Why do ethical issues permeate hr management

Further ethical issues crop in HR when long term compensation and incentive plans are designed in consultation with the CEO or an external consultant. While deciding upon the payout there is pressure on favouring the interests of the top management in comparison to that of other employees and stakeholders. In many organisations till recently the employees were differentiated on the basis of their race, gender, origin and their disability.

Not anymore ever since the evolution of laws and a regulatory framework that has standardised employee behaviours towards each other. In good organisations the only differentiating factor is performance! In addition the power of filing litigation has made put organisations on the back foot. Managers are trained for aligning behaviour and avoiding discriminatory practices.

Human resource practitioners face bigger dilemmas in employee hiring. One dilemma stems from the pressure of hiring someone who has been recommended by a friend, someone from your family or a top executive.

Generally, employees are not expected to speak against their employers, because their first loyalty in towards the organisation for which they work. However, if the situation is such that some act of the organisation can cause considerable harm to the society, it may become obligatory to blow the Whistle. The HR manager is in the dilemma how to solve this issue between the opponents and defenders of whistle blowing.

Industrial work is often hazardous to the safety and health of the employees. Legislations have been created making it mandatory on the organisations and managers to compensate the victims of occupational hazards.

Ethical dilemmas of HR managers arise when the justice is denied to the victims by the organisation. Restructuring of the organisations often result in layoffs and retrenchments. This is not unethical, if it is conducted in an atmosphere of fairness and equity and with the interests of the affected employees in mind. If the restructuring company requires closing of the plant, the process by which the plant is chosen, how the news is to be communicated and the time frame for completing the layoffs is ethically important.

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To remain ethical, HR managers must abide with the job-related details and leave out knowledge of an employee's personal life. 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.

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. 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. Hiring and termination decisions must be made without regard to ethnicity, race, gender, sexual preference or religious beliefs.