Major Issues in Ethical Management

Some of the major issues an organization deals with is handling ethical challenges in workforce diversity.

The following are some of the major ethical challenges an organization faces in ethical management −

Harming Some While Benefitting Others

HR managers do much of the screening while the hiring process is still on. By its very nature, screening leaves some people out and permits others to move forward. In short, the ones left out will be affected by not getting the job, no matter how much they need it.

HR managers can neglect the emotionalism of such situations by adhering strictly to the skill sets and other needs of the position, but there will always be a gray area where HR managers may scale how much each applicant wants and needs the job.

Equal Opportunity

The HR managers must regularly monitor the company’s hiring practices to make sure there is no discrimination in the hiring process based on ethnicity, sexual orientation, race, religion and disability. However, simply abiding with Equal Employment Opportunity Commission (EEOC) guidelines does not guarantee ethical behavior.

For example, if an HR manager recommends a candidate in order to fill a quota, that decision is unethical, because it will remove other applicants that may be more qualified.


Privacy is always a sensitive matter for an HR manager. Though a company culture may be friendly and open and motivates employees to freely discuss personal details and lifestyles, the HR manager has an ethical obligation to keep such matters private. This specifically comes into play when the competing company calls for a reference on an employee. To remain ethical, HR managers must abide with the job-related details and leave out knowledge of an employee’s personal life.

Compensation and Skills

HR managers can suggest compensation. While these recommendations may be based on a salary range for each position, ethical dilemmas arise when it comes to compensating employees differently for the same skills.

For example, a highly sought-after executive may be able to negotiate a higher salary than someone who has been with the company for several years. This can become an ethical problem when the lower-paid employee learns of the discrepancy and questions whether it is based on characteristics such as gender and race.

Human resources departments must handle a host of ethical and legal issues from the regulations of the EEOC to the principles and practices of organizations such as the Human Resource Management Institute.

Labor Costs

HR must cope with conflicting needs to keep labor costs as low as possible and to invite fair wages. Ethics come into action when HR must select between outsourcing labor to countries with lower wages and harsh living conditions and paying competitive wages.

While there is nothing illegal about outsourcing labor, this issue has the potential to build a public relations problem if consumers object to using underpaid workers to save money.

Opportunity for New Skills

If the HR department selects who gets training, it can run into ethical issues. As training is a chance for development and broadened opportunities, employees who are left out of training may debate that they are not being given equal opportunities in the workplace.

Fair Hiring and Justified Termination

Hiring and termination decisions must be made without regard to ethnicity, race, gender, sexual preference or religious beliefs. HR must take precautions to eliminate any bias from the hiring and firing process by making sure such actions adhere to strict business criteria.

Fair Working Conditions

Companies are basically expected to provide fair working conditions for their employees in the business environment, but being answerable for employee treatment typically means higher labor costs and resource utilization.

Fair pay and benefits for work are more obvious factors of a fair workplace. Another important factor is provision of a non-discriminatory work environment, which again may have costs engaged for diversity management and training.

By now it’s pretty clear that while working in an organization, we come across people with different backgrounds, cultural beliefs and we need to respect their beliefs. In case an employee feels left out due to some problem, it may not work in the favor of the organization.

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