A case study of ethical issue at Gucci in Shenzen, China

On 8 October 2011, an open letter- was spread on the Internet. This letter was written by 5 former employees of the Gucci Shenzen Flagship Store. In the letter, they alleged that employees caught an occupational disease, that there was one miscarriage attributable to excessive working hours and there was no compensation for these hardships. Moreover, they stated that there were excessive restrictions on employees’ behavior, including the need to obtain permission before getting a drink or a snack, and strict limitations on toilet time. They stated that, while the restrictions were applied strictly to all the frontline employees, including one who was pregnant, they were not applied to the managers. They also claimed employees had to pay compensation for any product that was stolen or went missing, even though these luxury products had already been insured. They also criticized Gucci’s goods exchange policies which appeared to be arbitrary and dependent on the manager’s mood. Later, further information emerged, suggesting that the case also involved falsification of records about working hours, the imposition of forced, unpaid overtime work. Gucci implemented a system of working 1 full day, followed by a day off. Officially, 1 day’s work was about 10 hours. But the workers complained that, on their working days, they were required to clock off at a certain time to establish a false electronic record, and then continue their work, counting goods until 2 or 3 AM without compensation.

DISCUSSION QUESTIONS

1. In this case, the Principle of Rights was violated. Explain what Principle of Rights is, give a general example under this right and discuss how this Principle of Rights has been violated by quoting THREE (3) examples from the case.

2. Was the store manager being professional in his/her way of managing the staff and the store? Why? Provide FOUR (4) reasons and elaborate.

3. What should have been done in the first place by the other employees to avoid the above issues which eventually led to the 5 colleagues’ resignation and why?

4. What are your recommendations for improvement for this store in terms of management? Provide FIVE (5) suggestions.

5. What are TWO (2) most important lessons that you can learn from the above case (relate to the lessons you have learnt in this module) and elaborate.