Ethics in Business

From a business perspective, working under government contracts can be a

very lucrative proposition. In general, a stream of orders keep coming in,

revenue increases and the company grows in the aggregate. The obvious

downfalls to working in this manner is both higher quality expected as

well as the extensive research and documentation required for government

contracts. If a part fails to perform correctly it can cause minor

glitches as well as problems that can carry serious repercussions, such as

in the National Semiconductor case. When both the culpable component and

company are found, the question arises of how extensive these

repercussions should be. Is the company as an entity liable or do you look

into individual employees within that company? From an ethical perspective

one would have to look at the mitigating factors of both the employees and

their superiors along with the role of others in the failure of these

components. Next you would have to analyze the final ruling from a

corporate perspective and then we must examine the macro issue of

corporate responsibility in order to attempt to find a resolution for

cases like these.

The first mitigating factor involved in the National Semiconductor

case is the uncertainty, on the part of the employees, on the duties that

they were assigned. It is plausible that during the testing procedure, an

employee couldnt distinguish which parts they were to test under

government standards and commercial standards. In some cases they might

have even been misinformed on the final consumers of the products that

they tested. In fact, ignorance on the part of the employees would fully

excuse them from any moral responsibility for any damage that may result

from their work. Whether it is decided that an employees is fully excused,

or is given some moral responsibility, would have to be looked at on an

individual basis.

The second mitigating factor is the duress or threats that an

employee might suffer if they do not follow through with their assignment.

After the bogus testing was completed in the National Semiconductor labs,

the documentation department also had to falsify documents stating that

the parts had surpassed the governmental testing standards. From a legal

and ethical standpoint, both the testers and the writers of the reports

were merely acting as agents on direct orders from a superior. This was

also the case when the plant in Singapore refused to falsify the documents

and were later falsified by the employees at the have California plant

before being submitted to the approval committees (Velazquez, 53). The

writers of the reports were well aware of the situation yet they acted in

this manner on the instruction of a supervisor. Acting in an ethical

manner becomes a secondary priority in this type of environment. As stated

by Alan Reder, . . . if they [the employees] feel they will suffer

retribution, if they report a problem, they arent too likely to open their

mouths. (113). The workers knew that if the reports were not falsified

they would come under questioning and perhaps their employment would go

into jeopardy. Although working under these conditions does not fully

excuse an employees from moral fault, it does start the divulging process

for determining the order of the chain of command of superiors and it

helps to narrow down the person or department that issued the original

request for the unethical acts.

The third mitigating factor is one that perhaps encompasses the

majority of the employees in the National Semiconductor case. We have to

balance the direct involvement that each employee had with the defective

parts. Thus, it has to be made clear that many of the employees did not

have a direct duty with the testing departments or with the parts that

eventually failed. Even employees, or sub-contractors, that were directly

involved with the production were not aware of the incompetence on the

part of the testing department. For example, the electrical engineer that

designed the defective computer chip could act in good faith that it would

be tested to ensure that it did indeed meet the required government

endurance tests. Also, for the employees that handled the part after the

testing process, they were dealing with what they believed to be a

component that met every governmental standard. If it was not tested

properly, and did eventually fail, isn't

the testing department more

morally responsible than the designer or the assembly line worker that was

in