In this world, ethics is one of the factors that greatly influence every individual’s choices and actions. But in the case of the residential construction industry dilemma, we should be specifically looking at business ethics. Business ethics may be well-defined as a set of rules, standards, and moral rationales concerning what is right or wrong and what is reasonable or not in some specific situations (Ferrell, Fraedrich, & Ferrell, 2012).
In regards to the said dilemma, the case asserts for assessment through consequentialism – principles judged by their own consequences. In the case of the industrial company, the dilemma is that within a period of 5 years, the cost for building materials and labor has increased, and these resulted to decrease in profit. However, it is also mentioned that the competitors are still able to maintain their profits by hiring subcontractors that use undocumented and illegal laborers. There are two considerations. First, if the company will follow what others are doing, it may certainly result into maintenance or increase of its profit. But it would require removal of some of the current employees, resulting to the risk of financial loss. Second, if the company will not adhere with the competitors’ strategy, certain decrease in profit will occur. But this will keep the current employees from losing their jobs. Nevertheless, it must be noted that in consequentialism, the duty of making a choice “should not be in the abstract manner, but toward some particular person, group or idea” (Francis & Mishra, 2009).
First, let us consider the best interests perspective. This approach asserts that the action to be carried out will be dependent on what best interests the individual involved. Now if the first choice will be carried out, it will be clearly concluded that the mere intention of the owner is the preservation of the industry. Most of today’s businesses are more concerned with the profit; without any gain, no enterprise will be well-established. In line with this, competition is a great concern for a business. If one is experiencing a problem regarding its operations – resources, quality of work, and profit – and yet competitors are able to maintain their operations (and seemingly succeeding in it), it is a negative thing. Looking again at its consequence, if the industry will be adhering with what its competitors are doing, it will certainly be able to maintain its operations. Thus, if the only intention of the industry is towards itself and the best interests approach will be implemented, then it may be considered as a good choice.
However, there is also what we call as the utilitarian approach. Now this approach asserts that the right course of action must be determined by what maximizes utility (Morland & Bos, 2011). Or in more understandable words, this approach tends to look at the consequences as a whole. It looks not only at the mere intention of the individual chiefly involved (in this case, it is the industry), but at the impact on others as well. Now it is very clear in the case that what the competitors are hiring are undocumented labourers. In short, it is less legally accepted in the business world. We can verily say that one factor in ethics is following the standards in the community; ethics is adhering with the rules and regulations established by the governing authorities in the society – whether it is in the context of commerce or not. Thus, the choice of doing the same thing as the competitors do is not ethically sound at all. The next concern regarding its consequences is the loss of jobs for the current workers in the company. This will be a sad reality that instead of helping families and other people with their need of financial security, the company will be putting them to financial risks. This too is not ethically sound. Thus, if the utilitarian approach will be implemented, then it may be suggested that the company should make alternative ways to maintain its operations other than the one that leads to illegal operations and loss of jobs for the current employees.