Kyle and his family own a successful farming and processing business at several locations near Weston in Marion County, AL (not far from Hamilton, AL). The produce that they grow (vegetables and fruits) is sold under their own label, Alabama Sunshine. Kyle raises all of the produce on the family farms and sells it and the condiments that he makes from the produce at a roadside market that his family owns just outside of Weston on Bexar Ave.
Although his family helps run the business, Kyle hires temporary workers during the peak times of the planting, growing, and harvest seasons. He also hires temporary workers during peak production times in his condiment processing facility in Hamilton, AL. As can happen, Kyle occasionally is approached by one of his local, seasonal workers about hiring a cousin or other relative who is new to the Alabama. This potential employee would agree to work for below minimum wages, would not ask for or expect any health insurance or other benefits, and would gladly accept all wages in cash without any deductions for social security (OASDI) or taxes. With the rising costs of fuel, fertilizer, and supplies, Kyle needs to cut expenses wherever and whenever possible and he could save money by hiring such workers. Since his operation is rural (primarily in Marion and Fayette Counties, AL), he feels that he would probably not have any problems from State or federal authorities.
Kyle tries to be an ethical business person. He knows that what he is being asked to do is questionable at best and possibly illegal but it is mid-September; harvest time for the late season crops is approaching quickly; and he knows that he needs the extra workers to get his fall crops in and the land ready for the next planting. Without a successful harvest and preparation for the next planting, there will be no Alabama Sunshine produce to sell and he will not be able to support his family or regular workers.
As people have grown more health conscious, demand for Kyle’s organically grown produce has increased and grocery store customers are asking for Alabama Sunshine produce by name. Kyle would like to expand the retail operations to include a store along a nearby major highway (I-22) that connects Birmingham, AL, Tupelo, MS, and Memphis, TN but he does not want to get entangled in what he considers to be “unnecessary” federal and state regulations.
Kyle finished his business degree from UAH several years ago and he vaguely recalls Unit 1 in his BL textbook, so he understands the basic issues but he trusts your knowledge and comes to you for advice and counsel. What should Kyle consider as he ponders the relationship between “law” and “business ethics”? What factors, if any, have changed society’s concept of business ethics and the social responsibility of business enterprises? What should Kyle understand about the relationship between “maximum profits” and “optimum profits”?
Kyle wonders if the federal government can regulate his business operations. And, if so, under what clause of the U.S. Constitution might the federal government regulate Kyle’s business activities? What is Kyle’s best argument against federal regulation of his roadside stand and farm businesses as the operations exist now? Will he be successful in this argument? Would it make a difference if he opens a store along the highway (I-22) connecting Birmingham, Tupelo, and Memphis? Under what authority would the State of Alabama have an interest in Kyle’s business? What other issues might Kyle face?