and the Law

Business law fixes the minimum standards of behavior for businesses (Bramble, 2013). Enforcing these laws generally consists of fines involved in the exercise of trade and commerce. Criminal accountabilities must be proven in the appropriate court of law through evidence. Even when found culpable, a business can only be fined as a penalty. But business ethics exceeds simple legality as it sets the way a business should conduct what it is legally obliged to. It consists of values upheld and practiced by the majority. It is the spirit of the letter of the law. It is intended to establish an environment of personal accountability in a business environment when the law does not explicitly establish it. At the same time, it shapes the reputation of the business for the public to see and accept. The reputation is founded on accepted values like honesty, integrity, confidentiality or respect, which are all part of business ethics. The law may not require a business to be truthful or honest about its product or service, but being honest about it is what will build its reputation for being ethical. This is because consumers or the people will not buy or patronize a business not known for being ethical (Bramble). Businesses are concerned with business ethics because they want to avoid criminal and civil law violations and all actions that will damage their public image and reputation (Fieser, 2005). The three different ways of establishing standards of business ethics are from the profit motive, following the law, and from general moral obligations. There are weak and strong versions of the approach from the profit motive. The weak version says that "good ethics results in good business." The strong one, in reverse, says that "good business results in good ethics." In a free market, the profit motive is what creates a morally appropriate environment. Customers demand safe products and they will buy or work only for businesses that meet this demand. The fact is that businesses, which do not respond to this reality will not survive. However, this strong version, like the weak one, has problems unique to itself. This means that not every moral business practice will develop out of the profit principle. Restricting business ethics to following the law seems to be optional. There are always opposing arguments to what the law requires or supra-legal principles. It cannot, therefore, be expected of businesses to perform duties on account of much disagreement over what is or are not fixed. And establishing business ethics from general moral obligations should place morality outside of both the profit motive and the law. Most philosophers agree to this third approach and place proper ethical behavior on a level above the law. They address supra-legal moral principles by suggesting five broad moral principles as the standard of ethical compliance for businesses. These are the harm principle of avoiding causing unwarranted harm; the fairness principle of being fair in all their practices; the human rights principle of respecting human rights; autonomy principle of not infringing upon the rationally reflective choices of individuals; and the veracity principle of avoiding deceptive practices (Fieser).

Applying the Law to Specific Issues in the Workplace


An employer has the right to monitor all incoming and outgoing business calls, emails and conversations during work hours (Lister, 2013). It is not a breach of employee's privacy rights for the employer to review the documents in the possession of the employee for any purpose. The employee can be held accountable for the information contained in those documents. Employee privacy rights are, however, guaranteed and protected under the Fourth Amendment of the U.S. Constitution. He may not be subjected to unreasonable searches or seizures for personal belongings or conversations. The employer violates this law if he searches or orders the search of an employee's personal items except in the case of an executive order for security purposes (Lister).

The Wheeler Lee Act of 1938 prohibits deceptive advertising by businesses (Fleming, 2013). The Federal Trade Commission is the governing and implementing body for this law. It specifically prohibits unsubstantiated claims of superior performance of products, goods, or services through any print, electronic, digital, or product labels. These practices create mistrust and reluctance among consumers (Fleming).

Affirmative Action

This is a policy, which provides job opportunities to applicants who may be subjected to discrimination because of particular obstacles or disadvantages, such as gender or race (Handlin, 2013). It is meant to boost employment among disadvantaged minority groups. However, it is not like equal employment opportunity laws. Affirmative action can be enforced only in the public sector and in businesses with government contracts. Nonetheless, more and more private businesses opt to voluntarily comply with affirmative action guidelines in order to improve their workforce diversity (Handlin).

Very likely, these businesses consider demographics within their organizations in making

that decision (Afredo, 2013). If an ethnic group constitute a large share of the workforce, the organization should have the equivalent representation of that group. But before representation is attempted, there should be some openness in all to different cultural practices and customs without these interfering with work operations. This requires respect for other cultures and a sincere desire to integrate insights or innovations from these practices into policies. Morally, this conduces to integrating all members as if their respective identities and history matter alike (Alfredo).

Sexual Harassment

Title VII of the Civil Rights Act of 1964 states that no employee should be discriminated based on his sex/gender (Wicks, 2013). Sexual harassment is a form of workplace discrimination and can be the subject of a complaint in the category of discrimination. The sexual harassment acts of even a single perpetrator can foster a sexually hostile environment in the workplace. Both male and female employees realize and become wary that they can lose their jobs if they do not give in to the sexual advances of the perpetrator, often the employer or manager. Sexual harassment may and are also committed by employees against fellow employees. One way is when they apply indirect pressure on the victim to either resign or tolerate the harassment. Sexual harassment in all forms rob hardworking employees of their morale (Wicks).


Safety Sciences professor Dr. Jan Wachter argued that the Golden Rule may be used as basis for workplace safety programs (Newswise, 2011). But it is the responsibility of safety professionals to infuse ethical standards into the programs. This is because many current approaches to safety management are not solidly ethically based. Laws inform people what they cannot do and ethics instructs people and organizations what they should do. Ethics instructs about doing the right thing and not doing the wrong thing.

Dr. Wachter endorsed a safety management systems approach in the workplace. It recognizes that all unsafe acts and conditions suggest problems in the management system. The creation and enforcement of an ethical system in an organization rest on senior management, which will effectively analyze and control workplace hazards. Safety is a fundamental function of business, like quality, rather than just a "sunk cost (Newswise)."

Environmental Protection

Businesses are the biggest contributor to environmental damage in the form of energy consumption, toxic waste, air and water pollution and deforestation (Fieser, 2005). Industrial toxic waste contaminates ground water and harms those who use it. Oil spills from petroleum industries, the burning of fossil fuels, and fluorocarbon gases from the manufacture of domestic products are among the environmental threats of business. They threaten life in this planet (Fieser). These realities make businesses ethically responsible.

Some of these problems are expensive nuisances, such as oil spills and toxic waste.

Products Liability

Businesses are usually answerable for defective products, negligence and breaches of warranty (Frenz, 2013). These are examples of…[continue]

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