An article examining the ethical considerations of job reneging won University of Notre Dame Business professor Tonia Hap Murphy the Ralph C. Hoeber Outstanding Article Award from the Academy of Legal Studies in Business (ALSB). The award is given to the most outstanding article from among 14 articles published in volume 26 of the Journal of Legal Studies Education, which is sponsored by the academy. “Reneging: A Topic to Promote Engaging Discussions About Law and Ethics in a Business Law or Legal Environment Course,” was chosen by a select committee made up of ALSB members.
“I’m honored to receive this recognition from my peers,” said Murphy, who is an associate professional specialist in the Department of Accountancy at the Mendoza College of Business. “Reneging is an important topic, particularly in the context of recent ethical failures in the business world. I hope my work contributes to the discussion of the importance of integrity and promise-keeping, both in business education and the corporate culture.”
Murphy accepted the award on Aug. 9 in Denver, Colo., during the academy’s annual meeting. The academy is an international academic-professional organization composed of professors of legal studies in colleges of business.
The article discusses the legal and ethical issues arising in reneging cases. Reneging occurs when a person accepts a job offer, and then backs out before work begins. The prospective employee might have gotten a better offer, or simply reconsidered for other reasons. Billy Donovan, the University of Florida men’s basketball coach who changed his mind after signing a contract to coach the Orlando Magic in the NBA, is a recent and well-publicized example cited by Murphy.
When it comes to students accepting job offers, the National Association of Colleges and Employers (NACE) periodically polls employers about the rate of reneging, but doesn’t supply statistics on the number of incidents, said Murphy. NACE has reported the rate as being relatively unchanging in recent years, but it appears to happen often enough that nearly all university career placement offices have policies in place to discourage the practice – sometimes with disciplinary action or by levying stiff fines.
Murphy found that employers seem not to pursue legal claims when prospective employees have reneged, although an argument can be made that equitable recourse may be available, at least in some states. For that reason, reneging is largely an issue of ethics.
From an ethical standpoint, students often don’t see a problem with backing out of an offer if something better comes along. “One of my students said it’s just the way of the world, an accepted business strategy,” said Murphy. She pointed to a study by another university that found 44 percent of young adults agreed that reneging is acceptable if offered a better job with a different company. “But students would get terribly upset if an employer reneged on them. I’d like them to question why they believe reneging by employers is an ethical violation, while employees may renege with impunity,” she added.
The central ethical issue is whether a person with integrity would renege, Murphy said. Those who tend to think of backing out as merely a business strategy are missing the larger point of the damage the action does to their reputation, and the negative effects it may have on the prospective employer and others. “And many people, I find, haven’t thought through the whole concept of promise-keeping, and how generally, when you make a promise, you are expected to live up to it.”
The basis for the article was a study Murphy conducted with her introductory business law students in 2007/2008. She set up a pre-course and post-course study aimed at measuring how students would answer a number of questions aimed at gauging whether they believed reneging was acceptable. During the course, Murphy discussed with the students various law contract issues, and in particular, cases where legal conditions existed so that a person legally could get out of a contract, but ethical considerations might dictate a different decision.
“I would say to the students, ‘If you know you made this commitment, is it the right thing to carry out your obligations anyway, even though there’s a legal loophole that would allow you not to live up to them?” said Murphy. By the end of the course, she found her students significantly less likely to agree that reneging was acceptable, results she sees as encouraging.
“What we want for our students is that they recognize when they are faced with an ethical issue. If they face up to the small ethical issues in their lives and do the right thing, they are more likely to do the right thing when they confront tougher issues later on,” she said.
For more information about Tonia Hap Murphy, her research on reneging or the Outstanding Article Award, contact Murphy at (574) 631-9022 or email@example.com.
About Tonia Hap Murphy, Accountancy Associate Professional Specialist at the Mendoza College of Business
Tonia Hap Murphy obtained her undergraduate degree in English from the University of Notre Dame, and her Juris Doctorate from the University of Michigan Law School. After practicing law with a large law firm in Indianapolis and working as an in-house lawyer at Eli Lilly and Company’s Indianapolis headquarters, Murphy joined the faculty at Notre Dame in 1992. She currently teaches the introductory Business Law course. Professor Murphy serves as Senior Articles Editor of the Journal of Legal Studies Education. She has written articles on law and ethics, and pedagogy in legal studies courses. In 2009, the Academy of Legal Studies in Business awarded Professor Murphy the Ralph C. Hoeber Outstanding Article Award for her research. Professor Murphy is an active member of the Academy of Legal Studies in Business and a member of the Indiana Bar.