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For HR, the ethical landscape is changing

The job of HR is often characterised by moral dilemma. Ethics expert Clare Payne identifies these grey areas and points out how things are changing.

Is being good at your job compatible with being a good person? You’d hope the answer was an emphatic yes, but the truth is some HR professionals have been dismissed for standing up for what they believed was right – HRM has heard from more than a few of them.

But Clare Payne is of the opinion that things are changing. Recognised as a leading voice on the topic of business ethics, Payne is a former employment lawyer and co-author of A Matter of Trust: The Practice of Ethics in Finance. But her thoughts and writing extend beyond the finance industry, she also addresses the ethical dilemmas of HR.

Dealing with unpleasant behaviours

When it comes to dealing with an employee accused of being a sexual harasser or a bully, there’s a strong temptation in some organisations to use legal processes and payouts to quickly shut it down. They either hush up the victims, or usher the offender out of the workforce.

Instances of this behaviour are uncovered all the time. In December last year, it was revealed that media company Vice has a history of doing both. It settled with complaining employees – holding them to non-disclosure agreements – and also fired managers accused of harassment.

Given the current environment, this line of action risks more than your organisation’s reputation, says Payne.

“Not unlike the Catholic Church, you are just allowing someone to go on and offend again,” she says. Not only could this be a potential source of liability, it’s also a waste of company resources. Putting her employment lawyer hat on, she says it’s always better to go through the right processes rather than the quick fix.

“It costs a company more eventually, and the person perhaps won’t learn a lesson. They’ll actually be rewarded. They get a big payout and everybody is under confidentiality agreements so nobody finds out what happens. Then they go out and get a new job.”

Stuck in the middle

Because of the position as an intermediary between an organisation and its employees, HR can find itself in a quandary when the executive wants to act unethically. It’s something representatives from the Australian HR Institute have spoken about before, arguing that HR’s allegiance is to the company and not to any boss.

“There’s always been this tension because HR is obviously employed by the company and yet they should have a role to represent the staff and the people. But sometimes those two stakeholders can be in conflict,” says Payne. “We’ve seen HR giving a lot of attention to the employer rather than to the staff. And I think that’s being reconsidered now.

“That’s the same with any profession. Finance has given too much attention to the shareholder as the primary stakeholder over the customer. When we look at ethics, we look across the stakeholders and work out how to manage their interests and their needs and how to make sure they’re prioritised in a fair way. That’s the dilemma for HR at the moment.”

Individual reputational damage, exposed more easily now on social media, means that there is now a personal, career-minded reason why behaving ethically is the right choice.

“We’re into the age of individual accountability. Things stick with the individual. If they’re seen to be unfair or unethical, then that will stay with them regardless of whether they were just doing what they were told,” says Payne. “People have to think about what they want to be known for.”

Ethical language

Payne’s talk at the upcoming AHRI State Conference in Darwin will have a focus on how language frames and influences ethics. “A lot of the language of business that we’ve come to accept – and the language of management – actually skews our moral compass,” says Payne.

As an example she brings up redundancies. There are a plethora of euphemisms from “downsizing”, “smartsizing” and “rightsizing” to “workforce optimisation”.  

“If the people that are managing redundancy think about it as ‘workforce optimisation’ they will probably have less empathy for the person going through the process. Because they’re thinking with the company hat on that this is a great thing [for the business]. Whereas it could be the worst thing to happen to someone’s life.”

What’s in a name

But it’s not just how we label processes that can take us off track. “Just in itself I find ‘human resources’ quite an offensive term. The most people-focussed area refers to people as resources,” says Payne.

Obviously discussing the best and worst names for HR can often get heated, but it’s not just the name Payne finds troubling.

“What happens is, where there’s people-oriented areas of business – be it corporate social responsibility or environmental social governance – they get reduced to an acronym. Like HR. Or employee relations becomes ER.”

A lot of HR professionals would sympathise with this. There are more than a few examples of HR acronyms they could rattle off, including PIPs (performance improvement programs), EAPs (employee assistance programs) and KPIs (key performance indicators).

“HR and employment practices in general are just riddled with acronyms. And in a way that takes the human element out of the most human aspects of business,” says Payne.

Hear leading ethics expert Clare Payne, and other HR leaders and experts at the AHRI State Conference in Darwin on Thursday 12 April. Early bird registration closes Thursday 15 March.

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Peter Maguire
Peter Maguire

This is nothing new. I have faced the “ethical” question time and again throughout my career in “Personnel Management” or “HRM” or “Organisational Effectiveness” or “Workplace Relations” or “People and Culture” or whatever else it has been called over the past 40+ years. The correct answer is not about being loyal to a company or a boss – rather it is about having the courage to be true to yourself and your personal values and calling out wrong decisions and behaviour for what they are. Sure taking an ethical stand can have short term adverse consequences ( I have copped… Read more »


So who determines what the moral compass is? (Not HR) If the Company is going in one direction, which they think is Ethically OK and some-one in HR (or Finance or anywhere) disagrees with that direction, should the company change their direction? This is completely separate to impropriety. Not so sure either that HR is there to “represent the staff”??? Again, if staff are not happy with a policy or a direction or their pay or whatever then there is usually opportunity for discussion, and maybe HR can facilitate the discussion (but I would not like to think that HR… Read more »


I agree with Peter…Providing support and guidance to an organisation is fundamental to HR, and this includes providing support to all levels and facets of the organisation and ideally finding a balance between supporting employees and supporting senior management with your integrity and reputation intact. I’ve experienced first hand that HR is still very much for the C-suite with alarming repercussions. If your advice or actions do not reflect best and fair practice, then what are you doing? If your assessment is that the approach favoured by senior management is not ethical then you should be in a position to… Read more »

Wessel Appel
Wessel Appel

What are your options when one of the Senior HR Managers is the power hungry person who wants to control and influence all operational areas in the company and who could easily be labeled as the actual bully? What did I do about it? Initially I resisted in a professional manner by constructively contributing in meetings the Senior HR Manager. This strategy was not appreciated and I was isolated from these meetings by simply not being invited or been informed I am not required to attend. How did I respond to this Senior HR Manager? I then resigned and distance… Read more »

Robert Compton
Robert Compton

HR professionals can take a utilitarian or deontological view of ethics. They are the extremes. Then there are 50 shades of grey.
In many cases the personal circumstances of the HR professional will determine which approach they take. Can I afford to lose my job?
Do I take on the Executive? Or do I point out the moral and legal implications?
Quite the dilemma at times. No easy prescriptive answers I’m afraid.

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