Business Ethics

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,