A contract can be termed as an agreement between people or bodies with a promise to perform a certain task currently considered (Andrews 7). For a contract to be complete, an offer and an acceptance have to exist. Contracts bind the parties involved, and are supposed to be honored, failure to which either party may seek legal address regarding the matter. Legal address can emanate from the failure of each party to meet the required stipulations at the designed time. This is termed as the breach of contract. There are rules and regulations set by the relevant government authorities that govern on the effective management and transaction of contractual agreements. The NCMA stipulates that all members of the contract management profession have to align and adhere to the stipulated regulations requiring them to uphold high standards of veracity and conscientiousness (NCMA 1). Members are expected to strive to achieve the highest possible standards of professionalism in a job presentation, and to implement assiduousness in carrying out proficient duties while serving to the best of one’s capability.
This work discusses contracts, and endeavors to identify three case examples of unethical incidences dealing with contracts. It proceeds to; review the three incidences regarding the misconduct surrounding the unethical incidences in the contracts, evaluate whether the standard policies and procedures or code of ethics are adequate to government contracting, identify the violations on the involved individual and the weakness of the oversight of the organization in which the unethical incident occurred, and identify the consequences on the firm and the individual.
Global Communications
The misconduct surrounding the unethical incident at Global Communications is the intention to reduce costs by reducing the workforce. This is unethical since Global Communications’ intentions were not made aware to the Technologies Workers Union (Ajay 185). The workers union had a right to know of the intended action by Global Communications. This is so as to cease employment opportunities for its workforce in order to reduce costs and remain relevant in a highly competitive telecommunications industry. It appears unethical because Global Communications intends to lay-off workers and yet proceed to outsourcing jobs from other countries. This was seen as a way of avoiding contractual agreements with the local workers. The contracts of these workers were going to be terminated even when they (workers) were not the reason behind the increased competition.
The violations involved concern the livelihood of workers. These workers were bound to lose the source of their livelihood and yet the company was ready to hire other workers from outside the country (Ajay 186). These workers to be hired from outside the country would have to be paid, and yet Global Communications considered paying the current workers expensively. It does not seem to solve anything when some workers are laid-off while others are recruited from foreign countries. This assumption to reduce costs by laying-off workers while outsourcing others from foreign countries is a weakness of the organization’s oversight. It brings about the need to terminate the contracts of the current employees without liaising with the workers’ association. The workers’ association has to know the welfare of workers, and when a company decides to overstep that process, it becomes highly unethical.
Orkin Company
This company has an ethical issue because it had convinced its clients to continue paying for a lifetime annual renewal fee for termite control. However, after experiencing financial constraints as a result of inflation in the country, Orkin Company decided to increase the renewal fee by forty percent (Leagle 1). While doing this, only a few of its persistent customers were saved from the increment. This was because they were informed of an accommodation plan that could ensure they were not affected by the increment. However, the company did not consider it necessary to inform the other customers about the possibility of attaining this plan. This is unethical since the company had been progressing due to the constant renewal of the annual fees from its customers. Therefore, the company should have felt obliged to inform all its customers regarding the accommodation plan. It was unethical to increase its annual fees to customers, and yet they were not responsible for inflation in the country. Since all parties (customers) were party to the contract, then it would have been ethical to inform all customers of the intention to raise the annual renewal fees.
The rights of the customer were violated because they were not informed of the company’s intention to increase their annual renewal rates (Leagle 1). Even after the customers had been obediently remitting their renewal fees annually, Orkin decided not to inform them all regarding the increments. It violated the terms of contract by not involving all customers in the accommodation plan. Such an act would have adverse effects on the Orkin firm in that it would lose customers. In case customers came to learn of the accommodation plan, they would lose confidence with the company; thus Orkin would lose its source of revenue. On the individual perspective, customers had to suffer the consequences of paying increased rates, and yet the circumstances that led to the forty percent increment were beyond the control of the customers.
T-mobile company
The misconduct surrounding the unethical incident is the trend by the company to extend contracts of customers without notifying them. In this regard, the code of ethics is adequate since there is an offer but with no acceptance. Since a contract requires an offer and an acceptance to be completed, this contract cannot be assumed effective as per the law since it is extended without notification to customers. In this contract, only the company seems to be involved in the contractual agreement. The other party, which consists of the customers, is not aware of the extension of the contract (Emars 1). As far as contracts are involved, the contracts if written should be accompanied by signatures from both parties. However, in this case, it appears the company intends the contract to continue without involving the party that is to be affected by the contract. Customers are the ones requiring the services of T-mobile; therefore, likely affected by the contract and yet they are not involved. This is highly unethical since T-mobile should treat its customers with honesty. Honesty is vital in contractual agreements; thus it would be in order for the company to ensure it maintains honesty by informing its customers of the intended increments. The violations exist in the sense that customers are not involved in the extension process, and are later subjected to early termination rates when the prevailing plan is consequently cancelled. Because of this conduct of the company, T-mobile always has to suffer the consequences of having to suffer from customer boycotts. Customers, on the other hand, felt betrayed by the company they trusted for their services. This act impacts negatively on customers in that they have to be subjected to additional termination fees, to which they were not party.
Works Cited
Ajay, Aggarwal. “Some Lessons in outsourcing.” International Journal of Electronic Marketing 1. 4 (2006): 183-195. Print.
Andrews, Neil. Contract Law. Cambridge: Cambridge University Press, 2011. Print.
Emars, Natalie. Boycott of T-Mobile. BoycottOwl, 2009. Web. 24 Jan 2013.
Leagle. STATE EX REL. GUSTE v. ORKIN EXTERMINATING COMPANY, INC. Leagle, 2010. Web. 24 Jan 2013.
NCMA. The Contract Management Code of Ethics. National Contract Management Association, 2012. Web. 24 Jan 2013.
