Managing People: Ethical Issues in Flight Centre

The report analyses the ethical issues in Flight Centre, including workplace bullying, underpaying employees, and surcharging customers. It provides recommendations for maintaining staff performance, including setting ethical goals, providing fair payment, and stopping workplace bullying.

Running head: MANAGING PEOPLE
MANAGING PEOPLE
Name of the Student
Name of the University
Author Notes

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Executive Summary
The aim of the report is to analyse the various ethical issues that are present in Fightcentre,
one of the premium travel agents of the province of Australia. The report aims to analyse the
various concepts of ethical issues in consideration to coaching, performance management and
delegation across business with their range of recommendations and causes. The following
report will have an access to the details about the organization as well as the problems that
the client is facing in relation to the natural problems present in the whole section. The report
is an analysis of the problems with a series of recommendations for each of the cases.

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Table of Contents
1. Introduction........................................................................................................................3
2. About Flight Centre............................................................................................................3
3. The Incident.......................................................................................................................4
4. Problems detected in the incident......................................................................................5
4.1 Performance management............................................................................................5
4.2 Coaching......................................................................................................................6
4.3 Delegation across business...........................................................................................8
5. Recommendations for the maintaining staff performance.................................................9
6. Conclusion........................................................................................................................10
7. Reference..........................................................................................................................11
8. Appendices.......................................................................................................................13

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1. Introduction
Business in any form should be backed by ethical and moral backgrounds which is
one of the principle facts of any enterprise. However, in the modern world with the greed of
earning more profit and business ideas, some of the enterprises in the business sector strives
and yearns to go through the false process and fake ways in which the profit can be earned.
To a business, the whole ethical manner serving to the customers hold pivotal value and for
which the business has to undergo some of the vital theories and models for consideration
(Dion 2012). According to the ethical theories stated in Saksena (2012), the Flight Centre
which is one of the major travel retails of the province of Australia and serves to more than
80 countries all over the globe has been accused of serious allegations like surcharging the
customers, underpaying their employees, workplace bullying and even unorganized long
working hours which is totally unethical. The following report analyses the company, the
incident and allegations related to it and along with the problems, the theories that are to be
considered in the whole span. The following paragraphs highlight the recommendations and
model features that are there in the overall company profile and the ways in which the
following allegations can be removed. The overall report is thereby an amalgamation of the
problems as well as the recommendations for the matter.
2. About Flight Centre
Flight Centre is one of the premium and largest retail travel outlet group in the
province of Australia which was founded in the year 1982 and headquartered in Brisbane,
Australia. The industry in which the company operates in travel and serves the area of 80
countries including Australia, New Zealand, Canada, United States of America, UAE. South
Africa, Hong Kong, Singapore and India among others (flightcentre.au 2018). There are
approximately 20000 employees working for the company with an approximate net income

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of $257 million. The company is one of the most effective companies listed in Australian
stock exchange which states the importance and grandeur of the place.
3. The Incident
The Australian travel giant has faced a number of claims in the matter of underpaying
their own staffs, workplace bullying and even surging up flight prices for their customers
which is one of the biggest issues which has been raised. The employees of the firm are paid
at approximately $33,500, not even the minimum wage allocated in the Australian pay
commission which is approximately $4000 below the minimum wage rate (Joshi, Sharma and
Kumari 2016). The employees are then trained to charge tremendously high prices from the
customers to make their wage adjustable to their needs.
The long working hours as well as the lack of proper payment means makes the
workers resort to unfair means in the whole business and as a result of which the workers are
forced to surge up their prices to make profit out of it (Oliver and Schoff 2017). The amount
of surging totally depends upon the type of booking as well as on the worker which is
unethical to the core.
Another problem that has been faced by the employees of the Flight Centre is the lack
of proper working hours and the long shifts which is again not under the rule for the work
ethics (Becker 2012). The longstanding duration of work can any employee have least
interest to the overall working culture and loss of morals in the considerable span of time.
The third accusation being the fact of work place bullying which is again one of the
major problems in the whole lot. According to Crane and Matten (2016), the lack of
workplace ethics can refrain any employee from maintaining their work ethics in the overall
lot which again can impact the work.

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Therefore, the number of incidents seen in the workplace includes the surging up of
flight prices and looting the customers, underpaying the employees, workplace bullying and
long working hours. The advertisement published for the recruitment of Flight Centre says all
about the allegations (Appendix 1).
4. Problems detected in the incident
There are a number of problems that has been detected in the overall management of
the organization which can be deemed under the following headings -
4.1 Performance management
According to Aguinis (2013), Performance management is defined as the process and
measure by which both the authorities as well as the employees of a particular organization
tend to plan and work together to monitor and review the work objectives as well as the
planning of the work for making an overall positive contribution to the organization. The
understanding by the managerial authorities for the contribution of the work goals of a place
in terms of appreciation and appraisals is termed as work management in a place for making
sure that the organization has the ability to drive and venture into a better place for better
work results.
The process of effective performance management system is essential to the good
working of a business as that helps the business as well as the employees to grow and have a
basis of their own in the concerned span of time (Koslowski 2013). The essential of
performance management in Flight Centre is also of great importance as in this way, the
company as well as the employees will have a mutually beneficial saga of profit (Appendix
2).
There are a number of theories that is related to the Performance management concept
which are as under –

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The Goal Setting Theory – The theory invented by Edwin Locke in 1968 is one of the basis
of the theory in which the employer sets goals for the employees for a particular span of time.
This motivates the employees to work towards it and achieve it (Locke and Latham 2013).
This kind of motivation helps the employees to aim for better goals at the end of the time
which becomes more realistic and ultimately improves their performance at the end of the
time.
The Expectancy Theory – This theory invented by Victor Vroom in the year 1964 is one of
the base theories which states that the individuals or employees set their performance
standards according to their behaviour in the workplace (Renko, Kroeck and Bullough 2012).
This is determined by the level of satisfaction they have and modifications are done
accordingly. The performance of the employees are totally influenced by the future events
occurring in the span of time.
On the analysis of both the theories, it can be said that the Flight Centre is not
adhering to any of the theories in a positive way. The company is setting goals for the
employees for hiking the prices as per their convenience which again is measuring their
performance. The employer itself is encouraging and measuring the performance on the
unethical grounds which makes the overall disrupted performance one of the most anticipated
works of the time. The company gives allowance to not measure performance by quality but
by the amount of looting which is to be done (Dion 2012). The overall performance
management of the organization is therefore one of the negatives of the organization as there
is no positive feedback in the performance management system and leads to the employees to
have false allegations in terms of the overall venture.

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4.2 Coaching
Coaching in terms of performance management is defined as the type of performance
appreciation or feedback that is driven from the employees for the managers to improve the
overall productivity of the employees and to improve the capability of the employee in their
work performance and correct the amount of performance adhered (Robertson 2016).
There are a number of ways in which the coaching is given for the employees in a
particular organization which can be assured to give the employees the required amount of
work motivation as well as the scheduled and consistent ways to grow within the workplace.
The value of coaching lies in the fact that it helps to improve the performance of the
individuals to the point that it inspires both the employees and the managers to have a decent
amount of knowledge and skills for the betterment of their work for making sure that the
business is increased with the increase in the amount of profit.
The model that is to be used for coaching in terms of performance management is the
GROW model for coaching. The GROW model is one of the basic coaching models that
was developed in the 1980s and 1990s and contributes to the problem of setting up of goals
and solving the problems in association with it (Grant 2012). The model which was
developed in United Kingdom is directed to help the employees to have the required amount
of growth in the workplace for the betterment of work.
According to Grant (2012), the GROW model is an abbreviation for the terms of
Goal, Reality, Obstacles and Opinions and way forward. These points help the business as
well as the employees to achieve their potential level of business in the amount of time. The
goal is to be set at the end where the end result is to be achieved, the reality is the current
situation of the place in the concerned span of time. The obstacles determined the number of
problem that are there and the options are the determinant of the ways that the overall stages

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of performance has. The way forward is the way in which the overall measure is being
addressed (Appendix 5).
Analysing the GROW principle in Flight Centre, it can be seen that the company
lacks all the necessary stimulations of coaching and does not want to make any amendments
in the employee policy of the brand. The company has no fixed coaching policy that will help
the employees of the organization to have the required amount of benefits in the concerned
span of time. The coaching centre is one of the principle ways to motivate and engage the
employees whereas in Flight Centre there is no policy for the better performance in terms of
coaching.
4.3 Delegation across business
Delegation in the business world is defined as the one way of ordering tasks from the
superior in the business to the subordinates in an organization for the performance of the
work. The authority confers upon the task or power to a particular person and help to get the
work done in the particular span of time (Chevrier and Viegas-Pires 2013). The assignment
of any form of responsibility or authority to the workers working under by the people is
termed as the delegation across the business organizations.
The concept of delegation is very serious in the overall business of the Flight Centre
as in the concerned business, the overall work load of looting and conferring the work of
overcharging the customers fall upon the employees for which they get an additional
incentive and percentage over the surcharged amount. According to Chevrier and Viegas-
Pires (2013), this act of delegating the work of unethical manner to the employees of the
organization is to make sure that the unethical work is not done by the authorities on a direct
basis but by the workers on whom the blame can be put.

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This work of surcharging is one of the principle ways in which the business of Flight
Centre works which means that they make their profit out of the unfair means of looting and
underpaying their staffs in the manner (Graham, Harvey and Puri 2015). The delegation of
the business is generally done to make sure that the work of the delegation process is being
done to earn profit by the people of the business in an unethical manner.
5. Recommendations for the maintaining staff performance
 One of the principle recommendations for the maintenance of staff performance is to
set them a goal which is ethical and even the payment of the employees should be
according to the wage rate of the country. The employees should be given the
required amount of monetary benefits to keep them motivated and also help them to
deal with the work pressures in an ideal way.
 The second recommendation is to keep the working hours of the employees at one of
the principle priorities in the span of time. The minimum working hours for an
employee should be at par with the legalised time span of the particular country which
means that the employees should not be forced to work overtime and under pressure
for prolonged span of time. If the worker is working for more than the scheduled time
span, proper bonus and incentives should be provided to the employees.
 The third recommendation is to stop workplace bullying of the employee in the
concerned span of time. Workplace bullying is one of the negative aspects of any of
the workplace ethics and should not be encouraged in any way. Strict actions and laws
should be imposed both by the legal system and in-house system to make sure that the
staff performance is maintained in the longer span of time.
 The last recommendation is to follow the ethical means in conducting a business and
to treat the customers of the business in a better and decent manner. The surcharging
on the actual price is actually one of the principle unethical means which is being

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done by Flight Centre and which should stop at once. The customers should be
charged according to the legal prices and no amount of encouragement should be
given to these unethical works.
6. Conclusion
At the end of the analysis, it can be concluded that the Flight Centre is one of the
esteemed organization which will make sure to include all the detailed aspects of the analysis
to make sure that the organization has all the detailed aspects of working including the moral
grounds of working. The overall conclusion of the analysis is on the fact that the analysis is
done based on coaching, delegation across business and the methods of performance
management. The recommendations as well as the analysis of the recommendations are also
mentioned in the report. The overall report is an analysis of the ethical means of the Flight
Centre.

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7. Reference
Aguinis, H., 2013. Performance management (Vol. 2). Boston, MA: Pearson.
Becker, G.K. ed., 2012. Ethics in business and society: Chinese and western perspectives.
Springer Science & Business Media.
Chevrier, S. and Viegas-Pires, M., 2013. Delegating effectively across cultures. Journal of
World Business, 48(3), pp.431-439.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Dion, M., 2012. Are ethical theories relevant for ethical leadership?. Leadership &
Organization Development Journal, 33(1), pp.4-24.
Dion, M., 2012. Are ethical theories relevant for ethical leadership?. Leadership &
Organization Development Journal, 33(1), pp.4-24.Flight Centre. (2018). Cheap Flights,
Hotels, Tours, Cruises and Holidays - Flight Centre. [online] Available at:
https://www.flightcentre.com.au/ [Accessed 4 Oct. 2018].
Graham, J.R., Harvey, C.R. and Puri, M., 2015. Capital allocation and delegation of decision-
making authority within firms. Journal of Financial Economics, 115(3), pp.449-470.
Grant, A.M., 2012. An integrated model of goal-focused coaching: An evidence-based
framework for teaching and practice. International Coaching Psychology Review, 7(2),
pp.146-165.
Joshi, T., Sharma, S. and Kumari, S., 2016. Ethics in Business. E-Commerce for future &
Trends, 1(3), pp.1-2.
Koslowski, P. ed., 2013. Contemporary economic ethics and business ethics. Springer
Science & Business Media.

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Locke, E.A. and Latham, G.P. eds., 2013. New developments in goal setting and task
performance. Routledge.
Oliver, J. and Schoff, P., 2017. Agency and Competition Law in Australia Following ACCC
v Flight Centre Travel Group. Journal of European Competition Law & Practice, 8(5),
pp.321-328.
Renko, M., Kroeck, K.G. and Bullough, A., 2012. Expectancy theory and nascent
entrepreneurship. Small Business Economics, 39(3), pp.667-684.
Robertson, J., 2016. Coaching leadership: Building educational leadership capacity through
partnership. New Zealand Council for Educational Research. PO Box 3237, Wellington 6140
New Zealand.
Saksena, P.N., 2012. Ethical theories and the incidence of occupational fraud. Advances in
Management.

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8. Appendices
Appendix 1– Recruitment advertisement of Flight Centre in 2013
(Source – abc.net.au 2018)

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Appendix 2 – Performance management system
(Source - Aguinis 2013)
Appendix 3 – Goal Setting Theory
(Source – Grant 2012)
Appendix 4 – Expectancy Theory
(Source - Renko, Kroeck and Bullough 2012)

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Appendix 5 – GROW Model
(Source – Robertson 2016)

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Reflective on the group project
We worked in a group of three people who worked on the project and had different
parts to play to make the overall project complete within the time span and in an effective
manner. The task of the assignment was divided in a convenient manner in between us and
we all made sure that we do our parts with zest and utmost perfection. Our first member of
the group (Binayak) was assigned the task of researching the project as well as making sure
that all the relevant information had been included in the project. I, Bijay was assigned the
work of writing the project as well as making sure that all the research material has been well
incorporated in the project assignment. The third member of our group (Kiran) was assigned
the task of proofreading the whole work and I made sure that all my mistakes have been
rectified after his work. In this way we completed the work after trying our best.