Could Your Workplace Benefit From Ethics Training?

There is no universal moral code to guide businesses through complex dilemmas about what is right or wrong. Business ethics contain principles and standards that guide the behavior of business. It entails what is right or wrong, and dictates what behavior is acceptable within the organization. Attention to ethics in the workplace sensitizes management and employees to how they should conduct themselves while in the workplace. Being conscious of ethics in the workplace will help ensure that when managers and employees are facing crucial times and decision making, that they will uphold the values and ethics of the company.

Ethics training in the workplace should be a major concern to companies and employees as a whole. The ethical framework of a company defines who they are, and their reputation relies upon it. A company should start by having an ethics policy in place and promote its use to everyone in the organization. This should include extensive training, evaluations and promotion of the ethics policies. Use staff meetings, and other training sessions to discuss the ethical overview of the company. Be sure to have a clear and visible statement in regards to your core business principles.

Ways to Enforce Ethics Training

The ethics policy and procedure training will not be effective unless the employees know that the policies exist. Having several ways of communicating the message will enforce its viability. The employees should become very familiar with the policies and act in accordance with the policies. The training can be implemented in several ways that will reinforce the company’s position on adhering to the code of conduct. Below is a list of examples on how a company can train their employees on ethics.

1. Make new employees aware of the ethics policy when they begin working at the company.

2. Review the ethics code of conduct in management and employee trainings.

3. Having upper management review the ethics policy will reinforce the training within the management team.

4. Resolving any ethical dilemmas that may arise in accordance with the guidelines will reinforce the belief that the company has in the policy.

5. Include ethical performance evaluations and appraisals. Reward employees who demonstrate the ethical values of the company.

6. Provide all employees within the organization a copy of the ethics policy.

The decision to do right or wrong may not be an easy decision to everyone. Having an ethical code of conduct in place within an organization should encourage the employee to make the correct decision. The training and management that has occurred with the implementation should lead them to make a decision that is in accordance with the ethics and culture of the company.

References:

Carter McNamara, M. P. (n.d.). Complete Guide to Ethics Management: An Ethics Toolkit for Managers. Retrieved from Free Management Website: http://managementhelp.org/businessethics/ethics-guide.htm

Ethics, M. C. (2010). Thinking Ethically: A Framework for Moral Decision Making. Ethics Resource Center.

 

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Ethics in Finance, Who Should Be Held Responsible?

Ethics in the corporate finance is becoming a widespread issue. With all of the corruption in business today and lack of ethics, people are being misled and a losing a fortune of their income to the greedy corporate giants. Far too often we hear or read about a company that is accused with corruption and the enormous amount of money that they have wrongfully taken from the public, or from people within their own corporation. There is a huge lack of and disregard for ethics in the business world. Once considered Taboo, it seems as though unethical behavior in business is now the norm. The government expects businesses to uphold ethical standards on their own without government interference. When they break the law, the government gets involved. There have been regulations put into place to curve and ultimately cease altogether the amount of corruption in the corporate world.

Legislators are cracking down on unethical and criminal behavior that occurs within businesses. Since all of the recent corruption in business in the last few years, new legislation has come about to govern how companies handle the financial reporting of a company. John R. Boatright in “Individual Responsibility in the American Corporate System: Does Sarbanes-Oxley Strike the Right Balance? argues that governing laws is a method of deterrence is correct. If companies know that they are mandated to follow certain guidelines and adhere to certain rules, than that may deter them from criminal wrong doing and committing fraud.” The Sarbanes-Oxley Act did not develop because all business were conducting business ethically and are doing the right thing. Many companies have defrauded their stakeholders, employees, and the public. They have cost Americans billions of dollars due to their unethical behavior.

There should be individual responsibility attached to the fraud that exists within these companies. With all of the financial analysis tools that are available today, accountants and top management are able to produce financial disclosures and give accurate projections of a company’s finances. These tools should make the process run more smoothly being as though they now have the capabilities to produce profit and loss statements, future projections, accrual and cash statements, and a wealth of other tools to make keeping an accurate account of their financials relatively simple. The profitability and rate of return for a company can be shown through use of the above mentioned tools. This will assist in giving a better outlook to investors, shareholders, etc. Giving the true and accurate financial outlook of a company can better help an investor or anyone who has in interest in the company to make a more informed decision as to whether or not they will go into business with the company.

Unintended FMLA Retaliation?

Author- Casey Sipe

The Family Medical Leave Act is nothing new, and neither are the difficulties, issues and paperwork that comes with it.  Most likely, at one point or another, the FMLA has caused a problem for you and your company.  Maybe you had questions about paying an exempt employee when they take intermittent FMLA leave after using up all of their vacation and sick leave.  Or maybe you had a “difficult” employee take FMLA leave just as you were getting ready to terminate them, leading to questions about when and how to go about the termination (or maybe you just let them go and are currently looking down the barrel of a retaliation lawsuit).

The FMLA forbids an employer from retaliating against employees that takes FMLA leave.  It seems fairly simple that you cannot terminate an employee because your employee took FMLA leave to take care of a sick child, undergo back surgery or have a baby.  Unfortunately, things are not always that cut and dry.  And frankly, with the FMLA, they are almost never cut and dry. Continue Reading

About the Author:

Casey Sipe and I am a management-side labor and employment attorney with Scaringi & Scaringi in Harrisburg, Pennsylvania. If you would like to contact me, I can be reached at (717) 657-7770 orcasey@scaringilaw.com

Was Your Termination Illegal?

Being terminated from your job is a hard enough to deal with, but what if the termination was illegal? Wrongful termination happens when an employee is discharged from employment for illegal reasons or if company policy was violated when the employee is terminated. If you feel as though you were a victim of a wrongful termination, you may have the right to file a claim against your former employer.

Discrimination 

An employer may not terminate or demote their employees based on discrimination. Discrimination can come in many forms. Title VII of the Civil Rights Act of 1964 (Title VII) prohibits employment discrimination. Even though most states are employment at will states, it is illegal for employers to terminate their employees on the basis of discrimination. Discrimination can be based on your race, color, national origin, gender, religion, age, disability, religion, or if you are pregnant. If this does occur, the terminated employee has the option to file a claim with the EEOC.

Retaliation

An employer may not terminate, harass or otherwise retaliate against their employee for filing a claim of discrimination, participating in a discrimination proceeding, or otherwise opposing discrimination. Retaliation is prohibited by law when it involves any type of the employment aspect including hiring, termination, wages, promotions, layoffs, fringe benefits, or any other condition of employment. Employees may find themselves being retaliated against after they file a claim or participate in an investigation against their employer. Under these circumstances, the employer cannot terminate or otherwise demote employment of their employees. This may happen after an employee makes a claim of sexual harassment, is a Whistleblower or complains about any other form of discrimination or wrongdoing within the company.

Written Contract Employee Agreements 

Contract employees are hired by a business to complete an assignment or project, and may have expertise related to the subject matter. Their contracts are typically negotiated and can be paid hourly or by the project. If a written contract or other statement that promises job security for a specific length of time chances are, you may not be classified as an at-will employee. Employment contracts change the “at will” relationship, restricting the ability to terminate employees who aren’t working out. Typically the agreement allows for a “for cause” termination unless the contract term has ended. If cause is not shown for early termination of a contract, the employee may have grounds for a lawsuit against the employer.

Business often times use independent contractors rather than employees, due to the flexibility in hiring as well as the cost savings. Misclassifying workers can cause employers to be subject to penalties from the IRS. An employer can be penalized to reimburse wages and pay retroactive taxes and penalties for workers who were misclassified. See Employers- Are You Accurately Classifying Your Employees for more information

 

Employers- Are You Accurately Classifying Your “Employees”

Running and maintaining a business is a critical task. Although business owners attempt to do everything correctly with running their business, shortfalls may occur. One of the main tasks that business owners want to get correctly is the way that they classify their employees. There are a two ways that individuals can be classified. They can either be classified as independent contractors or employees. Independent contracts and employees are not the same. Knowing the distinction between the two will assist you in determining what your hiring strategy should be. It will also affect how you withhold several taxes.

It is imperative that you correctly determine whether the people providing services to your business are classified as employees or independent contractors. Generally, you must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on the earnings that are paid to an employee. You do not generally have to withhold or pay any taxes on payments to independent contractors. Also, the amount of responsibility that you give a person and whether or not you control their duties is a factor as well.

How To Determine If Individuals Providing Services To You Are Employees Or Independent Contractors

Before you can determine how to pay for the services that are provided to you, you must first know the business relationship that exists between you and the person performing the services. The classifications are listed below:

Employee

Under common-law rules, anyone who performs services for you is your employee if you can control what will be done and how it will be done. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed.

Independent Contractors

The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done. The earnings of a person who is working as an independent contractor are subject to Self-Employment Tax.

Statutory Non-Employee

There are three categories of statutory non-employees: direct sellers, licensed real estate agents and certain companion sitters. Direct sellers and licensed real estate agents are treated as self-employed for all Federal tax purposes, including income and employment taxes. Read more

Statutory Employee

If workers are independent contractors under the common law rules, such workers may nevertheless be treated as employees by statute (statutory employees) for certain employment tax purposes if they fall within any one of the following four categories and meet the three conditions described under Social Security and Medicare taxes. Read more

The IRS uses three characteristics to determine the relationship between businesses and workers:

  • Behavioral Control covers facts that show whether the business has a right to direct or control how the work is done through instructions, training or other means.
  • Financial Control covers facts that show whether the business has a right to direct or control the financial and business aspects of the worker’s job.
  • Type of Relationship factor relates to how the workers and the business owner perceive their relationship.

In determining whether the individual providing services to your company is an employee or an independent contractor, consider all of the information that provides evidence of the degree of control and independence that the person has. This will better assist you in making the determination. If your company is not ready to hire someone on full time, or you may just need a person for a short amount of time, consider hiring someone on a temporary basis.

Many small businesses relay on independent contractors for their staffing needs. There are several benefits to outsourcing individuals’ vs hiring employees. These benefits include:

  • Savings on labor costs
  • Flexibility to determine when you will hire or terminate someone without having them on your payroll
  • Elimination of the taxes associated with having an employee

Regardless of your hiring needs, it is crucial that you correctly determine whether the people providing services to your business are classified as employees or independent contractors.

Employers – Are You At Risk For A Wrongful Termination Lawsuit?

The decision to terminate an employee is almost never an easy one. Once the decision is made, there are steps that can be taken to reduce the risk of an employee filing a wrongful termination lawsuit against you. As the majority of states are “Employment at Will” states, that does not restrict a former employee from filing a wrongful termination lawsuit against you. Under that law in most states, if there is no employment contract, workers are employed on an “at-will” basis. This essentially means that employers have the right to terminate employees at any time for any reason other than discrimination, and rightly so, employees have the right to leave the organization at any time.

The decision to terminate an employee should not come without prior warnings. The steps leading up to the termination should be documented in the personnel file of the employee. This should include the employee’s signed statement that they received a copy of the employee handbook detailing the company’s policies and procedures, verbal and written warnings, performance evaluations, and any other materials that the company deemed necessary to show disapproval of the performance, actions, or behavior of the employee.

Having this information can become very useful to establish a pattern that the employer has tried to counsel the employee for the better. The EEOC requires that employers keep all personnel or employment records for one year. If an employee is involuntarily terminated, his/her personnel records must be retained for one year from the date of termination.

Regardless of the decision and the documentation that has been made for the employee, they may feel that they were unjustly targeted and still try to find other ways to justify a wrongful termination. Once the decision to terminate has been made, there are several factors that employers should consider before executing the decision.

The employer should consider whether or not the employee:

  • Has filed a workers compensation claim?
  • Are they pregnant or have recently given birth?
  • Are they over the age of 40?
  • Have they taken any type of leave in the past year?
  • Their racial or ethnic background?
  • Have they recently filed a grievance or made a complaint about something?

Considering these factors could put employers in a better position to defend themselves against a wrongful termination lawsuit. Be sure to have all documentation in place to prove the termination was not based on one of the above factors. After the matter is finalized, be sure to protect the interest of the company by securing all equipment and codes given to the employee. You can read more about ways to protect yourself against Employee Sabotage.

The Key to Building A Winning Team

It takes great leadership to build a winning team. Building a successful business requires the knowledge to build long lasting teams. Creating a winning team does not happen overnight. It involves hiring the right key players, assessing their skills and abilities, keeping open lines of communication, and working towards a common goal. The more challenges that your organization is presented with, the far more critical it becomes to build a team that is efficient and effective.

1. Determine the Key Players That Are Needed

Before putting together the perfect team, you will need to know exactly who you are looking for and what qualities they should embody. Knowing what each component of running your business requires and who it takes to fill that position is important. Having clear and concise roles and responsibilities will be essential in building your team. Developing job descriptions will help you articulate the most important outcomes you need from an employee and the tasks they are to perform. There are many roles that potential candidates can play. Hiring multifaceted players that can perform more than one role can be beneficial. Be sure not to put too much responsibility on one person that it forces them to become unable to keep up and essentially unproductive.

2. What Makes The Candidate Right For Your Team?

When choosing the right candidate to hire, you should know what their competencies are and how to best leverage them to get the maximum benefit. The person should be able to perform the job duties as required and have the drive to learn more. Knowing at what level a person can and will succeed and what is needed to get them to that point will determine if they are a right fit for your team. You should consider whether or not the candidate fits and buys into your office culture. The person must be flexible and work well with others. Bringing in someone who has a creative streak and shares your vision of the company will be increasingly beneficial.

3. Communicate Communicate Communicate

Take time to build working relationships with each team player. This will not only make each person feel as though they are a part of the team, but it will enable that person to build trust in you. If they trust you, they will consistently work harder to ensure that the goals of the company are met. Keeping the lines of communication open will make the team player feel comfortable bringing problems and issues to your attention when they arise. Praise the team members when they do something exceptional, meet a goal or milestone. This will increase employee motivation and their overall performance. Use constructive criticism to provide feedback that can help the employee grow and develop into the team player that you need.

4. Encourage Interaction

When individuals know their roles and responsibilities, there is far less confusion and competitiveness. This will allow the team members to come together and collaborate strategically on projects and other tasks at hand. Interaction can also be a benefiting factor in reducing oversight. When the team members interact and work together, they can identify missing components that another team member may have over looked, and resolve the issue before it becomes a major problem. A team that interacts well together will work to ensure the success of the business.

5. Make Teamwork The Culture of Your Office

A company culture is values and practices shared by all members of the team.  You want your employees to embody the values that are set forth in that culture. The company culture is vital to its success because it emulates what the company represents. Companies with a strong culture that is aligned to their business goals routinely outperform their competitors. To achieve those results with your business, you have to first determine what your culture is, how you are going to implement it, and essentially guide your team players to achieve the desired culture.