Fundamentals of Human

Resource Management
Human Resource Management

 The policies, practices, and systems that

influence employees’ behavior, attitudes, and
performance.
Human Capital

 An organization’s employees, described in

terms of their training, experience, judgment,
intelligence, relationships, and insight
 Scope of Human Resource Management
The scope of HRM covers but is not limited to the following functions:
Training and Development Industrial Relations

Hiring (Recruitment
Grievance Handling and Selection)

HR planning

Payroll Management

Rewards and Recognitions Legal

Procedures
Therefore, HRM is about developing and managing harmonious relationships at
workplace and striking a balance between organizational goals and individual goals.
Scope of Human Resource Management
The scope of HRM is extensive and
far-reaching. Therefore, it is very
difficult to define it concisely. HRM in
However, we can classify the scope Personnel
of HRM under the following three Management
categories:
HRM in
Employee
Welfare

HRM in
Industrial
Relations

Let’s look at each in detail.

 Scope of Human Resource Management

HRM in Industrial Relations

HRM in Industrial Relations is a highly sensitive
area. It needs careful interactions with labor or
employee unions, addressing their grievances and
settling the disputes effectively in order to maintain
peace and harmony in the organization.
 Scope of Human Resource Management

It is the art and science of understanding the employment (union-

management) relations, joint consultation, disciplinary procedures, solving
HRM in Industrial
problems with mutual Relations
efforts, understanding human behavior and
HRM in Industrial
maintaining Relationscollective
work relations, is a highly sensitiveand settlement of disputes.
bargaining
area. It needs careful interactions with labor or
employee
The main aimunions,
is to addressing
safeguard the their grievances
interest and by securing the
of employees
settling
highestthe disputes
level effectivelytointhe
of understanding order to maintain
extent that does not leave a negative
peace
impactand harmony in the
on organization. It isorganization.
about establishing, growing and promoting
industrial democracy to safeguard the interests of both employees and
management.
Did You Know?

Another vital part of the HR planning

process is 'Succession Planning'.
Succession Planning refers to the way
in which a company forms policies for
replacing key members of its
organization, shifting transfer of
authority and responsibility carefully
from a leaving member to a new
member. This often entails ensuring
that an arriving employee has the
necessary training and experience to
fulfill their functions.
MCQ

Q. Which of the following is NOT a

scope of HRM?
MCQ

Q. Which of the following is NOT a

scope of HRM?
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Key roles of human resources

 Legal Issues
 Employment Process
 Testing
 Compensation
 Performance Management
 Benefits Administration
 Employee Relations
 Training and Development
 HRIS
HR Competencies

 A collection of knowledge, skills, abilities and

other characteristics (KSAOs) that are
needed for effective performance in the jobs
in question (Campion et al., 2011).
Key competencies
 Skills of HR Professionals
The various skills of HR professionals are as follows:

HR De c Lea
Skil Ma isio Tec der
ls king n h nica ship
Skil l Sk Skil
ls ills ls
Skills of HR Professionals

HR
Skil
ls
HR Skills:

HR managers are required to know how people play a role

in the organization, an advantage against the competition
as well as the policies, programs etc. Today’s HR
professional must be skilled at communicating,
negotiating and team development.
 Skills of HR Professionals

Dec
ision
M Decision Making Skills:
Skil aking
ls
HR managers should take a variety of decisions that affect
whether employees are qualified and motivated and
whether the organization is operating efficiently and
complying with the law. This requires knowledge of the
organization’s line of business and decisions must take
into account social and ethical implication of the
alternatives.
 Skills of HR Professionals

Tec
h ni
cal
Skil
ls
Technical Skills:

These skills are specialized skills. In HRM, professionals

need knowledge of state-of-the-art practices in such areas
as staffing, development, rewards, organizational design
etc.
 Skills of HR Professionals

Lea
d er
ship
Skil Leadership Skills:
ls

HR managers need to play a leadership role with regard to

the organization’s HR. In today’s environment, leadership
often requires helping the organization manage change.
HR professional must oversee the changes taking place to
make it a success.
 Session 2

©SHRM 2008
LEGAL ISSUES IN HUMAN
RESOURCE MANAGEMENT

©SHRM 2008
 PURPOSE

The purpose of this module is to introduce

students to common legal issues faced by HR
professionals.

©SHRM 2008
EMPLOYMENT DISCRIMINATION

 U.S. employees have legal protections

against employment discrimination at
the state and federal levels. These
protections come from laws (statutes)
and from court cases.
 Protections at the state level vary from
state to state. Even some
municipalities have laws (ordinances)
that protect employees from
discrimination.

©SHRM 2008
EEOC

 In the U.S., the Equal Employment

Opportunity Commission (EEOC) is the main
enforcer of employee civil rights.
 Each year, the EEOC receives thousands of
complaints from employees alleging
employment discrimination.

©SHRM 2008
EEOC

Once the EEOC receives a complaint, one of

three outcomes may occur:
 The complaint can be dismissed as
unfounded.
If the complaint passes the initial review, the
EEOC can either:
• Have its own attorneys handle the
case; or
• Issue the complainant a Right-to-Sue
letter.

©SHRM 2008
 PROTECTED CLASSES

Protected class: To receive employment

discrimination protection under federal
legislation, an employee must be a
member of a class of individuals
intended to receive protection.
Generally, protected classes are age,
race, gender, religion, color, national
origin, disability and ethnicity.

©SHRM 2008
 FEDERAL LAWS
 Civil Rights Act of 1886 (Section 1981)
– Prohibits discrimination on the basis of race,
color, national origin, ethnicity.
 Equal Pay Act of 1963
– Requires employers to pay employees equal
pay for equal work regardless of gender.
 Civil Rights Act of 1964 (Title VII)
– Prohibits discrimination based on race, color,
religion, sex (gender), or national origin.
 Age Discrimination in Employment Act of 1967
– Outlaws discrimination in employment
against individuals over 40.
 Rehabilitation Act of 1973
– Prohibits employment discrimination against
individuals with disabilities.

©SHRM 2008
FEDERAL LAWS

 Pregnancy Discrimination Act of 1975

– Prohibits discrimination based on pregnancy
and childbirth.
 Uniformed Services Employment and
Reemployment Rights Act (USERRA) of
1994
– Grants employees who have served in the
military the right to be reinstated to their
employment without losing benefits.
 Americans with Disabilities Act (ADA) of
1990
– Prohibits discrimination against employees
and job candidates with disabilities and
requires employers to make reasonable
accommodations unless they impose an
undue hardship on the employer.

©SHRM 2008
 FEDERAL LAWS

 Civil Rights Act of 1991

– Expanded legal protections to employees;
allows for punitive damages.

 Family and Medical Leave Act (FMLA)

of 1993
– Permits 12 weeks of unpaid leave for
medical or family reasons.

©SHRM 2008
 Theories of Employment
Discrimination

Under Title VII, there are two main theories

of employment discrimination:

 Disparate treatment: Under this theory, it is alleged that the

employer intentionally discriminated against an employee
(or group of employees) because of his/her race, color,
religion, gender, or national origin.

 Disparate impact: Under this theory, it is alleged that the

employer’s human resource practices systematically
exclude members of a protected class.

©SHRM 2008
 Sexual Harassment
Under Title VII, sexual harassment is a form of sex
(gender) discrimination.
There are two types of sexual harassment:
 Quid Pro Quo (Latin for “this for that”): This
type of sexual harassment occurs when a
supervisor or other authority conveys to a
subordinate (through either words or actions)
that he/she must engage in sexual conduct in
order to advance or to not receive poor
treatment.

©SHRM 2008
 Sexual Harassment

• Hostile Work Environment: This type of sexual

harassment occurs when an individual is
subjected to the unwelcome and offensive
behavior of others in the workplace. This may
include offensive language, jokes, gestures,
glaring, or displaying offensive images. This type
of harassment typically comes from co-workers.

©SHRM 2008
 Retaliation

Title VII of the Civil Rights Act makes it

unlawful for an employer to retaliate
against an employee by taking an adverse
employment action against a covered
individual for engaging in any protected
activity.

Protected activities include such actions as filing a

discrimination complaint, threatening to file a discrimination
complaint or picketing to protest discrimination.

©SHRM 2008
 Employment At Will vs. Due Process

Most U.S. employees are employees at will. Under

employment at will, an employee can be discharged
for any non-discriminatory reason at any time.
However, some employees are due process
employees. Due process employees are generally
unionized and/or civil servants. This category of
employee can be disciplined (including discharge)
only for cause.

©SHRM 2008
 Affirmative Action
Affirmative action programs are implemented
as a means to remedy past discrimination.
Some employers have adopted these programs
voluntarily and others have been required to
adopt them by the EEOC or court order. Some
employers might be required to have an
affirmative action program because they are
federal contractors (Executive Order 11246).
However, quota systems are unlawful because
they have been found to violate Title VII.

©SHRM 2008
 Employment
Discrimination Defenses

The following are some defenses an employer can use

to defend Title VII cases:

• Bona fide occupational qualification (BFOQ)

• Seniority
• Merit
• Employee misconduct
• Valid selection test

©SHRM 2008
 U.S. Supreme Court
Cases
• McDonnell Douglas Corp. v Green, 411 U.S. 792
(1973): Established the burden-shifting standard for
disparate treatment cases.

• Meritor Savings Bank v Vinson, 477 U.S. 51

(1986): A hostile work environment due to sexual
harassment is a type of sexual discrimination.

• Sutton v United Airlines, 527 U.S. 471 (1999):

Minor illness/ailments are not disabilities as defined
under the Americans with Disabilities Act.

©SHRM 2008
 Employment Discrimination Review and
Wrap-Up

Many employment discrimination issues we

discussed directly relate to the selection
and staffing functions of the organization.
However, employment discrimination can
be found in other types of HR practices.
What laws prevent discrimination in training and development,
compensation and appraisal?

Take the self-assessment quiz.

©SHRM 2008
 OTHER HR-RELATED LEGAL ISSUES

• Compliance
• Safety
• Military Leave
• Labor Relations
• Employee Privacy
• Negligent Hiring
• Negligent Retention
• Negligent Referral

©SHRM 2008
 Compliance

Recordkeeping
 Employers must keep records on employees for a
variety of reasons, including compensation (e.g.,
payroll records), appraisals (past performance
evaluations), and safety training.
 Employers with more than 100 employees are
required to file an annual report (EEO-1) that provides
a numerical count of their employees by job category
and by ethnicity, race and gender.

©SHRM 2008
 Safety

• In 1970, the U.S. Congress passed the Occupational Safety

and Health Act. The purpose of this law is to help both
employers and employees reduce on-the-job death and injury.
• The law is administered by the Occupational Safety and
Health Administration (OSHA), a division of the U.S.
Department of Labor.
• OSHA provides both guidelines (optional) and standards
(required) for employers.

• Employers can be subject to both scheduled and random

inspections by OSHA.

©SHRM 2008
 Workplace Violence

Employers have a responsibility to make the

workplace as safe as possible. Part of this
responsibility includes taking steps to prevent
workplace violence. The employer who fails to do
so is subject to possible liability.

©SHRM 2008
 Workplace Violence

Some steps employers can take to

reduce workplace violence include:
 Monitoring and security measures (e.g., security guards,
surveillance cameras, identification badges, password-
controlled entry).
 Establishing a zero-tolerance policy on workplace
violence.
 Offering employee training on workplace violence
avoidance and alternative dispute resolution tactics.
 Establishing a zero-tolerance policy about being on the
jobsite or performing work duties while under the
influence of illegal drugs or alcohol.

©SHRM 2008
 Military Leave

 Uniformed Services Employment and

Reemployment Rights Act (USERRA) (38 U.S.C.
4301) provides reemployment rights for veterans and
members of the National Guard and Reserve following
qualifying military service.
– This law also prohibits employer discrimination
based on current or past military service or
based on one’s intent to join the military.

©SHRM 2008
 Military Leave

 Family and Medical Leave Act of 1993: In January

2008, the Family and Medical Leave Act was
amended to include a provision that states “eligible
employee shall be entitled to a total of 12 workweeks
of leave during any 12-month period . . . because of
any qualifying exigency (as the Secretary shall, by
regulation, determine) arising out of the fact that the
spouse, or a son, daughter, or parent of the employee
is on active duty (or has been notified of an impending
call or order to active duty) in the Armed Forces in
support of a contingency operation.”

©SHRM 2008
 Labor Relations
• Labor relations refers to the dealings between
the management of an organization and its
organized labor representative (e.g., unions).
• Unions exist in the public and private sectors.
• The National Labor Relations Board was
created by Congress in 1935 to administer the
National Labor Relations Act, the primary law
governing relations between unions and
employers in the private sector.

©SHRM 2008
 Labor Relations

• The overall rate of unionization in the United

States has been declining for decades.

• Organizations have a duty under federal law to

deal with unions fairly and to bargain in good
faith.

©SHRM 2008
 Labor Relations
The National Labor Relations Act (NLRA) prohibits
unfair labor practices, which are defined as
activities by employers that interfere with the right
to unionize by employees.

Examples of unfair labor practices include telling

employees to vote against unionization or
threatening to close a facility if the workplace
becomes unionized.

©SHRM 2008
 Labor Relations
Employers also have protections against unfair
labor practices. For example, the Taft-Hartley
Act of 1947 prohibits secondary boycotts and
allows states to pass right-to-work statutes.
Under the Taft-Hartley Act, closed shops (in
which employees must be a member of the
union before they are hired) are prohibited.
However, states may allow union shops (in
which the union requires that an employee
become a union member within a certain amount
of time – usually 30 or 60 days – of being hired).

©SHRM 2008
 Employee Privacy

Employees have a limited expectation

of privacy in the workplace.
 Email and telephone calls are normally not considered
to be private. However, some states have wiretapping
laws that offer limited protection for employee
telephone calls.
 Employees should expect privacy in restrooms and
changing facilities. However, in some sectors,
employees can be monitored for loss prevention.

©SHRM 2008
 Employee Privacy

 The Fourth Amendment of the U.S. Constitution has

a provision on unlawful searches and seizures by the
government. This provision has been interpreted by
courts to mean that governmental workers have
special privacy protections.
 Employers with federal grants and contracts must
have a drug free workplace policy pursuant to the
Drug-Free Workplace Act of 1988. However, drug test
results and other medical records must be handled
appropriately and be consistent both with this act and
the Health Insurance Portability and Accountability Act
(HIPAA).

©SHRM 2008
 Negligent Hiring
• Employers have a responsibility to workers,
clients, community and themselves to ensure that
employees do not harm others in the
performance of their work duties.
• Under the legal doctrine of respondeat superior,
an employer might be held civilly liable for the
actions of employees.

©SHRM 2008
 Negligent Hiring

Many employers investigate the

backgrounds of their employees before
hiring them. Such practices include:
 Checking references/contacting former employers.
 Conducting a criminal background check.
 Requesting transcripts.
 When appropriate, requesting proof of licensure (e.g.,
license to practice medicine or law, driver’s license).
 Drug testing.

©SHRM 2008
 Negligent Retention

Related to the issue of negligent hiring is negligent

retention. Negligent retention occurs when an
employer does not discharge an employee after
the employer learns (or should have known) that
the employee was a danger to others.

©SHRM 2008
 Negligent Referral

Negligent referral occurs when an employer knows

that a current or former employee poses a threat
to others, but does not pass this information on to
the next employer.

©SHRM 2008
 Employee References

• Giving employee references can pose a difficult

situation for employers. On one hand, employers
do not want to be sued for negligent referral by
subsequent employers. On the other hand,
employers want to avoid former employees
bringing a lawsuit based on discrimination,
tortious interference with contract (i.e., interfering
with an employee’s ability to obtain another job),
or defamation.

©SHRM 2008
 Review and Wrap-Up

Discussion question: What are some

important legal trends affecting HR?

©SHRM 2008
Session / Week 3

The Employment
Process
 Processes in Human Resource Management
Human Resource Planning (Recruitment, Selection, Hiring, Training,
1
Induction, Orientation, Evaluation, Promotion and Layoff)
Human Resource Planning is generally considered as
the process of people forecasting. This is right but
does not completely define what Human Resource
Planning encompasses. It also involves the processes
of Evaluation, Promotion and Layoff. Human
Resource Planning involves the following functions:
•Recruitment: It aims at attracting applicants that
match a certain Job Criteria.
•Selection: The next level of filtration. This aims at
short listing candidates who are the closest match in
terms qualifications, expertise and potential for a
certain job.
•Hiring: This involves deciding upon the final
candidate who gets the job.
•Training and Development: These processes work on
an onboard employee for up gradation of his skills
and abilities.
 Processes in Human Resource Management
2

Employee Remuneration and Benefits

Administration is the process that involves
deciding upon salaries and wages,
Incentives, Fringe Benefits and Perquisites
etc.

This process is very important because

money is the prime motivator in any job.
Performing employees seek raises, better
salaries and bonuses.
 Processes in Human Resource Management
3

Performance Management helps the

organization to train, motivate and reward
workers. It is also meant to ensure that the
organizational goals are met with efficiency.
The process can be conducted for not only
the employees but can also be conducted
for a department, product, service or
customer process; all towards enhancing or
adding value to them.

Nowadays, there is an automated

Performance Management System (PMS)
that gathers and provides all the information
to help managers evaluate the performance
of the employees and assess them
accordingly on their training and
development needs.
 Processes in Human Resource Management

Employee relations include Labor Law and

Relations, working environment, employee
health and safety, employee- employee
conflict management, employee- employer
conflict management, quality of work life,
workers compensation, employee wellness
and assistance programs, counseling for
occupational stress. All these are critical to
employee retention apart from the money
or remuneration which is only a hygiene
factor. Employee retention is a nuisance in
organizations, especially in industries that
are hugely competitive in nature. Though
there are myriad factors that motivate an
individual to stick to or leave an
organization, but few such as stated above
are certainly under our control.
MCQ

Q. Which of the following is an

aspect of HRM which deals with
working conditions and
amenities at workplace?
MCQ

Q. Which of the following is an

aspect of HRM which deals with
working conditions and
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ABC Guidelines for Successful
Recruitment
 Hiring Strategies followed by Organizations

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 Hiring Strategies followed by Organizations
Hiring can take place in many ways and at many levels such as follows:
Hiring can be for entry level positions or ‘lateral’ hiring where people with
experience are taken on board.

Further, hiring people can be based on competitive exams (entry level) and
the personal approach favored by HR managers for senior level positions.
In recent times, hiring for the entry level has taken on an entirely new
dimension with the campus recruitment procedures that rely on getting
the best talent available from the campuses.
The other way of hiring is through selective approach where the Staffing
department entrusts the placement consultants with the task of identifying
potential employees by picking ‘profiles’ from employee databases and the
consultants own database as well.
The most niche hiring takes place at senior levels where the essence is
discreetness and hence dedicated consultants or HR professionals
approach people at higher levels on a one-one basis.

Hence, different hiring strategies are used for different levels in the organization.
 Components of Hiring Process

INTERVIEW

Whatever is the hiring strategy deployed, the essential components of the

process remain more or less the same. These include choosing from the
available candidates, taking a decision as to the pay and perks, making an
offer and finally, getting them ‘on board’. The hiring process ranges from
less than a month or so to drawn out affairs for niche placement. The
strategic imperatives that underpin hiring depend on the ability of the
organization to effectively leverage its reputation, flexibility in the roles
that are available, availability of skilled resources and finally, the package
that the organization is willing to offer.
 Components of Hiring Process
The term ‘fitment’ is often used as HR jargon which is all
about whether a particular person is suitable for the role
HIRED
that is being filled and how well he or she ‘fits’ the job
profile. One of the reasons for attrition in organizations is
the fact that many employees join an organization with a
set of assumptions about their role only to have their hopes
dashed in reality. Hence, in recent times, industry experts
have focused on this aspect of ensuring that people are
hired only if they are of the right fit. Therefore, hiring
people is a key component of a company’s internal strategy
and hence something that needs detailed attention and
focus.
 Interview Preparation

 Step One: Become Familiar with the Job

 Step Two: Review the Employment Application or Resume
 Step Three: Plan Basic Questions
Session 4 - Testing
Session 5 - Compensation
compensation

 Base pay
 Merit Increase System
 Single Rates
 Variable pay
 Skill-based pay
 Competency-based pay
 Broadbanding
 Gainsharing
 Long-term incentive compensation
Direct Compensation
Indirect Compensation
Session 6: Benefits Administration
Benefits administration

 Benefits administration is the process of

establishing, maintaining, and managing
benefits for the employees of an organization.
Employee benefits typically include medical
insurance, pension plans, individual retirement
accounts (IRAs), vacation time, sick time, and
maternity leave. Numerous vendors offer
software that can assist benefits administrators.
Session 7: Employee Relations
Session 8: Training & Development

HRMS
 HRM Practices – Training and Development

Training is a planned effort to

facilitate the learning of job-
related skills, knowledge and
behavior by employees.

Development is the
acquisition of knowledge,
skills and behaviors that
improve an employee’s ability
to meet changes in job
requirements.
 HRM Practices – Training and Development
The following considerations need to be taken into account when an HR
professional tries to assess the training and development needs of the
employees of an organization:

Spontaneous, unplanned
training or Systematic,
planned training Focus on current job
skills or future job skills

Train few employees

or Train all employees Individual orientation or
Group orientation
 Human Resource Information System
(HRIS)
One of the significant and emerging
areas in Human Resource
Management is the Human Resource
Information System (HRIS). Today,
organizations need accurate and
timely information to take human
resource decisions. The speed, with
which information is retrieved,
procured and analyzed for decision
making accounts for the efficiency of
an organization. HRIS is a
systematic way of sorting data and
information for each individual
employee, to aid in planning,
decision making and submitting
reports to other departments. HRIS is
defined as composite database,
computer applications and hardware
and software that are used to collect,
record, store, manage, deliver and
manipulate data for Human Resource
Case Study

Keith Jones is a Human

Resource Manager. He has
noticed that many team
1. What do you think
members under the
Keith should do to
leadership of David
help David’s team
Schindler are facing
members?
problems regarding his
dominant attitude, rudeness
2. How can Keith help
and authoritarian approach.
David get close with
Some of David’s team
his team and resolve
members have even
the issue?
approached Keith with a
request to change their
teams.