KELLER PLASTIX MANUFACTURING, INC

Keller Plastix Manufacturing, Inc



Ethical Dilemmas Faced by Keller Plastix Manufacturing, Inc.

Introduction

Keller Plastix Manufacturing, Inc. wants to move its fan manufacturing from Georgia to China and its plastic beverage container production from Wisconsin to Africa. In doing so, the company faces many ethical and legal dilemmas with respect to the following issues: (Bilinsky, 2011).

The cost of labor in America is much high than it is in China. China has access of competitive labor available at lower cost. United States Department of Labor published Fair Labor Standards Act (FLSA) in the year 2009, according to which the minimum wage is $7.25 per hour.

The Wage and Hour Division of the United States Department of Labor is responsible for the implementation of minimum wage law.

Plan to identify, analyze and determine a solution

In China, however, there was no law on minimum wage. The first ever law in this regard is the Regulations on Minimum Wages in Enterprises which was published and made effective in the year 1993. It got amended later in the year 1994 and is effective to date. In the year 2008, in an effort to calm down the grousing consumers, China raised minimum wages across the country.

The minimum wage rate in china is different for different provinces. The highest minimum wage rate is in the province of Shenzhen which is 2484 US dollars on an annual basis. This highest minimum wage rate in China is much lower than the minimum wage rate in America which is 15,080 US dollars (Brassey, 2002).

Moreover, employee benefits in China majorly consists of retirement benefits, medical benefits, maternity benefits and disability and industrial injury benefits. These benefits are fewer and relatively cheaper than the benefits an employer has to provide in the US (Brassey, 2002).

Dilemma - ADR

The plastic beverage container manufacturing plant closed because it was releasing large amounts of a highly toxic substance in the air. The toxic released caused many cases of birth defects and carcinogens. The Environmental Protection Agency in the United States closed down the Madison Wisconsin plant. Keller Plastix Manufacturing, Inc. cannot open the manufacturing unit again until it resolves the issue. The shift of the manufacturing unit to Africa will save cost for the company in that it plans to dispose of the toxic waste by burying fifty feet under the soil in a remote area. The African law also prohibits this method of disposal. African law for environmental protection prohibits hazardous waste incineration.

Hence, the company will have to invest in proper disposal of toxic waste coming out of its manufacturing unit even in Africa. The company should take comfort from the fact that the cost of proper disposal of waste in America would have been much higher than it is in Africa.

Keller Plastix's plastic beverage containers exploded at any temperature above 90 degree Fahrenheit. This posed a serious threat of a legal action against the company in that the explosion of beverage containers caused numerous injuries and in certain ...