Industry guru Dave Taylor offers tech support on technical and business topics, including iPhone, iPod, Microsoft Windows, Sony PSP, cellphones, online advertising, CSS, Web design, business, Unix, Linux, SEO, Mac OS X, and shell script programming.     


Should we pay our bankrupt supplier?

One of our suppliers has completed a job for us and shut down his business. My boss doesn't want to pay bill for his services. My boss justifies this because if something goes wrong with the completed job, the supplier won't be there to fix the problem. I think he just wants to avoid paying just because he can get away with it, and I think we owe the money and should pay it. I can't go over my bosses head about this or I'll risk my own job though. Can you give me ideas on how else to convince my boss to do the right thing? If I can't, I may need to quit just to live with myself. This feels like a trap and whatever I do, I lose. Help!


Dave's Answer:

I asked my colleague Laurie Weiss, PhD, to answer this one, as she focuses on business integrity issues. Here's what she suggested:

You sound stuck between a rock and a hard place. If you take a strong position with your boss, he'll probably resist and you risk his wrath and possibly losing your job. If you go along with his program, you lose your own self-respect and you can't live with that either.

Try looking at it this way. Most people are honest when they know someone is watching them. Some, like your boss, are opportunistic when they think nobody notices what they're doing. When questioned, they really see themselves as honest and usually believe that they have a very good reason for their questionable behavior.

Given this, you do have another option. You can approach your boss as if he would naturally do the right thing if he understood what it is. Instead of confronting the issue head on, take the position of being confused by his behavior.

You would honestly be confused if you had not already decided that he is opportunistic.

You might say something like this. "Excuse me Joe, I'm having trouble understanding your thinking about this. I thought you were very satisfied with Mike's work."

With luck, Joe might respond. "Yeah, it was OK."

You "Have you needed to call him back about any work he's done in the past?"

Joe, "Not really."

You, "Are you really worried about this job?"

Joe, "Well...I don't know..."

You, "I know he's having a tough time financially--he had some really bad breaks. I know you always try to do what's right. What are you worried about here?"

Here you're appealing to Joe's better side, without challenging him. Your conversation assumes that he's doing the best he can, and you're giving him an opportunity to change his position by himself.

If Joe ends up thinking it's his own idea to pay Mike, you all win. Since you already see yourself in a lose-lose situation, you have nothing further to lose by giving this a try. And you just might win after all.

I'd also suggest that you consider talking about obligations and the karmic principal of "what goes around, comes around", but that's just me. :-) You can learn more in Dr. Weiss' The Integrity Course, an online, multimedia course to help you say what you think without getting fired or losing your friends.


More Useful Business and Management Articles:
✔   How do I trademark my group's name?
Yo Dave! So I'm looking 2 trademark my group's name, and once its trademarked will I get a certain certificate of trademark to...
✔   Export LinkedIn Profile as a PDF Resume?
I've spent the last year or two updating and adding to my LinkedIn profile and it has a ton of information about me....
✔   How do I run a credit card transaction with PayPal Here?
I contacted PayPal and got their little blue triangle card reader for use with the "PayPal Here" application, so I can process credit...
✔   How do I search for a registered trademark?
I'm trying to come up with a new name for our software product, having been informed by a customer that a really big...
✔   I'm unemployed. What do I list on LinkedIn?
I wanna ask you about LinkedIn. What's the best practice to fill out the CURRENT POSITION Field when you are not working and...

Let's stay in touch!
Sign up for my weekly AskDaveTaylor Newsletter and you'll receive even more tech and gadget help right to your inbox, along with exclusive news and industry updates. It's good stuff. I promise!
    Enter your name: and your email addr:  





Categorized: Business and Management   (Article 6654, Written by )
Tagged: business ethics, business integrity, fair business practices
Previous: Should I sign up for PayPerPost.com?
Next: Upload images to your Wordpress blog without FTP?




Reader Comments To Date: 6

RD Greenfield said, on July 7, 2006 11:06 AM:

Concerning article 6654:

I feel that the writer is taking a moral responsiblity for his boss' actions that is not his, as he is not the owner of company and not the policy maker of that organization.

Quitting his job over somnething like this is like shooting yourself in the foot!

Cooper Strange said, on July 9, 2006 8:59 PM:

True, he may not be the policy maker for the company, but he represents the company and the company has a reflection on him. His action can help define the policy for the company. Though he now faces a tough decision by no choice of his own, a choice it remains. His choice will further define his own business ethics. Hard, but true.

These are the moments that set us along one of two paths, and a good choice now (I highly encourage the suggestion to cater to the boss's better nature) can not only bring self-confidence and self-respect in a choice well made, but can set a business person apart as trustworthy, and thus, an excellent pick for a wide array of jobs in the future...or if all goes bad, the immediate future.

In any case, discression is needed to make the decision that needs to be made, and wisdom to implement that decision through the appropriate action.

Jim said, on July 10, 2006 6:15 PM:

The boss has the legal obligation for paying for services rendered. He can retain a certain amount for a fixed period of time such as one year or two, whatever, depending on the extent and complexities of the job performed. Witholding payment would be questionable legal performance and will tarnish the reputation of the company. The bankrupt company is under legal obligation to pay what they can to creditors and witholding or denying payment for services performed by them is actually denying payment to other companies down the line.

Jonathan Ginsberg said, on July 13, 2006 8:55 PM:

Dave:
Let me offer another perspective - I am a bankruptcy lawyer in Atlanta and there is a practical concern here. If the supplier has in fact filed for bankruptcy, any asset (which would include the accounts payable) is an asset of the estate. This asset will appear on the bankruptcy schedules alongside equipment, motor vehicles or bank accounts.
The bankruptcy trustee has the responsibility for marshalling the assets, selling them and distributing funds to the creditors in order of priority.
It is likely that the owner of the writer's company will soon get a letter from the bankruptcy trustee demanding that this accounts payable be sent to the trustee. So, I think that the writer's ethical dilemma may solve itself when the boss finds that the supplier has been replaced by a bankruptcy trustee who really won't take no for an answer. Sort of an involuntary karma thing!
Jonathan Ginsberg
Atlanta, GA
Ginsberg Law Offices, P.C.

Jean said, on September 27, 2006 8:52 AM:

I believe the person should have the conversation with their boss stating that
the work had been done to his pleasure.
If the person doesn't say anything, he will
lose a part of his soul by not speaking up.
How do I know? Because, I too was part of
an organization that was unethical and I paid
for it by ruining my health. It is now 4 years
down the road, finally, I can go back to work.

John Hower said, on August 23, 2007 11:59 AM:

also jpandcin@tampabay.rr.com .go to google and type hower and molding systems view as html also same site under libary blog case 05-1889 is the recorded court hearings ..I'm open to anything to catch this crook. Thanks John Hower

Starbucks coffee cup I do have a lot to say, and questions of my own for that matter, but first I'd like to say thank you, Dave, for all your helpful information by buying you a cup of coffee!

I do have a comment, now that you mention it!











I will never send you any unsolicited email. Ever.






Check This Out Too...

 
Look for Answers
Need Help? Ask Dave Taylor!


Follow Me on Pinterest

Find Me on Google+
ADT on G+
© 2002 - 2013 by Dave Taylor. All Rights Reserved.

Note: This web site is for the purpose of disseminating information for educational purposes, free of charge, for the benefit of all visitors. We take great care to provide quality information. However, we do not guarantee, and accept no legal liability whatsoever arising from or connected to, the accuracy, reliability, currency or completeness of any material contained on this web site or on any linked site. Further, please note that by submitting a question or comment you're agreeing to my terms of service, which are: you relinquish any subsequent rights of ownership to your material by submitting it on this site. My lawyer says "Thanks".
"Ask Dave Taylor®" is a registered trademark of Intuitive Systems, LLC.