Ethical Implications of Close-Knit Relationships in the Workplace

 Nathaniel W. Gapatan and Christian Mark S. Doronio

Divine Word College of Laoag, Graduate School of Business

September 2024

Abstract

This paper explores the dual impact of workplace friendships on organizational ethics and effectiveness. On one hand, positive interpersonal relationships can enhance job satisfaction, teamwork, and communication, fostering a supportive and collaborative work environment. On the other hand, these friendships can blur professional boundaries, leading to favouritism, biased decision-making, and compromised integrity. The Social Identity Theory is used to explain how close-knit relationships can both support team cohesion and introduce risks of bias. The paper also highlights the challenges of nepotism and favouritism in hiring and promotion practices, particularly in government settings. Effective mitigation strategies include implementing clear codes of conduct, ensuring consistent enforcement, and fostering a culture of accountability. In the context of government institutions in the Philippines, adherence to ethical standards and the role of opposition in maintaining transparency are emphasized. The article concludes that while workplace friendships have significant benefits, they must be managed carefully to prevent ethical lapses and maintain organizational fairness.

Keywords: Ethics, Human Resources, Social Identity Theory, Workplace Relationships

Introduction

In any organization, how employees interact with each other has a big impact on its overall ethical environment. These interactions are the foundation upon which the organization’s culture is built, influencing everything from decision-making processes to the daily conduct of its members. When employees form friendships at work, it can create a positive atmosphere where collaboration and teamwork thrive. These bonds often lead to increased job satisfaction, better communication, and a sense of belonging that motivates employees to perform at their best. However, while workplace friendships can be beneficial, they also carry inherent risks if they become too dominant or influential within the organization. When friendships begin to take precedence over professional responsibilities, the lines between personal and professional boundaries can blur.

It is not uncommon for employees within an organization to develop close-knit relationships. In a 2012 study conducted by Jobsite, an online job search website, 70% of a thousand respondents said that having friends at work is the most crucial element to a happy working life. In the same study, it was found that two-thirds of the respondents would turn down a job offer with a higher salary to stay working with the people they liked and respected. This means that more than the salary or a pay rise, the greatest driving factor for workplace happiness is whether employees have a good working relationship among themselves or not.

In the Philippines, the dynamics among colleagues are deeply influenced by cultural traditions. When seeking advice from our elders about proper behaviour in the workplace, they often emphasize the importance of "pakikisama." This concept, which is deeply ingrained in Filipino culture, highlights the value of harmonious relationships and cooperation with others.

Social identity theory and the impact of close-knit workplace relationships

According to organizational behaviour theory, particularly the Social Identity Theory (Tajfel and Turner, 1979), people naturally form groups with those they share similarities with, which can lead to close-knit friendships within the workplace. Such relationships lead to a dynamic team of employees with stronger teamwork, high morale and a solid support system.

While these bonds can foster a supportive environment, they also carry the potential to result in biased decision-making. When managers form close personal relationships with their colleagues, loyalty to friends may overshadow the need for impartiality, leading to decisions that prioritize personal connections over merit. This bias can make it difficult for managers to provide honest feedback, as they might hesitate to criticize or address performance issues for fear of damaging the relationship. Additionally, enforcing necessary disciplinary actions can become even more challenging, as managers may avoid holding friends accountable, thereby compromising the integrity of their leadership. Over time, this favouritism can erode trust within the team, as employees may begin to perceive unfair treatment or unequal opportunities. Ultimately, this undermines the fairness and transparency that are essential to cultivating a healthy organizational culture, where decisions are made based on performance, and accountability is upheld without personal biases influencing outcomes.

In the workplace, much like nepotism, close friendships can lead to favouritism, where promotions or desirable work assignments are awarded based on personal relationships rather than merit (Perry, 2023). This dynamic often leaves high-performing employees feeling overlooked and unsupported, especially when they see those with family ties or strong connections to management being unfairly favoured. When a work environment becomes unsupportive in this way, it sets a precedent where hard work is not rewarded, undermining motivation. As a result, employee morale can decline, particularly among top performers, who may develop feelings of resentment and mistrust towards management due to perceived inequities in how opportunities are distributed. This, in turn, can significantly impact overall productivity and workplace harmony, as the unfair treatment erodes both team cohesion and the desire to excel.

When strong friendships dominate the workplace and there is little to no opposition to challenging ideas or behaviours, it creates an environment where personal and professional boundaries become blurred. This blurring of lines can severely weaken accountability, as individuals may prioritize their personal loyalties over the organization’s best interests. For instance, friends might be more inclined to cover for each other's mistakes or turn a blind eye to unethical behavior, fearing that addressing such issues could harm their relationships. In doing so, they inadvertently compromise the integrity and ethical standards of the organization. This fosters an atmosphere ripe for "groupthink," a phenomenon in which the desire for harmony and consensus overrides critical thinking and independent judgment (Kenton, 2024). As a result, important concerns may go unvoiced, and decisions may be made without thoroughly considering potential risks or alternative viewpoints. Over time, this can lead to a pattern of poor decision-making, inefficiencies, and even larger organizational failures, as the lack of accountability stifles innovation and critical reflection.

In worst-case scenarios, these unethical practices by management drive top-performing employees to seek employment elsewhere, leading to their departure from the organization (Perry, 2023). When someone leaves, their workload is distributed among the remaining staff, without the benefit of additional hires. This is because applicants are selected based on their connections with management rather than their qualifications. This issue is especially apparent in some government agencies, where employees are overworked and underpaid, often performing tasks meant for multiple people. The problem of staff turnover is worsened by selective hiring practices and background checks that focus on an applicant's political affiliations, aimed at expanding a politician’s influence. This delays the addition of new personnel. As a result of this toxic environment, overburdened government workers are often unfairly stereotyped by the public as slow, irritable, and unhelpful. Unfortunately, the blame is placed on the employees, who need support, rather than on the management, who failed to provide it.

 Ethical Implications of Close-knit Workplace Relationships

While workplace friendships have the potential to boost job satisfaction and enhance collaboration among employees, they can also introduce ethical challenges, such as favoritism, conflicts of interest, or bias in decision-making. To mitigate these risks, organizations must recognize the potential pitfalls and implement well-defined policies that promote fairness, transparency, and professional conduct. By doing so, they can foster a positive work environment while maintaining accountability and equity across the team.

In most cases, organizations create their own Professional Code of Conduct to clearly define the expected behaviours and ethical standards for their employees. This document typically serves as a foundation for maintaining professionalism within the company and helps guide employees on how to act in various situations. It usually includes important elements such as the company’s mission and values, ethical standards, acceptable workplace behaviour, and the disciplinary procedures that will be followed if these rules are violated. Additionally, it outlines the specific roles and responsibilities employees have in maintaining a respectful, lawful, and productive work environment.

However, merely having a written code of conduct does not guarantee that employees will always behave as expected. While it provides a framework, the document itself cannot enforce the rules. Effective enforcement requires active involvement from management, continuous training, and a positive organizational culture that emphasizes integrity and accountability. Without proper leadership, follow-through, and mechanisms for addressing misconduct, a code of conduct can easily become a formality that employees may overlook or ignore. This shows that simply having rules on paper is not enough; fostering an environment that actively upholds those standards is key to ensuring proper behaviour in the workplace.

In the context of government agencies in the Philippines, workplace concerns involving government employees are governed by the Civil Service Commission (CSC). Under Executive Order No. 292, the CSC is tasked with formulating policies, standards, and guidelines to ensure the effective management of personnel in the civil service. It also implements programs aimed at promoting cost-efficient and productive workforce administration within government institutions.

Moreover, government employees must adhere to the provisions of Republic Act No. 6713, also known as the "Code of Conduct and Ethical Standards for Public Officials and Employees." This law reinforces the principle that public office is a public trust. It sets ethical guidelines and standards for government workers, specifies prohibited activities and transactions, and offers incentives for exemplary service. Violations of this law can result in penalties, underscoring the importance of integrity and accountability in the public sector.

Despite the existence of laws and regulations, we continue to hear about the misconduct of government employees. This may be due to the government's leniency in enforcing these rules. Additionally, it seems that individuals who engage in unethical behavior are often the ones who receive benefits or rewards, while those who adhere to the regulations are marginalized or, in some cases, excluded from certain circles. This creates an environment where misconduct is overlooked or even incentivized, while integrity is punished. In such an environment, the value of opposition becomes even more critical.

When misconduct and corruption are normalized or rewarded, it is often the voices of opposition that call attention to these injustices. Opposition serves as a vital check on the system, challenging unethical practices and pushing for accountability. It ensures that those in power do not operate without scrutiny and that the integrity of institutions is maintained (World Bank Institute, 2005). Without opposition, the culture of rewarding wrongdoing and punishing integrity could become entrenched, leading to a deeper erosion of public trust in government institutions. The role of dissenters, whistleblowers, and critics is crucial in holding those in power accountable and advocating for the proper enforcement of laws and regulations.

The importance of having an opposition is clearly illustrated by the current composition of the Philippine Senate. Ana Theresia “Risa” Hontiveros, a prominent advocate for women's rights, gender equality, and anti-corruption, stands out as a key opposition figure. Serving her second term since 2022, she was the only opposition candidate to win a Senate seat in the 19th Congress, securing 11th place among the 12 elected senators (Rappler, n.d.).

In contrast to many of her colleagues who often remain silent to maintain their political alliances, Hontiveros frequently takes progressive positions that clash with the more conservative, law-and-order approach of Vice President Sara Duterte, who also leads the Department of Education. A notable instance of this conflict arose when Hontiveros questioned the budget allocations for the Office of the Vice President (OVP) and the Department of Education, raising issues about transparency and the controversial confidential funds granted to the OVP.

Hontiveros' actions have highlighted potential issues regarding the misuse or overreach of public resources, drawing attention to these concerns that might otherwise be overlooked if all senators aligned themselves with the administration. Her role as an opposition figure is crucial in ensuring that government spending and resource management remain accountable and transparent.

The political system in the Philippines relies on a robust process of open debate, where various ideas are presented, challenged, and either embraced or dismissed by the majority. This dynamic exchange helps surface the most effective solutions and policies. However, when there is no competition for power, it creates a detrimental situation for all parties involved. In the absence of political competition, citizens may feel that their perspectives are ignored, leading to disengagement from the political process. This disengagement can be extremely harmful to the health of a democracy, as it undermines the essential principle of active citizen participation.

Conclusion

The interplay between workplace friendships and organizational ethics presents a complex landscape. On one hand, strong interpersonal bonds among employees can enhance job satisfaction, foster collaboration, and build a supportive work environment. However, these relationships also carry significant risks, such as favouritism, biased decision-making, and blurred professional boundaries, which can undermine organizational fairness and integrity.

The Social Identity Theory illustrates how natural group formations can enhance team cohesion but also lead to potential conflicts of interest. When personal relationships overshadow professional responsibilities, issues like favouritism and unethical behaviour can arise, impacting employee morale and overall productivity. This is particularly evident in settings where nepotism and connections influence hiring and promotion decisions, leading to dissatisfaction among top performers and a decline in organizational effectiveness. 

In response to these challenges, organizations must establish clear codes of conduct and enforce ethical standards rigorously. While such frameworks provide necessary guidance, their effectiveness hinges on consistent management involvement and a culture that prioritizes accountability. In the context of government agencies, adherence to regulations and the presence of strong opposition voices are vital for maintaining transparency and preventing corruption.

Ultimately, balancing the benefits of workplace friendships with the need for ethical conduct requires ongoing vigilance and proactive measures. By fostering an environment where fairness and integrity are upheld, organizations can harness the positive aspects of interpersonal relationships while mitigating potential drawbacks, thus ensuring a healthy and productive work culture.

References:

Executive Order No. 292, s. 1987. Instituting the “Administrative Code of 1987”. Retrieved from: https://www.officialgazette.gov.ph/1987/07/25/executive-order-no-292-s-1987/

 

Fairchild, C. (2012, October 17). Workplace happiness survey finds friends are more important than salary. Huffpost. https://www.huffpost.com/entry/workplace-happiness-friends-over-salary_n_1971110

Kenton, W. (2024, June 12). What is groupthink? Definition, characteristics, and causes. Investopedia. https://www.investopedia.com/terms/g/groupthink.asp#:~:text=Groupthink%20is%20a%20phenomenon%20that,of%20a%20group%20of%20people.

 

McLeod, S. (2023). Social identity theory in psychology. SimplyPSychology. https://www.simplypsychology.org/social-identity-theory.html

 

Perry, E. (2023, March 14). 10 ways to detect favouritism in the workplace. BetterUp. https://www.betterup.com/blog/favoritism-in-workplace

 

Rappler. (n.d.). Risa Hontiveros. Rappler.com. https://www.rappler.com/people/n76471186-risa-hontiveros/

 

Republic Act No. 6713. An act establishing a code of conduct and ethical standards for public officials and employees, to uphold the time-honoured principle of public office being a public trust, granting incentives and rewards for exemplary service, enumerating prohibited acts and transactions and providing penalties for violations thereof and for other purposes. Retrieved from: https://www.ombudsman.gov.ph/docs/republicacts/Republic_Act_No_6713.pdf

 

World Bank Institute. (2005). Parliamentary staff training for commonwealth countries. Agora. https://www.agora-parl.org/sites/default/files/agora-documents/WBI%20-%20The%20Role%20of%20the%20Opposition%20-%20EN%20-%20PI.pdf