Case Study: Ethical and Legal Violations at Overseas
Facility
Big Aircraft Company (BAC) is a publicly traded U.S.
corporation with more than 500 overseas production facilities. Jeff Bland, an
audit manager with BAC, was offered a two-year assignment in one of the
factories in the Islamic country of Idzatu. Francine Boyd, a senior audit
manager, bid for the position but was denied the job. Initially, BAC explained
that cultural issues were involved in the denial. After additional meetings,
BAC stated that she was not eligible based on her age, religion, and sex. The
country of Idzatu permits discrimination based on age, religion, and sex and
practices intentional discrimination based on religion. In Idzatu, women are
assigned to low-level jobs and are not permitted to occupy management level
positions. In addition, Idzatu laws prohibit women over the age of 45 from
working.
After several months in Idzatu, Jeff initiates the annual
audit required by the corporate internal audit procedures. During the course of
the audit, Jeff discovers a variety of inconsistencies and questionable
business practices. His report indicates the following issues.
1.The BAC Idzatu facility only employs men in management and
supervisory positions. Very few women work in the plant and those that do
occupy lower level positions.
2.An inspection of a BAC subcontractor’s facility in Idzatu
revealed children ages 8-12 working over 60 hours a week in violation of Idzatu
labor laws.
3.Employees in the subcontractor’s facility were exposed to
toxic chemicals and loud noises without protective clothing and headgear.
Jeff files this report with his boss in the U.S. and is
warned by his boss to keep his mouth shut. Jeff has two children under the age
of 10, and he is appalled by the working conditions and the lack of action by
BAC. Six months pass, and no changes have been implemented in either facility.
Jeff is told to mind his own business because different countries have
different laws and the ability to manufacture aircraft parts at a lower cost is
why BAC maintains a facility in Idzatu. Jeff is outraged and reports these
conditions to the U.S. Department of Labor and the ILO. Two months after filing
these reports, Jeff is fired.
Based on the information provided in the case scenario,
answer the following questions:
– Evaluate the legal issues that Francine Boyd may bring
against BAC and any arguments that BAC may use to refute Boyd’s claims.
– In your view, is Jeff protected by any of the
whistleblower statutes? Provide legal arguments that support your position.
– In your opinion, what are the legal, ethical, and cultural
issues of Jeff’s findings?
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