Discretion over the budget when in times of crisis


Problem: Your friend is a manager in a company which is in financial trouble. The workforce has been very loyal so your friend is working hard to prevent job losses. Your friend tells you they had an angry exchange with a star employee, who is insisting that they be paid a very large performance bonus. Your friend admits that the star employee met all of the criteria to earn the bonus. Company policy also indicates that managers have discretion over the budget when in times of crisis. Your friend has checked and there is simply no money in the budget to both pay the large performance bonus as well as salaries.

Out of the three major approaches discussed in class, is the rights approach best suited to resolving this dispute? If it is best suited, justify your answer. If it is not, suggest a different approach and justify it.

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Other Management: Discretion over the budget when in times of crisis
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