HR Leads Business

Jul 1, 2020 | Clare Chiappetta

Making Ethical Decisions in Times of Crisis

Companies across the globe have been faced with difficult financial and employment decisions. Employers are facing ethical dilemmas about how to safely return to work while protecting employees, decisions regarding layoffs, and how to weather this economic storm.

“Businesses are trying to manage difficult trade-offs where the long-term impact is not that clear,” says Alison Taylor, executive director at Ethical Systems and senior advisor at Business for Social Responsibility. “HR needs to play a strategic role.”

Here’s how you can support ethical decision-making at your organization during times of crisis.

Write Policies That Support Crisis Scenarios

Ethical decision-making during a crisis is rooted in base policies regarding compliance and ethics. Preparing for decision-making during a crisis begins with your foundational documents. “Most often, people are in a crisis or urgent situation when they fall back on policies,” says Sarah Campbell, president of OnPoint Policy and adjunct professor at Loyola University Chicago School of Law. “We could be faced with uncertainty at any time, and we always want to act on common ideas and values.”

When writing policies, try to anticipate all crisis scenarios, even if you don’t actually expect them to happen. Play through how policies will be implemented during a crisis. This is where HR can provide a lot of value. “HR’s gift to the organization is it’s people-oriented focus,” Campbell says. HR can advise leaders on how policies will actually be implemented during a crisis, as well as conduct follow-up research and make suggestions for revision.

Create a Taskforce to Ensure Equity

Assemble an interdepartmental task force to aid in decision-making during a crisis. Pull members from different groups and levels to offer input. They will be able to demonstrate how each group will be impacted by potential decisions. Establish criteria for mitigating the impact on more vulnerable groups, Taylor suggests. For example, when deciding where to cut costs, begin with your highest paid — and therefore least vulnerable — people in the executive suite.

HR can play an overarching role in identifying where that impact can be minimized and what tradeoffs have to occur. “HR sees employees at all steps of the employee experience,” Campbell points out. “HR is really plugged into employee needs and can foresee effects of decisions on the workforce.” Eliminating executive bonuses, for example, could save money that can be put towards paying healthcare costs for laid-off employees.

Support Your People — and Your Long-Term Success

Moments of crisis also double as moments of hyper-transparency, when organizations are closely scrutinized for their actions. HR can offer critical advice on how decisions made now will impact your organization’s long-term brand. Customers, suppliers and future candidates for employment will remember how you behaved and what you prioritized during the pandemic, for example.

Airbnb’s leadership provides a model for ethical, people-centered decision-making during a crisis. A transparent and honest message from the CEO outlined the thought process behind their decision to lay off employees, as well as the company’s subsequent steps to support those employees moving forward. “That’s a good example of a company that has thought through it’s long-term position and reputation,” Taylor says. “Because of it, they made the decision to treat their employees with respect.”

“That accountability closes the gap between the right thing to do and the best thing for long-term reputation,” she says. “Don’t be consumed by your short-term imperatives at the expense of your long-term survival and reputation.” The most ethical course of action you take during a crisis will also support your long-term branding and strategy initiatives. Doing what you can to minimize the impact of a crisis on your most vulnerable employees is the best business move you can make.