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Ethical Dilemma

By amcol ·
The following situation describes an actual occurrence.

You are an IT manager of a shop that is mostly resourced with employees but also has a small percentage of consultants. One of your consultants approaches you and indicates he wants to be considered for permanent employment with your company.

Some pertinent facts:

1. You have no current official openings. You would have to work with HR to create a headcount.

2. You have had no prior conversations with this consultant, or any other consultant, about the possibility of a permanent posting. There is no precedent for this at your company.

3. The consultant is very competent, very highly regarded, and would in fact be a valuable addition to your staff.

4. The consulting company that currently employs the consultant has a formal contract with your company. That contract has a standard bidirectional one year non-solicit clause.

5. You have been doing business with this company for several years, are satisfied with their services, and intend to keep on using them in the future. They are a large national firm.

Question: how do you handle this situation?

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Not sure that it's your dilemma

by Tony Hopkinson In reply to Ethical Dilemma

After all you have not solicited the consultant.

Seems to me the ethical ambiguity is in the consulants court as he has solicited you for a job using the in the agency gave him at your place.

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True, but...

by amcol In reply to Not sure that it's your d ...

The question is not whose dilemma it is, the question is how do you as the manager who's been approached handle the situation?

This isn't about judging the consultant's behavior, which may or may not be ethically ambiguous. It's about the proper management response to the situation.

Let's agree the one thing you can't do as the manager is ignore this, hoping it'll go away. What action do you take?

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OK, I'll byte: Here's how I'd handle it...

by plditallo In reply to True, but...

1. I would tell the consultant first and foremost, that I appreciate his/her past and current contribution to our organization.

2. I would tell him/her that I would be willing to be an advocate on his/her behalf for our organization by discussing the possibility of opening an opportunity for him/her with our HR department,our Finance/Purchasing department, and our attorney AS WELL AS with his/her consulting company--if-- and only if-- he/she is willing to move the request further along knowing that his/her explicit/implicit contractual commitment prohibits the practice per se.

3. If the answer from the consultant is "Yes", then I would contact the HR/Finance/Purchasing departments first to determine if the enterprise I work for would even consider the matter. If the answer to that question is "No", I would advise the consultant of this, then close the matter. If the answer is "yes", then I would discuss the matter with the attorney. If the answer is "no" from the attorney, I would advise the consultant of this, then close the matter.

4. If the answer is "yes" from the attorney--and/or-- I realize there are risks of which I think the consultant may be unaware, I would then make the consultant cognizant of those risks. I would offer him/her another opportunity to abandon the effort. If the answer is "Let's stop", I would close the matter.

5. If the answer is "Let's proceed", then I would have the purchasing department make arrangements to discuss the possibility with the consultant's agency.

From that point on, it would be up to all parties involved to bring their cards to the table to work out the details.

I don't see this case as a crisis of conscience. Such a spiritual rift would only come into being when any one (or more) of the stakeholders choses to: (a) not act in good faith; (b) be untruthful.

I'm not sure why you asked, but I hope this helps.

Kind regards,
--Paula DiTallo

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I agree

by stress junkie In reply to OK, I'll byte: Here's how ...

Paula's post is a little more touchy feely than I would say is required. It really depends on what kind of consulting house we're talking about. There are a lot of consulting houses that temporarily hire contract employees to fill job openings. This kind of contract/consulting house acts more like a broker between customers with a temporary job to fill and independent consultant/contract workers. This kind of consulting house will probably be happy to let you hire the consultant for a fee, just like any employment agency would do. If the consulting house has permanently hired this consultant to service their customers and has groomed them, trained them, and shepherded their career then you might have a problem.

I believe that if you talk to the consultant's agency you will find that they are likely to have provisions for this already in place.

As Paula pointed out, first find out if your employer would make a position available. If not then end of story. If your employer would make a position available then ask this consultant if he/she would mind if you contacted his/her consulting house. If he/she doesn't mind then go ahead and approach the consulting house about making arrangements for this to happen. If you can't agree to terms then forget it.

In the end it really isn't a big deal. It's just a series of little issues that need to be researched.

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...ahhh well...touchy-feely or not...

by plditallo In reply to I agree

We both would have made the same sets of decisions!:-)) BTW, I agree with you on the terms issue--if the parties can't agree, its hopeless!

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by amcol In reply to ...ahhh well...touchy-fee ...

In the interest and spirit of being transparent, I posed the question not because I was looking for advice or direction. As I said, this was based on an actual incident. What I didn't say was that the incident happened a year ago and has already been resolved.

This is an intellectual exercise. I've noticed in reading many of the postings over the last few months what I consider to be a rather distressing lack of knowledge of proper ethical behavior, or even worse a conscious avoidance of ethical procedure for the sake of expediency. I've taught classes in MBA programs about IT management, and the subject of ethical behavior was always a big part of the curriculum.

I appreciate your responses, and would rather not comment too much on them just yet since I'd like to see if anyone else contributes to this discussion. However, with regard to one of the points made, the consulting firm in this case is not a temp-to-perm's a national, actually international, consulting firm whose stock in trade is putting resources on term of project efforts, then moving them onto other term of project efforts either at the client company or at another.

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You're a little devil

by stress junkie In reply to Clarification
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So tell us

by Dr Dij In reply to Clarification

how it was resolved?

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It's actually a matter of money

by IBM5081 In reply to Clarification

While the non-solicitation clause does (and should) discourage companies from treating their consultant contractors as an employment agency, the consultant house realizes that they cannot hold their employees as hostages forever. The employee wants out of the consulting business into the full-time job position, but is constrained by contract.
Once the contractor is made aware that their employee is interested in a job with their client, they can set a price for revoking the contract to make the employee available to the client prior to the expiration of the one-year clause.
There is incentive for the client to decide what that person is worth as an employee. As well, the contractor has other consultants who are still engaged with the client; there is incentive to continue the profitable relationship with the client.
Just because the employee wants a job (which does not yet exist) does not obligate the client to create one immediately. The client should definitely communicate with their contractor to establish terms and conditions if their own management concurs that the consultant's performance warrants it.

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I disagree

by amcol In reply to Clarification

No disrespect intended, but your response is exactly the reason I posted this to begin with.

This is NOT a question of money. That's precisely what's wrong with the way most folks have been trained to operate. Notice I said TRAINED TO OPERATE...I'm still naive enough, at my advanced age, to believe most people are innately honest and do things that are morally, legally, or ethically ambiguous because they've received some message somewhere along the line that it's OK to do so.

You say the non-solicit "discourages" the hiring of consultants by client companies. It doesn't discourage it, it legally enjoins it. There's no room for interpretation...this is very binary in that there are two choices, either do the right thing and honor the contract or do what's expedient and suffer the potential consequences.

I agree that consultants are not indentured to their own companies, and they are entitled to seek employment elsewhere. If there's a legal contract that says the consultant cannot accept an opportunity from a particular company, set of companies, or whole industry, there's still a vast amount of opportunity elsewhere that the consultant is free to pursue.

To your point about paying the contractor to revoke the contract, that is in fact what happened. I paid a conversion fee to the consulting company equivalent to what I would have paid a search firm, in consideration of which I received a legal document indemnifying me personally and my company from any legal remedy as spelled out in the non-solicit...not to mention permission to hire the consultant.

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