Conflict of Interest?

[WildBill]

This week a supplier invited the purchasing manager and the test engineer to have lunch to discuss the status of on-going project. The supplier is building some test equipment for our facility. The purchase order was negotiated and signed a year ago.

At the end of lunch, the supplier asked our test engineer what he liked to do outside of work. He responded that he was a new Texas resident and that he liked to hunt and fish, but hadn't had the opportunity yet. The supplier invited him to a deer hunt on his lease.

All of the purchasing agreements were negotiated and signed prior to hiring the new test engineer. He didn't have anything to do with the pricing of the contract or selection of the supplier. Do you think that there is conflict of interest? Do you think that he should refuse the offer of the hunting trip?

[Seabear]

Heck no, this is Texas, that's how we do things. Hope he gets a good one.

[Ericstac]

Weird... We usually do contracts after the hunt.

[Teamless]

nothing unusual Bill, and not inappropriate.
However the company itself may have a policy against those things, our company has one that we cannot accept the value of about $50 (in otherwords, maybe a decent dinner)

[tacticool]

I agree. It depends on company policy.

Having said that, I think the test engineer should disclose the gift to his manager, whether or not it's required by policy. I'm also curious if the test engineer has the authority to approve or reject the equipment built by the supplier.

[Jumping Frog]

Our company policy would not allow that.

If this project is in any way going to have federal government money in it, it is possibly illegal.

His best bet to protect himself is to disclose this in writing to his manager. His manager's best bet to protect the manager is to ask either Legal or HR for guidance.

[Keith B]

It really depends on company policy, but it becomes gray if they are involved in business dealings.

In this case, if the lease owner allows others to hunt on his lease and all he is doing is telling this person the can hunt there too, then if may not really be a big deal. However, as JF stated, he may want to go to his manager and let them know and get direction.

[SRH78]

If it were me, I would definitely check with higher ups and make sure it didn't violate company policy. Other than that, if he has no say in the contract, I see no conflict. If he does, that is another matter.

[WildBill]

A check of the company policies did not specifically address this. He did talk with his manager who referred it to his VP who referred it to HR. HR made the final decision that he could not accept the hunting invitation.

He is disappointed, but didn't want to lose his job over it. Again, the contract was already signed, he didn't have any decision in the purchasing choice. He and the purchasing manager were merely getting an update on the status of the project. BTW, the purchasing manager was invited, but is not a hunter so he declined. He didn't think it would be a problem.

An interesting aside - last month our company sponsored a golf outing where they invited customers for a day of golf, drinks and dinner. Apparently none of our management thought this was a conflict of interest. Maybe golf is okay and hunting is not.

[WildBill]

Our company policy would not allow that.

If this project is in any way going to have federal government money in it, it is possibly illegal.

His best bet to protect himself is to disclose this in writing to his manager. His manager's best bet to protect the manager is to ask either Legal or HR for guidance.

No federal money involved. At my last company, the NASA people couldn't even accept a sandwich if it cost more than $5.00.

[urnoodle]

My company won't allow any gift. HR uses the "if someone can speculate the appearance of impropriety" then it is against policy. That covers them in any situation. We aren't allowed to give gifts on holidays to one another either.

[WildBill]

HR uses the "if someone can speculate the appearance of impropriety" then it is against policy. That covers them in any situation. We aren't allowed to give gifts on holidays to one another either.

I have heard this same statement and consider it a "cop out", just like "zero tolerance" policies. For example, giving a gift to another employee should not be a the concern of the company. If I gave you a gift, there would probably be at least one person who would speculate about some "impropriety". There are some people who have nothing better to do.

[urnoodle]

I agree. I remember the office Holiday parties and they were a lot of fun. Anyone can conclude anything even without any evidence of a situation. I typically call it conspiracy theory.

[Happily Ever After]

An interesting aside - last month our company sponsored a golf outing where they invited customers for a day of golf, drinks and dinner. Apparently none of our management thought this was a conflict of interest. Maybe golf is okay and hunting is not.

Hypocrites are often blind to their own hypocrisy. Matthew 7:5

[LabRat]

HR uses the "if someone can speculate the appearance of impropriety" then it is against policy. That covers them in any situation. We aren't allowed to give gifts on holidays to one another either.

I have heard this same statement and consider it a "cop out", just like "zero tolerance" policies. For example, giving a gift to another employee should not be a the concern of the company. If I gave you a gift, there would probably be at least one person who would speculate about some "impropriety". There are some people who have nothing better to do.

Most of your statements center on why this hunting arrangement might be OK relate to "contracts already signed".

But business relationships, especially ones that are profitable, tend to run for years or decades and can involve many different projects or contracts; and involve major $$$$ over the years.

What about the future business that might be done? Could this be used as a "marker" to call in later?

Engineers have tremendous influence on what suppliers are considered for business.
It is their professional opinion on a suppliers quality system, manufacturing processes, process capabilities, etc. that can make a supplier the winner or the loser. Purchasing is a major player too, but engineers have lots of say-so.

Impropriety occurs when there is a quid pro quo arrangement or the appearance of a quid pro quo arrangement.
Best to stay away from even the appearance of a conflict of interest.

Some companies use the overall value of an item to help indicate whether some arrangement qualifies as conflict of interest. That's not always a wise choice; some folks have attachments to goods or services that transcend money. Power is a good example.


LabRat