Case – Who should pay ? Source - Course Book, Pg 404
Analyzing the case through 8 steps framework. Step 1: Facts of the Problem and Goal to be achieved.
Brief description of the case Gene Elliot finds himself in a cobweb of different companies acting as employers, permanent or temporary and working on the same project, directly or indirectly. Having sustained grave injuries at workplace he sues two companies demanding $2.4 mn in settlement. The companies are trying to shrug off the responsibility by referring to different clauses outlined by the law. As the amount is not even contested, goal is to find which organization should be ethically responsible for the compensation payment. In case the best solution is a break up between companies, it is to be made sure that the share of every company is fair. Step 2:Different Stakeholders and how are they affected. Gene Elliot: The victim, who suffered a permanent disability and right now is struggling to get compensation. He is staring at loss of employment forever. The disability renders him incompetent in his area of expertise. Mabey Bridge: Parent company of Gene Elliot. One of their employee is not able to offer his services for considerable time and the same time is struggling for compensation. This sets a very bad precedent for other employees and will not accept such assignment in future. Turner Construction: As they accepted Gene as their temporary employee, ethically they are also responsible to any mishap during his employment with the company. B&C Steel: As this company was actually doing work and a study found out that there were other instances of negligence as well, it is highly probable that court will ask B&C steel to pay damages to Gene.
Step3: What are the alternatives and which alternatives will be closed if a particular alternative is preferred and which alternatives will still be open? Alternative 1 - B&C Steel pays the entire amount, if proven guilty. Alternative 2 - Turner Construction and B&C Steel could split the compensation amount. Alternative 3 - The three companies split the entire compensation amount in the ratio of profits they aim to make in the project. Alternative 4 - The parent company Mabey Bridge, despite not being sued, could pay Gene Elliot, in part, full or on some other criteria, as he was its permanent employee. Going by the facts presented the first alternative should be chosen as B&C Steel’s negligence was quite clearly visible throughout the operations. If taken, this alternative would deal with all issues and Alternative 2 and 3 shall be discarded. Alternative 4 is an open alternative irrespective of any of the above 3. This will also help build confidence in employees of Mabey in taking similar kind of projects in future.
Step 4: What are the ethics of each alternative? ( consequences, duties, obligations, virtues, justice, care, ethical values and principles.) Alternative 1 - B&C Steel pays the entire amount, if proven guilty. The consequences would be a big hit on bottom line but it would make them revamp their entire operations and safety systems which should be beneficial in the long run. The duties and obligations of the company definitely take into account its responsibility to provide safe environment to workers and look after them in case of emergencies. The ethics here is pretty clear. The case clearly speaks of negligence on part of B&C Steel and they should pay the employee. But as is also stated, the company is playing with the words in the books of law. The fact that the compensation figures have not even been contested also confirms the gravity of the accident which is also accepted by the companies. So it raises a question on their principles as well. Alternative 2 - Turner Construction and B&C Steel could split the compensation amount. A similar argument prevails here with the difference being that two companies arrive at a consensus on their share of responsibility and negligence and decide upon the...
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