role of human resource management

● strategic role of human resources

○ Human resource management is the process of managing the relationship
between the employee and employer

Employers ○ Have control over the place of work and processes adopted by
employees
○ Mitigate issues and challenges in the workplace that may
decrease productivity or detract employees
○ Provide incentives to retain or attract employees
○ Use KPIs to measure the effectiveness of employee performance

Employees ○ Under the control of the employer

○ Generate revenue for the business
○ Training required to develop their skills
○ Legal right to be treated ethically and fairly

● interdependence with other key business functions

Operations ○ The need for more or less employees, due to outsourcing or

automation
○ Retraining/education and amendments to organisational structure
due to new technology and operational processes

Marketing ○ Staff with a diversity of skills design, promote, price and

distribute a product
○ Staff must be motivated and competent to meet the needs and
wants of consumers

Finance ○ Businesses must take into account the cost of wages, staff
acquisition and training
○ Redundancy of employees to reduce labour costs through
outsourcing or automation

● outsourcing

𑁋 human resource functions

○ Businesses outsource its human resource functions so that they can
focus on core business activities
○ A contracted HR company assists the business in managing and
growing their workforce in the background
○ HR functions that are outsourced include: recruitment, induction,
leadership training, mediation, outplacement, payroll
 𑁋 using contractors 𑁋 domestic, global

Domestic contractors ○ Outsourcing business functions within the business’

country of operation
○ Alleviates costs and the need to hire additional
employees for administrative tasks
○ New ideas and advice from HR professionals to
improve HR management
○ Greater control through accessibility to communication
platforms with the contractor
○ Attractive for small-medium businesses who do not
have the time or internal resources to undertake audits,
payroll management and compliance reports to the
standard of larger companies

Global contractors ○ Outsourcing business functions offshore

○ Desirable for businesses who are under pressure from
global competitors
○ Enables a business to enter and familiarise themselves
with a new overseas market
○ Process outsourcing - e.g repetitive and easily
documented work
○ Project outsourcing - larger tasks completed long
term

key influences

● stakeholders 𑁋 employers, employees, employer associations, unions,

government organisations, society

Employers ○ Exercise control over employees

○ Oversee human resource management in the workplace
○ Increasing responsibilities due to legal obligations e.g workplace
dispute resolutions
○ Influence the training, development and satisfaction of
employees, thereby influencing business performance

Employees ○ Have greater autonomy and responsibility in the workplace

○ Their rights for pay, working conditions and contract negotiations
are protected by trade unions
○ Businesses must retain highly-skilled staff by offering rewards,
incentives and a flexible work-life balance

Employer ○ Protect the interests of employees and the industry

associations ○ Provide employers advice on matters such as discrimination,
awards and unfair dismissals, contract negotiations
○ Also offer forums and training programs about leadership and
management to employers

Trade unions ○ Made up of employees in an industry

○ Legally advocate on behalf of employees to improve their pay
and working conditions and workplace dispute resolutions
○ Employees pay a small fee to become a member of a union

Government ○ The courts have judicial power to resolve cases regarding

organisations workers’ rights and disputes
○ The Federal Court resolves issues under the Australian Industrial
Law
○ The Fair Work Commission settle workplace disputes, listen to
appeals and contribute to the formulations of agreements and
awards, have the jurisdiction to fine employees and employers

Society ○ Media, protests and strikes expose issues surrounding HR

○ Communities advocate for their right to have optimal safety and
wellbeing at work
○ Rising unemployment due to offshore subcontracting and
automation is not well received by communities and media due
to increasing unemployment
○ Advocate against discrimination and unethical treatment

● legal 𑁋 current legal framework

𑁋 employment contracts

Common law ○ Under common law, both employees and employers have
basic obligations in a working relationship
○ Employers: providing work, duty of income, paying
income and expenses, abiding by industrial legalities
○ Employees: obey lawful and reasonable commands made
by their employer, use care and skill in their work, act in
good faith of their employer

Minimum ○ Ten National Minimum Employment Standards which

employment infer the basic working conditions for all employees in
standards Australia aged 18 and over
○ Provide a safety umbrella for employees who are
vulnerable and have a low socioeconomic status
○ E.g 38 hours max of work a week, entitlement to annual
and parental leave, flexible working arrangements, public
holidays
Minimum wage rates ○ Decided by the Fair Work Commission and reviewed
annually
○ Increased to $21.38 an hour from 1st July 2022
○ Employees’ base rate of pay is determined by:
➢ award/agreement that covers the employee
➢ national minimum wage (covers employees who
are not covered by an award or agreement)

Enterprise ○ An agreement made between an employer/s and a group

agreements of employees within the workplace
○ Must pass Fair Work’s ‘better off overall test’ to ensure
that it meets the minimum t&cs of the modern award

Awards ○ Legally binding contract that outlines the minimum terms

and conditions for employment
○ Usually covers a whole industry, particularly low skilled
industries e.g hospitality, retail

𑁋 work health and safety and workers’ compensation

Work health and safety ○ Under common law, employers have the obligation to
provide a duty of care to employees
○ Must ensure that their workplace is safe and free of
hazards that will cause injury or fatality
○ Workplace may be examined by a WH&S officer

Workers’ compensation ○ By law, employers are required to take out workers’

compensation insurance
○ Workers’ compensation is administrated by the The
State Insurance Regulatory Authority
○ If an employee is injured, workers’ compensation will
cover their wage and costs of medical appointments
whilst they are unfit for work

𑁋 anti-discrimination and equal employment opportunity

Anti-discrimination ○ Several legislations under federal law that protect

employees or applicants from discrimination on the
basis of age, ethnicity, gender, sexuality, disability,
religion, political views, carer responsibilities or
prospect of pregnancy
○ Ensures that all employees are treaty equally and fairly
in the workplace
○ If complied to, businesses can improve employee
satisfaction and performance, harnessing a positive
corporate culture
Equal employment ○ During the acquisition process, employers should not
opportunity choose an applicant based on their characteristics
mentioned above
○ Ensures that the best person is selected for the job
○ E.g an employer can not tell an unsuccessful female
applicant aged in her late 20s that she was not selected
just in case she becomes pregnant

● economic
○ Demand for labour is determined by the demand for goods and services in the
economy
○ High demand and economic upturn → more competitiveness in the job
market, high wages offered to retain staff, leads to inflation
○ Globalisation
➢ Need to train and manage multiethnic work forces
➢ Redundancies
➢ Legislation regarding wages + working conditions alter between
different countries
➢ Ethical issues brought to light
○ Changes in how and what is produced determines how much and what labour
skills are required
➢ Automation
➢ Flexible staffing arrangements

● technological
○ Need for further training and development so that skillsets and knowledge
align with emerging technologies
○ Automation has led to redundancies, loss of industry and increased
competitiveness
○ Work from home arrangements - increase employee satisfaction, flexibility
and productivity
○ Concern for work-life balance → being unable to switch off technology after
working hours

● social 𑁋 changing work patterns, living standards

Changing work patterns ○ Growth in casualisation and part time work

(labour fragmentation)
○ Mobility of jobs → employees change jobs more
often
○ The aged population and employees who have ESL
are immobile in their job changes
○ Rising female participation rate
○ Ageing of the workforce
○ Early retirement as a result of superannuation and
 greater income security

Living standards ○ Casualisation of the workforce is making high living

standards unattainable
➢ No pay when sick or on leave
➢ No annual leave
○ Outsourcing → loss of employment and industry
➢ Loss of income decreases living standards
➢ The individual is unable to afford the highest
quality of necessities to enhance the standard
of living
➢ Less taxation being received by the
government

● ethics and corporate social responsibility

○ Practices that are socially, ethically and morally acceptable

○ Ethical frameworks and treatment must be created and exhorted in the
workplace:
➢ Anti discrimination polices
➢ Fair dismissal
➢ Minimum wage standards
➢ Ethical issues surrounding the use of cheap labour through global
contractors
○ Benefits:
➢ Staff retention
➢ Low absenteeism
➢ Reduction in costs
➢ Reputability in the community
➢ Enhance corporate culture

Processes

Acquisition ○ Planning → determine internal goals e.g improved customer

service and external environment e.g job competitiveness,
economy, laws
○ Recruitment → the process of acquiring the right quality and
quantity of employees to ensure that business goals are met
○ Selection → culminating information about each applicant and
using this to select the applicant with the best equipped
knowledge, skills and experience for the job
○ Placement → locating in a position that best utilises the
individual’s skills to ensure business goals are met

Development ○ Induction:
➢ Gives the employee a positive attitude toward the job
 and business
➢ Builds the employee’s confidence
➢ Fosters positive working relationships
➢ Informs them of major safety policy and procedures

○ Training → development of knowledge, skills, attitudes and

behaviour so that flaws in business performance and culture
can be addressed, no training leads to higher turnover as staff
seek development at other businesses

○ Organisation development → job rotation, job sharing,

broadening job roles and description, self management teams,
mentoring and coaching

○ Performance appraisal → Evaluate employee performance,

identify areas for mentoring, coaching and leadership
development

Maintenance ○ The processes involved in retaining staff and maintaining their

wellbeing at work
○ Ways to maintain staff:
➢ Better communication = better working relationships =
better retention
➢ Implementing the improvements suggested that
employees which are crucial to both competitiveness
and corporate culture
➢ Monetary or non monetary benefits
➢ Responding to requests for a work-life balance
➢ Abide by legislation to provide a safe and fair work
environment e.g WH&S, provision of leave with pay
and worker’s compensation

Separation ○ When a business voluntarily or involuntarily leaves a business

○ Dismissal:
➢ Summary dismissal → for series misconduct e.g theft
➢ Dismissal can also be based off poor employee
performance → employers are required to give a written
warning and opportunities to improve performance
➢ Redundancy due to poor business performance,
automation

○ Unfair dismissal
➢ When an employee submits an appeal to Fair Work
Australia as they believe that their dismissal was harsh,
unfair or unreasonable
➢ Unfair dismissal can be claimed if: the business has 15
or more employees, has been employed for more than 6
months and if the process dismissal processes e.g
paperwork were initiated
Strategies

● leadership style

○ Employees do not appreciate constant supervision of their work which occurs

under an authoritarian management body
○ Rather, employees thrive in an environment where communication is open and
honest and managers operate with integrity

Directive ○ Coercive and immediate compliance from employees

○ Relevant in a crisis
○ Also known as autocratic

Participative ○ Democratic
○ Input from other employees encouraged and accepted

Visionary ○ Emphasis on long term vision

○ Leaders are firm and motivate their employees
through persuasion and feedback

Pacesetting ○ Accomplishment of tasks to a high standard

○ Self directed work
○ Relevant to provide excellent and quick results from
a highly competent team

Affiliative ○ ‘People person’ → prioritises employee wellbeing

over work
○ Emotional bonding
○ Relevant to get input from valuable employees, foster
a positive corporate culture

Coaching ○ Focus on professional growth and development of

employees
○ Relevant to help an employee improve performance
and advance in their career

● job design - general or specific tasks

○ The process of designing a job and how it will interact with other jobs and
employees
○ Ensures employee retention and attainment of business goals
○ Presented in the form of:
➢ Job rotation
➢ Job enlargement → broadening job roles and responsibilities,
horizontal expansion through adding similar level responsibilities
➢ Job enrichment → more challenging tasks
 ➢ Semi-autonomous work group → small group of employees are in
charge of a specific aspect of the transformation process, conduct work
with no supervision
➢ Cross-functional teams → project teams; report to project leaders upon
completion
➢ Flexible working arrangement
○ Job analysis → ongoing process wherein the attributes of a job and the skills
required are analysed thoroughly, allowing the position to evolve to meet
current and future business needs

● recruitment 𑁋 internal or external, general or specific skills

○ Recruiment is the process wherein a business attracts the a viable quantity and
quality of staff to fill job vacancies whilst being cost effective
○ The recruitment of a diverse, inclusive workforce is indispensable to
connecting with consumers with different backgrounds and needs, also
ensuring CSR

Internal ○ Using individuals who are currently employed at the business fill
other positions within the business
○ Business is aware of the applicant’s knowledge, skills, working
relationships and how they ‘fit in’ to culture
○ Applicant already aware of business practices and has
relationships
○ Saves time as there is no need for an orientation
○ Motivates employees through opportunities for career
advancement

External ○ Using individuals who are not employed in the business to fill
vacancies
○ Recruitment process consumes more time and resources
○ New employee will bring new ideas into the business and
provide insight into practices of competitors

General ○ Flexibility, versatility, positive attitude, communication,

teamwork, leadership, ability to work under pressure
○ Foundational to ensuring an employee can aid a business toward
achieving its goals

Specific ○ Specific skills needed in some positions to meet industry needs,

particularly when there are skill shortages
○ Business may choose to either outsource positions or projects
that require specific skills or train its own staff
○ By training and developing staff to attain specific skills,
businesses can improve performance and retain staff by
 providing such opportunities for career advancement

● training and development 𑁋 current and future skills

○ Training → aims to develop skills, knowledge and attitudes that ensure

employee performance can achieve business goals
○ Development → when an employee further enhances its knowledge and skills
to align with emerging industry demand and practice
○ Based off business needs, industry demand, skill shortages, changing work
patterns
○ Ensures staff retention and a reduction in absenteeism, disputes, injuries and
turnover
○ Increases employee productivity and motivation due to opportunities for
career advancement and an increase in confidence

● performance management 𑁋 developmental, administrative

○ Performance management is the systematic process whereby employee

performance is measured, evaluated and controlled to improve individual and
business performance simultaneously
○ Two objectives:
1. Evaluate individual performance
2. Use that information to develop the individual

Developmental ○ The use of data to develop the knowledge and skills of

individual employees through periodioc feedback
○ Aids them in overcoming weaknesses and increasing
effectiveness
○ Ensures that staff are retained for future leadership roles
○ Increases motivation and productivity through providing
opportunities for career development and feedback

Administrative ○ When data, usually from an annual appraisal, is used to plan

HR functions such as training, development, rewards, pay
levels, benefits and vacancies
○ Enables managers to identify areas of weakness/need in the
business so that employee and holistic business performance
can be enhanced
● rewards 𑁋 monetary and non-monetary, individual or group, performance pay

○ A rewards system ensures that staff are motivated and retained, encouraging
them to exceed preset benchmarks and meet goals
○ How individuals give its employees remuneration depends on its profitability,
economic conditions, current conditions/contract of employees and what
rewards competitors are offering
○ Performance pay → in order to further improve and reward performance for
individuals and groups, remuneration may be through:
➢ Profit sharing
➢ Gain sharing
➢ Share plan
➢ Pay increase
➢ Commission
➢ Bonus

Monetary rewards ○ Rewards that have a financial value,

usually reflected in pay

Non-monetary rewards ○ Rewards that have no financial value

○ Intrinsic → feelings of achievement of
satisfaction that the individual experiences
from completing the job
○ Extrinsic → provided externally to the
job, eg social events, flexible working
arrangements

Individual ○ Often related to individual performance

○ However, giving an individual a reward
may led to conflict and rivalry
○ Bonuses, commissions, promotion,
reduced supervision

Group ○ Working in teams has made it more

difficult to monitor individual
performance
○ Employees are dependent on one another
to exceed benchmarks
○ Rewarding a team of employees is more
viable in improving corporate culture and
productivity within teams
● global 𑁋 costs, skills, supply

Costs ○ High labour costs in Australia and shortage of skilled workers

has caused businesses to outsource its operations to be cost
effective and thus increase competitiveness
○ Due to high living standards in Australia, employers are faced
with the on-costs of superannuation and remuneration
○ Outsource operations to countries such as China and India
and/or establish subsidiaries to take advantage of low labour
costs

Skills ○ Temporary visas are used to attract overseas workers to be

employed in jobs which Australians do not want to work in
○ Skill shortage a continual issue for Australia who is aiming to
grow economically
○ Expansion overseas requires consideration of which staffing
approach a business will adopt (PEG):
➢ Polycentric → staff from the host country with parent
country staff working in corporate headquarters,
reduced labour costs
➢ Ethnocentric → only uses parent country staff in its
business
➢ Geocentric → staff with the most feasible knowledge
and skillset for a specific location or role, culminating
a body of managers with global experience, increased
labour costs

Supply ○ Due to global outsourcing and recruitment, there is a shortage

of skills within the Australian workforce
○ Although countries like China and India do not have a
shortage of workers, its workers tend to be low skilled and
thus have insufficient working conditions, arising CSR issues
of modern slavery

● workplace disputes

○ An industrial dispute is when a disagreement arises between an employer and

a group of employees, resulting in employees ceasing to work
○ Apparent through:
➢ Strikes: workers withdraw their labour for a period of time
➢ Lockouts: employers close the entrance to a workplace and refuse to
let employees in → used to push employees to agree to/sign
something, response to strikes
○ Major causes of disputes include:
➢ Remuneration
 ➢ Working conditions
➢ Job security issues
➢ Workplace health and safety
➢ Management issues

BENEFITS COSTS

○ Helps gain management’s attention ○ Publicity will have impinge business

to issues which are causing stress,
improving conditions for employees
and productivity for the business
○ Publicity will spread awareness of
issues such as pay and working
conditions in favour for employees
○ Governments can change policies in
response to workplace conflict
reputation
○ Frustration may arise from the
public toward employees and unions
if strikes, etc disrupt the general
public
○ Costly, particularly if legal action is
taken and employers have to pay
compensation
○ Damage working
relationships/corporate culture

𑁋 resolution 𑁋 negotiation, mediation, grievance procedures, involvement of

courts and tribunals

Negotiation ○ When employees and employers resolve disputes

through discussion, eventually compromising a
formal or informal agreement
○ Reduces costs

Mediation ○ When both parties confidentially discuss the issue in

the presence of an objective, unbiased third party
○ Reduces risk of disputes escalating and turning into a
legal matter

Grievance procedures ○ A pre-established, formal dispute resolution process

within a modern award or agreement
○ Outlines steps that the employer and employee must
take to resolve issues
○ Provides the obligation for managers to quickly
resolve disputes before they become serious

Involvement of courts and ○ A last resort, used when negotiations have failed
tribunals ○ Involves the Fair Work Commission
○ Conciliation → when a third party is involved in
helping two other parties reach an agreement
 ○ Arbitration → when conciliation fails, stated in an
award or if both parties agree, a third party in a court
setting hears both sides and makes a legally binding
decision
○ Common law action → when parties make claims for
damages or breach of contract, heard in state,
territory of the Federal Courts, costly and last resort

Effectiveness
● indicators
○ Indicators are benchmarks used to determine the effectiveness of individual or
business performance
○ Are usually compared against industry standards or businesses of best practice
○ Help develop strategies to rectify these problems

𑁋 corporate culture
○ Values, ideas, beliefs and expectations shared by staff within a
workplace
○ Positive corporate culture ensures that effective working relationships
are established and sustained
○ Also improves staff productivity and motivation as staff are
comfortable and confident to communicate and collaborate with one
another
○ If corporate culture is unwelcoming, staff turnover and the level of
disputes will be increased

𑁋 benchmarking key variables

TYPES OF BENCHMARKING - PIBB

Informal benchmarking ○ Networking, informal discussions,

conferences, business visits

Performance benchmarking ○ When a business compares its performance of

a specific process/activity with competitors

Best practice benchmarking ○ Comparing performance levels with a

business of best practice, particularly in a
specific area

Balanced scorecard ○ When a business determines whether it has

benchmarking reached its objectives that were established in
its strategic plan
 ○ Benchmarks aligned with objectives

MEANS OF MEASURING BENCHMARKS - HQQ

Human ○ Diagnostic tool that enables a business to systematically

resource audit analyse and evaluate performance, allowing for problems to
be identified and solutions developed to improve
performance
➢ Comparing specific or macro business performance
against industry standards or a business of best
practice
➢ An externally sourced consultant researches and
analyses problems within the workplace and helps
the business enact solutions
➢ Management evaluates key performance variables
➢ Legal compliance analysis → ensures that companies
are abiding to legislation and predetermined policy

Quantitative ○ Used to measure the effectiveness of HR management

measures through numerical figures; profit and cost
○ Frequently undertaken by business who are striving to be of
best practice or partaking in quality assurance programs
➢ Variances in labour budgets → indicates
insufficient determination of staffing needsthrough
high staff turnover, absenteeism, wages, overtime
➢ Costs of injury/sickness → non-compilance WH&S
legislation, lack of training, higher insurance
premiums and higher risk of fines
➢ Performance appraisals → compared with targets,
indicates whether managers have undertaken
appraisal rather than effectiveness as this is presented
to the individual
➢ Percentage of goals achieved → often seen through
increasing sales per employee
➢ Levels of labour turnover → high turnover =
problems with corporate culture, training and
development

Qualitative ○ Detailed feedback and research on key issues

measures
 ○ Means of measurement include feedback from management
and employees on organisational relationships, corporate
culture, leadership
○ Analysis of industrial disputes
○ Feedback from performance appraisals from training,
development, rewards, recruitment

𑁋 changes in staff turnover

○ The number and time frame within which staff separate from a
business
○ May be unsatisfied with corporate culture, impeding their mental
health and making them less productive and motivated at work
○ New opportunities may be pursued elsewhere
○ In order for a business to gain insight into new ideas and changes its
organisational structures, some turnover is needed
○ High staff turnover indicates negative corporate culture, poor training
and development

𑁋 absenteeism
○ Employee absences on an average day, not including leave
○ High levels of absenteeism indicate workplace conflict and
unsatisfactory staff
○ Increases costs as employees may still be getting paid whilst they are
not productive at work
○ Business then has to compensate for this loss of productivity e.g
extending hours of other employees, which is not cost or time effective

𑁋 accidents
○ More likely in dangerous and physically demanding workplaces e.g
construction
○ ‘Lost Time Injury Frequency Rate’ (LTIFR) to determine how
accidents impact the loss of days/shifts and therefore productivity
○ Indicate how well the legislative requirements of WH&S are being
complied with
○ Accidents may be reduced through regular safety audits, appropriate
training and development, provision of safety equipment and non
faulty equipment, communicate changes with employees

𑁋 levels of disputation
○ More likely in larger businesses, where working relationships are more
impersonal and misunderstandings more likely
 ○ Employees should be concerned if grievances are high, as it may be
detrimental to business reputation due to media exposure of legal
action

OVERT

EMPLOYEES EMPLOYERS

○ Pickets ○ Lockouts
○ Strikes ○ Stand-downs
○ Work-to-rule (when an employee ○ Dismissals
refuses to perform additional duties)
○ Working at a slower pace to decrease
productivity and therefore increase
customer complaints

COVERT

EMPLOYEES EMPLOYERS

○ Absenteeism ○ Discrimination
○ Theft or sabotage ○ Harassment
○ Lack of cooperation ○ Lack of cooperation
○ Excluding employees from
decision-making input

𑁋 worker satisfaction
○ Usually measured through employee satisfaction surveys → gives
insight into how staff feel about their work, management and corporate
culture
○ Can be improved by matching the business needs to that of the skills
and social likings of the employee to maximise their satisfaction,
motivation and therefore productivity
○ Ways to increase worker satisfaction
➢ More flexible working arrangements
➢ Opportunities for career advancement → training and
development, mentoring, promotion
➢ Rewards and incentives
➢ Consultation with employees in decision making
➢ Positive corporate culture → consideration of needs, good
communication, affiliative leadership style between levels of
management/employees