Performance Appraisal Case
Performance Appraisal
Case
The Facts
Frank, the new CFO of the 20-year old company
First non-family member to hold that position and be included in Executive Committee
After he took office, the company wanted to downsize and Frank agreed it was necessary
He could see that family members were concerned solely about their own finances but remained neutral
The CEO asked Frank for advice on how to downsize ethically
Frank recommended to base the decision on three-year average performance appraisal scores
Once the results were submitted to Frank, he saw that the scores of three employees in different departments were missing
He asked the CEO about it
The CEO replied that these individuals were longtime employees who had asked him to appraise their performances informally. He had agreed.
The CEO tried then to convince Frank about the legitimity of the situation :
◦
◦
◦
◦
1)
2)
3)
4)
It’s time for them to retire anyway
They just aren’t performing the way they used to
They’ve got plenty of retirement stored away
They’ll get a considerable amount of severance pay
When Frank asked the CEO if these employees were aware of their own performance he said : “I don’t know, they should, everybody else does”.
The Stakeholders
The Family Members (Owners of the company) Shareholders
The CEO and the CFO
The three employees + their families
All other current employees
Prospective employees
The Community
The Ethical Issues
The teliological POV : Benefits and Harms
Benefits for the Owners, Shareholders,
CEO+CFO and current employees include :
◦ 1) Company’s profits increase because of lower labor costs
◦ 2) Salaries of CEO+CFO increase because of the above. Thus, they may support their families better
◦ 3) Other employees whose performances were being appraised normally could have been feeling that they were being treated unfairly
Harms for all other stakeholders
◦ 1) The three longtime employees in question
Case
The Facts
Frank, the new CFO of the 20-year old company
First non-family member to hold that position and be included in Executive Committee
After he took office, the company wanted to downsize and Frank agreed it was necessary
He could see that family members were concerned solely about their own finances but remained neutral
The CEO asked Frank for advice on how to downsize ethically
Frank recommended to base the decision on three-year average performance appraisal scores
Once the results were submitted to Frank, he saw that the scores of three employees in different departments were missing
He asked the CEO about it
The CEO replied that these individuals were longtime employees who had asked him to appraise their performances informally. He had agreed.
The CEO tried then to convince Frank about the legitimity of the situation :
◦
◦
◦
◦
1)
2)
3)
4)
It’s time for them to retire anyway
They just aren’t performing the way they used to
They’ve got plenty of retirement stored away
They’ll get a considerable amount of severance pay
When Frank asked the CEO if these employees were aware of their own performance he said : “I don’t know, they should, everybody else does”.
The Stakeholders
The Family Members (Owners of the company) Shareholders
The CEO and the CFO
The three employees + their families
All other current employees
Prospective employees
The Community
The Ethical Issues
The teliological POV : Benefits and Harms
Benefits for the Owners, Shareholders,
CEO+CFO and current employees include :
◦ 1) Company’s profits increase because of lower labor costs
◦ 2) Salaries of CEO+CFO increase because of the above. Thus, they may support their families better
◦ 3) Other employees whose performances were being appraised normally could have been feeling that they were being treated unfairly
Harms for all other stakeholders
◦ 1) The three longtime employees in question