Ethics and Independent Contractor Status

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Integrative Case 1: Nike

1. What ethical issues faced by MNCs in their treatment of foreign workers could bring allegations of misconduct in their operations? Some of the issues that could play a role include: wage rates and benefits, working conditions such as job security, workplace safety, temperature, ventilation, and other standards, working hours, breaks, vacations, worker compensations and unemployment benefits. 2. Would the use of third party independent contractors alleviate or insulate MNCs from being attached, and would such use be a good defensive shield against charges of abuse of “their employees”? As is the case in the United States, the “independent contractor” status can only be supported through clear, legally defensible criteria, such as the amount of control the “contractor” has over the tasks to be achieved, the method the contractor is paid, the freedom of the contractor to work on other contracts simultaneously, and so on. Legally, these criteria are not likely to apply to the foreign workers of companies like Nike, who tend to have limited control over their performance, work long, fixed hours on company premises, and be paid on an hourly or piece rate. Even if MNCs find a legal loophole to continue to classify their foreign workers as independent contractors, this will not shield their public image from public criticism for acting unethically and evading their social responsibilities.| 3. Given the principles noted in the case, how can companies comment on their positive actions to promote human rights so consumers will think well of them? Would you propose a company (a) do nothing, (b) construct a corporate code of ethics, or (c) align itself with some of the universal covenants or compacts prepared by international agencies? One must consider both ethical considerations and communication issues when dealing with this. When dealing with communication issues, companies should emphasize truthfulness in all of their...
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