Ethics and Management

Two situations were recently brought to my attention. The first involves a nonprofit that had to let staff go, forgo cost of living or any kind of increase in salaries, and require staff to take a furlough of 40 hours during the year. All the staff accepted the reality of the situation which included that they basically would be working for less money in the coming year than they had in the past year. For staff on the lower end of the payscale, it has been a struggle; but they knew they were better off than their former colleagues who now are looking for employment in these difficult economic times. Everything is copessedick until someone in the accounting department is asked to cut checks for three employees who put in extra time during the previous year's audit. The decison for this action had to come from senior management. These bonuses are going to senior personnel. Perhaps the senior staff at this organiztion need to read The New Agreements In The Workplace by David Dibble. It is published by The Emeritus Group, New York, 2002. The second situation involves a nonprofit organization and a member of its staff. Two years ago the executive director let a member of the staff go for inadequate job performance. A few months later the individual sued the organization claiming wrongful dismissal. The school asked the appropriate state agency to step in and review the situation. It did and said that the individual was not mistreated or discriminated against. The individual found a lawyer who was willing to work on a retainer with the hope of weinning the case. They filed suit in court and with depositions dragged the process out over a year. The individual lost the case, but the organization ran up a very large lawyer's bill--over $100,000. Unfortunately the individual and its counsel decided to pursue a more favorible judgement in federal court. Repeating the same course of events. Depositions were taken all over again. The organization's lawyer hoped that the federal court would throw the case out. Unfortunately it decided to accept the case. The organization's lawyer informer his law firm of the situation. He estimated that the cost to the client would run somewhere between $50,000 and $100,000, which the client doesn't have. What should the organization do? Send us your comments.