Business Essays - Employee Organizations Companies

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Employee Organizations Companies

Mandated Employee Benefits

Organizations and companies are operating at higher-cost due to mandated employee benefits. Federal and State governments in an effort to assist the working public maintain a productive and successful lifestyle. In doing so, they have placed unintended financial burdens on companies due to low productivity and over worked employees due to under staffing.

An example of these mandated benefits are: paid overtime, paid personal days, paid sick days, paid vacation time, and paid holidays. Some hourly employees have falsely claimed overtime earnings on their time sheets to gain extra income. This type of behavior is very wrong and unethical. In such cases, the employees gain a few extra dollars and increase the employer's liability in terms of taxes and other fees mandated by the government.

Hourly employees are often tempted to be unethical in this manner when there is minimal supervision of their activities. In these cases the employee or employees receive income without fair production in the interest of the company. This is a selfish practice on the part of the employee. Most companies consider their employees to be assets necessary for profit. Claiming time worked or income, increases the overall liability, thus reducing profit.

Money and time are also lost when people abuse their benefits to take time off with pay. Many employees have taken time off from work for personal holidays. Most companies offer employees one to three paid personal holidays a year for individual paid time off. Personal holidays are treated as regular paid vacations and observed company paid holidays. Some employees have also abused personal holidays by taking more days off than required or not properly recording personal holiday hours on payroll records.

Comp time is another type of paid time off that is offered by companies to their employees. Rules governing comp time are different for all companies. It has also been acknowledged that comp time is improperly recorded on employee's time or payroll records. Another traditional benefit offered by companies is sick time. This can be time off with or without pay. Sick time guidelines are established by respective organizations with regards to the individual employee status.

Government programs and Laws protecting employees such as FMLA (Family Medical Leave Act) and ADA (American Disability Act) have also been abused by people for time off work. Time off work means no individual production for the organization. Companies must guarantee employees employment for a limited time when FMLA or ADA is used. Companies again suffer losses when these privileges are abuse unethically.

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In these cases (FMLA and ADA), insurance companies may be required to pay wages to employees during time off work. It has been proven that insurance companies usually past the cost of insurance claims to clients by increased premiums. When these types of unethical behavior are practiced, the companies, the communities, and others pay for loss suffered by insurance companies.

Over extending vacation time and not recording properly has also been unethical behavior of some people. Most companies do not require salaried management persons to complete payroll time sheets. These type employees have also been noted to take unnecessary time off work without approval. In these cases, the organization suffer loss due to marginal performances of departments due to no or poor leadership.

It has also been observed that employees tend to be followers of their leaders, thus employees will exercise some poor ethics behavior. Another unethical behavior in some workplaces is the improper use of time clocks. Hourly employees, who are required to punch a clock, will sometimes have another employees clock them in when they are not on duty. This is just another way of lying or falsifying company records and time abuse. Employees, who are not required to punch a clock, occasionally extend their break periods and never make up the nonproductive time.

During the planning or budgeting process of most companies, managers have started to consider anticipated losses due to unethical behavior of their employees. Unfortunately, these losses or anticipated costs are passed on down to their customers. The final conclusion is that customers or the community pays for the cost of unethical behavior of others. Many organizations are enforcing strict quality control standards and performance programs to justify required productivity.

Successful organizations strive to accomplish quality goods and services with maximum productions and minimum liabilities. Most time abuse cases can be avoided by good supervisions. Organizations must also implement programs that promote of good ethical behavior of people within their organizations. Other establishments have been able to control or suffered less time loss by making employee’s owners and providing profit sharing for employees.

Companies and organizations are incurring increased overhead expenses due to theft of supplies by people within the organizations. These supplies or resources usually have very little economic cost per unit, but the cost can add up to several hundreds or thousands of dollars. Workplace theft possesses some characteristics that render it easier to commit than the ordinary crime and significantly harder to detect.

The supplies that are being stolen are already in the hands of those who may be tempted to take them. Unlike shoplifting or other act of the more traditional forms of theft, the offender or robber has control of the items or supplies that are stolen from organization. These robbers may be managers; supervisors or employees who have been entrusted an authorized by their employers to use supplies for organizational related activities.

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Unfortunately, for organizations, these trusted individuals sometimes steal items from the workplace and use them for personal use. The act of stealing supplies is unethical because it is wrong; it violates Christian principles and increases cost of operation.

Replacement parts of printers and fax machines (cartridges) are stolen by employees and taken home for personal use. Other general office supplies such as pens, pencils, paper clips, paper, etc. are also removed from the work place and taken home for personal use. Some employees have also abused the use of company paid mail services for personal use. Metered mail services and courier services (Fed EX, UPS, US Mail, etc.) are being used by employees to ship personal items.

This unethical behavior of employees is a very serious problem for companies. This problem is serious because access to those supplies may be continuous and therefore opportunities for dishonesty are correspondingly continuous. Employees cannot be monitored at all times and they are likely to have an intimate knowledge of supplies, its disposition, official procedures and the checks that exist.

They are within the company and accordingly have an increased ability to plan dishonesty so that it can be efficiently accomplished remained undetected. The custodians of company property are usually managers, supervisors and employees. These custodians of supplies are often not the owners of the company and they accordingly have less interest in protecting assets from loss. For these and many other reasons, workplace theft may be subtle, indirect and hard to detect, yet it represents a serious threat to the economic integrity of an organization or business.

Managers of organizations must exercise their duty to improve internal controls because if you allow people to do the wrong thing then unfortunately there are proportions that will do the wrong thing. Effective leaders of organizations must always implement measures within their work environment that will develop a positive ethical culture and structure. Management is a chief controller of workplace behavior and its role in prevention of theft should be central. Managers are responsible not only for their own actions but accountable for the actions of their staff.

Often companies provide their employees vehicles as a tool to provide services to the customer. Vehicle misusage cost the companies money, and this affects the bottom line. Company vehicles are company asset that should not be abused for personal usage. Company vehicles are only to be driven by the employees only for business purposes only. Any driver other than the employee is therefore considered not insured by the company's insurance policy.

This abuse leaves the company open for civil action in the event of an accident take place. The core ethical values of honesty, integrity, and fidelity apply to the employee's personal use of the company vehicle. Personal use of the company vehicle also adds unnecessary wear and tear and shortens the useful life and dependability of the vehicle.

Unnecessary mileage causes the company's to have a hirer vehicle turn over rate than normal. There are two ways to provide vehicle to the employees, one is to lease the vehicles, and the other way is to purchase the vehicles through a capital expenditure. Companies that lease the vehicles usually return the vehicles after a predetermined time frame or mileage in order to keep from paying any penalties from the lease.

When the vehicles are returned prematurely, that is an added expense to the company’s profit. When companies purchase these vehicles, they also remove these vehicles from their inventories at a given timeframe and mileage. Business vehicles that are owned can be depreciated annually on the company's income taxes for a specific percentage, but there is no depreciation for the personal use of the vehicle.

The IRS has specific rules for classification of company vehicles, and in order to keep from loosing money, many companies do not allow for person use of the vehicles. The core ethical values of honesty, integrity, and fidelity also apply in these circumstances, because the employee is also in violation of all of these.

Fuel credit cards are sometimes abused for personal usage as well. Fuel card are provided with the company car to provide fuel and maintenance of the vehicle. With out built in safe guards on the company's fuel cards, there are those individuals that will abuse that privilege. The core ethical values also apply for these circumstances as well, honesty and integrity are violated, and this will affect company profits in addition to this just being plain theft.

Personal charges for gas and maintenance can be difficult to identify by the company if there are a lot of vehicles in the company. One such safeguard for the companies is the use of special credit card services that require that the mileage be entered into the transactions for fuel and maintenance before the card will authorize the transactions. The employee will have to verify any discrepancies in mileage on a monthly basis. This will in turn send a report to manager for that employee for review.

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In addition to the company vehicles many companies provide employees the financial resources that are needed to travel and complete their assignments, a process abused by many employees. Some employees steal from the company through the petty cash funds that are so readily available. Employee's request petty cash funds to reimbursement themselves for purchases that are not work related. This in itself is unethical behavior at any level, in other words it is still theft of company funds. This also has an affect on the company's profits.

Credit cards are a convenience tool for that employee that often gets abused also. Many companies issue credit cards for their employees to use while on the job. This becomes a big source of abuse to the company's finances because the employee has been entrusted to manage their expense account. Fraudulent charges can be made on the card and written off as long as the maximum balance has not been met and the company continues to pay the monthly payments. With out checks and balances by managers to oversee the statements, no one will question any of the charges made. This is another example of unethical behavior and theft of company funds.

Travel and expense reporting is a form of justifying travel related expenses which is often abused by the employees that use them. Some of the employees find ways around the system by reporting false or over inflated items on their expense report for reimbursement or justification for a non-business related expense.

Travel and expense reporting is designed to be flexible and allow the employee the resources to travel and expense their charges easily. It is the flexibility that makes the program so vulnerable to employees with little remorse for ethical values.

The core ethical values of honesty, integrity, and fidelity apply to the employee's personal use of the company resources.

Employees abuse telecommunication devices such as the telephone, fax machines, Internet services and emails while on company time for non-business oriented purposes. It has be estimated that more than 35% of an average employee time is spent on personal calls, surfing the Internet and sending / receiving personal emails at the companies expense. In some companies personal calls are allowed as long as they are kept to a minimum of 3 minutes. Meanwhile, it is understood that most employees have children and needs that may need to be taken care of during normal business hours.

Companies are now implementing tighter controls over the abuse of the telephone, long-distance, Internet and email privileges. With the assistant of modern technology, the traditional PBX phone system has been enhanced and nearly replaced by more sophisticated systems. These systems are now capably of tracking all activity on the phone lines including the fax. These systems are capable of generating reports based on incoming calls, outgoing calls, call durations, long-distance and voice recording capabilities.

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The cost of these systems is comparable to the amount of time an average employee spends for non-business oriented purposes. Nearly every company in America has implemented some type intrusion risk software program to protect their network from hackers, hazardous viruses, or malicious activities caused by employee excessive surfing. Excessive surfing causes the company ports to be vulnerable in the Internet world; like an open gateway to their network allowing malicious activity by an intruder.

By that, that vulnerability can cause the company to loose revenue if they provide and are depended on web-services to their customer's. It is unethical on behalf of the employee to be compensated for time and work he/she is being paid for.

It has been reported that the estimated level of software piracy in the United States, in 1998 cost the software industry more than $11 billion, with losses exceeding $2.9 billion in the U.S. alone. Approximately 25 percent of all business software in the U.S. is obtained illegally. Software piracy is not limited to books, songs and movies. It includes many types of creative works, including computer software and hardware. There are several different types of piracy: End User, Reseller, BBS/Internet, and Trademark/Trade Name Infringement.

The most frequently abused type of piracy that happens within companies and organizations across the globe is End User Piracy. End User Piracy is when a single copy of a software package is purchased and installed on several different systems or across a network environment. Generally, when software is purchased, the rights you are purchasing are described in the license and documentation that accompanies the software.

Therefore, if it's copied, distributed or installed in ways that the license does not allow, the company is not only engaging in unethical practices but also is violating federal copyright laws. Why do companies pirate software? The main reason is to reduce cost and save money. It's less cost effective to purchase a 5K application program with a limited number of 5 users when the same can be purchased and installed across the LAN/WAN and have unlimited users.

A good indication to determine if a company has pirated software is if, multiple users have the same serial number, they share logon's, they lack original documentation or an incomplete set, and non-matching documentation, where documentation does not match the software version installed.

When a company's software is pirated, consumers, software developers, and resellers are affected. The company runs a greater risk of obtaining a virus; having corrupted disks space, and defective software. The company usually has inadequate documentation to enjoy the full benefits of the software package and is unable to take advantage of technical support and product upgrade, which are available to legitimate registered users of the software.

When the software company software applications are pirated, developers lose money not only from current application products but from future ones as well. When a software product is sold on the market, a portion of the revenue is funneled back into developing better software packages.

When it's pirated, software developers lose revenue from the sale of their products, which hinders development of new software and stifles the growth of the software company. There are many anti-piracy organizations that have been developed to guard against piracy. Stealing is still illegal, unethical, and all too frequent in today's digital age.

The best way to remedy employee abuse of the mandated benefits is tighter control of the processes by which they are monitored. This involves management at all levels, Human Resources and employees with strong moral values. Starting at the top of the food chain, companies need to develop and review the current policy and procedures to ensure the appropriate controls are in place. The core ethical values of honesty, integrity, and fidelity apply to the employee's personal use of the company resources.

References

  • Australian Inst of Criminology. (2004). Retrieved September 28, 2008, from http://www.aic.gov.au
  • Equal Employment Opportunity . (2008). Discriminatory Practices. Retrieved September 27, 2008, from http://www.eeoc.gov
  • Equal Employment Opportunity Commission. (2008). Discriminatory Practices. Retrieved from http://www.eeoc.gov/
  • Internal Revenue Service. (2007). Retrieved September 27, 2008, from http://www.irs.gov
  • Velasquez, M. (2008). Business Ethics Concepts and Cases. Retrieved September 27, 2008, from http://wps.prenhall.com
  • Equal Employment Opportunity Commission (2008) Discriminatory Practices. Retrieved September 27, 2008, from http://eeoc.gov

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