Ethics Challenge

Kaela Ringo, the manager of operations, works for PURE Inc., frozen fruits producer for many years. It is December 1, 2021, and Kaela is trying to decide what production schedule to set for the first quarter of 2022. Demand for frozen fruits is soft and current overall projections indicate that sales will only be 75% of the original amount planned for the first quarter of 2022. She is aware that at this level of production, it may become necessary to lay off key employees. However, she is able to rent additional warehouse space to store excess inventory, if necessary. As a result, she is considering production of enough frozen fruits to maintain the current level of staff and make use of the available rental space for warehousing the unsold product.

Required:

1. Identify the ethical issues involved in the decision Kaela must make about the level of production for the first quarter of the year.
2. What alternative courses of action could Kaela take that may reduce the need to lay off employees?