Ethical Issues in Organisational Culture

This assignment delves into the complex ethical issues that can arise within organizational culture. It examines conflicts of interest, particularly focusing on how job security policies influence employee behavior. The discussion draws upon real-world examples, such as labor disputes at Woolworths, to illustrate these challenges. Students are expected to analyze the potential consequences of ethical breaches and propose solutions for fostering a more ethical workplace environment.

Running head: HUMAN RESOURCE MANAGEMENT
Human Resource Management
Student’s name:
Name of the University:
Author’s note:

1HUMAN RESOURCE MANAGEMENT
Executive Summary
This study sheds light on the conflicts of interest that arises in an organisation when there is a
clash of private interest and the organisational goals. Majority of the organisations in any
industry faces this challenge and the HR department of the organisation is responsible to manage
the conflicts. In this study, a conflict case of Woolworths has been described where the
employees of Woolworths’ warehouse in Levrton had strike in protesting for the casualisation of
labour hire. The following report focuses on a particular situation of conflict in interest, where
the management of a public domain organisation was involved in malpractice of casualisation of
labour hire. The report also addresses the problems of the company caused by such behavior, its
potential causes and solutions, and reasons for choosing a particular solution by the HR
department of the company. HR department of the organisation could have taken the option of
job security to the employees. The impact of this strike on Woolworths has been justified with
loss of brand image and employees’ issues. It also evaluates this situation in regards to the ethics
and professionalism in the organizations and recommends ways to handle such conflicts in
business.

2HUMAN RESOURCE MANAGEMENT
Table of contents
Introduction......................................................................................................................................3
Selected Case Scenario....................................................................................................................3
Interest of employees and business entity.......................................................................................5
Impact of conflicts on employees and business performance.........................................................7
Role of HR managers.......................................................................................................................8
Options available to HRM professional..........................................................................................9
Best appropriate option in case of Woolworths.............................................................................10
Conclusion.....................................................................................................................................11
Reference List................................................................................................................................12

3HUMAN RESOURCE MANAGEMENT
Introduction
Human resource management is the practice to handle the human resource within an
organisation and HR department tries to manage the employee performance towards the
organisational strategic objectives. In addition, Conflict of interests is a very common issue in
the business sector and both the public and private sector face this issue quite frequently. If the
conflicts are not managed properly, the productivity of the organisation gets hampered. OECD
(Organisation for Economic Co-operation and Development) avers that the conflict between the
organisational management and employees could inappropriately affect the performance of the
official duties and responsibilities (Oecd.org 2017).
This study will focus on a situation as stated above and questions related to this situation
where conflict has arose in a real-world business situation. This study will delineate the conflict
situation within the organisation and the eternal issue between employer and employees. The
ethical and professional behaviour to defend this situation will also be discussed in this report.
Selected Case Scenario
Woolworths Supermarket is a famous Australian supermarket and it is owned by
Woolworths Limited. Along with Coles, the retail giant Woolworths create a duopoly in the
supermarket industry in Australia. Woolworths has more than 990 stores in all over the Australia
and New Zealand. The stores sell vegetables, packaged fruits and foods, meat and necessary
things like beauty products, magazines, household products and much more. Woolworths
Supermarket started its journey in the year 1942 in South Wales and headquarter of the
organisation is in Bella Vista New South Wales. The CEO of the organisation is David Banducci

4HUMAN RESOURCE MANAGEMENT
and revenue of the organisation touched 44 billion AUD in the year 2016 (Woolworths.com.au
2017). Woolworths provides special importance in supply chain management as, without the
supply chain, the organisation will not manage the product flow in the retail stores. Supply chain
management helps the supermarket in boosting the customers' services and it can reduce the
operation cost. Operation costs within retail can decrease purchasing cost and reduce production
cost, it can also decrease in total supply chain costs. From the supply chain and warehouse,
Woolworths has the benefits of protection of the products, protection of the goods from theft and
climatic conditions. Woolworths stores the raw materials for future production and surplus
products also stores in Warehouses.
According to The Age news, on 9th August 2015, Woolworths faced the issues of workers
strike over employees’ hire casualisation (Mentioned in the new article:
http://www.theage.com.au/victoria/woolworths-laverton-workers-strike-over-labour-hire-
casualisation-20150809-giv9au.html.) On 9th August, more than 200 striking workers had
blocked the trucks from leaving and entering the warehouse at Leverton, in Melbourne’s west.
Woolworths sells liquor also and it has a special department that manages the liquor distribution.
The employees at Leverton at the liquor distribution centre started protesting at 4 am on Monday.
The anger had been rising among the employees in Woolworths, related to labour hire
casualisation in warehouse and supply chain (Theage.com.au 2015). On the last few days, a
group of employees met with the management of Woolworths in order to solve the labour-hire
casualisation as Woolworths used an external agency in order to hire the casual employees. The
employee-group asked the management to take the disciplinary actions in case of anyone
involved in the illegal practice of external agency picket (Theage.com.au 2015).

5HUMAN RESOURCE MANAGEMENT
On the other side, Woolworths had been trying to seek the orders to break the picket and
the organisational management had been delaying in putting the stop of the issues at the Fair
Working Commissions. The employees had been very worried as the notice came from the
external agency as a surprise to the employees and they could lose the employment all of a
sudden. One of the employees from negotiation team averred that the National Union of Workers
had already claimed the introduction of the labour-hire breaching an agreement in the year 2014.
While talking with the Woolworths management, the spokesperson declared that external labour-
hire firm had made partnership with Woolworths in order to recruit the casual labours. The
Woolworths spokesperson had said that they were not going to put any changes in retention and
recruitment policy. Moreover, the industrial action had been disappointing that time and Unions
and Employees could not address the concerns. The picket had threatened the labours of the
Woolworths and the external agencies also put threat to stop supply of groceries and liquor also.
The picket also made the situation worse by stating that more than 600 permanent labours could
face the unemployment issues in Melbourne North. Woolworths did not check the situation
correctly and the decision of stripping off more than 600 employees from the warehousing
operation made the wound worse (Theage.com.au 2015). However, the spokesperson in
Woolworths commented that Woolworths tried to invest more in the opening of new stores in
Victoria and they shifted the employees in those stores.
Interest of employees and business entity
Woolworths’ employees had been protesting about the same issues for two years before
the strike occurred and the group of employees tried to negotiate over the key employment
problem in Collective Enterprise Agreement. The employees of Woolworths took the industrial
stance in order to solve the issue of labour hire casualisation and the employees tried to find

6HUMAN RESOURCE MANAGEMENT
solution in a constructive way. That time, Woolworths had more than 197,000 registered staff
members. The employees had interest in improving their conditions by striking on Monday and
the employees had taken this step out of complete frustration. The casual warehouse employees
of Woolworths took the step as they were just pushed into a corner and only one option left to
walk off the job. Employees raised the issue of labour hire casualisation and the rights of casual
employees to have the permanent positions within the orghanisation with contract. The
employees also raised the issues of rates of pay for the casual workers and conditions in which
they had to work in Woolworths. As mentioned by Watson (2013), employees highlighted the
ratios of use of casual workers in Woolworths and security in tenure of employment for the
casual workers. The casual employees had been facing the issue regarding the lack of
transparency in recruiting of the casual employees and the Woolworths’ management
commitment towards the stable workforce.
In case of some of the Australian organisations, the management tries to do 100%
outsourcing in case of employees from the hiring agencies. The main elements of casualisation
that provide benefits to the organisation are minimum wages, no fringe benefits for the hired
labours, contract-based working, no job security and reduced payroll (Reddy et al. 2015). The
employees do not have the longer services and they do not have long leave also. Woolworths
took the casual workers as it provided profit to the organisation as the organisation did not need
to give extra wages to the employees. Woolworths had found this casualisation of hired labour
was one of the easy path and quick way to generate the revenue. According to Bourelle (2014),
in Australian scenario, in the meat industry, this casualisation happens more and employees do
not have any security in the job. Woolworths used the labour-hire arrangement s a triangular
relationship with the employees as employees were hired as an employee or by an independent

7HUMAN RESOURCE MANAGEMENT
agency (Miller 2014). This resulted that the employees are supplied by the third party and the
security in a job depends on the willingness of the third party. In the warehouse of Leverton, the
employees were continuously requesting to make them permanent and they were threatened to
lose the job.
Impact of conflicts on employees and business performance
The conflicts between employees and business management always pose a negative
impact on the business performance. As stated by Watson (2013), casualisation has always been
an element of unemployment in Australia as the employers embraced this flexible option in
business. In casual workforce, the employers can reduce manpower depends on workflow and
the employers can also detain the employees if they want. In the business concept, JIT (Just in
Time) approach can be taken as the business entity wants to provide goods in response to the
demand and not in the apprehension of the demands (Toscano 2017). Therefore, Woolworths'
management faced the challenge in keeping the employees as a permanent basis in warehouse
sector and supply chain. The permanent workforce in idle time was not being a good option for
Woolworths. This figure was same on that contemporary time as almost a quarter of all
employees in Australian workforce reported being causal workforce (almost 23.2%) (Huang
2015). When the employees had a strike on Monday, the production of that day got hampered as
employees were frustrated. With the frustration of the employees, management of Woolworths
took the decision to think over the matter. Woolworths had a set of rules and negative influence
of the business had influenced the brand image. The stressed and worried employees did not put
forward the productivity and business organisation had faced the mental health issue from the
employees.

8HUMAN RESOURCE MANAGEMENT
The employees desired not to work effectively if their wishes and demands did not get
fulfilled. The business objectives and productivity of the organisation got hampered for some
days till the management provided a green signal to negotiate over the issues. It was difficult for
the Woolworths to look forward without the management of supply chain and warehousing
(Frederickson and Rohr 2015). On the other side, it was difficult for the employees to stop the
work and responsibilities for a long time. The productivity and brand image of the organisation
was in danger and the ethical business policy of the organisation had not been followed perfectly.
At that time, growing use of casual labours was predominant and the Woolworths could have
been provided certainty of for the casual labours.
Role of HR managers
In the Woolworths, HR department is very important as the human resources of the
organisation are large in numbers. In minimising the conflict issues of the employees against the
organisational management, HR department can play the role of negotiator. In this case of
Woolworths, the HR department could not redesign the policy of the organisation; however, they
could negotiate with the employees to bring out the solution. In pluralistic nature of
organisational culture, the most of the critics viewed that conflict represents the dissimilarities of
the organisations’ opinions (Klein et al. 2013). On that sitiation, the HR department could give a
memo for show cause, suspend the concerned person, restrict his involvement in the official
matter and curtail his scope for promotions. Since penalty is the first option for any company to
handle a situation like this. It raises a threat to the other employees so that they are restricted
from involving in any such conflicts of interest. However, in the grievance of the employees, HR
department could understand the demands of the employees are valid or viable or not. The
employees' demands could be incompatible with the organisational goals. As opined by Fawkes

9HUMAN RESOURCE MANAGEMENT
(2014), conflict resolution is all about the decision-making of particular case, HR department of
Woolworths made understood the management the needs of the employees and their grievance.
HR department could transfer the employees to another department or another location
to curtail the relationship with the other employees in order to minimise the rage among
emoloyees. HR department of the organisation might arrange a session with the affected
employees to know about the exact reason for this type of conflict and the resultant behaviour
and may try to dig down deep to know about the loopholes of their policies regarding code of
conduct and code of ethics. As suggested by Carrese et al. (2015), HR department could also
arrange a training session for the employees on a regular basis to remind them about the
company's policies. In case of Woolworths’ strike of the employees, HR managers needed to
conceptualise all the unequal outcomes of the casualisation of hire employees. In recruitment and
selection of the employees, HR managers could stop using external agencies for hiring and they
could themselves manage the recruitment process.
Options available to HRM professional
The HR department of Woolworths could arrange a session with the warehouse
employees who were involved in the conflict of interests and must try to know the exact reason
for such a behaviours and showed them organisational policy. According to the feedbacks of the
employees, the HR department could try to change its code of conduct and code of business
ethics. In this process, the HR department could set some guidelines to reduce the workplace
conflicts. It must be having some already set code of conducts and ethics for all the employees.
a) Starting new recruitment policy

10HUMAN RESOURCE MANAGEMENT
Woolworths’ HR managers could start new recruitment policy apart from the third party
external recruitment and it might have pacified the employees. The employees of the Leverton
needed the security that time and the HR managers could ensure that recruitment policy of the
organisation would be changed and management was thinking about this. New recruitment
policy would help the employees and HR managers themselves would arrange the recruitment
and selection.
b) Making permanent to employees
The HR department could ensure all the employees in Leverton that they would be
permanent in no time and HR department was talking with management in this note. The
employees of Leverton in warehousing could stop the strike as the being permanent could solve
the casualisation issue in the organisation. The management had to bear the extra wages for that
matter, however, the sudden rage of the employees could be solved by ensuring the security in
the job.
c) Ensuring employee-friendly organisational policies
Woolworths made the contract with the employees when they came to the organisation.
HR department could make a new set of organisational policies that would ensure a permanent
job, security in the workplace and right wages for the employees. This approach of the HR
department in Woolworths could decrease the rage of the employees during the strike.
Furthermore, the company could have changed some business strategies and ethics to avoid the
similarity incidences with the rival company (Bourelle 2014). It is a challenging task and quite
time to consume as well as involves financial investments.

11HUMAN RESOURCE MANAGEMENT
Best appropriate option in case of Woolworths
In case of Woolworths in solving the strike issue, the HR department could ensure the job
security for the casual contract employees with giving some fringe benefits. The employees were
deprived as they were not treated as equal to permanent employees. Giving dignity to job
security in the workplace could solve the issues for employees (Apsc.gov.au 2017). The HR
department of Woolworths is always responsible for maintaining the professionalism and ethical
behaviour among the employees. These help in developing effective workplace habits, which
assist the employees and the organisation in the long run to improve the productivity. In
Woolworths, the conflict of interest is a deviation from the workplace ethics and professionalism
from the management. In these situations, the group or the individual acted according to their
own interest and ignores the organisational interest. In addition, honesty, respect, fairness and
responsibility towards the work and the organisation construct the business ethics. Woolworths
could have adopted some formal rules and regulations and these are called the code of ethics.
Conclusion
It has been observed from the analysis that Woolworths had issues in casualisation of
employees and they had malpractice in profit-making and wages of the employees. Conflict of
interest is a big issue in any organisation and it could lead to a downfall in productivity and in
the reputation of the organisation in the long run. Although in some cases, conflicts of interests
have contributed in the generation of new ideas and direction for businesses, it has majorly
affected some businesses also in terms of quality, corruption, unethical practices and reputation.
Such behaviour creates a negative impact on the work culture of the organisation. However, the
HR managers could change the organisational policy by ensuring the job security to the
employees.

12HUMAN RESOURCE MANAGEMENT
Reference List
Apsc.gov.au, 2017. In whose interests?: Preventing and managing conflicts of interest in the
APS - APSC. Apsc.gov.au. Available at:
http://www.apsc.gov.au/publications-and-media/current-publications/in-whose-interest
[Accessed on 14 Nov. 2017].
Bourelle, T., 2014. New perspectives on the technical communication internship:
Professionalism in the workplace. Journal of Technical Writing and Communication, 44(2),
pp.171-189.
Carrese, J.A., Malek, J., Watson, K., Lehmann, L.S., Green, M.J., McCullough, L.B., Geller, G.,
Braddock III, C.H. and Doukas, D.J., 2015. The essential role of medical ethics education in
achieving professionalism: the Romanell Report. Academic Medicine, 90(6), pp.744-752.
Fawkes, J., 2014. Public relations ethics and professionalism: The shadow of excellence.
Routledge.
Frederickson, H.G. and Rohr, J.A., 2015. Ethics and public administration. Routledge.
Huang, P.H., 2015. How improving decision-making and mindfulness can improve legal ethics
and professionalism. JL Bus. & Ethics, 21, p.35.
Klein, P.G., Mahoney, J.T., McGahan, A.M. and Pitelis, C.N., 2013. Capabilities and strategic
entrepreneurship in public organizations. Strategic Entrepreneurship Journal, 7(1), pp.70-91.
Luce, E.A., 2015. Conflicts of interest.

13HUMAN RESOURCE MANAGEMENT
Miller, S., 2014. Trust, Conflicts of Interest, and Fiduciary Duties: Ethical Issues in the Financial
Planning Industry in Australia. Capital Failure: Rebuilding Trust in Financial Services, p.305.
OECD, 2014. Managing Conflict of Interest in the Public Service. oecd.org. Available at:
https://www.oecd.org/gov/ethics/48994419.pdf [Accessed on 14 Nov. 2017].
Reddy, A.A., Rani, C. and Reddy, G.P., 2015. Labour scarcity and farm mechanisation: A cross
state comparison. International Journal of Management, 3(4), pp.45-67
Toscano, N. 2017. Woolies workers strike over labour hire casualisation. The Age. Available at:
http://www.theage.com.au/victoria/woolworths-laverton-workers-strike-over-labour-hire-
casualisation-20150809-giv9au.html [Accessed on 15 Nov. 2017].
Watson, I., 2013. Bridges or traps? Casualisation and labour market transitions in
Australia. Journal of Industrial Relations, 55(1), pp.6-37.
Woolworths.com.au. 2017. Woolworth Supermarket Available at:
https://www.woolworths.com.au/ [Accessed on 15 Nov. 2017].