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CHAPTER 15
EMPLOYEES AND THE CORPORATION
INTRODUCTION
Employees and employers are engaged in a critical relationship affecting the
corporation’s performance. There is a basic economic aspect to their association:
Employees provide labor for the firm, and employers compensate workers for their
contributions of skill and productivity. Yet, also present in the employee-employer
exchange are numerous social, ethical, legal, and public policy issues. Attention to the
rights and duties of both parties in this relationship can benefit the firm, its workers, and
society.
PREVIEW CASE
Worker’s pay increased at Target
Worker schedules stabilized at Starbucks
Interviewer requests Facebook login information from job applicant
What is a fair pay level for workers? Who or what should determine wages—the free
market, the employer acting unilaterally, collective bargaining negotiations between
employers and unions, or government mandates such as minimum wage laws?
What is the best way to balance the employer’s need for flexibility and efficiency in
scheduling part-time workers’ hours with the employee’s need for predictability in
organizing their lives and finances? Should scheduling be subject to government
regulation, or be left to employers and employees to work out?
Should employers, like the correctional services department in this example, have a right
to review job applicants’ social media pages? What information should be considered
private, and what should be considered public? What if the job was not in the correction
services field but in some other line of work, would the employer have the right to review
your Facebook page then? Who should be responsible for protecting applicant and
employee privacy?
Teaching Tip: Preview Cases
The three preview examples illustrate the complexity of the rights and
duties of both employers and employees in the modern workplace. In
the first example, a worker’s right to fair and decent wages is explored.
The second example examines fair and healthy worker scheduling. In
the final example, the potential employer is checking a man’s
background at the expense of his privacy.
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CHAPTER OUTLINE
I. THE EMPLOYMENT RELATIONSHIP
II. WORKPLACE RIGHTS
III. SPECIAL ISSUE: WAGES AND INCOME INEQUALITY
IV. PRIVACY IN THE WORKPLACE
A. Electronic Monitoring
B. Romance in the Workplace
C. Employee Drug Use and Testing
D. Alcohol Abuse at Work
E. Employee Theft and Honesty Testing
Teaching Tip:
Rights and Duties of Employers and Employees
Students may be asked to consider the brief vignettes given in the
preview examples. What rights or duties, as shown in Figure 15.1, are
illustrated by these mini-cases? Do any rights conflict? If so, which
should be given priority?
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prior written consent of McGraw-Hill Education.
V. WHISTLE-BLOWING AND FREE SPEECH IN THE WORKPLACE
VI. EMPLOYEES AS CORPORATE STAKEHOLDERS
GETTING STARTED
KEY QUESTIONS AND CHAPTER OBJECTIVES
LO 15-1: Understanding workers’ rights to organize unions and bargain
collectively.
LO 15-2: Knowing how government regulations assure occupational safety and
health and what business must do to protect workers.
LO 15-3: Evaluating the limits of employers’ duty to provide job security to their
Teaching Tip: Whistle-blowing
Various real corporate examples could be introduced into a class
discussion to explore factors that may cause an individual to blow the
whistle against a firm. How much harm must occur? How much
potential for harm is a sufficient motivator? How much privacy should
be given to an organization? Are internal whistle-blowing programs —
developed by many firms — adequate, or are they window dressing or
legal protection? The clash between an employee’s loyalty to an
organization and her or his duty to society or a corporate stakeholder is
a rich area for discussion.
Instructors may wish to use clips from the movie “The Insider,” which
is a fictionalized account based on the story of Jeffrey Wigand, who
blew the whistle on tobacco company Brown & Williamson.
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prior written consent of McGraw-Hill Education.
LO 15-4: Analyzing employer obligations to pay workers fairly and how pay
policies can contribute to income inequality.
LO 15-5: Appraising the extent of employees’ right to privacy, when businesses
monitor employee communications, police romance in the office, test for drugs
or alcohol, or subject employees to honesty tests.
performance.
LO 15-6: Debating if employees have a duty to blow the whistle on corporate
misconduct, or if employees should always be loyal to their employer.
extended new protections to whistle-blowers.
KEY TERMS
drug testing
electronic monitoring
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INTERNET RESOURCES
DISCUSSION CASE
THE UGLY SIDE OF BEAUTIFUL NAILS
Discussion Questions
1. This section describes several “workplace rights.” Which of these rights are
Video Tip: The Nail Industry
The PBS News Hour aired an interview with the author of the New
York Times series on the nail industry on May 8, 2015, under the title
“Who Really Pays the Price for Those Beautiful Nails?” It runs 4:49
and may be accessed at www.pbs.org.
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prior written consent of McGraw-Hill Education.
Figure 15.1 lists several employee rights. Of these, the two most relevant to this
case are the right to a safe and healthy workplace and the right to fair and decent
chemicals used were toluene, dibutyl phthalate, and formaldehyde. Workers also
inhaled acrylic dust; acquired fungal infections from customers’ hands and feet;
2. To what degree do you think managers in the nail salon industry would be
able to improve conditions voluntarily if they wished to do so, and why do
you think so?
raised its prices to support higher wages and better working conditions for its
3. What factors make it particularly difficult for workers in the nail industry
to organize to improve their own conditions, and how could these factors be
overcome?
themselves unemployed, if the salon then became uncompetitive. Many workers
are undocumented immigrants and intimidated by fear of deportation. Many have
unions, NGOs, and government regulators.
4. What factors make it particularly difficult for government policy makers and
regulators to make rules for the nail industry and enforce them? How could
these factors be overcome?
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Several factors made it difficult for government policy makers and regulators to
difficult to enforce, since salons were numerous, small, and went in and out of
5. What do you think is the best way to improve conditions for workers in the
nail industry?
officials had posted a manicurist’s “bill of rights” in ten languages in every salon,
describing minimum wage laws and required safety measures. Workers
Teaching Tip: The Nail Industry
Students may be encouraged to research organizations that promote an
ethical nail industry, such as the California Health Nail Salon
Collaborative at www.cahealthynailsalons.org.