Ethics in HR (AQA A Level Business): Exam Questions

Source A: Royal Mail

Royal Mail delivers letters and parcels to every address in the United Kingdom. It is part of International Distribution Services, which also owns the European parcel business GLS and which employed 153 552 people in 2024 and had revenue of £12 679 million. Around 85 000 of Royal Mail's people are postal delivery workers, and the business takes on about 16 000 extra temporary workers each year between late October and January to cope with the Christmas rush.

In June 2025 the company stopped being a public limited company listed on the stock market. EP Group, controlled by the Czech businessman Daniel Křetínský, completed a £3.6 billion takeover that the UK government had approved in December 2024 and that became unconditional on 30 April 2025.

Most of Royal Mail's people belong to the Communication Workers Union, and relations with that union have been difficult. Strikes ran from August to December 2022, and before the two sides returned to talks Royal Mail said it was losing up to £1 million a day. The dispute ended in July 2023 with a three-year deal worth a 10% pay increase and a £500 one-off payment, accepted by 76% of those who voted on a 67% turnout.

A second three-year deal followed on 3 July 2025: 4.2% in 2025, then increases linked to the Consumer Prices Index of at least 2% in 2026 and at least 2% in 2027, worth more than 8% in total and backdated to 1 April 2025. The company also promised no compulsory redundancies for the life of the deal.

Service quality remains a problem. In October 2025 the regulator Ofcom fined Royal Mail £21 million for missing its delivery targets in 2024/25, the third year in a row it had been fined. The fine was reduced from £30 million because the company admitted liability and settled. Royal Mail returned to profit in 2024/25, reporting £12 million.

Source: International Distribution Services, Ofcom and Communication Workers Union announcements, 2022 to 2026

Appendix C: Pay and employee costs at Royal Mail

Source: Analyst

Appendix D: Royal Mail's delivery workforce

Source: Analyst

Assess whether Royal Mail should publish the ratio between its chief executive's pay and the pay of a typical postal delivery worker.

Calculate Royal Mail's employee costs as a percentage of revenue to support your answer.

Source A: Pennine Transit Ltd

Pennine Transit Ltd runs local bus services across three Yorkshire towns under contract to the local transport authority. It employs 210 drivers and 38 engineers, cleaners and office staff. In the year to March 2025 it had revenue of £14.6 million and an operating profit of £520 000.

Drivers at Pennine are not all on the same terms. Anyone hired before 2021 is on what everybody calls the old contract: £16.00 an hour, 28 days of holiday and company sick pay from the first day. Anyone hired since is on the new contract: £13.60 an hour, 20 days of holiday and no company sick pay. The two sets of drivers do exactly the same job, often on the same route on the same day, and they know what each other earns.

There are now 94 drivers on the old contract and 116 on the new one. There are also 23 vacancies the company cannot fill, and services are cancelled most weeks because nobody is available to drive them.

In January the drivers asked the company to recognise the union Unite so that pay could be negotiated for everyone at once. The managing director, Gareth Whitcombe, refused, saying Pennine had always dealt with its drivers directly and that a union would make the business slower to respond. The drivers balloted anyway. On a 79% turnout, 71% voted for recognition.

Mr Whitcombe has not changed his position publicly, but he has asked for costings on closing the gap between the two contracts.

Source: Pennine Transit Ltd

Appendix A: Pennine Transit Ltd selected data, year to March 2025

Source: Pennine Transit Ltd

Appendix B: The two driver contracts at Pennine Transit Ltd

Source: Pennine Transit Ltd

Assess whether having two different contracts for the same job is fair to Pennine Transit Ltd's drivers.

Calculate the employee turnover of drivers on each of the two contracts to support your answer.

Source A: Amazon UK

Amazon runs a network of fulfilment centres across the United Kingdom, where orders are picked, packed and despatched. One of the largest is BHX4 in Coventry, which employs about 3 000 people.

In January 2023 workers at BHX4 held the first strike at any Amazon site in the United Kingdom. Over the following eighteen months the GMB union signed up members there and applied for statutory recognition, which would have obliged Amazon to negotiate pay with the union rather than setting it alone. It would have been the first such agreement at any Amazon site in the country.

The ballot ran from 8 to 15 July 2024. Around 2 600 people voted. 49.5% voted in favour of recognition, and the union lost by 28 votes.

The weeks before the ballot were not quiet. The GMB said Amazon ran a sustained campaign against recognition: messages on screens around the site, posters in the toilets, managers brought in from other sites to talk to staff about what a union would mean, and QR codes in the canteens linking to a page for cancelling GMB membership. Amazon has said it respects employees' right to choose and prefers to deal with its people directly, pointing to its pay rates and the fact that it reviews them each year without being obliged to.

The union's main demand was a minimum of £15 an hour. Amazon's pay at the site at the time of the ballot was below that.

Amazon now has to decide what to do next, knowing that half the people who voted wanted a union and that another application can be made.

Source: GMB and Amazon statements and press reports, 2023 to 2026

Appendix A: The Coventry recognition ballot

Source: GMB and Amazon statements and press reports

Appendix C: What each side said

Source: GMB and Amazon statements

Assess whether Amazon acted ethically in the weeks before the Coventry ballot.

Source A: Caledon Rail Services Ltd

Caledon Rail Services Ltd maintains track, signalling cabling and lineside structures under nine contracts across central Scotland. It employs 260 people, had revenue of £31.4 million in the year to March 2025 and an operating profit of £1.18 million.

Of those 260, 196 work trackside, mostly at night and in all weathers. The other 64 are managers and office staff. The median trackside wage is £34 600 and the median management salary is £52 800, so a manager earns about one and a half times what the people on the track earn.

Last September the union asked for 7.5%. Caledon offered 2.0%, explaining that its largest contract is fixed-price and runs for two more years. In November the trackside staff voted for industrial action, and in December the company improved its offer to 3.0%. Neither side moved after that, and in February there were four days of industrial action, the first in eleven years.

What the union keeps returning to is not only the percentage. The trackside rate at Caledon is below the median for the sector while the management rate is above it, and the company has no written code setting out how a dispute should be handled and no employee forum separate from the union. Everything has gone through seven meetings and a ballot.

Talks resumed in March with a conciliation service in the room, and the board has to decide what it is prepared to pay.

Source: Caledon Rail Services Ltd

Appendix A: Caledon Rail Services Ltd selected data, year to March 2025

Source: Caledon Rail Services Ltd

Appendix C: How the dispute has run

Source: Caledon Rail Services Ltd

Assess whether Caledon Rail Services Ltd has handled its pay dispute ethically.

Source A: Dalmuir Shipworks Ltd

Dalmuir Shipworks Ltd repairs ships and offshore vessels in three dry berths on the Clyde. The yard has been working for ninety-six years, employs 290 people and had revenue of £42.8 million in the year to March 2025, with an operating profit of £2.3 million.

Seventy-eight per cent of the workforce is in the union, which appoints six safety representatives. They stopped work twenty-three times last year. There is a written safety procedure signed off with the union, nine reportable injuries were recorded, and 435 working days were lost to injury.

Because the yard employs more than 250 people it has to publish its gender pay gap, and the figures are uncomfortable reading. Thirty-two of the 290 employees are women, which is 11%. The median hourly rate for men is £19.20 and for women £16.32. Women make up 24% of the lowest-paid quarter of employees and 2% of the highest-paid quarter. None of the fourteen supervisors is a woman, and men are far more likely than women to receive a bonus.

The commercial problem is different and just as hard. The three berths are only full three days in four. A third of the yard's revenue comes from work that arrives at short notice, which is exactly the work that needs an empty berth, and the only ways of filling the gaps are to work through the night or to stop taking short-notice jobs at all.

The board is reviewing both the pay figures and the berths this spring.

Source: Dalmuir Shipworks Ltd

Appendix A: Dalmuir Shipworks Ltd selected data, year to March 2025

Source: Dalmuir Shipworks Ltd

Appendix B: What Dalmuir has to publish about pay

Share of each pay quarter who are women, percentages

Source: Analyst

Assess how well Dalmuir Shipworks Ltd is managing equality in its workforce.

Source A: Pennine Transit Ltd

Pennine Transit Ltd runs local bus services across three Yorkshire towns under contract to the local transport authority. It employs 210 drivers and 38 engineers, cleaners and office staff. In the year to March 2025 it had revenue of £14.6 million and an operating profit of £520 000.

Drivers at Pennine are not all on the same terms. Anyone hired before 2021 is on what everybody calls the old contract: £16.00 an hour, 28 days of holiday and company sick pay from the first day. Anyone hired since is on the new contract: £13.60 an hour, 20 days of holiday and no company sick pay. The two sets of drivers do exactly the same job, often on the same route on the same day, and they know what each other earns.

There are now 94 drivers on the old contract and 116 on the new one. There are also 23 vacancies the company cannot fill, and services are cancelled most weeks because nobody is available to drive them.

In January the drivers asked the company to recognise the union Unite so that pay could be negotiated for everyone at once. The managing director, Gareth Whitcombe, refused, saying Pennine had always dealt with its drivers directly and that a union would make the business slower to respond. The drivers balloted anyway. On a 79% turnout, 71% voted for recognition.

Mr Whitcombe has not changed his position publicly, but he has asked for costings on closing the gap between the two contracts.

Source: Pennine Transit Ltd

Appendix A: Pennine Transit Ltd selected data, year to March 2025

Source: Pennine Transit Ltd

Appendix B: The two driver contracts at Pennine Transit Ltd

Source: Pennine Transit Ltd

Appendix D: Two ways of closing the gap between the contracts

• 116 drivers are on the new contract, each working 1 800 hours a year

Source: Analyst

Pennine Transit Ltd is considering two ways of closing the gap between its two driver contracts:

Option 1: put every driver on the old contract

Option 2: raise the new contract to £15.00 an hour

Evaluate both options and recommend which one Pennine Transit Ltd should choose.

Calculate the extra wage cost each year under Option 1 to support your answer.

Source A: Amazon UK

Amazon runs a network of fulfilment centres across the United Kingdom, where orders are picked, packed and despatched. One of the largest is BHX4 in Coventry, which employs about 3 000 people.

In January 2023 workers at BHX4 held the first strike at any Amazon site in the United Kingdom. Over the following eighteen months the GMB union signed up members there and applied for statutory recognition, which would have obliged Amazon to negotiate pay with the union rather than setting it alone. It would have been the first such agreement at any Amazon site in the country.

The ballot ran from 8 to 15 July 2024. Around 2 600 people voted. 49.5% voted in favour of recognition, and the union lost by 28 votes.

The weeks before the ballot were not quiet. The GMB said Amazon ran a sustained campaign against recognition: messages on screens around the site, posters in the toilets, managers brought in from other sites to talk to staff about what a union would mean, and QR codes in the canteens linking to a page for cancelling GMB membership. Amazon has said it respects employees' right to choose and prefers to deal with its people directly, pointing to its pay rates and the fact that it reviews them each year without being obliged to.

The union's main demand was a minimum of £15 an hour. Amazon's pay at the site at the time of the ballot was below that.

Amazon now has to decide what to do next, knowing that half the people who voted wanted a union and that another application can be made.

Source: GMB and Amazon statements and press reports, 2023 to 2026

Appendix B: Pay at the Coventry site

Source: Analyst

Appendix D: Two ways Amazon could respond

• 4.8 million hours are worked at the site each year, at £13.50 an hour after the September 2024 pay review

Source: Analyst

Amazon is considering two ways of responding to the Coventry ballot:

Option 1: recognise the union voluntarily and negotiate pay

Option 2: keep dealing with employees directly and raise pay

Evaluate both options and recommend which one Amazon should choose.

Calculate the extra wage cost each year under Option 1 to support your answer.

Source A: Dalmuir Shipworks Ltd

Dalmuir Shipworks Ltd repairs ships and offshore vessels in three dry berths on the Clyde. The yard has been working for ninety-six years, employs 290 people and had revenue of £42.8 million in the year to March 2025, with an operating profit of £2.3 million.

Seventy-eight per cent of the workforce is in the union, which appoints six safety representatives. They stopped work twenty-three times last year. There is a written safety procedure signed off with the union, nine reportable injuries were recorded, and 435 working days were lost to injury.

Because the yard employs more than 250 people it has to publish its gender pay gap, and the figures are uncomfortable reading. Thirty-two of the 290 employees are women, which is 11%. The median hourly rate for men is £19.20 and for women £16.32. Women make up 24% of the lowest-paid quarter of employees and 2% of the highest-paid quarter. None of the fourteen supervisors is a woman, and men are far more likely than women to receive a bonus.

The commercial problem is different and just as hard. The three berths are only full three days in four. A third of the yard's revenue comes from work that arrives at short notice, which is exactly the work that needs an empty berth, and the only ways of filling the gaps are to work through the night or to stop taking short-notice jobs at all.

The board is reviewing both the pay figures and the berths this spring.

Source: Dalmuir Shipworks Ltd

Appendix A: Dalmuir Shipworks Ltd selected data, year to March 2025

Source: Dalmuir Shipworks Ltd

Appendix B: What Dalmuir has to publish about pay

Share of each pay quarter who are women, percentages

Source: Analyst

Appendix C: How the yard works, and what lost time costs

Source: Analyst

Evaluate two things Dalmuir Shipworks Ltd could do to narrow its gender pay gap, and recommend which one it should do first.