HSC Business studies – Human Resource

Management summaries

Strategic role of HRM: 3 mins medium

 The role of HRM is too acquire, develop, maintain and separate workers in order to create a highly
effective human resource package to meet the labour needs of the business and achieve its
business objective of higher profits.
 The strategic role of HRM is too meet the labour needs of the business and achieve the business
objectives. In order to do so they aim to achieve more specific and day to day HR goals most
importantly improving the employee – employer relationship, boost productivity, ensure legal
compliance and embracing CSR, manage change within the business and employees are correctly
hired, skilled and motivated.

Interdependence: Learn to: Explain the interdependence between HRM and other business functions. 12
mins extreme.

 There is a two way cross functional relationship between all 4 KBF’s, which is crucial for business to
understand and improve in order to achieve business objectives. Essentially HRM are dependent on
by the other KBF’s as they are required to provide and the right supply of properly trained and
motivated workers.
 HR and OP: Operations is the engine room of the business and responsible for the production of
G&S. Op is reliant on HR as their demands must be met by HR in order to perform efficiently and
effectively. For example, At Qantas when they purchase new leading edge technology or a new
aircraft or security system, HRM ensure they have adequate T&D so workers can properly and
safely use the new investments. OP also relies on HRM to achieve their strategic role seen at
Google HRM are responsible for creating and maintaining the corporate culture of creativity and
innovation. In doing soon as part of a job design tactic they have created a ‘20% time program’,
whereby workers are allowed up to 20% of their week to develop their own project not only does
this increase motivation and thus productivity but has also lead to developments such as Gmail.
HRM relies on operations to provide safe and fair tasks for all employees.
 HR and M: Marketing are responsible to link the product to the customer and generate revenues.
Marketing rely on HRM in two major ways, firstly through how marketing differentiate their
product as part of the market segmentation strategy. This is evident at Qantas whereby their
service is differentiated as high quality, therefore HRM must hire workers with the required skill
levels or train and develop current employees. Secondly, People are now a big emphasis of Qantas’
MM, so Qantas must train and motivate workers to satisfy customers as part of excellent customer
service. While HRM rely on marketing to generate sales thus increasing profits which will allow
employees to be paid.
 HR and Finance: Finance is responsible for the raising of funds and allocation of this funding to
different aspects of the business. HRM is reliant on finance to pay workers and fund strategies as
some such as rewards can be costly. As seen at Qantas whereby funds are needed for the huge
T&D program where they have spent $275M per year for the last five years. Also, the Financial
investments have had an effect, as in recent years investments in outsourcing areas such as the I.T
department have required redundancies as it has affected the level of staff. In turn through HRM
 improving the productivity of labour it will reduce costs or increase quantity which in turn lead to
higher profits and thus improving financial performance.
Special focus – Outsourcing and contracting: 6 mins extreme

 Outsourcing refers to businesses contracting individuals or companies outside of the business to

perform certain business activities. CBA used.
 Advantages: allows for specialisation allowing the business to concentrate on the core aspects of
the business. This may include hiring a HR specialist for all 4 processes parts or only a few. It can
also place businesses at a competitive advantage offering lower costs (and reducing time) or higher
quality.
 Disadvantages: it could be more expensive, over reliance can lead to disconnection between the
businesses decisions and workers, may not act ethically and not aligned with business culture and
business may have a better idea of which employee to hire who will fit in will aims and culture,
business loses control and training/motivation may not be specifically tailored for the workplace.
 Also, a decision over whether to use domestic or global contractors has implications. A contractor is
someone employed on a contract for services, i.e they are the one being outsourced. And has
conditions such as being on a fixed rate for an agreed amount of time.
 For domestic contractors it is a safer option in the sense that they already are aware and
understand the legal system and regulations, as well as having a gauge on what is viewed as ethical
in the country, as well as industry standards and practises.
 However, when going global it is a lot easy to find either higher quality or lower prices (typically
lower costs as quality is high in Australia as it is a developed nation). They may not understand the
regulations, ethical practises and industry standards, as well as barriers such as distance, culture
and language.
Learn to: Discuss the advantages and disadvantages of outsourcing in the global market.

 Outsourcing refers to contracting individuals or companies outside of the business to perform

certain business activities. It is particularly prominent in the global market as global contractors
offer many advantages and disadvantages.
 In regards to outsourcing HR this could relate to actually outsourcing tasks within the business
involving labour such as parts of the production process, as one goal of HRM is too reduce labour
costs or outsourcing areas of HRM such as the acquisition stage. Both endure the same advantages
or disadvantages. CBA must be used.
 Advantages: business outsource as it allows them to achieve a competitive advantage as certain
regions around the world may offer greater quality than Australia or lower cost. Optus outsource
their lower skilled labour tasks to India and Pakistan to decrease costs, as people are willing to work
for a lower wage, as well as less rigorous rules of sick leave, holiday pay etc. Likewise, Qantas
outsource its IT and aircraft maintenance to 2 Indian companies. It also saves time and allows for
specialisation with the business able to focus on its core components For example, a business may
outsource all or part of the HR process to a HR specialist company, such as the Australian business
the human resources centre a contractor which advises businesses in the HRM decisions or can
take over the entire HR process.
 Disadvantages: It may be more expensive to contract them or quality may be impaired. Over
reliance can lead to disconnection between the businesses decisions and workers. The contractor
may not be not aligned with business culture, particularly important for the acquisition stage as
business may have a better idea of which employee to hire who will fit in with aims and culture. The
contractor may also not act ethically resulted in bad publicity and loss of reputation for the
business seen with Nikes labour intensive sweatshops in Asia attracting backlash. Business loses a
 level of control and security such as training/motivation may not be specifically tailored for the
workplace and could be ineffective. Can also lead to redundancies and retrenchment, evident in
Optus who after outsourcing many aspects of the business it resulted in 1300 people in 2014
costing $24m. Also, out of this industrial disputes may arise, which has been a problem at Qantas.
HRM Influences: overview. 2 mins extreme

 The aim of HRM is too boost productivity in order to achieve a range of BO. In doing so they must
consider a range of influences that can affect the quantity, quality and cost of the workforce. These
included, CSR and ethics considerations, the legal framework, social, economic, technological, and
consideration of stakeholders.
CSR and ethics: 6 mins extreme + learn to. 1st choice.

 HR is influenced by the related concepts of ethical considerations and CSR and both go above and
beyond the law. Ethics refers to the consideration of the values of beliefs of individuals inside and
outside the business. CSR refers to the obligation to go above and beyond the law as a whole
business in regards to acting in a morally and ethically right way, such as the integration of social
and environmental considerations in Business decisions.
 Both influence management as pushes business to act in way that may include extra costs thus
reducing profitability, such as supporting a charity.
 For ethics this refers to considering the emotions and treating in a fair way the employee’s as well
as the individuals the employee’s come into contact. This could be achieved be creating an ethical
framework with a code of conduct or code of ethics. It forces businesses to consider the effects on
these individuals when making potential investments or business decisions that could lead to
achieving BO. Such as outsourcing overseas may decrease costs, however, may be viewed as
unethical as it is not utilising domestic workers and is making workers redundant. As well as
ensuring employees have a safe and healthy working environment, fair compensation, treatment
and equal employment opportunity, going above just the legal requirements for each category
(may increase costs). For CSR in HRM this refers to intentionally improving the work life of
employees and/or getting them engaged in charities or functions beneficial to society.
 Embracing or not embracing CSR and ethics can have respectively a positive or negative impact as it
can attract good or bad publicity, affecting sales, morale etc.
 In summary both influence by encouraging business to act in a certain morally right way which may
come at the expense of achieving BO, and embracing/not embracing can lead to good/bad
publicity.
Learn to: Explain how a business exhibits CSR in the management of HR.

 CSR refers to the obligation to go above and beyond the law as a whole business in regards to
acting in a morally and ethically right way, such as the integration of social and environmental
considerations in Business decisions.
 For HRM CSR can be exhibited in two ways, firstly through creating a safe, healthy and fair working
environment and looking after the wellbeing of employee’s. This could be achieved in many ways
such as creating a ‘work-life balance’ which Google emphasises as well as creating a healthy
working environment (maintenance) through a plethora of leisure facilities, including gyms, pools,
spas, games room’s and libraries. Telstra have also tried to create a fairer working environment
(acquisition) as they go well above what the law requires in regards to equal, employment
opportunity. This refers to hiring people regardless of factors such as age, religion, gender etc.
Telstra have continued to increase their employment of women, with now 31.5% of Telstra
employee’s and 30% of the board.
  The second way to achieve CSR HRM is too actively involve your employee’s in activities that have a
positive social or environmental impact. This could include involving employee’s in charities or
foundations such as exodus, or for environmental – national parks and other green practises seen
at the Body Shop who allows there employee’s 2-3 paid days off per year to do voluntary charity
work or environmental work such as working at a national park. Also, encouraging and have parts
of the T&D with an emphasis on green practises amongst employee’s.
 A final consideration for HRM when exhibit CSR is that this can extend to the global workforce.
Therefore, businesses must account for what is viewed as ethical in other countries. Samsung have
created an effective diversity management program, accommodating for different religions or
cultural rituals or practises such as Islamic prayer giving the day off.
 To conclude it should be noted that the effect of exhibiting CSR is that not only it leads to higher
morale, motivation and thus productivity but also attract positive publicity, both leading to higher
profits.
Social influences – changing work patterns and living standards. 6 or 9 mins.

 Social influences are the social patterns and trends in society such as changing work patterns and
living standards. HRM must be aware of these influences as they affect the price, quantity and
quality of labour as it demands more flexibility in working hours, a work life balance, leave
arrangements, family friendly programs etc. must be considered during HRM processes and
strategies.
 Changing work patterns (1st choice): There are many changing work patterns that must be
considered by HRM. Female employment has increased due to changes in social attitudes and anti-
discrimination laws, Qantas now have a workforce comprised of 42% women, this may offer
better/worse quality and increase costs such as more considerations of maternity leave, also
increases quantity, may be motivated differently etc. Also the ageing population which increases
quantity. More multi-cultural and ethnically diverse workforce, has many advantages but also
provides challenges increasing cost and quantity Samsung has diversity management programs.
More chance of career changes, harder to retain staff. More outsourcing (quantity). Yet most
importantly big shifts from full time to part time or casual, this can decrease costs improve
flexibility but also make it harder to motivate, can have less quality, Qantas since 2008 have had a
decrease of 5000 full time employees.
 Living standards: As the standard of living has increased over the years considerations include;
expectation of greater quality of working life and conditions (increasing costs) also expectation of a
work-life balance, both requiring extra childcare, study leave, superannuation, paternity leave.
More people attending tertiary education – more skilled labor. Also, consistent with higher living
standards puts pressure to increase wages.
Economic: 3mins medium.

 Economic conditions affect a range of issues regarding HRM such as demand for labour, wage
levels, availability of labour etc. all affecting quantity and cost of labour.
 High economic growth: demand for products increases thus this requires an increase in labour
resulting in unemployment falls and wage levels increase. This also shifts power on to employees in
the bargaining process as business work harder to attract and keep employee’s, and they may
demand better working conditions. This can also lead to inflation rising rapidly workers demand
higher wages, a wage explosion and cost blowout could occur.
 Low economic growth: contrastingly, unemployment rises, wages decrease, bargaining power given
to employers, may also create issues such as redundancies and must be managed carefully to avoid
 unfair dismissal. Seen in the GFC Qantas had to reduce staff numbers to cut costs as demand for
their services was decreasing as well as an executive pay wage freeze.
Technology: 3mins medium.

 The state of technology can affect the cost and quality of labour, affecting labour needs.
Technology can lead to capital widening whereby new machines and a greater variety of machines
are used by the business requiring people that can operate these machines e.g new security
systems and A380’s at Qantas led to the creation of new jobs and T&D to train employee’s. it also
results in capital deepening whereby more machines are used leading to automation and thus
redundancies.
 Also, issues such as IT skills. It also improves the efficiency of HRM and processes, such as
acquisition allowing for online requirement and employment databases. Better communication
between stakeholders.
Stakeholders: each type. 3-6 mins medium

 These are individuals or groups with a vested interest in the business and it’s HRM. Stakeholders
often have various and competing aims that HRM must consider as the businesses performance is
affected by stakeholders (e.g industrial action).
 Government organisations (1st choice) – They are stakeholders in two ways, firstly as they account
for a large proportion of the workforce. And secondly as they include organisations such as the FWC
which determine and enforce the legal framework for industrial relations. Legislations enforced by
GOV bodies include the FWA 2009, EEO workplace act, work health and safety act etc. considerable
influences on how HRM must operate. Also they cover issues such as unfair dismissal and resolving
disputes. They aim for a fairer industrial relations system.
 Employers (2nd choice) – They employ workers and aim to create a productive labour force, cut
costs and increase quality in order to meet BO. E.g they must find the right balance between
pleasing workers and lowering costs, and if management is done poorly this may lead to an
inefficient workforce and high levels of Industrial disputes. Qantas after outsourcing, relocating staff
overseas and hiring more casual staff, it resulted with lower costs yet faced backlash form unions
who have different interests.
 Employee’s – they are crucial for the HR process and needed for a business to function and achieve
BO. They want a better work life and conditions, higher pay, job security etc. which require high
costs conflicting with employers. Not met less productive also conflicting.
 Unions – they represent the collective interests of employees in an industry of better working
conditions and pay. Employers must adapt to demands as these unions can organise industrial
action, and have a major role of resolving industrial disputes and negotiating new enterprise
agreements. Tend to oppose issues such as pay cuts, outsourcing, and redundancies. Also cover
issues such as discrimination of workers. Qantas employees are represented by 18 diff unions, such
as Australian workers union. Bus may lobby govs to assist in disputes etc?
 Employer associations – These represent the interests of the employers and are usually industry
based. They aim for more favourable outcomes for their employee’s such as reducing labor costs
recommending strategies as an example, and can act on behalf of employers in industrial disputes.
They can also lobby governments for help in disputes or for changes in legislation that will help the
employer, and any serious concerns are represented to the Gov or community. Qantas are
represented by the Australian chamber of commerce and industry.
 Social – stakeholder as made up of individuals either directly or indirectly affected by HRM
decisions (workers and families). Society may create a bad image in the business if they do not
meet their set expectations, values and aims such as fair wages a work life balance etc.
Legal framework: overview. 12 mins extreme (total input for exam and 2 min overview) 2nd choice.

 Australia has a regulated and decentralised system.

 The legal framework are the laws and regulations dealing with employment relations. These have
an influence by placing restrictions on what businesses must and can’t do, as well as imposing
punishments for breaches. FWA is the centrepiece and enforces this framework.
 The current legal framework includes issues of employment contracts, occupational health and
safety, workers compensation, anti-discrimination and EEO. HRM may have to change policies in
order to meet changes in legislations.
Employment contracts (1st choice): 9 mins extreme

 Employment contracts are signed an employer and employee and set out the terms and conditions
of employment.
 There are 3 types of contracts individual common law agreements, enterprise agreements and
awards, all must meet the minimum wage set by the minimum wage panel and minimum
conditions outlined in the NES. In addition the law demands rights and obligations of employees
and employers that have been prescribed over many years and are implicit in all EC.
 Common law (rights and obligations of e’ees and e’ers) – these are the R&O of both employees and
employers that have been set out over many years in the principal of precedence and are implicit in
all EC. For employers these include provide a safe working environment, pay agreed in EC and other
expenses such as superannuation, provide work, not act in bad faith a harm the reputation of
employee’s, have the right to dismiss workers under circumstances. Employees, maintain employer
confidentiality, obey lawful and reasonable commands, perform work with care, have the right to
be paid fairly and work in a safe environment.
 Minimum employment conditions: these are the minimum conditions that are set out in all EC.
They are set out in the NES developed as part of the FWA. They cover issues such as hours of work
per week, requests for flexible working arrangements, parental leave entitlements, annual leave
and other leave entitlements.
 Minimum wage rates: these are set minimum wages for each industry and are set and reviewed by
the min wage panel a body under the FWC.
 Awards (modern awards): These are contracts that legally enforce the minimum wages and
conditions for each industry. As set out by the MWP and NES.
 Enterprise agreements: These agreements are collectively negotiated by employees (who may be
represented by unions) and employers (employer associations). These alter the modern award for
the industry and must pass the BOOT test whereby overall they are better than the award. They
must be approved by the FWC. There are characteristics of E.A such as may apply to either one
business or several. The bargaining power can be shifted depending on level of employment (higher
unemployment power shifts to employers). They are strictly governed by laws and HRM must meet
the new conditions. They can lead to industrial disputes and action. Both part of formal system.
 Other employment contracts: This refers to individual common law agreements between an
employee and the employer. These agreements are part of the informal system and are not
involved by the FWC but are governed by court systems under a principle of precedence. They do
not follow a resolution process and disputes can be very drawn out and costly. They also must
follow the same min conditions and pay yet can only be obtained by workers with unique skills and
of much higher than average pay, threshold is 138,000 approx. such as the CEO of Qanats Alan
Joyce.
OH&S and WC (2nd choice): 6 mins high

 There are legislations that outline the employer’s obligations towards the safety of his employees,
and must take extensive measures to protect the physical and mental wellbeing of workers. This
includes providing safe workplace etc. This can increase the costs of HRM, however, may also serve
as a motivating tool.
 OH&S – These laws and regulations cover a range of industries put into effect the minimum
standards of workplace conditions. These are enforced and monitored by FWC inspectors. Breaches
or any accidents as a result of breaches will lead to bad Pubs and potential criminal punishment and
lawsuits. As part of obliging to the legislation Qantas have implemented a WH&S program ensuring
the health, safety and welfare of workers and has led to a decrease in injuries and accidents by 80%
since its implementation in 2001.
 WC: Employers are obliged to take out workers compensation insurance to cover some of the costs
of workplace injuries for employee’s (medical costs).
Anti-discrimination and EEO: 6 mins medium.

 These are laws and regulations that make it illegal to discriminant, treat unfairly and not hire
people based on their age, ethnicity, religion etc.
 Antidiscrimination: make it illegal to treat employee’s in an unfair because of those factors. For
example pay women or a minority less than someone else for the same work.
 EEO: make it illegal for employers to not hire someone because of these factors. E.g not hire an
indigenous. Creating equal access to jobs for all.
 Qantas provide training to managers to ensure they understand how to identify and prevent
discrimination, as well as seriously investigate all discrimination claims. Additionally, Qantas have
programs to ensure they hire women and indigenous people.
Learn to: Discuss the influence of Gov. on the process of determining employment contracts.

 EC cover common law agreements, enterprise agreements and modern awards, however only in
the latter two do Governments have a significant influence as common law agreements go through
the court system following a principle of precedence. E.A agreements are collectively negotiated by
employees (who may be represented by unions) and employers (employer associations). While
awards are contracts that legally enforce the minimum wages and conditions for each industry.
 The Gov is responsible for establishing the current legal framework which covers issues such as
minimum conditions and pay as well as setting up institutions mainly the FWC to enforce legislation
followed. Prior to the FWC the Howard Govs industrial relations system workchoice made reforms
to the Workplace Relations Act 2006, whereby business EC only had to meet the minimum wage set
by the FPC and a few issues such as hours of work. However, the Rudd Government scrapped this
and set up the FWA 2009 and FWC which is now the legal framework. Under this framework the
Gov has a significant influence on all businesses regarding the determination of E.A which must
contain the 10 minimum conditions set out by the FWC in the NES (cover issues such as hours of
work per week, requests for flexible working arrangements, parental leave entitlements, annual
leave and other leave entitlements), and must meet the minimum wage for the industry
determined by the minimum wage panel a body under FWC. Once the agreement has been
signed it goes to the FWC where ombudsman ensure that it meets these requirements as
outlined in the FWA and passes the BOOT (better off overall test) where the E.A (enterprise
agreement) must be better of overall than the altered modern award for that industry. They also
enact penalties for negotiating in bad faith. For modern awards these are passed through the
FWC and minimum wage panel and legally enforces and ensures the NES and minimum wage for
the industry is set out in the contract. For example, under the Fast food industry award 2010 it
 ensure the checkout chick at maccas is being paid the same wage as the same aged person at KFC
as a checkout chick.
 (for a shorter answer) In summary Govs have an influence as they outline what must be included in
these contracts as established under the legal framework, ensuring NES (cover issues such as hours
of work per week, requests for flexible working arrangements, parental leave entitlements, annual
leave and other leave entitlements) and the min. wage is met as well as does it pass the BOOT
through ombudsman at the FWC that will approve or not approve the contract. They do this to
create a balance between competing stakeholders and for a fairer I.R system, and accountability
and avoidance of long costly disputes.
 In May 2016 the full bench of the FWC did not approve a Cole’s supermarket enterprise agreement
as it did not pass the BOOT. Coles E.A had sought to reduce penalty rates and compensate with
other entitlements one being a slight increase in the standard base rate.
Learn to: Compare the process of negotiating individual contracts and the negotiation of enterprise
agreements.

 Australia’s wage determination system is a hybrid of both centralised and decentralised components. The
decentralised components include E.A and I.C which give efficiency to the economy and flexibility to firms. It
is crucial HRM and all stakeholders understand the differences between these E.C.
 EA are collectively negotiated between the employees typically represented by unions and employer and
cover 42% of the formal system. These agreements must include the minimum wage and the NES, which
covers hours per week, requests for flexible leave and numerous leave entitlements, and are implemented
by the wage panel and FWC. The agreement must also include a specific resolution process and pass the
BOOT, all this is a crucial consideration in the negotiation process evident with in May 2016 when the full
bench of the FWC deemed a Coles EA did not pass the BOOT which had sought a decrease in penalty rates
but an increase in other entitlements such as a standard bas rate. In regards to flexibility these can only be
negotiated during the protective bargaining period. Furthermore, the FWC oversee parts of the negotiation
process and may act as a mediator/conciliator or arbitrator. Finally the level of unemployment can affect the
bargaining power in this period, e.g if there is high unemployment employers have more power as people
are more desperate for work. At Qantas 70% of employees are partied under an EA with in the last 12
months alone 14 new EA signed all represented by unions.
 IC refer to contracts signed between an employer and an employee not many who are very rarely
represented by a union and tend to have unique skills and must be earning over the pay threshold
of $138000 (unless not under an award), these form 30% of the informal system. One similarity is
seen in that these agreements must also meet the minimum wage and NES yet do not have to
include a specific resolution process or pass the BOOT. These contracts havealot more flexibility in
the negotiation process as they can be negotiated at any time and also in regards to resolution
process they come through the court systems as opposed to the FWC and follow a principle of
precedence so disputes are very drawn out and costly. Finally, these contracts are also affected by
the level of unemployment. At Qantas IC are only offered to a few senior positions, one being CEO
Alan Joyce. Similarly at Macquarie bank they offer it to executives and senior associates and within
it have a non-compete clause.
Processes: overview. 2 mins high

 HRM is an ongoing process encompassing the workers entire time at the business. If these carried
out efficiently and to a high level it allows HRM to achieve its strategic role of BO through improving
employee-employer relations, productivity etc.
Acquisition: 4 mins medium
  This is the process of hiring workers. In order to hire the right people it requires the business to
substantial planning to identify the labour needs of the business. In doing so a job analysis can be
conducted to produce a job description defining the position, scope of activities and major
responsibilities.
 Then there is a decision on recruitment whether to go internally – promoting a current employee or
externally – people outside the business. There are benefits for both as internally reduces costs
such as advertising, already understand culture, act as a motivating tool, however, may create
conflict and competition in the workplace. External is generally more expensive as it may require
head-hunters, advertising, employment agencies etc. yet less disruptive and the best person for the
job may be external offering new skills, ideas that may only come externally as they are specialised
in the area, this may also not require T&D.
 Following this is selection/screening which narrows the pool of applicants to the right person. This
could include interviews, past employer references, ability and personality tests etc. lastly (if
needed), orientation introduces them to the business, and so they can swiftly settle in and
understand the business culture.
Development: 4 mins medium

 This is the process that is concerned with improving the current and future skills and capabilities of
its workers to help them reach their potential and gain a CE. This can achieve less accidents,
improved quality and productivity, versatility and can act as a motivating tool, loyalty (less
absenteeism and ST), job satisfaction. Planning is required to determine what TT&D programs are
needed through considering what skills the workforce needs.
 There are two types of training businesses can use, on the job (in house), which could include
apprenticeships, demonstrations, job shadowing and mentoring. This has advantages of more cost
effective, can be tailored for that specific business, training alongside colleagues may build morale,
however, bad habits may be passed on, quality depends on the trainer and time available, may not
be a good learning environment. Off the job (external) could include a course or seminar,
advantage is may offer new insight that may not be obtained in house, yet this may be more
expensive and time consuming, lost working time. Appraisal can be used to monitor which T&D has
been most effective.
Maintenance: 4 mins medium

 Process concerned with retaining employees and keeping them more motivated and committed to
the business. Poor maintenance management leads to lower morale and increases in absenteeism
and ST. This can be imporved by motivation found through a rewarding system/remuneration
package, whereby there is a mix of both monetary rewards - increased salary, commissions
(depending on occupation), bonuses etc. as well as non-monetary – fringe benefits such as
workplace leisure facilities, free child care, company care etc. note, this package should be tailored
made depending on the job description and pay structure, e.g salesman increase commission.
 other methods could include a safe, healthy and fair working environment, democratic leadership
style, varied tasks, praise and even discipline through punishments.
Separation: 4 mins medium

 The process of ceasing the employment relationship between employer and employee.
 In this process HRM must be aware of legal and ethical standards regarding unfair dismissal.
 There are two types – firstly voluntary, where the employee chooses to leave the company, this
could include resignation where the employee decides to leave with the intention of finding a job
elsewhere, retirement, or voluntary redundancy, whereby the position is no longer required by the
 business and someone volunteers. Secondly involuntarily, whereby employees are forced to leave
against their will, this could be dismissal whereby there are legitimate grounds for being ‘fired’. Also
involuntary retrenchment, whereby the position is now not required by the bus (redundancy),
retrenchment is the process by which the employee has become separated as a result of
redundancy. There may be a system for involuntary retrenchment whereby it is based on merit, or
last in first out etc.
Strategies overview: 2 mins extreme

 HRM strategies are tactics used to improve the entire HRM process of DAMS, as well as increase
the productivity of labour and the employee-employer relationship allowing them to achieve BO.
Leadership style: Maintenance. 6 mins high

 Refers to the way in which managers relate to their employees and their freedom and input in the
decision making process. There are numerous leadership styles each with their own benefits, and
which one is used will depend on the industry and skill levels of labour, however, in recent years
there has been a general shift from an autocratic style to a democratic style.
 Autocratic, is where the leader has total control over decision making with no input from labour
with a very ‘do as I say’ attitude. This is more appropriate for lower skilled labour where clear
instructions may be the best way to increase productivity. Meanwhile, a democratic style is where
decision making is a collaborative process, where employees have an input yet the employer does
not have to follow it, this can give workers a greater feeling of value and responsibility, higher
motivation, however, could lead to conflict and time consuming decision making. Two other styles
are Laissez-faire, a lot of power given to employee’s responsibility and input with fairly basic
parameters and goals, similar benefits as democratic yet can lead poor outcomes and decisions if
workers are unreliable, uncommitted etc. And Beaurocratic gives a little power to everyone yet
policies are based on policies, guidelines and manuals. Qantas was autocratic now democratic, and
Google in order to emphasise innovation have laissez-faire.
Job design: Maintenance and acquisition. 6 mins high

 This refers to determining the way in which tasks and jobs will be carried out. This can aid the
acquisition process through job descriptions enticing workers to join the company but mainly
maintenance as it can prevent boredom and increase motivation. There could be general or specific
tasks. General tasks should aim to provide workers with a range of simple, varied tasks typically for
lower skilled workers, may prevent specialisation Qantas use this as a form of job enlargement and
job rotation for some occupations, similarly at Google. Or specific tasks could be given as they
provide a greater sense of challenge and responsibility, recommended for higher skilled workers.
Qantas use this for higher skilled occupations to achieve job enrichment.
Rewarding: 3rd choice maintenance. 6 mins high

 This is what employees receive in return for their services. One strategy is for HRM to implement a
range of rewards and rewarding systems in order to create a remuneration package that will
increase motivation, loyalty improving matching indicators and overall productivity.
 Monetary rewards: rewards in the form of money and will comprise of the bulk of the
remuneration package this includes increases in wages or salaries, overtime rates, bonuses as a
percentage of profit, piece rates or commissions. Note, it will depend on industry and job, e.g
salesmen more suited to commission increases.
  Non-monetary, this refers to benefits not paid in cash, includes fringe benefits such as company car,
free phone, leisure facilities, free childcare, flexible working hours, better T&D and work life
balance. Should be used in conjunction with monetary.
 Decisions over group or individual rewards (first choice), employees are often divided into
workgroups and become collectively responsible for certain tasks – case for group; this is where
everyone in the group is paid the same amount, this is a simpler system and encourage synergy as
everyone in the group will work towards the same goal for the same benefit. However, this may
lead to people slacking off or ‘free riding’ and getting the same reward, under the individual system
(people are paid based on performance or role) this does not occur and this may be a fairer system
motivating everyone individually to reap their own rewards, however, this may lead to conflict and
bad competition making group activities ineffective.
 Performance pay, this is another rewarding system whereby part or all of an employee’s wage is
based on performance. This is where bonuses or commissions are particularly prevalent. This can
motivate people to work to their best ability, however, for some jobs the value of performance
maybe very subjective thus may be deemed unfair.
 Qantas use a performance pay particularly for senior managers. And Google individual rewarding
system.
Training and development: 2nd choice, 6 mins high

 This is the process that is concerned with improving the current and future skills and capabilities of
its workers to help them reach their potential and gain a CE and understand workplace procedures.
This can achieve less accidents, improved quality and productivity, versatility and can act as a
motivating tool, loyalty (less absenteeism and ST), job satisfaction.
 T&D must be planned to ensure it is meeting the labour needs of the business, this involves the
decision for the programs current and/or future skills (mixture of both recommended despite more
costly). It is crucial to improve current skills because, it enables them to do their current job better,
such as operating a new machine, this allows for immediate improvements and increases in
productivity and constant worker satisfaction, however, this training becomes ineffective eventually
as workers typically will reach a performance threshold/certain level of competence and additional
training gives little benefit. However, it is also crucial to improve future skills in order to ensure a CE
can be sustained, and there is a productive workforce for the future. This includes, trained to
perform other jobs by hierarchy for potential future use, as well as training for anticipated change,
such as a new technology or structural changes in the business, Google use this to remain
innovative and for the workers to develop new leading edge technologies. This can increase WS as
employees feel they are developing and moving forward in the business. However, employees may
take their skills elsewhere. Qantas have spent $275m a year on T&D, with programmes for
operating new security systems, aircraft engineering and maintenance, safety procedures,
customer service etc.
Recruitment: acquisition. 6 mins high.

 This is the process the business goes through to find the most appropriate person for the job,
within this there are a number of strategic decisions that must be made, and is crucial for the
quality of the acquisition stage, as the right person can increase productivity and limit workplace
problems achieving a CE. Then there is a decision on recruitment whether to go internally –
promoting a current employee or externally – people outside the business. There are benefits for
both as internally reduces costs such as advertising, already understand culture, act as a motivating
tool, however, may create conflict and competition in the workplace. External is generally more
expensive as it may require head-hunters, advertising, employment agencies etc. yet less disruptive
 and the best person for the job may be external offering new skills, ideas that may only come
externally as they are specialised in the area, this may also not require T&D.
 Also a decision whether to hire someone with general or specific decisions, note this will depend on
the position. Business should use both, recommended general for lower skilled tasks to offer
versatility, flexibility reduces costs in the long run. Specific skills should be used for senior positions
requiring higher skilled jobs allowing business to have the highest quality with specialists in
important positions. Qantas uses a mixture of both with Alan Joyce current CEO being internal.
Google, use both including an internship as a program to hire internally.
Performance analysis/management: development and maintenance. 6 mins high

 PM is a system of monitoring an employee’s contribution and outcomes to the business and taking
necessary corrective action. This not only allows for improvements in worker performance but also
improves the employee-employer relationship a goal of HR through constant and direct feedback
between the parties, with feedback, encouragement and praise. There are two types,
administrative and developmental. Administrative refers to doing the bare minimum used to fulfil
legal requirements and satisfy stakeholders, such as brief annual reports, this is time savvy and
cheap yet does not endure any real improvements. Developmental, goes far beyond any
requirements and really embraces the strategy, with great detail on individual performance, fining
tuning skills and helping workers understand their role and goals of business. Google uses a
developmental approach with peer reviews of each worker scaling them from ‘needs improvement’
to ‘superb’.
Global labour inputs: 1st choice. All stages. 6 mins extreme

 This is made possible due to globalisation and refers to accessing a greater pool of workers than
domestically, this helps overcome supply shortages with workers which may offer greater skills or
lower costs. This can improve the acquisition stage ensuring the right worker is hired, may require
less T&D. This can help business improve productivity and achieve BO, yet there are numerous
barriers such as cultural, religious, language. This gives business a greater supply of workers,
building a workforce of greater variety and allows them to access the best of workers possible. This
comes with the benefit of potentially offering greater skill levels, as greater quality may be able to
be found in some regions overseas, it also brings a new influx of ideas, perspectives etc. that may
be due to differences in culture and upbringing. It may also offer lower cost a goal of HR, as certain
regions of the world due to cultural differences, economic conditions and legal requirements may
work for a lower wage, note this may come at the expense of quality and lead to bad pubs.
Learn To: Examine the advantages of a diverse, culturally competent workforce for a global business.

 A diverse culturally competent workforce refers to a business developing a workforce that has
employed and supported awareness, knowledge and respect for a range of cultures. Although there
are numerous challenges businesses may face such as language and religious barriers, there are
numerous benefits. Firstly, through aiming to achieve a diverse, culturally competent workforce it
allows the business to overcome the labour skill shortage some countries face. It can also help
businesses with its global operations as workers are familiar with foreign practises, tastes,
understanding of local laws, ethics etc. allowing businesses to maximise performance in every
country they operate in. In order to achieve this Woodside petroleum take a geocentric approach
hiring people regardless of nationality, Qantas go a step further with an ethnocentric approach to
staffing in foreign countries involving them hiring host country nationals (HCN’s) in senior positions
rather than transferring a domestic worker. Secondly, it can increase innovation, with an influx of
new ideas, views of products, perspectives on issues such as conducting CSR, and approaches to
 solving issues, T&D techniques etc. all leading to greater productivity a goal of HR. This is evident at
Proctor and Gamble whose board is 58% diverse and studies have shown diverse teams that have
these high diversity levels produce results 6 times better, achieve a rate of return on earnings 53%
higher and achieve revenue targets 46% more than homogenous teams (taste of harmony
organisation). Once more, it can increase good will and good publicity and reputation, as taste of
harmony studies have shown within 10 days of winning a diversity award the share price of the
company will increase, while within 24 hours of a diversity complaint it will decrease.
Workplace disputes strategies: (maintenance) 6 mins high. Each individual 2 mins.

 These are strategies used to resolve conflict between employees and employers, which will
inevitably arise due to competing interests. Disputes can increase profits, lower morale, lead to Bad
Pubs. Strategies must be fair/in good faith and transparent.
 Negotiation (1st choice) – This involves a discussion and direct communication between the two
stakeholders aiming to find a compromise and acceptable outcome. The employee is generally
represented by a union, and this tends to be the first stage of the process.
 Mediation – this is where an independent third party attempts to solve the dispute, and is a more
formal and structured form of negotiation. These professionals are facilitators and try to
understand the best way to avoid hostilities and achieve a mutual, fair agreement. After this come
conciliation whereby the third party will offer suggestions on how to settle the dispute.
 Involvement of courts and tribunals: This is whereby the parties take their case to a tribunal, in this
case the FWC, they will make a legally binding decision on the dispute and this is known as
‘arbitration’. If a party takes it to the courts it is typically if there has been a breach in the contract
prior.
 Grievance procedure – This is a system whereby disputes and complaints mainly between
employees but also employee and employer are referred to a special grievance committee. The
dispute is further investigated and the entire process is documented to ensure regularity and
transparency.
Learn to: Analyse/evaluate the causes of the causes of two workplace disputes and the strategies used to
resolve them.

 Workplace disputes typically occur between employees and employers, this tends to be over issues
such as better pay or conditions. It is crucial businesses resolve these issues as disputes can affect
morale and productivity, thus lowering profits and placing the business at a competitive
disadvantage. The potential strategies businesses can use include grievance procedures,
negotiation, mediation or involvement of tribunals or courts. Two business that have faced these
disputes are Coles and Fletcher International. When analysing it is crucial to look the relationship
between the components of the causes, strategies used to resolve and was it timely or costly/when
evaluating the strategies it is crucial to look at a set of criteria, this is did it solve the dispute for the
employee, employer or was there a compromise and was this done time and cost affectively.
 For Coles, in July 2016 there was an industrial dispute at Polar Fresh which operates the Truganina
facility on behalf of Coles. In the dispute over 640 workers took industrial action by walking off the
job and demanding better pay - $3 increase $30/h and better job security and conditions
particularly for the casual workforce, with an increase in full time positions and predictable
fostering arrangements. After failed negotiations (define) the workers started picketing on the road
outside the distribution centre. This affected farmers as they could not deliver there produce as
there were 70 trucks backed up and Coles fresh food shelves were bear, costing both parties. The
workers were represented by the National Union of workers while Coles were by lawyers. The FWC
improved the industrial action and it was taken to the court. Initially the Supreme Court ordered a
 junction for the workers to cease picketing. Following this in a matter of days the strike was over
and a compromise was reached. The workers gained a 4.75% pay rise and 120 new secure jobs, 50
of which were permanent full time. Additionally, there was an increase in paid breaks and rostered
days off. Clearly, the strategy used was the involvement of the courts and a compromise was made.
Although it set out what it aimed to achieve in a timely fashion it cost 10’s of thousands to Coles
and farmers.
 For Fletcher International a sheep meats and related products company there was a dispute over
pay for about 600 staff over wage levels, which occurred over a twelve month period. The
Australian Meat industry employee’s union represented the workers, and although the strategy of
negotiations whereby both parties directly communicate with each other in an attempt to reach an
acceptable outcome, was held it was ineffective with the unions continually pressing for the
increases in pay. Following this a grievance procedure was used, whereby the employee’s
complaints were passed on to a special grievances committee in a fair and transparent process, this
did not solve the issue yet prevented temporary escalation. However, soon the dispute reached a
climax and the union threatened industrial action, and as a result Fletcher International resorted to
their own form of industrial action forced a lockout of the workers, and they were to resume days
after. At this point once again negotiations were held and a compromise was met with a slight
increase in wage levels. Therefore, although initial strategies were ineffective eventually
negotiation worked and the dispute was resolved. Essentially, they only costs were the lowered
moral, and the production time loss during the lockout, however, it was time that was expensive
with the entire process continuing for 12 months.
Effectiveness overview: 2 mins high.

 The effectiveness of HRM is determined by whether HR strategies have improved the HRM process
and achieve HR and business objectives, such as higher productivity and an improved employee-
employer relationship. This can be measured by a set of indicators that essentially measure morale,
which need to be used in conjunction in order to have an accurate measurement, and should be
used before and after the implementation of strategies.
 Benchmarking key variables – This should be used as a prerequisite, as all indicators are key
variables and through the process of benchmarking them it can enhance the accuracy of assessing
the effectiveness. It can be used against yourself in different time periods, gauging your progress
which strategies are working well, and can be assessed against competitors as this may indicate a
business is doing well in tough conditions. Or against industry benchmarks, set by certain outside
bodies that may suggest absenteeism of 8 days per staff is expected. (or could mean benchmarking
quality and productivity etc., check this out).
 Absenteeism 1st choice – This refers to workers staying home from work without good reason, i.e
illness, however, true absenteeism is hard to measure as employers cannot always tell if someone
has a good reason or not, therefore, it is taken absenteeism covers both legitimate and illegitimate
reasons. High levels may indicate low motivation and morale, which may be due to a not rigorous
acquisition stage, an insufficient rewarding system or poor job design. This can be very costly as it
pays ‘bludgers’ and potentially requires a casual to replace him at short notice.
 Accidents in the workforce 2nd choice – The level of accidents is a simple to measure indicator that
is particularly crucial for some hazardous industries such as construction. High levels may indicate
inadequate T&D, poor recruitment strategy, unsafe working environment etc.
 Corporate culture 2nd choice – This refers to the businesses character and the shared attitudes,
values and practises within the business, it influences processes, goals and can help differentiate or
give a CE, it is crucial all employee’s understand and work together under this culture which may be
‘customer focused’ or ‘environmentally focused’. It is crucial for HRM to enforce and maintain the
 culture in employees. A poor corporate culture due to employee’s not embracing it may be a result
of low motivation and morale, and a poor employee-employer relationship. Recruitment needs
people who can fit into culture.
 Worker satisfaction – this is how content workers are and how motivated and morale levels at
work, directly affecting productivity. There is no clear measure of this and is very subjective yet
surveys and consultants may give an accurate picture. Low WS shows a range of issues.
 Staff turnover – This refers to the portion of staff that leave each year, high levels may indicate
HRM has not hired the right people who are motivated and committed. There are numerous costs
such as redundancy payments and costs of hiring people.
 Level of disputation – this refers to disputes between employees and employers or between
employees. These disputes can be very timely, costly, lead to bad pubs and reduce morale. High
levels may indicate insufficient rewarding and unsatisfactory employee-employer relationship.
Learn to: Evaluate the effectiveness of HRM for one business and recommend appropriate alternate
strategies.
In evaluating the effectiveness of HRM it is crucial to make a judgement based on a set of criteria, that
being a set of indicators. Excellent performance in these areas suggest that the current strategies used
have achieved HR goals such as an improved employee-employer relationship, increased productivity and
morale, in turn leading to higher profits and a CE. These indicators include benchmarking key variables,
corporate culture, absenteeism, accidents, levels of disputation, accidents, staff turnover and worker
satisfaction. It should be noted that when looking at Qantas only the latter 5 have been used. Through
looking at those indicators it will show where the weaknesses lie, and based off this alternate strategies
will be recommended. When recommending it is crucial to put forward reasons in favour of each strategy
that can be used to respond to influences, improve processes and achieve HR goals. The current strategies
Qantas use are global labour inputs, an autocratic leadership style, a rigorous recruiting system and T&D.
Qantas’ HRM has been very effective in some areas illustrated in the fact they have had favourable
outcomes in staff turnover, worker satisfaction and level of accidents. Staff turnover refers to the portion
of staff that leave each year. At Qantas the rate is decreasing and currently sitting at an ideal figure of
4.4%, this low staff turnover reflects that HRM has been effective in hiring the right people who are
committed to the business. This is due to their recruiting system whereby they have hired the right person
for each role due to them sourcing either internally such as Alan Joyce current CEO or externally with
substantial advertising and head hunters to aid the process. Furthermore, worker satisfaction is crucial in
determining the effectiveness of HRM and refers to how content workers are with their job and their
morale at work, directly affecting productivity. There is no obvious measure yet at Qantas through the use
of staff surveys, invitations for employee feedback and external consultants it has illustrated there has
been improvements over the years in this indicator. This outcome is due to their effective T&D programs
which has had $275m a year in the last 5 years invested into it and has improved the current and future
skills of employee’s, allowing them to reach their potential and tackle new challenges and tasks thus
increasing satisfaction levels. These high levels have also been achieved by the democratic leadership style
which through its collaborative process gives employee’s a sense of responsibility and value. Finally,
Qantas has had success in the indicator of levels of accidents, in which the frequency rate of accidents has
dropped 16.5% in the last 6 years, particularly impressive considering the hazardous and risky nature of
some aviation tasks. This is reflected in their impressive T&D strategy, as well as their global labour inputs
which has given them access to a greater supply of workers allowing them to capture the best talent and
expert workers that can perform tasks more safely. Based off these 3 indicators it appears Qantas’ HRM
has been extremely effective, however, there are two indicators that require significant improvement.
The HRM at Qantas has been ineffective in the level of disputation, disputation referring to disputes
between employees and employers, or between 2 employees’. These high levels indicate an unsatisfactory
employee-employer relationship and insufficient levels of pay, and is evident in the last 5 years as there
have been two engineer disputes, baggage handler and numerous pilot disputes. These disputes are not
only costly and timely but also decrease morale and productivity. Therefore it is recommended Qantas
introduce the performance management strategy with a developmental approach, a system which
monitors an employee’s contribution and making any necessary corrective action. Although it is primary
used as a motivating tool to reach specific targets, it also significantly improves their employee-employer
relationship as it requires direct communication with feedback, encouragement and praise, ensuring the
employee’s do not feel neglected. Similarly in order to improve the feeling employees are being paid
unfairly, they should introduce a rewarding system. This will involve monetary rewards such as bonuses
tied to profitability (this is also a performance pay system, whereby pay is linked to outcomes), not only
will this motivate people to work harder for the business, but discourage them from entering an industrial
dispute due to its heavy effect on profits. In conjunction a range of non-monetary rewards should be used
such as a free phone or more flexible working hours, and all this should be in the form of group rewards,
thus creating a fairer and more beneficial system with employee’s feeling they are being paid reasonably.
Although both performance analysis and an improved rewarding system require extra costs this is
outweighed by the reduction in the levels of disputation and means HRM are achieving their goals and the
business objective of higher profits, thus improving their effectiveness.
There is also a second indicator that shows HRM and their current strategies have been ineffective. This is
absenteeism referring to workers staying home from work without good reason, however, true
absenteeism is hard to measure as employee’s is hard to measure as it is hard to tell whether someone has
a truthful reason or not, thus, it is taken absenteeism covers both illegitimate and legitimate reasons. At
Qantas absenteeism has remained steady hovering around the Australian business average of 9.5 (days
taken off per year by each worker). However, when this is compared to other developed nations this
average is poor with NZ and US around four days and Asian countries averaging 2.2 (human resources
director Australia). Based off this Qantas is performing poorly in a global context, ad these high levels
indicate that workers are unmotivated and bored thus productivity is low. This also serves as a reason to
implement the rewarding system, as it will serve as a motivating tool and provides incentives for
employee’s to attend work and boost their own productivity and thus profits for the business and
increased pay for themselves. In conjunction, job design should be introduced this refers to the way in
which a set of tasks or the entire job should be organised. Qantas should give to the higher skilled
employee’s specific tasks achieving job enrichment which will prevent boredom and increase motivation
due to the greater challenge. Also to the lower skilled workers a wide and varied range of general, simple
tasks should be given achieving job enlargement and job rotation, this also will prevent boredom and
motivate employees. Although it may seem that general tasks reduce specialisation this is outweighed by
the increase in productivity and lowered absenteeism. Therefore through the implementation of the
rewarding system and job design strategies it will lead to a decrease in absenteeism and simultaneously
productivity and profits rising hence HRM has been effective.
To conclude, Qantas has currently implemented strategies of global labour inputs, T&D, autocratic
leadership style and successful recruiting system, which has resulted in HRM being effective in the areas of
worker satisfaction, staff turnover and level of accidents. Contrastingly, they have been ineffective in the
levels of disputation and absenteeism. Therefore, it has been recommended in order to reduce the level of
disputes performance analysis and a rewarding system with both monetary and non-monetary group
rewards. Also, in reducing absenteeism the rewarding system and the strategy of job design to increase
motivation and prevent boredom. If these strategies are implemented it will allow them to achieve their
HR goals and overall business goal of higher profits.