The Impact of Outsourcing on Employees - Essay Example

In this case, a company based in South Carolina plans to outsource its call center to Asia. This will lead to the loss of 120 jobs in South Carolina. Such a move raises concerns about whether the process is legally and morally right and may lead to several business implications. Society relies on a moral responsibility to follow a system of values and promote human development. Repercussions of outsourcing are evident in America, and they are unethical since American citizens are usually educated in America for employment in the same region (Hira & Hira, 2008). Once a company outsources, these Americans face displacement from their jobs (Charara, 2012).

Conversely, Asia will benefit since outsourcing leads to increased employment and training in its region. Outsourcing has also contributed to other immoral practices such as discrimination, sexual harassment, as well as wrongful termination of employees in the US, Canada, and Europe. Asian companies have realized the need to address such factors by devising appropriate insurance policies meant to cover factors such as data security, property, workers' compensation, extortion, kidnapping as well as nationalization, and all other forms of possible risks.

Presently, outsourcing has become common in America and it is a legal business activity. This is because firms need the freedom to conduct trade internationally besides being able to boost growth within America’s economy. Legal procedures that an outsourcing company follows demand the signing of a contract that will cover an array of areas such as the risk of poor performance by the contractor, unforeseen charges, property damages, or data loss. The client will also want clearly outlined procedures on how the business will run as well as the day-to-day management.

Modes of handling termination or breach of contract are also necessary for the contract. Positive business implications that are due to outsourcing involve acquiring a competitive advantage in the market (Hira& Hira, 2008). This is achievable through cost reduction, improved quality, exposure to advanced technology, availability of labor as well as the ability to combat the competitive threats in the domestic market. The presence of strict labor laws in America also makes companies outsource.

The labor laws bar the firms from wrongful termination of contracts amongst other business practices. Labor laws in Asia are less strict compared to South Carolina. Moving to Asia indicates that the company will obtain cheap and qualified labor (McIvor, 2010). Most of the available laborers in Asia have English knowledge and are engineering or IT graduates. Outsourcing will also indicate that the managers will have more time to focus on their core competencies and other critical issues.