This is a rough decision, said Chris Zale, store manager and vice-president of Zales Department Store. ZDS, a large urban retailer with 350 employees, is a family-owned business that has operated in the region for over 50 years. Zale believes strongly in delegating authority to lower levels of management. However, Riley Rivers, the Manager of the Mens Sportswear department, has recently referred a problem to him.

Six weeks ago, Morgan Murphy aged 23, was hired as a temporary employee. He has an outstanding personality and immediately made friends with the senior workers in the department, as well as with other salespersons and clerks in the store. Moreover, he is an exceptional salesperson who relates well to customers. In fact, many had gone out of their way to tell Rivers how much they enjoyed dealing with Morgan. After Morgans two-week temporary period, his manager requested that he be hired on a full-time basis; Morgans partner has recently undergone major surgery, so Morgan was glad to have full-time work.

Four days ago, Nat Bailey, Personnel Manager of the ZDS, realized that Morgan had not taken the medical exam required of all full-time employees. When Morgan took the exam that afternoon, he didnt pass it due of an existing heart condition. Because of restrictions in the companys medical insurance program, he could not be hired.

Bailey told Rivers that Morgan would have to be terminated. Rivers, argued strongly that an exception be made in Morgans case. Several employees have also told the Bailey that it would be unfair to Morgan to release him now, since it was his own oversight. Also, they argue that the company should be willing to help people in situations such Morgans, since they have an Equal Employment Opportunity Commission program and have even hired some disabled employees in the past.

But Bailey, the personnel manager, says that Morgan must go. The rule is that all permanent employees must pass the physical, and Morgan has not.

Rivers appealed the decision to Chris Zale, the store man ager, who said he would let her know something the next day. As he ponders a way out of the dilemma, Zale is aware of the results of a survey on his desk; 44% of the employees say that they would consider joining a union if one attempted to organize the store.

1.What are the key issues in the case?

2.Develop 4 realistic alternatives for Zale to consider.

3.Why would Zale want to avoid having the employees form a union?

4.What decision do you recommend that Zale make regarding Morgan Murphy's employment status? What if any changes should be made over the longer term?