Making Ethical Decisions

The requirements for the Unit 1 Individual Project is to review the case study entitled, “Shutdown at Eastland” on page 89 of text book Ethical Theory and Business by authors Tom L. Beauchamp and Norman E. Bowie. After reading the article, the assignment is to develop a plan to close the assembly plant in Eastland, Michigan. This essay will explain the terms of the close, employee notification and provide suggestions for separation benefits. It will also describe all of the affected stakeholders, how their interests will be considered, and determine responsibility for those laid off as a result of the plant closing. Additionally, the essay will make address communicating this news to employees, the press, and community.

Determining a Layoff Plan - Employees

The Speedy Motors Company closing is very sensitive in nature. The first step is to devise a well though out action plan. To do so, the board, senior management, the plant’s legal counsel, and human resources should consider all of the factors involved in closing the facility. Because Speedy’s closing will affect nearly two-thousand employees, they are bound to the policies of the Worker Adjustment and Retraining Notification (WARN) Act. The WARN Act surrounds notification polices and separation pay as it relates to companies with fifty or more full-time employees. This act requires companies like Speedy to provide a sixty day written notice to employees if the closing is not related to a natural disaster, unforeseeable circumstances, such as a cancellation of major order, or a “faltering” company (“WARN,” 2007). Secondly, it is important to discuss with each eligible employee their monetary, health, and retirement benefits and early release options as they separate from the company. Speedy should consider length of service and compute the benefits accordingly.

With this in mind, Speedy should provide as much advance notice as possible and design a separation package that will allow terminated employees successful reentry into the workforce (Eisen, 1993).

Determining a Layoff Plan - Stakeholders

According to Beauchamp and Bowie (2006), stakeholders are stockholders, employees, customers, suppliers, management and the local community. Speedy should consider who and how many stakeholders will be affected by the plant closing and seek alternative methods to avoid the facility shut down. Perhaps the company can consolidate multiple facilities, discontinue stagnant product lines or find an investor to financially back the company to avoid the plant closing. However, responsibility for the laid off is on the company executives who defend the decision that the plant closing are related to the harsh competitive realities of the