Thursday, September 18, 2008

What are they teaching in business school?

From Michael Ward at UT--Arlington
At the same time that you found an accounting error in the calculation of your monthly compensation, you also learn that your brother, who does not have health insurance, will lose his foot to diabetes. The accounting error will provide you with an extra $3,000 this month and you could use it to help your brother buy a prosthetic foot to get up and about. You know that the prosthetic will enable your brother to work and generate income well in excess of $3,000. Is it unethical to not report the error so that you can help your brother?

1 comment:

  1. I can tell you what happened to the workers involved in a smilar real-world case (without the brother). Workers represented by a union discovered that they had been paid overtime to which they were not entitled; when the error was discovered, the company disciplined (my memory of the case--in Dilts and Hilgert, Cases in Collective Bargaining and Labor Relations, which is unfortunately in my office) the workers (I think they fired them), the union filed a grievance--and lost it. The arbitrator upheld the firing.

    So the moral is--if you do keep the money, don't get caught.

    I could tell another story. My wife changed jobs. Employer 1 (the old job) mistakenly kept her on the payroll for two or three pay periods. She reported this to them (TWICE!!!), because (a) she hadn't earned the income and (b) she didn't want them realizing their error and clawing back the pay but leaving her on the hook for the taxes. The employer made no effort (it's now three years past) to recover the pay.

    I don't know what the moral of that is.