Deborah is the Underwriting Manager at Acme, Inc., a large national property and casualty insurance company. It’s been only a fair year, due to high claims from a number of hurricanes. Consequently, she has only a small amount of extra money with which to raise her senior underwriters’ compensation. There are no clear guidelines on how to divide up these funds, other than to “use her best judgment.”
As is customary in situations like this, there are no clear answers. Her staff members all have strengths and weaknesses. Moreover, they have different life and work situations that cannot be ignored. How should she handle the situation?
Here are the candidates for a raise:
Hector: Unmarried, no children. Good performance, his section always produces a profit. Considered a “superstar” when recruited from Cornell several years ago, executive management is still waiting to see him perform at his potential. He’s the most productive of this group of senior underwriters, though not by a great amount.
Rhonda: Single parent of two girls, ages 2 and 3. Dedicated, bright, but overall her performance has been good, occasionally excellent, but inconsistent. This has been attributable, perhaps, to the stress of dealing with the emotional aftermath of her recent divorce and trying to raise her two children alone on one salary and struggling to pay for day care.
Amanda: Married, no children. The only non-college grad in the group. Started as an administrative assistant, worked her way up to senior underwriter while taking some insurance courses at night. Not blessed with exceptional natural talent for the business but works extremely hard, putting in many extra hours during evenings and weekends. Performance very good.
Raymond: Married, one child. Always has performed acceptably, occasionally very well. Known throughout the company as a real team guy, and departments in which he works always have high morale. Organizes company outings to social events, volunteers in the community on behalf of the company, has created a good feeling wherever he works.
- If you have to give all the raise money to only one person, who should get it? Why?
- If you can divide up the raise money any way you’d like, how would you do so and why?
- Be sure to identify the ethical framework(s) from which you are working for each of the questions.