Sexual Harassment Ethics

1. Why is sexual harassment considered to be a business ethics issue?

Ferrell and Fraedrich (2009, pg 72) stated that sexual harassment is a form of sex discrimination that can occur at work, school, and university or in social settings. Sexual harassment in the workplace is any form of unwelcome sexual attention that is offensive, humiliating or intimidating that occurs anywhere employees carry out any task for their employers. Sexual harassment can be written, verbal or physical. Both males and females can be the victims of sexual harassment.
Sexual harassment presents legal, ethical, and moral issues for companies in the area of organizational relationships, which is defined by Ferrell and Fraedrich (2009, pg73) as "the behavior of organization members toward customers, suppliers, subordinates, superiors, peers, and others". These are all relationships in which sexual harassment can
occur, but it occurs most frequently within the relationships that Ferrell and Fraedrich (2009, pg73) refer to as "significant others" whom are superiors, peers, and subordinates within the organization. It has been noted above the sexual harassment is considered a form of discrimination, and as such it is illegal. For example, the fact that it is unethical for one employee to use sexual blackmail against another or for one employee to create a hostile working environment for another employee.

2. In the past, sexual harassment was often ignored in the workplace. Provide a possible reason for why this is no longer the case?

Solomon (2007) stated that in the past sexual harassment has risen to the forefront in most companies and the major problem seems that people do not even know what is and what is not sexual harassment. There does not seem to be a clear line on this issue. The genders seem to have separate views when it comes to sexual harassment. However, it is no longer the case, because The Sex Discrimination Act 1984 protects individuals across Australia from discrimination on the basis of sex, marital status or pregnancy and, in relation to employment, family responsibilities. The Act also makes sexual harassment against the law.

3. Assuming the claim by Kristy Fraser-Kirk is true, how may a better understanding of business ethics have helped the David Jones board and senior management avoid this situation?

Raths (2006) stated that business ethics are the examination of the variety of problems that can arise from the business environment, and how employees, management, and the corporation can deal with them ethically.
Problems such as fiduciary responsibility, corporate social responsibility, corporate governance, shareholder relations, insider trading, bribery and discrimination are examined in business ethics. Raths (2006) also stated that every employer must take all reasonable steps to prevent sexual harassment in the workplace to avoid liability. This means that employers must actively implement precautionary measures to minimise the risk of sexual harassment occurring and to respond appropriately when harassment does occur. Under the Sex Discrimination Act, an employer may be held vicariously liable for sexual harassment when the employer has not taken all reasonable steps to prevent sexual harassment in the workplace. Ferrell and Fraedrich (2009) showed the steps which should be taken to avoid sexual misconduct or harassment
charges:
 A statement of policy naming someone in the company as ultimately responsible for preventing harassment at the company.
 A definition of sexual harassment
 A nonretaliation policy
 Specific procedures for prevention
 Establish, enforce, and encourage victims of sexual harassment to report the behavior to the authorized.
 Establish a reporting procedure.
 Make sure that the company has timely reporting requirements to the proper authorities.

4. Define, with reference to the differences between, an ethical issue and an ethical dilemma.
Ferrell and Fraedrich (2009, pg 63) showed the definition and the different between ethical issue and ethical dilemma as follows:
• Ethical Issue: An ethical issue is a problem, situation, or opportunity that requires an individual, group, or organisation to choose among several actions that must be evaluated as ethical or unethical. An example of an ethical issue is when an employee has been asked to do something for the organisation which he/she believes is morally wrong.
• Ethical Dilemma: An ethical dilemma is a problem, situation, or opportunity that required an individual, group, or organization to choose among several wrong or unethical actions. For example, the supervisor enters the office and asks the accountant for a check for $150.00 for expenses, he tells the accountant he incurred entertaining a client last night. He submits receipts from a restaurant and lounge. At lunch the supervisor’s girlfriend stops by to pick him up for lunch and the accountant overhear her telling the receptionist what a great time she had at dinner and dancing with the supervisor the night before. What should the accountant do?

5. Was Kristy Fraser-Kirk faced with an ethical issue or an ethical dilemma when deciding whether to take the sexual harassment claim to court? Justify your answer. Kristy Fraser-Kirk faced with an ethical dilemma when deciding whether to take the sexual harassment claim court. As Ferrell and Fraedrich (2009, pg 63) stated, an ethical dilemma is a problem, situation, or opportunity that required an individual, group, or organization to choose among several wrong or unethical actions. As under Sex Discrimination Act, sexual harassment is unlawful in almost every employment situation and relationship. In this case, there is a sexual harassment occurred, so there is a breach of the law. Therefore, an ethical dilemma arises when she has to choose whether to take the matter to court and lose her job or keep the job but the matter might happen again.

6. What responsibility is held by the board of directors and senior management for the ethical conduct of an organisation’s employees?

There are 6 steps for the stakeholder frameworkfor managing responsibility and business ethics. The steps are:
1. assessing the corporate culture to identify the organisational mission, values, and norms that are likely to have implications for social responsibility –
2. identifying stakeholder groups to recognise their needs, wants and desires
3. identifying stakeholder issues to understand the main issues of concern to the most powerful stakeholders
4. assessing the organisational commitment to social responsibility
5. identifying resources and determining urgency to prioritise the stakeholders and issues
6. gaining stakeholder feedback through surveys, focus groups and the use of performance indicators
(Maignan, Ferrell & Ferrell 2005, cited in Ferrell, Fraedrich & Ferrell 2010, p. 47)

The employers may be held legally responsible for acts of sexual harassment committed by their employees. This is called ‘vicarious liability’. The Sex Discrimination Act makes employers liable for acts of sexual harassment unless they have taken all reasonable steps to prevent it from taking place.

7. Your textbook discusses the United States legal requirements in regard to sexual harassment in the workplace. Write a brief report advising managers and directors of Australian organisations on their legal obligations to prevent and act upon sexual harassment in the workplace.

Sexual harassment continues to be a serious issue in workplaces across Australia. Young women can be especially vulnerable to sexual harassment from their older, male managers or co-workers.

Ellison (2004, pg 4)recommended that employers take the following steps to prevent sexual harassment.
(a) Get high-level management support
Obtain high level support from the chief executive officer and senior management for implementing a comprehensive strategy to address sexual harassment.
(b) Write and implement a sexual harassment policy
 Develop a written policy which prohibits sexual harassment in consultation with staff and relevant unions.
 Regularly distribute and promote the policy at all levels of the organisation. Ensure the policy is easily accessible on the organisation’s intranet.
 Provide the policy and other relevant information on sexual harassment to new staff as a standard part of induction.
 Translate the policy into relevant community languages where required so it is accessible to employees from culturally and linguistically diverse backgrounds.
 Ensure that the policy is accessible to staff members with a disability.
 Ensure that managers and supervisors discuss and reinforce the policy at staff meetings. Verbal communication of the policy is particularly important in workplaces where the literacy of staff may be an issue.
 Periodically review the policy to ensure it is operating effectively and contains up-to-date information.
(c) Provide regular training and information on sexual harassment to all staff and management
 Conduct regular training sessions for all staff and management on sexual harassment and the organisational policy. This training should be behaviourally based which means it should increase knowledge and understanding of specific behaviours that may amount to sexual harassment under the Sex Discrimination Act. Regular refresher training is recommended.
 Train all line managers on their role in ensuring that the workplace is free from sexual harassment.
 Display anti-sexual harassment posters on notice boards in common work areas and distribute relevant brochures.
(d) Encourage appropriate conduct by managers
 Line managers should understand the need to model appropriate standards of professional conduct at all times.
 Include accountability mechanisms in position descriptions for managers.
 Ensure that selection criteria for management positions include the requirement that managers have a demonstrated understanding of and ability to deal with discrimination and harassment issues as part of their overall responsibility for human resources.
 Check that managers are fulfilling their respon¬sibil¬ities through performance appraisal schemes.
(e) Create a positive workplace environment
 Remove offensive, sexually explicit or pornographic calendars, literature, posters and other materials from the workplace.
 Develop a policy prohibiting inappropriate use of computer technology, such as e-mail, screen savers and the internet.
 It is recommended that medium and large employers undertake regular audits to monitor the incidence of sexual harassment in their workplaces and the use and effectiveness of their complaints procedures.

Refernce List

o Ferrell, OC, Frearich, J & Ferrell, L 2009, Business ethics: ethical decision making and cases, 7th edn, Houghton Mifflin, Boston. o ASX Corporate Governance Council 2007, Corporate governance principles and recommendations, 2nd edn, viewed 16 December 2010, http://asx.ice4.interactiveinvestor.com.au/ASX0701/Corporate%20Governance%20Principles/EN/body.aspx?z=1&p=-1&v=1&uid=#. o Raths, L 2006, Nordic Governance in the context of International Best Practice, viewed 20th Dec 2009, http://www.griffithuni.net/school/gbs/afe/symposium/2008/Barnes.pdf o http://www.humanrights.gov.au/sexualharassment/

o Solomon, J 2007, Corporate Governance and Accountability, 2nd edn, John Wiley & Sons, Milton. o Ellison, M 2004, Corporate governance: Australian best practice recommendations, a comparison with the UK, NZ and the US, viewed 23th Dec 2010