1. Human resource management is a goal-oriented function.

Discuss the objectives of

HRM at individual, organizational and societal levels.
The personal HRM objective includes acquiring, developing, utilizing, and retaining efficient
employees in an organization. This can be possible if employees can accomplish
organizational along with their individual goals. For this, employees should be provided with
adequate training and feedback on their performance.
HRM has to prepare human resources to accomplish organizational goals. HRM to achieve
the organizational objectives like to earn profit, growth, expansion, survival, diversification
etc. via the HR functions namely planning, recruiting, selecting, placement, induct, train and
develop the human resources and to arrange for performance appraisal of the employees.
HRM serves other functional areas, so as to help them to attain efficiency in their operations
and benefit the organization. HR should achieve organizational goals through the proper
utilization of human resources. Succession planning is an important aspect to be taken up as a
contemporary organizational objective.
HRM should follow the rules and laws or legal restrictions imposed by society. It has to
develop and maintain healthy relations between union and management. It is the
responsibility of Human Resource to ensure that legal, ethical, and social-environmental
issues are suitably dealt with.
Contribute to minimization of socio-economic evils such as unemployment problems, in
equal distribution of income and wealth, more employment opportunities for women etc. Aim
in creating healthy work relations in the organization and to work towards corporate social
responsibility (CSR) involving employees to contribute to the cause. A social objective is a
statement that details a specific desired outcome of a project that is related to the interaction
of the individuals, groups, and institutions within a society. Often our social objective is
related to improving human wellbeing.
2. Discuss the emergence of human resources management retrospectively (historical
perspective). Explain the contribution of international Labor Day (May 1) and the
International Labor Organization (ILO) in the development of human resources
management.

The term "human resource management" has been commonly used for about the last ten to
fifteen years. Prior to that, the field was generally known as "personnel administration." The
name change is not merely cosmetics.
 Historical Milestones In HRM Development

1
  Father of Personnel Management

Personnel administration, which emerged as a clearly defined field by the 1920s (at least in
the US), was largely concerned the technical aspects of hiring, evaluating, training, and
compensating employees and was very much of "staff" function in most organizations. The
field did not normally focus on the relationship of disparate employment practices on overall
organizational performance or on the systematic relationships among such practices. The
field also lacked a unifying paradigm.

HRM developed in response to the substantial increase in competitive pressures American

business organizations began experiencing by the late 1970s as a result of such factors as
globalization, deregulation, and rapid technological change. These pressures gave rise to an
enhanced concern on the part of firms to engage in strategic planning--a process of
anticipating future changes in the environment conditions (the nature as well as level of the
market) and aligning the various components of the organization in such a way as to promote
organizational effectiveness.

Human resource management (HRM), also called personnel management, consists of all the
activities undertaken by an enterprise to ensure the effective utilization of employees toward
the attainment of individual, group, and organizational goals. An organization's HRM
function focuses on the people side of management. It consists of practices that help the
organization to deal effectively with its people during the various phases of the employment
cycle, including pre-hire, staffing, and post-hire. The pre-hire phase involves planning
practices.
The Historical Background Of Human Resource Management
Human resource management has changed in name various times throughout history. The
name change was mainly due to the change in social and economic activities throughout
history.
Industrial Welfare
Industrial welfare was the first form of human resource management (HRM). In 1833 the
factories act stated that there should be male factory inspectors. In 1878 legislation was
passed to regulate the hours of work for children and women by having a 60 hour week.
During this time trade unions started to be formed. In 1868 the 1st trade union conference
was held. This was the start of collective bargaining. In 1913 the number of industrial welfare
workers had grown so a conference organized by Seebohm Rowntree was held. The welfare

2
workers association was formed later changed to Chartered Institute of Personnel and
Development.
Recruitment and Selection
It all started when Mary Wood was asked to start engaging girls during the 1st world war. In
the 1st world war personnel development increased due to government initiatives to
encourage the best use of people. In 1916 it became compulsory to have a welfare worker in
explosive factories and was encouraged in munitions factories. A lot of work was done in this
field by the army forces. The armed forces focused on how to test abilities and IQ along with
other research in human factors at work. In 1921 the national institute of psychologists
established and published results of studies on selection tests, interviewing techniques and
training methods.
Acquisition of other Personnel Activities
During the 2nd world war the focus was on recruitment and selection and later on training;
improving morale and motivation; discipline; health and safety; joint consultation and wage
policies. This meant that a personnel department had to be established with trained staff.
Industrial Relations
Consultation between management and the workforce spread during the war. This meant that
personnel departments became responsible for its organization and administration. Health and
safety and the need for specialists became the focus. The need for specialists to deal with
industrial relations was recognized so that the personnel manager became as spokesman for
the organization when discussions where held with trade unions/shop stewards. In the 1970's
industrial relations was very important. The heated climate during this period reinforced the
importance of a specialist role in industrial relations negotiation. The personnel manager had
the authority to negotiate deals about pay and other collective issues.
Legislation
In the 1970's employment legislation increased and the personnel function took the role of the
specialist advisor ensuring that managers do not violate the law and that cases did not end up
in industrial tribunals.

Flexibility and Diversity In the 1990's a major trend emerged where employers were seeking
increasing flexible arrangements in the hours worked by employees due to an increase in
number of part-time and temporary contracts and the invention of distance working. The
workforce and patterns of work are becoming diverse in which traditional recruitment
practices are useless.

3
 International Labor Day has been celebrated worldwide on May 1 of each year since 1889 to
claim labor rights and fair conditions in accordance with international labor standards
recognized internationally by most governments. With the arrival of the pandemic, several
reports show deterioration in job growth, with the loss of more than 30 million full-time
jobs, according to the International Labor Organization. Furthermore, in Latin America and
the Caribbean, more than 160 million people work in the informal sector have seen their
income reduced by up to 80%, well above the world average (60%), one of the world’s
hardest hit regions. The same is true in Africa, where 85% of workers are informal, and in
Asia, with more than 60%.
The ILO is the global body responsible for drawing up and overseeing international labor
standards. Working with its 181 member States, the ILO seeks to ensure that labor standards
are respected in practice as well as principle. The ILO is the only tripartite U.N. agency. The
ILO is a meeting point for governments, workers and employers of ILO's member States to
set labour standards, improve upon policies and create programs that promote decent work
for people.
3. Write a short note on strategic human resource management (SHRM) and discuss how it
evolved philosophically and practically.
Experts define SHRM from a different perspective. Some of the important definitions are
listed below: “Strategic human resource management means formulating and executing
human resource policies and practices that produce the employee competencies and behaviors
that the company needs to achieve its strategic aims.”- Gary Dessler.“Strategic human
resource management is an approach to making decisions on the intentions and plans of the
organization concerning the employment relationship and the organization’s recruitment,
training, development, performance management, and the organization’s strategies, policies,
and practices.” – Armstrong.
Strategic HR can be demonstrated throughout different activities, such as hiring, training, and
rewarding employees. HRM evolved over a period of years from the era of industrial
revolution. The evolution of HRM dates back to 18th century and the concept is very old in
nature involving the management of human beings.
SHRM is a people management philosophy that is based on the belief that human resources
are crucial for the success of a business as their expertise can be utilized for meeting the
defined objectives.
4. There is increasing trend in all organizations alike to value employees as important
assets. Why is this so?

4
Their employee's skills, abilities, knowledge, and experience are intangible and invaluable
assets in securing the organization's future. Valued employees' positive mood will directly
impact the processes, profits, and productivity of the organization. Human Resource is called
so because its major responsibility is dealing with the human part of the organization, and this
involves having great interpersonal skills. People management skill is needed by all managers
for optimal corporate productivity and brings value-addition to the organization.
As a result of this view, issues such as the following are pertinent in the discourses of human
resources management.

a) Human capital management

What are tenets of human capital management? Human Capital Management or HCM is a
set of practices related to human resource management like recruitment, managing
employee performance, optimizing employee engagement, etc. It poses immense value to
the organization if done correctly.

Human capital theory rests on the assumption that formal education is highly is highly
instrumental and necessary to improve the productive capacity of a population. In short,
human capital theorists argue that an educated population is a productive population.

Strategic human capital management (HCM) is a people-focused approach to HR that unites

a variety of human resource processes to work as one from recruiting and onboarding to
payroll and benefits, to workforce and performance management.

b) Knowledge management- Knowledge Management - The Basics. Knowledge

Management is the explicit and systematic management of vital knowledge - and its
associated processes of creation, organization, diffusion, use and exploitation - in
pursuit of business objectives. There are many definitions of knowledge management.

What is a knowledge management strategy? A knowledge management strategy is a

systematic approach to create, share, and use its information and documentation to improve
business processes, enhance innovation, and achieve competitive advantages. The best four
components of knowledge management are people, process, content/IT, and strategy.
Regardless of the industry, size, or knowledge needs of your organization, you always need
people to lead, sponsor, and support knowledge sharing.

c) Talent Management- Talent management is a process used by companies to optimize

how they recruit, train and retain employees. Through human resources processes, such

5
 as strategic workforce planning, companies can anticipate their needs and goals and
attempt to hire a workforce that reflects those needs. The plans for managing talent may
include talent acquisition, local parameters, budgets and staffing requirements, among
many other strategies.

A talent management strategy is the plan of action to optimize employee performance. This
means optimizing performance in the broadest sense. It includes a plan to: Bring people up to
speed faster (optimizing time to productivity) Identify gaps in skills and other job resources
early on.

Features of a talent management strategy

Recruitment (talent acquisition). Building talent 'pools'.

Succession planning. Life-long learning.

Leadership development. Career management.

Deployment. Performance management.

What are the basics of talent management?

The 7 Steps of a Great Talent Management Process

Steps 1 Specify What Skills You Need. ... 2: Attract the Right People. ...
3: Onboard and Organize Work. ... 4: Organize Learning and Development. ...
5: Hold Performance Appraisals. ...
6: Strategize to Retain Your Best Talent. ... 7: Plan for Successions.
d) Career Management- discuss the basics of career, its management, the central
argument (tenets), strategies and practices related to it.

Career Management is a life-long process of investing resources to accomplish your future

career goals. It is a continuing process that allows you to adapt to the changing demands of
our dynamic economy.
Career management is conscious planning of one's activities and engagements in the jobs
one undertakes in the course of his life for better fulfilment, growth and financial stability.
It is a sequential process that starts from an understanding of oneself and encompasses
occupational awareness.

6
 A career strategy is any behavior, activity, or experience designed to help a person meet
career goals. A career strategy represents a conscious choice by an individual as to the type
of investment he or she is willing to make in attempting to reach career objectives.
This being true, career management is an important life skill to develop and cultivate.
According to "Get Smart! About Modern Career Development", there are six stages of
modern career development: Assessment, Investigation, Preparation, Commitment,
Retention, and Transition.
5. Human resource management as a field of study (investigation) witnessed rigorous
developments in theories, models and methods over years. Prepare short notes on each
of the following covering classifications, central arguments and applications
 Theories of human resource management (classifications, central arguments and
applications)
There are four Human Resource theories which are named as follows:
 Organizational Lifecycle Theory
 Strategic Contingency Theory
 General Systems Theory
 Transaction Cost Theory
1. Organizational Lifecycle Theory
One of the HR theories is organizational lifecycle theory. This is the first human resource
management theory. Historians and academicians have observed that organizations, just like
that of living organisms, have life cycles. They are born (established or formed), they grow
and develop, they reach maturity, they begin to decline and age, and finally, in many cases,
theydie.
Study of the organizational life cycle (OLC) has resulted in various predictive models. These
models, which have been a subject of considerable academic discussion, are linked to the
study of organizational growth and development. Organizations at any stage of the life cycle
are impacted by external environmental circumstances as well as internal factors. The rise
and fall of organizations and entire industries have been witnessed. Products also have life
cycles, a fact that has been long recognized by marketing and sales experts. It seemed
reasonable, for academicians, to conclude that organizations also have life cycles.

2. Strategic Contingency Theory

One of the HR theories is strategic contingency theory. The second one among the human
resource management theory and practice is strategic contingency theory, which, as the name

7
suggests, is based on two concepts i.e. ‘Contingency’ and ‘Strategic’ aspect of contingency.
A Contingency is a need for different tasks of a subunit in an organization on which tasks of
other subunits create an effect. This contingency becomes strategic once other subunit starts
controlling more contingencies and becomes powerful in an organization.
As per the Strategic contingency theory, a leader becomes a central part of an organization
due to his/her unique skills to solve the biggest HR challenges which others are unable to
solve. Too much dependency lies on a leader so he/she is not easily replaceable.
Advantages of the theory:
 Strategic Contingencies Theory focuses on tasks that need to be done in the form of
problems to be solved, thus de-emphasizing personality.
 That problem solving assumes a central role in a leader's ability conforms to a
common-sense view of the world; there is little need to provide an elaborate
explanation as to why it can work.
 The theory helps to objectify leadership techniques, as opposed to relying on
personalities.
 In a situation where persons are rational agents, such as in scientific and formal
academic settings, the Strategic Contingencies Theory would have more force and
effect. That is, it identifies what is common to the group -- the orientation towards
problem-solving -- and addresses it directly.
 The theory is simple and uses only the variables affecting power in contingency
control by an organizational subunit.
3. General Systems Theory
Another one of HRM theories or a theory that is widely applied to Human Resource
Management is the Systems theory is the interdisciplinary study of systems. A system is a
cohesive conglomeration of interrelated and interdependent parts which can
be natural or human-made. Every system is bounded by space and time, influenced by its
environment, defined by its structure and purpose, and expressed through its functioning. A
system may be more than the sum of its parts if it expresses synergy or emergent behavior.
Changing one part of a system may affect other parts or the whole system. It may be possible
to predict these changes in patterns of behavior. For systems that learn and adapt, the growth
and the degree of adaptation depend upon how well the system is engaged with its
environment. Some systems support other systems, maintaining the other system to prevent
failure.
The goals of systems theory are to model a system's dynamics, constraints, conditions, and to

8
elucidate principles (such as purpose, measure, methods, tools) that can be discerned and
applied to other systems at every level of nesting, and in a wide range of fields for achieving
optimized equality. It is quite visible how it can be applied to HR and hence one of the
widely spoken HR theories.
4. Transaction Cost Theory
One of the HR theories is transactional cost theory. Transaction cost theory in human
resource management is part of corporate governance and agency theory. It is based on the
principle that costs will arise when you get someone else to do something for you .e.g.
directors to run the business you own.
Transaction cost theory is an alternative variant of the agency understanding of governance
assumptions. It describes governance frameworks as being based on the net effects of internal
and external transactions, rather than as contractual relationships outside the firm (i.e. with
shareholders).

 Models of human resource management (classifications, central arguments and

applications)
Human Resource Management Models

Four major models have been identified for human resource management and all these serve
many purposes.
1. They provide an analytical framework for studying Human resource management (for
example, situational factors, stakeholders, strategic choice levels, competence)
2. They legitimize certain HRM practices; a key issue here is the distinctiveness of HRM
practices: “It is not the presence of selection or training but a distinctive approach to selection
or training that matters”
3. They provide a characterization of human resource management that establishes variables
and relationships to be researched.
4. They serve as a heuristic device-something to help us discover and understand the world
for explaining the nature and significance of key HR practices.
The four HRM models are:

The Fombrun, Tichy and Devanna Model

Being the first model (dates back to 1984), this emphasizes just four functions and their
interrelatedness. The four functions are selection, appraisal, development, and rewards. These
four constituent components of human resource management and are expected to contribute
to organizational effectiveness.
The Fombrun model is incomplete as it focuses on only four functions of HRM and ignores
all environmental and contingency factors that impact HR function.

9
The Harvard Model
The Harvard model claims to be comprehensive in as much as it seeks to comprise six critical
components of HRM. The dimensions included in the model are stakeholders, interests,
situational factors, HRM policy choices, HR outcomes, long-term consequences, and a
feedback loop through. The outputs flow directly into the organization and the stakeholders
The Guest Model
Yet another human resource management model was developed by David Guest in 1997 and
claims to be much superior to other models. The details will justify the claim. This model
claims that the HR manager has specific strategies to begin with, which demand certain
practices and when executed, will result in outcomes. These outcomes include behavioral,
performance-related, and financial rewards.
The model emphasizes the logical sequence of six components: HR strategy, HR practices,
HR outcomes, behavioral outcomes, performance results, and financial consequences.
The claim of the Guest model that it is superior to others is partly justified in the sense that it
clearly maps out the field of HRM and delineates the inputs and outcomes. But the dynamics
of people management are so complex that no model (including the Guest model) can capture
them comprehensively.
The Warwick Model
This model was developed by two researchers, Hendry and Pettigrew of the University of
Warwick (hence the name Warwick model). Like other human resource management models,
the Warwick proposition centers around five elements
 Outer context (macro-environmental forces)
 Inner context (firm-specific or microenvironmental forces)
 Business strategy content
 HRM context
 HRM content
The strength of the model is that it identifies and classifies important environmental influ-
ences on HRM. It maps the connection between the external and environmental factors and
explores how human resource management adapts to changes in the context. Obviously, those
organizations achieving an alignment between the external and internal contexts will achieve
performance and growth.

 Research methods in human resource management (classifications, central

arguments and

10
 applications)
Research Methods in Human Resource Management is a key resource for anyone
undertaking a research report or dissertation. It covers the planning and execution of HRM
research projects, from investigating and researching HR issues to designing and
implementing research and then evaluating and reviewing the results.
Research Methods in Human Resource Management balances theoretical frameworks and
practical guidance. Fully updated throughout, this edition now includes increased discussion
of methodological issues, more real-life examples and international case studies and best
practice sample literature reviews and write-ups. 'Review and Reflect' sections at the end of
each chapter help to consolidate learning and explain how it can aid professional
development. This book is fully mapped to the CIPD Level 7 Advanced module on
Investigating a Business Issue from an HR Perspective, and multiple-choice questions and a
glossary of terms help students understand the key concepts and use the terminology
confidently. Online supporting resources for lecturers include an instructor's manual and
lecture slides and there are annotated web links, further reading and new reflective questions
for students.

6. Differentiate between job analysis and job evaluation by showing the specific purposes of
each. Discuss the various methods under each function of human resource management.
Job Analysis: HRM function that includes in-depth examination of specific job an its related
activities.
Job Evaluation: A function of HRM that determines the value or worthiness of a job.

2. Input Or Output

Job Analysis: It is an input for job evaluation

Job Evaluation: It is an output of job analysis

3. Objectives/Purpose

Job Analysis: Objectives or purposes of job analysis are:

- To assist recruitment and selection process
- To provide basis for job description, job specification, job evaluation and job simplification
- To provide information about the nature or characteristics of different jobs and provide
assistance for training and development program.
Job Evaluation: Objectives or purposes of job evaluation are:
- Job rating
- Determination of pay structure
- Minimizing recruitment and selection costs
- To maintain harmonious relationship between employees and superiors

11
4. Procedure/Steps

Job Analysis: This process includes the following steps:

- Collecting information about the job
- Review of collected information
- Job analysis
- Job description
- Job specification
Job Evaluation: This process includes the following steps:
- Job analysis
- Job specification
- Rating of job
- Arrangement of reward and compensation
- Classification of job
7. Training and Development
 Why do we need to have training as human resource management function?
Training is important because it represents a good opportunity for employees to grow their
knowledge base and improve their job skills to become more effective in the workplace.
Despite the cost of training for employees, the return on investment is immense if it is
consistent. Training constitutes a basic concept in human resource development. It is
concerned with developing a particular skill to a desired standard by instruction and
practice. Training is a highly useful tool that can bring an employee into a position where
they can do their job correctly, effectively, and conscientiously. Get the Human Resource
Skills to Support Strong Training and Development. Training and development programs
provide a host of benefits. They enhance employee performance, boost employee
productivity, reduce employee turnover, and improve company culture.

 What are the common problems in planning and providing trainings in Ethiopian
organizations?

Lack of awareness among stakeholders, low motivation of the trainees, less quality
of teaching-learning materials, less benefit after graduation, less support provision of the
program from training universities and ministry of education were among the challenges in
offering the training.

 Also, discuss on the essentials of human resource development.

Human Resource Development includes such opportunities as employee training, employee

career development, performance management and development, coaching, mentoring,

12
 succession planning, key employee identification, tuition assistance, and organization
development.

8. Performance and reward management

 Discuss the justifications to conduct employee performance appraisal and the various
methods.
Performance appraisal is defined as a process that systematically measures an employee's
personality and performance, usually by managers or immediate supervisors, against
predefined attributes like skillset, knowledge about the role, technical know-how, attitude,
punctuality, and so on. Improving Overall Organizational Performance. This is the most
important reason for an organization to have a performance appraisal system. A performance
appraisal procedure allows the organization to communicate performance expectations to
every member of the team and assess exactly how well each person is doing.

There are some common and modern appraisal methods that many
organizations gravitate towards, including:
1. Self-evaluation
In a self-evaluation assessment, employees first conduct their performance assessment on
their own against a set list of criteria.
2. Behavioral checklist
A Yes or No checklist is provided against a series of traits. If the supervisor believes the
employee has exhibited a trait, a YES is ticked.
If they feel the employee has not exhibited the trait, a NO is ticked off. If they are unsure, it
can be left blank.
3. 360-degree feedback
This type of review includes not just the direct feedback from the manager and employee, but
also from other team members and sources.
4. Ratings scale
A ratings scale is a common method of appraisal. It uses a set of pre-determined criteria that a
manager uses to evaluate an employee against.
5. Management by objectives
This type of assessment is a newer method that is gaining in popularity. It involves the
employee and manager agreeing to a set of attainable performance goals that the employee
will strive to achieve over a given period of time.

13
  What is employee compensation?
Compensation is the remuneration awarded to an employee in exchange for their services or
individual contributions to your business. The contributions can be their time, knowledge,
skills, abilities and commitment to your company or a project. In simpler words,
compensation is the money received by an employee from an employer as a salary or wages.
 Discuss the different schemes of employee compensation.
Let's look at the different types of compensation that could be offered to employees in this
section. The desired types of compensation differ across the globe. In countries where
medical expenses are relatively high, it is common to find that attractive health benefits
make up a major portion of their compensation.
There are two types of compensation:
1. Direct compensation
Direct compensation refers to the payment made to an employee in the way of money or
finances. There are four main types of compensation that come under direct compensation:
Hourly: - Gig-workers, unskilled labor, semi-skilled labor, temporary workers, part-time
employees, or contract workers often charge their employers by the hour. They get paid for
the time they work, irrespective of their output. This can be seen in the fields of IT,
construction, tourism, and logistics. When hiring labor for hourly pay, employers typically
inform them of how much time their services are required. In the event that the time taken to
execute the given task takes more time, hourly workers can often get paid overtime.
In most countries, strict minimum wage standards have to be adhered to.
Salary: -Full-time employees, skilled employees, and those who are in senior management
positions typically receive salaries. Having a fixed salary generally indicates that the
employee's company has plans to invest in this employee and work with them for the
foreseeable future.
Some jobs that usually get paid in annual salaries are teachers, accountants, doctors,
managers, and so on.
Commission: - The commission is usually a favored way of paying sales teams. The
commission percentage is usually fixed for a certain number of items sold. It may increase if
the sales targets are exceeded.
The commission percentage varies depending on what is being sold and the profit margins
involved. Typical industries where commission-based compensations are commonplace are
real-estate, automobile sales, software sales, and so on.

14
Some employers offer a minimal salary package combined with an attractive commission
package, encouraging workers to work harder to earn more.
Bonuses: - Many organizations reward their employees for their contribution to the success
of the business at the close of a financial year in the way of bonuses. Some companies hand
out bonuses to all employees. Others hand out bonuses to those employees that have
contributed more than others.
Bonuses are usually paid annually but can also be paid quarterly or on a project basis.
Tips: - Tips also constitute direct pay for a worker's services. In some countries, it is
common for waiters to only work for tips paid to them by the customer.
Savings Plans and Annuity: -Another type of compensation that comes under direct
compensation is savings plans and annuities.
Merit-Based Pay: -Merit-based pay is given to employees that have met or exceeded their
targets or have performed exceedingly well in their roles.
Piecework / Project Work: - Gig-workers and freelancers are often paid based on projects or
milestones within a project. Writers, for example, get paid per word.
2. Indirect compensation
The other major type of compensation is indirect compensation. Although employees may
not receive cash directly, they still stand to gain financially from some types of indirect
compensation. In contrast, other types of indirect compensation do not entail specific
financial benefits.
Here are some types of indirect compensation:
Equity package: -Equity, or a small part of the company in the way of shares, has become an
increasingly popular way of compensating employees. Typically seen in law firms in the past,
now even IT firms and large retail organizations have started giving their employees equity.
Giving equity or shares to an employee makes the employee's loyalty increase, as the
success of the company directly ties into the employee receiving more financial benefit from
having shares in the company.
Stock options: - This type of compensation allows employees to purchase a fixed number of
shares at a specified price after a certain tenure. Stock options do not mean that employees
have any ownership of the company.
Benefits: - Benefits that are given to employees usually entail healthcare benefits, health
insurance, mental health benefits, retirement plans, and so on.
Retirement funds and pension plans are also attractive benefits that could be offered to
employees.

15
  Non-financial compensation
Non-financial compensation includes the following:
 Paid Time Off  Company Transport
 L&D Opportunities  Company Equipment
 Maternity Leave  Meals at work
 Childcare Benefits  Flexible Work Schedules
Companies often offer seemingly small benefits, such as access to the gym, free
entertainment tickets, free stay options, or even access to indoor sporting equipment. All
these seem like minuscule efforts and even unnecessary; however, when put together, the
overall package becomes quite attractive to an employee.

 How is performance appraisal linked to employee compensation? Provide examples.

Performance appraisals help to evaluate compensation packages for employees. Packages,
which include bonuses, higher salary rates, extra benefits and allowances, are dependent on
how an employee is performing.

Compensation is the reward provided to the employees in return for their work. It is the
important decisive factor for an organization in order to survive and grow. There are
financial and non-financial compensations.

The financial compensation is known also as the extrinsic needs of Maslow, which are the
pay that an employee receives as direct compensation such as basic salary, incentives and
benefits. Whereas the non-financial compensation known as the intrinsic needs of Maslow,
where the employee receives satisfaction from the job itself or from the physical
environment in which the job is performed (Chen et al., 1999).

Performance leads to reward and this is a sensitive issue with everyone, if for any reason an
employee gets a faulty reward, then the motivation and productivity level will decrease and
thus the employee feels the effort put at work is not being recognized (Hearn, 2012).

The compensation system should be aligned with the mission, vision and strategy in order to
create a compensation plan in an efficient way to achieve the organization goals.

9. Elaborate the essence of employee well-being, employee occupational safety and health
(OSH) in today’s employment relations. What does the Ethiopian Labor law
proclamation no.377/96 say about this?

16
 An employer shall take the necessary measure to safeguard adequately the health and
safety of the workers; he shall in particular:

Comply with the occupational health and safety requirements provided for in this
Proclamation.Take appropriate steps to ensure that workers are properly instructed and
notified concerning the hazards of their respective occupations and the precautions
necessary to avoid accident and injury to health; ensure that directives are given and also
assign safety officer; establish an occupational, safety and health committee of which the
committee's establishment, shall be determined by a directive issued by the Minister.
Provide workers with protective equipment, clothing and other materials and instruct them
of its use; Register employment accident and occupational diseases and notify the labour
inspection of same; Arrange, according to the nature of the work, at his own expenses for
the medical examination of newly employed workers and for those workers engaged in
hazardous work, as may be necessary. Ensure that the workplace and pemrises do not cause
danger to the health and safety of the workers. Take appropriate pre-executions to ensure
that all the processes of work shall not be a source or cause of physical, chemical,
biological, ergonomical and psychological hazards to the health and safety of the workers;
Implement the directives issued by the appropriate authority in accordance with this
Proclamation.

A worker shall:

Co-operate in the formulation of work rules to safeguard the workers’ health and safety and
implement same. Inform forthwith to the employer any defect related to the appliances used
and injury to health and safety of the workers that he discovers in the undertaking. Report
to the employer any situation which he may have reason to believe could present a hazard
and which he cannot avoid on his own any accident or injury to health which arises in the
course of or in connection with work. Make proper use of all safeguards, safety devices and
other appliance furnished for the protection of his health or safety and for the protection of
the health and safety of others. Obey all health and safety instructions issued by the
employer or by the competent authority

What does the proclamation say about equal employment opportunities?

Actually, the employer cannot discriminate between workers on the basis of nationality, sex,
religion, political outlook or any other conditions. The contract of employment should be
terminated, if necessary, according to the provisions of labor proclamation No 377/96 89 (1)

17
of proclamation No 377/96 young workers means a person who has attained the age of 14;
but is not over the age of 18 years. There are some working conditions set for young
workers. They should not be treated just like other workers. Basically, it is prohibited to
employ person's under14 years of age.

10. What is corporate social responsibility (CSR)?

Corporate Social Responsibility (CSR) is the idea that a company should play a positive
role in the community and consider the environmental and social impact of business
decisions. It is closely linked to sustainability − creating economic, social, and
environmental value – and ESG, which stands for Environmental, Social, and Governance.
All three focus on non-financial factors that companies, large and small, should consider
when making business decisions.
CSR can involve a broad scope of approaches and initiatives—everything from sustainable
practices to community involvement. Customers increasingly expect responsible behavior
from companies they do business with.
What is the rational to engage in CSR?
The purpose of corporate social responsibility is to give back to the community, take part in
philanthropic causes, and provide positive social value. Businesses are increasingly turning
to CSR to make a difference and build a positive brand around their company. Corporate
social responsibility is a business model by which companies make a concerted effort to
operate in ways that enhance rather than degrade society and the environment. CSR helps
both improve various aspects of society as well as promote a positive brand image of
companies.
What could the human resource related CSR activities?
One of the HR department's most important responsibilities is to educate other
employees about the company's policies and procedures. By doing so, you can help
employees understand their role in keeping the company sustainable. This is especially
important for implementing your CR strategy. The most obvious role HR has to play is
as the expert on ethical employment practices, which is a core strand of corporate
responsibility. But beyond this, HR is also the single function best placed to pick up on
and develop organizational culture and values to embed corporate responsibility.

18