As a top human resource executive in a large, privately held company, students are responsible for compensation and benefits. The firm’s owners are satisfied with financial performance. The student intern’s boss takes little interest in specific human resource issues, as long as things are going well. The high quality of management in your firm is recognized. The intern student have been researching outsourcing opportunities and have found that the company could achieve modest savings by outsourcing compensation and benefits. Intern students would feel an obligation to consider this action, although fifteen employees may lose their jobs and their position would be diminished in importance as a result of the action. What do they do?
1. What are the ethical issues in this situation?
2. What are the basic arguments for and against outsourcing in this situation?
3. What do you think most managers would do? What would you do?