Business Law

Project 3: Leading Ethically and Legally at Home and AbroadStep 1: Perform Ethical Analysis

Vice President Dodger has provided you with the Electropic LLC case file, which details recent events at Electropic LLC, one of Colossal’s technology companies. He has asked you to analyze the legal and ethical aspects of the case. The ethical aspects of the situation seem complex, and you realize that you need a structured way to think through the various resolutions to the case and their implications. You know that there are many different schools of ethical thought and a variety of frameworks or approaches for analyzing ethical problems, but you decide that the best approach to this particular situation is Badaracco’s right versus right framework.

You’ll start by working through the right vs. right ethical analysis, considering the various options for action and the winners and losers for each option. What are your recommendations for the best ethical course of action? Be sure to analyze all four questions and all three tests of Badaracco’s framework.

When you’ve finished analyzing the ethical aspects of this case, continue to the next step, in which you’ll consider any legal issues that could affect your decisions.

Project 3: Leading Ethically and Legally at Home and AbroadStep 2: Perform Legal AnalysisAs you continue to sift through and consider all the details of the Electropic LLC case, Vice President Dodger reaches out with an important note:

INBOX (1 NEW EMAIL)

From:

Ken

neth Dodger, Vice President, Colossal Corporation

To: You

Just wanted to remind you that in addition to the ethical aspects of the Electropic LLC situation, there may be legal implications that the human resources department needs to account for before moving forward with any plan of action. To that end, you’ll need to review any relevant information about fraud and employment at will, that might affect what could or should be done about the situation at Electropic LLC.

When you’ve worked through the possible legal implications and arrived at a recommended course of action for Electropic LLC’s HR department, it’s time to present your analyses, recommendations, and action plan in a report.

Please use your outline and research notes to inform the writing of your report.

That’s all for now. I know this is a tricky case. Thank you for your efforts.

KenProject 3: Leading Ethically and Legally at Home and AbroadStep 3: Write Your Electropic LLC Report

Use your outline and research notes to prepare your report. Be sure to meet the following requirements laid out by the VP:

Using Badaracco’s right vs. right framework and your legal analysis, prepare a report.

5/9/24, 2:00 PM
Electropic LLC
Course Resource
Electropic LLC
Notice: Contains Confidential Information
Electropic LLC is a respected and profitable website design and hosting company in
Colossal Corporation’s technology group. Melissa Aldredge has been a project manager at
Electropic LLC for several years and was recently considered for promotion to a senior
project manager position. Ultimately, the promotion was awarded to another long-term
employee, June Pyle. June and Melissa have a history of one-upping each other and
sharing an internal rivalry within the company.
Melissa recently reported internally that she had learned that June, who was given the
promotion over her, had never finished her MBA degree. All of June’s business cards have
“MBA” after her name, and the signature line of her email reads “June Pyle, MBA.”
Electropic LLC’s policy manual states that potential employees must submit transcripts for
all degrees listed on their resumes. However, this requirement was not in place 10 years
ago when June Pyle was hired. June has a history of stellar performance and was
promoted not because of her MBA, but because of her consistently exemplary work. June
has received excellent performance evaluations during her time at Electropic LLC, and her
leadership has led to increased revenue as well as positive press for the company. Her
record of success is what led to her promotion.
As a result of Melissa’s report, the director of human resources sent an email to all
employees who were hired prior to the policy change requiring transcript validation,
asking that they provide transcripts to validate their credentials. June did not respond to
the director’s request for transcripts and was called into the director’s office. In a very
tense and tearful interview, June confessed to the director that she does not have an
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Electropic LLC
MBA. She admitted that she was 12 credits away from completing her degree, but when
her dad got sick, she had to drop out. She said that she really needed a job to support her
family and she put the MBA on her resume hoping it would help her find a job. She shared
that she always intended to go back to school but became so busy with work that she
didn’t have time. Once she was hired, she felt that there was no turning back and she had
to keep the lie going by placing “MBA” in her email signature line and on her business
cards.
An MBA was not a requirement for the assistant project specialist job June was hired for
10 years ago, but four years ago, it was made a requirement for the senior project
manager position she holds now. Two of the current senior project managers do not have
MBA degrees because they were promoted before this requirement was in place.
Vice President Dodger has asked you to write a memo with your recommendations on
how human resources should handle this issue. June has a record of excellence with
Electropic LLC, and her superiors would be unhappy to lose her; however, ethical practice
and the law must be considered here as well.
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Résumé Fraud
Learning Topic
Résumé Fraud
Fraud, often called misrepresentation, is a very broad legal concept that incorporates a
variety of types of fraud and misrepresentation, both civil and criminal. There are
considerable variations across the states as to the specific categorization of types of fraud
as either civil or criminal law violations, or both. The federal government criminalizes a
variety of types of fraud including mail and wire fraud, bankruptcy fraud, and securities
fraud. These federal laws apply to everyone in the United States, regardless of the state in
which the fraud occurs. Although there is variation as to which explicit types of fraud are
criminalized within each state, in all states, some types of fraud unquestionably carry both
civil and criminal penalties.
Résumé fraud is a specific type of fraud that may result in civil or criminal penalties, or
both, depending on which state the fraud occurs in. In its most primal form, résumé fraud
is a type of common law, civil fraud wherein the intentional misrepresentations of material
facts are made in a résumé, and justifiably relied upon in the hiring of an individual for
employment. In the absence of any statutory provision specifically addressing résumé
fraud in a given state, the common law provides the remedy for résumé fraud typically in
the form of damages (monetary compensation). However, many states have statutorily
imposed sanctions specifically for committing résumé fraud. For example, in New Jersey,
both persons and legal entities are prohibited from intending to deceive by falsely
representing the receipt of a degree, credential, or certification, which one has not
actually acquired “in connection with any business, trade, profession or occupation”
(N.J.S.A. 18A:3-15.2). A violation of this provision is treated as a civil law violation, and
each instance of résumé fraud carries with it a $1000.00 civil fine (N.J.S.A. 18A:3-15.5).
On the other hand, in the state of Kentucky, “fraudulent use of an educational record” is
considered a Class A misdemeanor, which is punishable by up to 12 months in jail and
fines (KY Rev. Stat. Ann. 434.442). The Kentucky statute explicitly includes making false
written representations for certain educational achievements, such as a degree, in
employment applications. The states do differ as to how they treat résumé fraud, but
whether it is treated as a civil violation or as a criminal violation, résumé fraud is a
dishonest practice that should be avoided.
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Résumé Fraud
At-will employees should be particularly aware that résumé fraud provides a justifiable
basis for termination that may undermine otherwise legitimate arguments for wrongful
discharge (or other exceptions to the employment at will doctrine). For contract
employees, résumé fraud is often considered “just cause” for termination of an employee
who would otherwise be protected from termination by contractual “just cause”
provisions. Finally, in addition to the legal consequences of résumé fraud, the reputational
damage of lying on a résumé could undermine one’s career prospects as it did for former
Yahoo CEO, Scott Thompson, whose résumé represented that he had a double major,
including a degree in computer science, from Stonehill College, a degree that was not
awarded from until several years after he graduated. After being exposed by a Yahoo
shareholder, Thompson stepped down from his position in disgrace (Mackay, 2012).
References
Mackey, M. (2012, May 15). Ex-Yahoo CEO Scott Thompson and seven other cases of
resume fraud. The Huffington Post. Retrieved from
http://www.huffingtonpost.com/2012/05/15/yahoo-ceo-scott-thompsons-resumefraud_n_1516061.html
Resources
Résumé Misrepresentations
(https://leocontent.umgc.edu/content/scor/uncurated/mba/2218mba630/learning-resourcelist1/resume-misrepresentations.html?
ou=927731)
What is Fraud?
(https://leocontent.umgc.edu/content/scor/uncurated/mba/2218mba630/learning-resourcelist1/what-is-fraud-.html?
ou=927731)
© 2024 University of Maryland Global Campus
All links to external sites were verified at the time of publication. UMGC is not responsible for the validity or integrity
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Résumé Fraud
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5/9/24, 2:01 PM
Global Shippers, Inc.
Course Resource
Global Shippers, Inc.
Notice: Contains Confidential Information
One of Colossal Corporation’s import-export companies, Global Shippers, Inc., a New
York–based company with facilities in over 37 countries including the United Kingdom,
recently submitted a bid for an exclusive contract with the government of the small
country Neristan. The contract would provide Global Shippers with the exclusive right to
export goods from Neristan’s government-owned factories to the United States for
distribution and sale. It is projected that this contract would provide over $20 million in
revenue to Global Shippers per year, increase its stock value, and allow the company to
expand its international operations and employee base.
Shortly after Global Shippers submitted the bid, Neristan’s prime minister invited the CEO
of Global Shippers, Robert Manning, to dine with him at the most luxurious restaurant in
Neristan.
After Roger arrived to the dinner, the prime minister ordered the most expensive bottle of
wine on the menu, and as they drank, he made a proposal to Manning. The prime minister
said, “Here in Neristan we value relationships above all else, and we have a great
opportunity to help each other.” He went on to say that he was recently tasked with
“selecting the best company for Neristan’s contract,” and he thought that “Global Shippers
has what it takes.”
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Global Shippers, Inc.
Manning was excited by the prime minister’s comments. He agreed, “There is the potential
here for a great relationship.” Manning gratefully accepted the prime minister’s offer of
another glass of wine and listened intently. The prime minister then went on to say, “It is
customary in Neristan for business associates to help each other prosper, and if you
ensure a payment of $100,000 is wired to my personal account in the next week, I will
make sure that Global Shippers gets the contract.”
Manning, who had dealt with similar requests from other foreign diplomats in the past,
responded, “I’m afraid that such payments are prohibited in my country, but why don’t I
fly you to New York tomorrow so we can discuss business further?” Manning went on to
say, “The trip will be all expenses paid, and you will stay in the penthouse at the finest
New York hotel. If, after we are done conducting business, you want to see the sites, I can
show you around the city, and you can stay on us for a while.”
The prime minister gratefully accepted Manning’s offer, and Manning paid the $3,500 bill
for the dinner and wine on his corporate account. The next day the two flew first-class
back to New York. After conducting business in New York for a day, the prime minister and
Manning traveled around the city, went to the theatre on Broadway, and dined in the
finest restaurants. Everything was paid for by Manning’s corporate accounts. After several
luxurious days in New York, the two of them then flew first-class to Los Angeles, where,
after several days of “living it up on the town,” they met with Global Shippers Inc.’s board
of directors, and the prime minister announced that Global Shippers had been awarded
the contract. The prime minister stayed in Los Angeles, all expenses paid, for two weeks
after this meeting, and then flew back to Neristan.
In the meantime, upon the announcement of the contract acquisition, Global Shippers
Inc.’s stock skyrocketed, and the company began hiring more warehouse employees in
Neristan and the United States to manage its new lucrative contract. Manning received a
substantial bonus from Global Shippers Inc.’s board of directors for his excellent work
related to acquiring the Neristan contract.
Six months later, the first shipment of goods was ready to leave Neristan and go to the
United States, but the customs officials on the Neristan border refused to allow the goods
to leave the dock. The customs officials stated that they needed time to inspect the goods
for illegal contraband and that it could be weeks before they were cleared for shipment.
Manning, who was visiting the prime minister at the time, was called to the customs office
by his head warehouse employee. Manning slipped the customs officials $100 each and
asked if they could expedite the shipment. The goods were cleared the next day, and the
first shipment left for the United States.
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Global Shippers, Inc.
A few weeks later the prime minister of Neristan was arrested by Neristan authorities for
embezzling government funds. Manning began to worry that some of his actions may have
crossed the lines into illegal or unethical activity and (given his close relationship with the
prime minister) that he may soon also become the subject of investigation. He called the
vice president at Colossal Corporation, told him the whole story, and asked him if he could
help defend the legality and ethics of his actions.
© 2024 University of Maryland Global Campus
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of information located at external sites.
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5/9/24, 2:00 PM
Employment at Will
Learning Topic
Employment at Will
0:00 / 6:34
Transcript
Employment at will is a doctrine of common law that allows either the employee or the
employer to terminate an employment relationship at any time, for any reason, with or
without notice, and even for a morally reprehensible reason, so long as the ending of the
relationship does not fall into an exception to the employment-at-will doctrine.
Employment at will is the prevailing legal doctrine concerning employment relationship
termination in 49 US states (not Montana). In the overwhelming majority of the United
States, employment at will and its exceptions govern the rules by which one may legally
terminate an employee.
The generally accepted exceptions to employment at will include
express contract,
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Employment at Will
implied contract,
promissory estoppel,
public policy violations, and
good faith and fair dealing.
We discuss these five exceptions below.
Express Contract Exception
If an employer terminates an employee in violation of the terms of an express contract
between the employer and employee, then the employee can sue the employer for breach
of contract (and, in some states, wrongful termination).
For example, an employment contract guarantees that the employee will be employed by
the employer for a definite duration of time, with cognizable boundaries, such as a “oneyear period” or “for six months.” The employer terminates the employee before the stated
period has expired, and that termination is not otherwise permitted by the contract.
Likewise, consider a case where an employment contract states that an employee can be
terminated only “for cause” or “for just cause,” and the employee is terminated without
cause.
Implied Contract Exception
Implied contracts are contracts created by the conduct of the parties, which include any
representations or assurances made by the employer prior to or during the term of
employment. In some states, an implied contract is an exception to the employment-atwill doctrine.
For example, if an employer provides an employee handbook to a new employee, the
provisions in the handbook may be considered part of the contractual relationship. Often,
such handbooks outline a procedure for performance review, discipline, and discharge of
the employee. An employer who fails to live up to procedural obligations prior to
discharging an employee could be liable.
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Employment at Will
Promissory Estoppel Exception
In many states, promissory estoppel acts as an exception to the employment-at-will
doctrine. That is, when an employer makes a promise to an employee of employment or a
period of employment, and the employee relies on that promise to his detriment, and it
leads to injustice, then an employee may be able to have that promise enforced regardless
of employment at will.
For example, John is offered a job with Widget Co. He discusses with Widget’s manager
that, to take the job, he needs to move from California to New Jersey and give up an
already lucrative position with benefits. The manager assures John that he will have
gainful employment and a substantially larger income with Widget Co. for at least a year if
he makes the move. In reliance on this promise, John quits his job and moves to New
Jersey to begin work at Widget Co. After one week, John is laid off. Despite being an
employee at will, John may be able to recover under the theory of promissory estoppel.
Public Policy Violations Exception
Most states in the United States prohibit an employer from firing an employee if the
reason for the action violates some readily accepted public policy. This prohibition
prevents an employer from terminating an employee for exercising a legal right, including
a right contained in state and federal laws; or for failing to perform an illegal act for the
employer.
Firing an employee for performing some public duty (showing up to jury duty), for
exposing illegal conduct (such as reporting violation of some law to the employer or a
government agency), or for exercising her rights as a US or state citizen (such as voting)
are all against public policy.
This exception to employment at will encompasses the inability to terminate an employee
if doing so would violate her state or federal statutory rights. If an employee is terminated
because of her race, this may be a violation of Title VII of the Civil Rights Act of 1964, and
so an otherwise at-will employee would have a claim against the employer for violating a
federal statute.
Moreover, it is against public policy to terminate an employee for refusing to commit an
illegal act, such as a crime.
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Employment at Will
Good Faith and Fair Dealing Exception
A minority of states impose upon the employer a duty to exercise good faith and fair
dealing in regard to all employees. This doctrine, to varying degrees, means that an
employer must treat an employee fairly in the decision to fire her. This generally means
that an employer would violate these duties in firing an employee without due cause or
justification.
The preceding five generally accepted exceptions to employment at will allow injured
parties to seek recovery even in the face of the employment-at-will doctrine. As such,
they limit the circumstances by which an employer can terminate an employee.
Licenses and Attributions
Business Law: An Introduction (https://thebusinessprofessor.com/business-law-anintroduction/)
, by TheBusinessProfessor.com, Jason M. Gordon & Colleagues has been
adapted with permission from Jason M. Gordon. © Business Professor, LLC.
© 2024 University of Maryland Global Campus
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