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Hrm Objectives 1Societal objectives supporting functions legal compliance benefits union mgt relation HRP Employee relations selection training & development appraisal placement & assessment appraisal ,placement assessment
T&D appraisal placement compensation assessment
Societal objectives -to be ethically & socially responsible to the
needs & challenges of the society .For eg failure of org to use their resources for the societies benefit in ethical way may lead to restriction. Org objectives its nothing but the HRM dept exist to assist to serve the rest of the depts. in an org which in turn will assist the org in attaining its primary /common objective. Functional objectives The HR depts level of service must be tailored to fit the org it serves. Resources are wasted when HRM is either more or less sophisticated to suite org’s demand. It has to serve the function for which it has been formed. Personal objectives – to assist the employee in achieving their personal goals at least in so far as these goals enhance the individual ‘s contribution to the org.
Composition /structure of HR/Personnel Dept owner/director Mgr personnel Mgr IR Mgr administration Mgr HRD
Canteen medical welfare transport legal
Hiring Grievance handling compensation
Human Resource Planning (supply forecasting) Wastage Analysis- Manpower wastage is an element of labor turn over. Tavis stock institute of
human relations ,UK, suggested, wastage analysis using a curve.
The curve identifies 3 different phases, Induction phase marginal employees leave. Differential transit an employee learns abt the org & identifies his role in it. Settled connection an employees settles down & plans to stay long. According to this analysis wastage decreases with the increase of length of service &it also decreases with the increased skill exercise & age of employees.
Employee Remuneration Theories/Wage Theories
Reinforcement and Expectancy Theory
Reinforcement theory - states that high employee performance followed by a monetary reward will make future employee performance more likely. By the same token , a high performance not followed by a reward will make its recurrence unlikely in future. In short it shows the link between a particular behavior & remuneration.
-Vrooms Expectancy Theory –There are 4 important elements being explained in this theory 1 First level & second level outcome –Performance achieved as a result of efforts is the first level outcome. Second level outcomes are the rewards associated with performance
2Expectency The belief that a particular level of effort will be
followed by a particular level of effort will be followed by a particular level of performance.
3Instrumentality relation btw the performance & rewards 4Valence Individual [preference for a second level outcome
Valance range from negative to positive value.
Adam’s Equity Theory-
states an employee who perceives inequity in his/her rewards seeks to restore equity. The theory emphasises,equity in pay structure of employee remuneration. stakeholders in the org.Employers assume the role of principals & employees play the role of agents .Wages paid to the employees are considered as agency cost. The agency theory states that the principal must choose a contracting scheme that helps align the interest of agents with the principals own interest. These contracts can be classified as either behavior oriented (merit pay) and outcome oriented ( stock option scheme, Profit sharing scheme & commissions)
Agency Theory-Employees & employers are the two main
Promotion Promotion means an improvement in
Pay, prestige, position & responsibilities of an employee with in his/ her org
Purpose of promotion-to motivate -to attract & retain the services of qualified & competent people -increase the effectiveness of employees as well as the org -to fill up higher vacancies frm within org -To build loyalty, morale & a sense of belongingness in the employee -to impress upon others that opportunities are available to them too in the org if they perform well.
Principles of Promotion -to fill up the position that is vacant- external/internal recruitment
generally higher position external recruitment Lower position internal recruitment -whether to go for merit based promotion or seniority based promotion -Promotion based on seniority Merits • Easy to administer • Less scope for subjectivity in fixing seniority • Seniority & experience go hand in hand so it is right & proper to make promotion on this basis • Subordinates are more comfortable in working under a asenior boss rather than a young one with less experience • Loyalty is rewarded Demerits - Seniority is no indication of competence - Young & competent people get frustrated & might leave the org
In spite of judicial pronouncement , there is no single criterion for fixing the seniority of an employee Merit based promotion Merits -efficiency is encouraged , recognized & rewarded -competent people are retained because better prospects are open to them -productivity increases Demerits -discontentment amg senior employees -scope for favoritism -Loyalty & length of service not rewarded -opposition from union leaders To conclude , the promotion policy of merit or seniority promotion of a particular org depends upon the presence of union to an extent & the type of org Promotion against vacancies & non vacancies A good promotion chart Avoid frequent promotion not good for both employer & employee.
A promotion should be preceded by a job analysis & performance
appraisal Consultation with labour union If promotion based on merit adequate info regarding the post vacant should be displayed at several places to enable interested parties to apply for the same.
Types of Promotion Horizontal Promotion- increase in responsibilities, pay & changes in
designation with in same job family largely Ii the form of job enlargement & enrichment in for eg
Vertical Promotion- greater responsibilities, prestige ,pay with a significant
change in in the work content/ change in the nature of job.For eg
Dry Promotion- Under this promotion, the employee is moved to the
next higher level in the org hierarchy with greater responsibility authority & status with out any increase in salary. The promotee may be given one/two annual increments.
Transfer- involves a change in the job (not necessarily)
accompanied by a change in the place with out any change in position, pay responsibilities. Transfers are frequent but not promotions
Reasons for transfer-transfers are mainly done for reducing the imbalance OF
OVERSTAFFING frm surplus dept to other dept with in the org or frm the org to any of its sister concerns were there is a shortage -TO REMOVE INCOMPATIBILITY BTW THE WORKER & THE BOOSS OR BTW ONE Worker & OTHER WORKER -correction of faulty initial placement of any employee -a change has taken place in the interest 7 capacities of an employee necessitating his/her transfer -to overcome monotony -may be due to employees ill health -family related problems
Principles of Transfer -the frequency of transfer & the minimum period between -
transfer should be made kniow to all employees The authority which would handle transfer should be decided upon -the criteria for entertaining transfer need to be laid down & strictly adhered to The area of the org over which transfers can be made should be defined The effect of transfer on the pay & seniority of the transferred employee may be clearly evaluated Transfers should indicate wethre it’s a permenant or temporary one The performance f employee evaluated b4 transfering him & a jo analysis is to be carried out thoroughly -the interest of org should not be forgetten while framming transfers.
Types of Transfer
Production Transfer- arises due to a surplus /shortage either with in the org or with in different plants of the org due to changes in production Replacement transfer junior employee may be replaced by a senior employee to avoid layoff of the latter. A replacement transfer is used when all the operations are declining & is designed to retain long service employee as long as possible. Versatility transfer -are effected to make employee versatility & competent in more than one skill .For eg clerical employees in the bank. Shift Transfer- transfer of employee from one shift to another shift .It will be either by rotation basis /demanded by the employee. Remedial Transfer/Personal transfer -it is initiated by the employer. transfer initiated to correct the wrong placements
is the downward movement of an employee in the org hierarchy with lower status pay. It is a down grading process where the employee suffers considerable emotional & financial loss in the form of lower rank ,power & status, lower pay & poor working conditions.
Causes of Demotion - When an employee is unable to meet the challenges posed by a new
job -due to adverse business condition,org may decide to lay off some & down grade others job. -demotion may be used as a disciplinary tool.
Demotion policies -specification of circumstances under which an employee will be demoted -Specification of authority who is authorized & responsible to initiate a demotion -specification of lines/ladders of demotion -Specification of basis of demotion like length of service ,merit or both -It should provide for an open policy rather than an closed policy -It should contain clear cut norm s for judging merit & length of service -Specification pf provisions regarding placing demoted employees in their original places if the normal conditions are restored -Specification of nature of demotion whether it is permanent /temporary
Employee Turn Over/Labour Turn Over (External mobility)
Employee Turn over- Labor turnover
is the rate of change in the working hands of a particular organization during a given period. The rate of labor turn over is expressed in terms of accession & separation rate. Accession is addition to the workforce while separation is deletion from the work force , for any of the reasons mentioned below .The external mobility is computed as follows: Accession Rate Total Accession per year * 100 Avg # of employees per year Total separation per year * 100 Avg # of employees per year - (Total accession per year +total separation per year )/2 Avg # of employees for the year * 100
Separation rate -
Causes of Employee Turnover
Initiated by employer/org
Lay off- A temporary separation from the org, it may be for a definite period on the
expiry of which the employee will be recalled by the employer.
Reasons for layoff
-scarcity of resources like coal ,raw material, power etc.
-accumulation of stock -breakdown of machinery For any other reasons The employees are entitled for compensation for the period they are laid off. The compensation must be equal to half the normal wages the employee would have earned if the employee had not been laid off. Lay off could be based on merit or seniority
Recalling the employees
Seniority-the person with the longest service who had been laid off should be called back first. Merit- whose skill are very essential for the resumption of production will be called back.
Dismissal- When the termination of employment is initiated
by the employer, it is known as dismissal. The reasons for dismissal are -excessive absenteeism -serious misconduct -False statement of qualification at the time of employment -Theft of companies properties
It refers to termination of the services of employees because of replacement of labor by machines, closure of dept due to continuing lack of demand for the products manufactured in that particular dept of the org. Retrenchment entitles the employees to compensation which in terms of sec 25(f0 of the industrial dispute Act 1947 is equivalent to 15 days avg pay for every completed year of continuous service. Difference btw lay off - lay off employees will be recalled but in retrenchment employer is sent home for good. Difference btw dismissal due to misconduct of employee itself & only 2 or 3 suffers from this aspect but in case of retrenchment a whole lot of employees suffer a job loss due to various reasons
Compulsory retirement- a specific age limit for retirement especially those who are working in govt org Suspension - due to misconduct of the employee the Resignation- An employee resigns
Initiated by employee/worker
employee will be suspended frm his job for a temporary time period. & will be called back after that specific period of debarment
when employee secures a better job elsewhere or due to personal reasons like marriage, ill health or for other reasons. VRS/Golden hand shake plan handsome compensation is paid to these who opt for this option. -painless & time saving method of trimming staff strength. -out unproductive older workers -no objection from union since it is initiated voluntarily by employee To conclude the experience of companies is that org have lost competent people while incompetent employees have not opted for VRS
Better opportunities existing in other similar org people
leave the org due to a better opportunity in the similar company than the existing company is offering to the employee Lack of career growth in the existing org if the carrier growth provided y the existing employer is not good for the employee he may look on for a better opportunity.
Death which is inevitable beyond the control of the employer & employee
Solutions -Redeployment when there is a problem of overstaffing the
company resort to lay off ,vrs etc to reduce the staff instead of going for that the company can go for outplacement that is the redundant employees could offered jobs in other sister concern branches of the company were there is a a shortage of labor. a suitable transfer policy like by transferring employees frm surplus dept or pants to those were they are having shortage of employee
Transfer instead of cutting short the employees the company can go for -Creation of adhoc projects-if there is over staff in the org assign
them with new projects and keep them engaged instead of leading to a separation. qualities present with in an org so the employee should be provided with good quality of work life.
-some employees leave the org due to stressful wok timings & lack of other
-providing opportunities for self development -maintaining sound industrial & human relation -adopting effective technique of recruitment selection induction & placement, (right man at the right place) -providing challenging work -Power to control by way of employee participation/empowerment -mgt should adopt good forecasting system at those areas of external mobility. -providing counseling for employees is a good tactic for reduction in employee turnover by understanding the various problems confronted by the employees & the org can form suitable ways & means to deal with those problems & thus reduce the turn over. -A proper induction programme can reduce the employee turnover.
a work arrangements in which employees enjoy flexibility in working location &hours Potential Benefits -a good opportuninity for mothers fathers with small children, the
disabled & people living in remote areas -minimizes daily commuting -this technique helps in providing increased services & an international reach especially those working in different time zones in different countries. -it provides employee flexibility - Increases employee productivity - Reduces absenteeism - Reduces traffic congestion - Reduces pollution
-distractions at home
-Fellow employees in the office some times resent home telecommuters -there will e lack of loyalty -lose space in their home even converting a room in to a office space -The company face an increased risk of confidential data loss & risk to data integrity resulting frm the increased geographical diversity of their network & the loss of direct corporate control over the telecommuters physical work environment -drop in work productivity -The feeling of alienation can be very difficult for the tele workers -Expensive as far as technologies are concerned & the equipment -telecommuters lack the social community with coworkers -Training & development suitable for telecommuting work atmosphere should be incorporated by the org.
specific local legal issues, union issues, and most important the respective company rules & regulations of the company. -Difficulty in performance appraisal since the telecommuter is not present in the official location of work place the performance evaluation won be that perfect as compared to the traditional work performance
-companies going for telecommuting should take in to consideration
The approaches to labor welfare refer to the beliefs & attitudes held by agencies which provide welfare facilities. Some agencies provide welfare facilities inspired by religious faith, others as a philanthropic duty & the like.
The various approaches to labor welfare
The policing theory of labor welfare -the employers have enough chances
to exploit workers in an unfair manner. In short this approach gives the state/legislation to act as a policeman & compels the mgr of industrial establishments to provide welfare facilities & punishes the non complier The religion theory of labor welfare -consist of 2 aspects Investment aspect fruits of to days deed will be reaped tomorrow whether good/bad is therefore treated as an investment. Second aspect is atonement aspectpresent disabilities of a person are the result of the sins committed by him previously. Employee should undertake to do good deeds now to atone/compensate for the employees sins.
The paternalistic theory of labor welfare- The employer hols
the total industial estates & the profits accruing from them in trustMore or less employer act as a gurdian & the employees are like minors & provide the required aminities to the employees. The placating theory of labor welfare By providng required welfare measure by the employer to the employees peace can be bought among the workers. The Public Relation theory of labor welfare- welfare activities are provided to create a good impression on the minds of the workers & the public particularly. The functional Theory of labor welfare The social theory of labor welfare The social theory implies that a factory is morally bound to improve the conditions of the society in addition to improving the conditions of its employees. The philanthropic Theory of labor welfare-it refers to the provision of welfare provided by employer out of pity who wants to remove the disabilities of the worker.
Induction Employee orientation /induction covers the following Organizational issues
History of employer /company period Organization of the company provided Name & title of key executive Employee’s title & dept Layout of physical facilities probationary product line/service over view of production process company policies & rules disciplinary regulations, employee hand book safety procedure & enforcement.
Pay scale & pay days Vacations & holidays Rest breaks insurance benefits retirement program employer provided services to employees rehabilitation
Training & education benefits programmes counseling To supervisor To trainers
to co worker to employee counselor
Job location Job tasks Job safety requirements Different types of induction programmes over view of job job objectives relationship to other jobs
Formal & informal -formal one the mgt has a stuttered programme which is executed when new employees join the org.Informal one were new hire are directly put on to work & they rare expected to acclimatize themselves with the work & the org. Individual /collectiveSerial/disjunctive-when an experience employee inducts a new hire it is a serial orientation. He act as tutor & model for the new hire. In case of disjunctive it is likely to produce more inventive & creative employees because the new hire is not burdened with tradition. Investiture/Divestiture –Investiture orientation the characteristic feature that a new hire have is not been modified he is been given the freedom to apply his own potential to the job he is been entrusted with. Where as in divestiture seeks to make minor modifications in the characteristic of new hire to seek a better fit btw new member & the org, though he /she has been selected based on his /her potential for performance.
An Induction model New Employee: Mr Niraj Mital MBA HRM Job title: HR Executive Dept: HRD Reporting Date: 1st june 1999 8.00 am report to Ms Roopa ,HRD Chief 8.00am to 9.00 am:Miss Roopa will distribute brochures describing the org’s history ,produts, philosophy,. Review the org’s overall structure, authority structure with in HR Dept, review HRM Policies & practices 9.30am to 10.30 am :Mr rao will discuss company benefits, new employee is require to fill out health ,tax & other relevant forms 10.30 m to 11.30 am:tour to main building & auxilary facilities with Miss Roopa 11.30am to 12.30pm:lunch with HR mgr & Mis Roopa 12.30 pm to 3.00pm:Mr swaraj will provide
*a detailed tour of production ,marketing dept *Detailed discussion with chief executive HRM abt daily job routine & dept policies & rules, explain job expectations, introduce to his co workers 3.00pm to 5 .00 pm :new employee on his own to familiarize himself with his new job.
Steps in scientific selection
development basis for selection Job analysis HRP Recruitment Resume written examination Preliminary interview business game test final interview medical examination reference check line mgr’s decision job offer employment
Assess the fit btw the job & the candidate
Business games -case study
Role play In basket method Sensitivity Simulations
Types of tests include Aptitude test -intelligence test
-EQ -Skill test -Mechanical aptitude -Phychomotor test -Clerical aptitude test
-Work sample test -Situational test -GD Personality test Objective tests Projective test Interest test Multi dimensional testing
Types of Interview
Core interview -background information -Core interview -job& probing -Stress interview -Gd interview -Formal & structured interview -panel interview -Depth interview
Collective Bargaining in India Evolution In India CB came to occupy the centre stage only after 1900 In 1918 Gandhiji as the leader of Ahmedabad textile worker's advocated the resolution of conflict through CB agreements For another 10 years CB did not gain popularity The legal steps take by govt after the second world war revived the interest in subject again. The legislative measure initiated included negotiation, conciliation,& arbitration Basic conflicting issues concerning wages & conditions of employment were solved voluntarily After the independence with the spread of trade unionism CB have become popular In India the CB has taken place at 3 levels-plant level ,industry level & national level.
At plant level& industry level it is evident from Ahmedabad Textile industry, which was carried out at 2 levels -Agreement btw mill owners Association & Textile labour association -btw individual mill owner & Textile labour association At national level they are generally bipartite agreement btw mgt & labour convened by govt of India. The Delhi Agreement 7 th feb 1951,The bonus Agreement for plantation workers 1956 are examples for the same
When compared to other industrialized counties CB has not made much head away in India this is due to the following reasons -Employers reluctance -Weak unions -Inadequate interventions -Politicization of unions -Failure of both parties to devote adequate time -Third party interventions
A JOB CHANGE to a worker CAN TAKE PLACE IN 3 FORMS
A SYSTEMATIC MOVEMENT OF WORKERS FRM ONE JOB TO ANOTHER JOB JOB ENRICHMENT Restructuring of a job to make it more interesting & stimulating this concept developed by Herzberg.Job enrichment seeks to improvement task efficiency & human satisfaction & to provide greater scope for personal achievement & recognition, challenging assignments & opportunities for individual advancement& growth. JOB Enlargement is the horizontal regrouping of tasks & implies mere addition of more functions & increase in the task variety.
Outsourcing HR Activities
Increasingly many large firms are getting their HR activities done by outside suppliers & contractors. Employee hiring, T&D ,maintenance of statutory records are the usual functions contracted out to outsiders
Advantages of outsourcing -company can concentrate more on their core/strategic aspects of the company -to gain increased efficiency & better service in performance of functions -to get specialized expertise which is otherwise not available in house -it reduces the company’s risk exposure to changing technology & /changing customer services -company gets employees who will better match with the company’s job profile with regard to recruitment outsourcing -it can reduce cost, improve flexibility, Disadvantages of outsourcing -if the hr activities are outsourced to a third party then what s the need /relevance of an HR dept in an org -hr depts in an org are no more job givers as work is assigned to a third person.
Two wings of outsourcing includes BPO-if an external company develops software for the company, if
some one else does advertising for the company’s product, & if some other firms administer benefits for the company’s employees it is BPO
CALL CENTRES if some other company makes calls to the companies customers/receives their calls, it is a call centre its a part of BPO