Case 13.3: Reexamining a Proposal
Case synopsis and analysis
David Jones seeks to start a printing business and contacts a reputable professional employer
organization (PEO) to obtain an estimate for human resource services. The estimate included
costs for payroll, benefits, and the like and was sought before David opened or purchased his
business.
David then purchased an existing printing company and contacted the PEO to sign a contract for
human resource services at the previously quoted price. Sometime after signing the contract, the
Learning objectives:
• Students should recognize some of the complexities of ethical decision making.
Answers to questions in the text:
1. What role should ethics play in the writing of a proposal such as this? Did the PEO do the
ethical thing for David? How much money should the PEO have tried to make? What would you
have done if you were part of management at the PEO?
Students will waver on this a bit. However, most students will argue that ethics should play a
key role in the proposal. The PEO seemed to do the right thing when it revised the contract and
Northouse, Leadership: Theory and Practice, Seventh Edition: Instructor Resource
2. From a deontological (duty) perspective and a teleological (consequences) perspective, how
would you describe the ethics of the PEO?
Utilitarianism states that we should behave so as to create the greatest good for the greatest
number. Deontology concerns duty, and whether an action is itself good. Lying, for instance, is
not a good action even if done for a worthy cause.
3. Based on what the PEO did for David, how would you evaluate the PEO on the ethical
principles of respect, service, justice, honesty, and community?
4. How would you assess the ethics of the PEO if you were David? If you were among the PEO
management? If you were the salesperson? If you were a member of the printing community?
Students may argue this differently, but most will feel that the ethics of the PEO were strong
from all perspectives. David should be impressed with the PEO’s behavior, since it agreed to
Northouse, Leadership: Theory and Practice, Seventh Edition: Instructor Resource
Potential teaching approaches:
This case study is conducive to group discussions and exercises.
Below is a way to structure a class based on case study 13.3:
• Read case study 13.3.
Exercises for this case study:
1) Using the utilitarian approach, students should analyze whether the contract should be
2) In small groups, students need to develop a plan for the PEO so that this does not
happen again. Essentially, this requires students to step back in time and consider