Project 3: Icelandic Freeze In the third assignment, you have the opportunity to gain an understanding of the ethical practices in a business related to wages.  You will research and identify the ethical issue presented in the case scenario, identify the ethical dilemma associated with the presented case scenario and assess the scenario in terms of ethical relativism and moral universalism.      Read the Case Scenario Josh Garrett is Head of Packaging and Distribution at Biotech Health and Life Products (Biotech).  Josh is in charge of all of the branches the company has throughout the world. Josh has been reviewing cost reports for the different branches.  He is concerned with some of the results.  His main concern is with the rising costs of unskilled labor at the Germany branch.  Many of the employees in the Packaging Department are classified as unskilled laborers making minimum wage.  Josh decided to research the matter further and found that the current US federal minimum wage is $7.25 per hour, which has not changed since 2009.  Interestingly, the German government recently raised its minimum hourly wage by 4% to 8.84 euros per hour ($9.79 – USD).  This information weighs heavily on Josh since another raise would be costly for the company. Adding to the concern about the increase in unskilled labor costs is that distribution costs between Europe and North America have risen considerably.   The shipping crisis of 2016 has caused cargo costs to rise for all transatlantic routes and with the demise of the low-cost flight service of Air Berlin, cost in Germany have increased. Josh is a great outdoorsman and loves Iceland.  It occurred to Josh that relocating the majority of the Packaging and Distribution Department from Germany to Iceland and setting up a distribution center would solve these problems because production and distribution costs would be lower in Iceland.  Iceland is the halfway point in the transatlantic route.  The new location would eliminate the need to ship long-distance hauls.  Josh also knows that Iceland is one of the poorest countries in Europe so if part of the business is moved to Iceland, he will receive the credit for job creation in the country. Josh decided to research Iceland as a potential location.  His research showed: All professions are exempt from minimum wage; Salaries are determined by collective bargaining agreements with most professions paying 260,000 and 300,00 ISK or $2,600 - $3,000 a month;  Salaries are higher due to contributions to universal health care coverage; The cost of living is higher than many other European countries;  The average wage in Iceland is approximately $3160 before taxes per month for a full-time worker;  Income tax is 37.3 percent for most people.  However, income tax is higher for those workers who earn higher wages. Josh had not expected the higher salary base but further research showed that Josh could improve the rate considerably by hiring y ...

1. Project 3: Icelandic Freeze
In the third assignment, you have the opportunity to gain an
understanding of the ethical practices in a business related to
wages. You will research and identify the ethical issue
presented in the case scenario, identify the ethical dilemma
associated with the presented case scenario and assess the
scenario in terms of ethical relativism and moral universalism.
Read the Case Scenario
Josh Garrett is Head of Packaging and Distribution at Biotech
Health and Life Products (Biotech). Josh is in charge of all of
the branches the company has throughout the world.
Josh has been reviewing cost reports for the different branches.
He is concerned with some of the results. His main concern is
with the rising costs of unskilled labor at the Germany branch.
Many of the employees in the Packaging Department are
classified as unskilled laborers making minimum wage. Josh
decided to research the matter further and found that the current
US federal minimum wage is $7.25 per hour, which has not
changed since 2009. Interestingly, the German government
recently raised its minimum hourly wage by 4% to 8.84 euros
per hour ($9.79 – USD). This information weighs heavily on
Josh since another raise would be costly for the company.
Adding to the concern about the increase in unskilled labor
costs is that distribution costs between Europe and North

2. America have risen considerably. The shipping crisis of 2016
has caused cargo costs to rise for all transatlantic routes and
with the demise of the low-cost flight service of Air Berlin, cost
in Germany have increased.
Josh is a great outdoorsman and loves Iceland. It occurred to
Josh that relocating the majority of the Packaging and
Distribution Department from Germany to Iceland and setting
up a distribution center would solve these problems because
production and distribution costs would be lower in Iceland.
Iceland is the halfway point in the transatlantic route. The new
location would eliminate the need to ship long-distance hauls.
Josh also knows that Iceland is one of the poorest countries in
Europe so if part of the business is moved to Iceland, he will
receive the credit for job creation in the country.
Josh decided to research Iceland as a potential location. His
research showed:
All professions are exempt from minimum wage;
Salaries are determined by collective bargaining agreements
with most professions paying 260,000 and 300,00 ISK or $2,600
- $3,000 a month;
Salaries are higher due to contributions to universal health care
coverage;
The cost of living is higher than many other European
countries;
The average wage in Iceland is approximately $3160 before

3. taxes per month for a full-time worker;
Income tax is 37.3 percent for most people. However, income
tax is higher for those workers who earn higher wages.
Josh had not expected the higher salary base but further
research showed that Josh could improve the rate considerably
by hiring young people between the ages of 15 and 18 who
could work up to 40 hours a week since mandatory schooling
ended at age 16. Josh believed he could negotiate a much lower
salary.
Iceland’s teenage unemployment is higher than the country’s
overall unemployment. Hourly costs are quite a bit higher than
in the United States and slightly higher than in Germany.
However, Josh believes the change in logistics will cut
distribution costs in the Canadian and Germany branches, and
will more than make up for increase in labor cost.
Josh also has a desire to help the young people of Iceland. He
believes he is being socially responsible in cultivating one of
the poorest European countries and its low wage earners.
Josh decides to go ahead and move most of the German
production and distribution business to Iceland as well as open
a new distribution center. In moving to Iceland, Josh decides to
exclusively staff young workers and let the workers go before
they reached the age of 19 prior to the time when the worker’s
contract had to be renegotiated.
In Iceland, employees fall within one of two classification,

4. young workers and adults.
A young worker is anyone under the age of 24. An adult is a
worker over 24.
Young workers include youth, children and adolescent workers.
Youth are those under 18 years of age.
A child is an individual under the age of 15 and still in
compulsory school.
An adolescent is an individual under the age of 15 but not in
compulsory school.
Young workers are subject to restrictions dependent upon the
type of work, the work environment and times worked.
Youth unemployment tends to be extremely high. Youth can
only work part-time since a person must be 18 years of age to
work full-time.
Josh’s plan came under dispute when two recent lay-offs
brought his employment practice to the attention of the staff
who believed that Josh’s employment practices were unethical.
The workers feel Josh is trying to use the system to avoid
paying workers a fair wage and stopping workers from gaining
full-time employment since after the age of 18, a worker’s

5. contract must be renegotiated.
If the matter is not quickly settled, the workers will go to the
Collective to ask for higher wages and request a guarantee of
full-time employment when they reach the age of 19.
The workers have also questioned the company’s policy of
paying different wages for the same job in different worldwide
locations.
The company has always had a policy of ensuring fair wages
dependent upon the country in which the company operates.
However, if workers go to the Collective, the company will
have to pay more money than is reasonable for unskilled labor
costs, and will compromise the move to Iceland. Josh knows
the higher labor cost will negatively affect the company
financially. Added to his concerns is that he knows that
unskilled workers within Biotech make different wage amounts,
especially in Germany, Mexico and the United States. In these
locations, wages are much lower. Josh thought to himself, “is it
fair that the workers in other countries are making so much less
than the workers in Iceland?”
Instructions
Step 1: Write the Introduction
Create the introductory paragraph. The introductory paragraph
is the first paragraph of the paper and tells a reader the main
points covered in the paper. To help you know how to write an
introduction, view this website to learn how to write an
introductory paragraph:

6. http://www.writing.ucsb.edu/faculty/donelan/intro.html
Step 2: Answer the following
Assume Josh’s employment practices are unethical.
Explain the meaning of an ethical issue;
Identify and explain the ethical issue in the case scenario using
the course material to support the reasoning and conclusions
made;
Identify the one ethical issue in the case scenario that is
irrelevant to the case scenario. Explain why.
Identify and explain the ethical dilemma. Use the course
material to support the reasoning and conclusions made;
Define ethical relativism and moral universalism;
Does this case scenario illustrate ethical relativism or moral
universalism? Explain why or why not.
Step 3: Review the Paper
Read the paper to ensure all required elements are present. Use
the grading rubric to ensure that you gain the most points
possible for this assignment.
Proofread the paper for spelling and grammatical issues, and

7. third person writing.
Read the paper aloud as a first measure;
Use the spell and grammar check in Word as a second measure;
Have someone who has excellent English skills proofread the
paper;
Consider submitting the paper to the Effective Writing Center
(EWC). The EWC will provide 4-6 areas that may need
improvement.
How to Set Up the Paper
Create a Word or Rich Text Format (RTF) document that is
double-spaced, 12-point font. The final product will be between
4-6 pages in length excluding the title page and reference page.
You may not exceed six (6) pages so it is important to write
clearly and concisely.
Completing the Paper
Read the grading rubric for the project. Use the grading rubric
while completing the project to ensure all requirements are met
that will lead to the highest possible grade.
Third person writing is required. Third person means that there
are no words such as “I, me, my, we, or us” (first person
writing), nor is there use of “you or your” (second person
writing). If uncertain how to write in the third person, view this

8. link:
http://www.quickanddirtytips.com/education/grammar/first-
second-and-third-person
.
Contractions are not used in business writing, so do not use
them.
Paraphrase and do not use direct quotation marks. Paraphrase
means you do not use more than four consecutive words from a
source document, but put a passage from a source document into
your own words and attribute the passage to the source
document. Not using direct quotation marks means that there
should be no passages with quotation marks and instead the
source material is paraphrased as stated above.
Provide the
page
or
paragraph number
when using in-text citations. Note that a reference within a
reference list cannot exist without an associated in-text citation
and vice versa.
You may not use books as source material other than those
provided in the classroom.