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Module 4 notes – Loyalty and Whistle-Blowing
Corporate Loyalty – Case Studies of Whistle Blowing
Loyalty is an expectation of the employer
There‟s a fundamental vagueness about its meaning
Difference of opinion between employer and employee
With professions, requirement of loyalty is written into the code of ethics
What does loyalty mean?
Should it extend to cases where whistle-blowing has occurred
Whistle-blowing an employee calling public attention to his company‟s alleged
Case Studies of Whistle-Blowing
The Insider – Russel Crow – a research chemist at a tobacco factory in Virginia
o At Issue – Should he blow the whistle on his own company who has been denying
that they have any knowledge about the addictiveness of nicotine
o In the end he does blow the whistle and reveals that the company knew about the
addictiveness and as a result he…
his wife and children leave him
he loses his home
he was subject to physical intimidation
underwent many lawsuits
Silkwood (a movie based on an activist named Karen Silkwood)
o She was a whistle-blower on negligent practices in the nuclear power industry
First Challenger shuttle explosion in 1986
o Roger Boisjoly worked for a company called Mortin Thiokol – a supplies to
o Why did the challenger explode? Because of an „O‟ ring.
What is an ‘O’ Ring?
Two separate parts that are made out of inflexible material can be
sealed or held together by an “O” ring.
Temperature (freezing cold in January) caused the rubber to peel
away from one of the segments allowing flammable gas to escape
and ignite the explosion of the entire shuttle
Boisjoly, involved in the research of the „O‟ ring, warned of the
probability of an explosion occurring.
During the investigation, Boisjoly blew the whistle on Thiokol
(after the fact). He gave many warning with much data and memos
supporting the warning
o As a result…
Loses family and home
Cannot find employment in his field
o He was frequently asked if he would have don otherwise and he always says no,
he wouldn‟t change a thing.
Dr. Nancy Olivieri vs. Apotex.
o Doctor and medical researcher at University of Toronto and the Hospital for Sick
o She is approached by Apotex to do a clinical trial (human testing) on the children
with a drug, which affects the iron level in the blood. Parents/children signed off
on it and participated in the clinical trials.
o One year into it, based on biopsy reports, Olivieri concluded that the drug left a
dangerous amount of iron in the blood (sever side effects as a result)
o Olivieri originally agreed to sign a confidentiality agreement forbidding her to
discuss the trial until it was completed
o She is so upset by the results of this drug and wants to stop the clinical trial
because it‟s harming those who are willing to take the drug for the clinical trial.
o Apotex finds someone else to do the research and trial testing. She goes to
University of Toronto, The Hospital of Sick Kids, and the Regulatory Branch of
Health Canada which eventually cycles and becomes public news
She violated her confidentiality agreement and essentially blew the
whistle. She said the condition of the drug justified her doing this.
Pros and Cons of Corporate Loyalty
Duska does not think highly of corporate loyalty – he think it‟s a scam
Why does he disagree with Corporate Loyalty?
o He says loyalty is only appropriate to friends and family, especially when the
employer is a for-profit employer
o Appropriate only in a context where 2 things are true (2 criteria to be met):
1. It‟s a mutually enriching relationship
2. Self-sacrifice is sometimes required of everybody
a. A business will never sacrifice itself for you, it‟s employee
It is naïve and foolish to put much value on corporate loyalty
o Employees owe the corporation a good day‟s work for a good day‟s wage.
One of the most prevalent tools used by employers and business to inculcate loyalty is the
o Teams are used to get employees to misplace their loyalty and give more to the
company than is rational
What do you think about Duska’s argument?
Would you hire Duska?
Would you talk like this in an interview?
o Believing in team loyalty is at odds with your self interest as a rational employee.
Do you think whistle blowers betray the company?
Isn’t it much better to work in a n environment where people get along?
o Concern that people may invest themselves too personally, transferring feelings
that are more appropriate for family and friends into the workplace