This was one of the hardest things for me as a manager too. You have to own the company’s message to your reports (and others) even if you disagree with it or don’t know how it came to be.
In the one bit of company management training I got, the company lawyer explained: As a manager, you represent the company and its interests 24/7. You can try to help an employee but only so far as it doesn't affect the company's bottom line.
When the company lawyer is teaching management how to manage, the company culture has lost all positive vitality. As a first-line manager, my reports and my boss understand that my job is to align in both directions. We're in this together. At times I have to help our team understand that they need to make some sacrifice for the sake of the business, and at times I have to help my management understand that the business needs to make some sacrifice for the sake of the team members.
I'm trying to build a culture of loyalty where we take care of each other and where people can stay and continue growing for a decade or more. The day my management tells me the company's bottom line matters more than the people who deliver that bottom line is the day I'm out the door, and my team with me if I can swing it.
Others have flagged the legal obstacles. More practically, not doing so can affect your own perceived performance and career trajectory. There's also the problem that reports don't take the following message very well: "you're getting screwed. It's not my fault. It's the system."
There's a reason I said this was in the past. I felt like you had to become dead inside to succeed.
Good managers I had did not pretended orders from up above are their own nor that they agree with them. They just told us to do it anyway, but validated our concerns.
Why?