CHAPTER 9

HUMAN RESOURCE
MANAGEMENT
Getting the Right People
for
Managerial Success

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 LEARNING OBJECTIVES (1 of 2)
9.1 Discuss the importance of strategic human
resource management.
9.2 Discuss ways to recruit and hire the right people.
9.3 Outline common forms of compensation.
9.4 Describe the processes used for orientation and
learning and development.

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 LEARNING OBJECTIVES (2 of 2)
9.5 Discuss effective performance management and
feedback techniques.
9.6 List guidelines for handling promotions, transfers,
discipline, and dismissals.
9.7 Discuss legal considerations managers should be
aware of.
9.8 Describe labor-management issues and ways to
work effectively with labor unions.
9.9 Review the steps for becoming a better receiver of
feedback.

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 HUMAN RESOURCE MANAGEMENT
Human resource management (HRM)
• Consists of the activities managers perform to plan for,
attract, develop, and retain an effective workforce.
Human capital
• The economic or productive potential of employee
knowledge, experience, and actions.
Knowledge worker
• Someone whose occupation is principally concerned with
generating or interpreting information, as opposed to
manual labor.
Social capital
• The economic or productive potential of strong, trusting,
and cooperative relationships.
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 The STRATEGIC HRM PROCESS
Figure 9.1
Strategic human resource planning
consists of developing a systematic,
comprehensive strategy for:
• Understanding current employee
needs.
• Predicting future employee needs.

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 UNDERSTANDING CURRENT EMPLOYEE NEEDS
Job analysis
• Determining the basic elements of a job by observation
and analysis.
Job description
• Summarizes what the holder of the job does and how
and why he or she does it.
Job specification
• Describes the minimum qualifications a person must
have to perform a job successfully.

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 QUESTION #1
Joe, a human resources specialist for Jersey Office
Supplies Co., rides along with the furniture delivery
people to observe the problems they were
encountering and what activities they were required to
perform. Joe was performing a
A. personality test.
B. performance appraisal.
C. BARS.
D. job analysis.

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 PREDICTING FUTURE EMPLOYEE NEEDS
Predicting future needs
• Become knowledgeable about the staffing the
organization might need.
• Know the likely sources for staffing.
Human resource inventory
• A report listing your organization’s employees by name,
education, training, languages, and other important
information.

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 RECRUITMENT and SELECTION
Recruitment
• Process of locating and attracting qualified applicants for
jobs open in the organization.
• “5% of your workforce produces 26% of your output.”
• Internal: hiring from the inside.
• External: hiring from the outside.

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 INTERNAL and EXTERNAL RECRUITING:
ADVANTAGES and DISADVANTAGES
Internal and External Recruiting Advantages
INTERNAL RECRUITING ADVANTAGES
1. Employees tend to be inspired to greater
effort and loyalty. Morale is enhanced
because they realize that working hard and
staying put can result in more opportunities.
2. The whole process of advertising,
interviewing, and so on is cheaper.
3. There are fewer risks. Internal candidates
are already known and are familiar with the
organization.
EXTERNAL RECRUITING ADVANTAGES
1. Applicants may have specialized knowledge
and experience.
2. Applicants may have fresh viewpoints.
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Internal and External Recruiting
Disadvantages
INTERNAL RECRUITING DISADVANTAGES
1. Internal recruitment restricts the competition
for positions and limits the pool of fresh
talent and fresh viewpoints.
2. It may encourage employees to assume
that longevity and seniority will automatically
result in promotion.
3. Whenever a job is filled, it creates a
vacancy elsewhere in the organization.
EXTERNAL RECRUITING DISADVANTAGES
1. The recruitment process is more expensive
and takes longer.
2. The risks are higher because the persons
hired are less well known.
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 WHICH EXTERNAL RECRUITING
METHODS WORK BEST?

Most effective sources

• Employee referrals.
• E-recruitment tools (member directories, social media
such as LinkedIn, “dot-jobs” websites).
Realistic job preview
• Gives a candidate a picture of both the positive and
negative features of the job and the organization before
joining a firm.

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 QUESTION #2
Melanie scheduled a special interview with Gina before
Gina was hired, in which Melanie painted a picture of
both the positive and negative features of the job. Mel
was performing a(n)
A. structured interview.
B. unstructured interview.
C. performance appraisal.
D. realistic job preview.

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 SELECTION: HOW to CHOOSE the
BEST PERSON for the JOB
Selection process
• Screening of job
applicants to hire the
best candidate.
• Involves three
components:
1. Background
information.
2. Interviews.
3. Employment tests.
Many jobs, such as those in warehousing
and trucking, require that job applicants
take a drug test.

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 INTERVIEWING: UNSTRUCTURED
Unstructured interview
• No fixed set of questions and no systematic scoring
procedure.
• Involves asking probing questions to find out what the
applicant is like.

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 INTERVIEWING: STRUCTURED
Structured interview
• Asking each applicant the same questions and comparing
their responses to a standardized set of answers.
Type 1: Situational interview
• Focuses on hypothetical situations.
Type 2: Behavioral interview
• Explore what applicants have actually done in the past.

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 EMPLOYMENT TESTS (1 of 2)
Ability tests
• Measure physical abilities, strength and stamina,
mechanical ability, mental abilities, and clerical abilities.
Performance tests
• Also known as skills tests, measure performance on
actual job tasks—so-called job tryouts.
• May take place in an assessment center.

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 EMPLOYMENT TESTS (2 of 2)
Personality tests
• Measure such personality traits as emotional intelligence,
social intelligence, resilience, personal adaptability, and
need for achievement.
• May include career-assessment tests.
Integrity tests
• Assess attitudes and experiences related to a person’s
honesty, dependability, trustworthiness, reliability, and
pro-social behavior.
Other tests
• Drug testing, polygraph, genetic screening.

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 COMPENSATION and BENEFITS
Compensation
• Wages or salaries, incentives, and benefits.
Base pay
• Basic wage or salary paid employees in exchange for doing their job.
Incentives
• Commissions, bonuses, profit-sharing plans, and stock options.
Benefits
• Health insurance, dental insurance, life insurance, disability
protection, retirement plans, holidays off, sick days and vacation
days, recreation options, health club memberships, family leave,
discounts.

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 BENEFITS: NO SMALL COST
Benefits are no small part of an organization’s costs.
• In September 2017, private industry spent an average
of $35.64/hour in compensation, of which wages and
salaries accounted for 68.3% and benefits the
remaining 31.7%.

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 ORIENTATION, LEARNING, and DEVELOPMENT
(1 of 3)
Onboarding
• Programs that help employees to integrate and
transition to new jobs.
• Familiarize new employees with corporate policies,
procedures, cultures, and politics.
• Clarify work-role expectations and responsibilities.

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 ORIENTATION, TRAINING, and DEVELOPMENT
(2 of 3)
Orientation
• Helping the newcomer fit smoothly into the job and the
organization.
• Designed to give employees the information they need to
be successful.
• Following orientation, the employee should emerge with
information about:
• The job routine.
• The organization’s mission and operations.
• The organization’s work rules and employee benefits.

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 FIVE STEPS in the LEARNING and
DEVELOPMENT PROCESS
Figure 9.2

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 TYPES of LEARNING and DEVELOPMENT
On-the-job learning and development
• Coaching, training positions, job rotation, and planned
work activities.
Off-the-job learning and development
• Classroom programs, workbooks, videos, and games and
simulations.
Microlearning
• Segments learning into bite-size content, enabling a
student to master one piece of learning before advancing
to anything else.

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 PERFORMANCE APPRAISAL (1 of 4)
Performance
management
• Set of processes and
managerial behaviors
that involve defining,
monitoring, measuring,
evaluating, and
providing
consequences for
performance
expectations.

Figure 9.3
Source: Adapted from A.J. Kinicki, K.J.L. Jacobson, S.J. Peterson, and G.E. Prussia,
“Development and Validation of the Performance Management Behavior Questionnaire,”
Access the text alternative for these images. Personnel Psychology, 66 (2013), pp. 1-45.

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 PERFORMANCE APPRAISAL (2 of 4)
Performance appraisal
• Also called a
performance review.
• Consists of:
• Assessing an employee’s
performance.
• Providing feedback.

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 PERFORMANCE APPRAISAL (3 of 4)
Objective appraisal
• Based on fact and often numerical.
• Measures desired results.
• Harder to challenge legally: reduced personal bias.

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 PERFORMANCE APPRAISAL (4 of 4)
Subjective appraisal
• Based on a manager’s perceptions of an employees traits
and behaviors.
• Trait appraisals are easy to create and use, but validity is
questionable.
• Behavioral appraisals measure specific, observable
aspects of performance.
• One type is behaviorally anchored rating scale (BARS).
• Rates employee gradations in performance according to scales
of specific behaviors.

Frequently Always early

late and
unprepared
2 3 4 and ready
for work

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 QUESTION #3
Luann is conducting a performance appraisal on Bill.
The form her company uses asks her to list the
objectives that she and Bill agreed to last year, and
indicate how well he met each objective. Luann's
company is using a(n) ________ system of performance
appraisal.
A. objective
B. BARS
C. trait
D. informal

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 Who Should Make Performance Appraisals?
Peers and subordinates?

Customers and clients?

Self-Appraisal?

Managers?

YOUR PERFORMANCE

Example: 360-degree assessment.

• Employees are appraised not only by their managerial superiors but also by peers,
subordinates, and sometimes clients.
• Typically, an employee chooses evaluators (6 to 12 people) who fill out anonymous
forms, the results of which are tabulated by computer.
• Employee goes over results with his or her manager and together they put into place
a long-term plan for performance goals.
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 FORCED RANKING: GRADING on a CURVE
Forced ranking
• All employees within a business unit ranked against one
another and grades are distributed along a bell curve.
• Top performers rewarded with bonuses and promotions.
• The worst performers given warnings or dismissed.
• Rapidly losing favor.

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 EFFECTIVE PERFORMANCE FEEDBACK
One approach is to think of yourself as a coach.
Remember to deliver at least one positive message to
balance any negative feedback you must convey.
• Take a problem-solving approach and avoid criticism.
• Be specific and direct in describing the employee’s
performance and in identifying the improvement desired.
• Get the employees input.
• Follow up.

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 PROMOTIONS, TRANSFERS, DISCIPLINE,
and DISMISSALS
• Promotion: moving upward to a higher-level
position.
• Transfer: moving sideways with similar
responsibilities.
• Discipline and demotion: the threat of moving
downward.
• Dismissal: moving out of the organization through
layoffs, downsizings, and firings.

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 EXIT INTERVIEW and
NONDISPARAGEMENT AGREEMENT
Exit interview
• A formal conversation to find out why an employee is leaving and to
learn about potential problems in the organization.
Nondisparagement agreement
• Contract that prohibits one party from criticizing the other.
• Often used in severance agreements to prohibit former employees
from criticizing their former employers.

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 LEGAL REQUIREMENTS of HRM:
LABOR RELATIONS

Table 9.2
YEAR LAW OR REGULATION PROVISIONS
Gives employees legal right to examine letters of reference
1974 Privacy Act
concerning them
Immigration Reform & Control Requires employers to verify the eligibility for employment of
1986
Act all their new hires (including U.S. citizens)
Prohibits employers from demoting or firing employees who
2003 Sarbanes-Oxley Act
raise accusations of fraud to a federal agency

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 LEGAL: COMPENSATION and BENEFITS
Table 9.2
YEAR LAW OR REGULATION PROVISIONS

Employee Retirement Income Sets rules for managing pension plans; provides
1974
Security Act (ERISA) federal insurance to cover bankrupt plans

Requires employers to provide 12 weeks of unpaid

1993 Family & Medical Leave Act leave for medical and family reasons, including for
childbirth, adoption, or family emergency

Allows employees to switch health insurance plans

Health Insurance Portability & when changing jobs and receive new coverage
1996
Accountability Act (HIPPA) regardless of preexisting health conditions; prohibits
group plans from dropping ill employees

Increased federal minimum wage to $7.25 per hour

2007 Fair Minimum Wage Act
on July 24, 2009

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 LEGAL: HEALTH and SAFETY
Table 9.2
YEAR LAW OR REGULATION PROVISIONS

Occupational Safety & Health Act Establishes minimum health and safety standards in
1970
(OSHA) organizations

Consolidated Omnibus Budget Requires an extension of health insurance benefits

1985
Reconciliation Act (COBRA) after termination

Patient Protection & Affordable Employers with more than 50 employees must
2010
Care Act provide health insurance

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 LEGAL: EQUAL EMPLOYMENT OPPORTUNITY
Table 9.2
YEAR LAW OR REGULATION PROVISIONS
Requires men and women be paid equally for
1963 Equal Pay Act
performing equal work
Prohibits discrimination on basis of race, color,
1964, amended 1972 Civil Rights Act, Title VII religion, national origin, sex, or sexual
orientation
1967, amended 1978 Age Discrimination in Prohibits discrimination in employees over 40
and 1986 Employment Act (ADEA) years old; restricts mandatory retirement
Prohibits discrimination against essentially
qualified employees with physical or mental
Americans with Disabilities Act
1990 disabilities or chronic illness; requires
(ADA)
“reasonable accommodation” be provided so
they can perform duties
Amends and clarifies Title VII, ADA, and other
laws; permits suits against employers for
1991 Civil Rights Act
punitive damages in cases of intentional
discrimination

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 WORKPLACE DISCRIMINATION
Discrimination
• People are hired or promoted—or denied hiring or
promotion—for reasons not relevant to the job.
Adverse impact
• An organization uses an employment practice or
procedure that results in unfavorable outcomes to a
protected class.
Disparate treatment
• Employees from protected groups are intentionally
treated differently.

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 AFFIRMATIVE ACTION
Affirmative action
• Steps include:
• Active recruitment from groups traditionally discriminated
against.
• Elimination of prejudicial questions in interviews.
• Establishment of minority hiring goals.
• Importantly, EEO laws do not allow use of hiring quotas.

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 SEXUAL HARASSMENT
Sexual harassment
• Consists of unwanted sexual attention that creates an
adverse work environment.
• Violates Title VII of the 1964 Civil Rights Act.
• Two types:
• Quid pro quo: jeopardizes being hired or obtaining job benefits
or opportunities unless he or she implicitly or explicitly
acquiesces.
• Hostile environment: doesn’t risk economic harm but
experiences an offensive or intimidating work environment.

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 BULLYING
Bullying
• Abusive physical, psychological, verbal, or nonverbal
behavior that is threatening, humiliating, or intimidating.

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 BEATING BACK the BULLY
Recognize the mistreatment as bullying.

Stay calm and confident.

Don’t strike back.

Avoid being alone with the bully.

Document what is happening.

Know your next steps.

From Table 9.4.
Sources: A. Bruzzese, “Workplace Becomes New Schoolyard for Bullies,” USA Today, August 24, 2011, http:// usatoday30.usatoday.com/money/jobcenter/workplace/bruzzese/2011-08-24-
bully-bosses-overtake-workplace_n. htm (accessed June 6, 2016); K. V. Brown, “Far beyond School Playground, Bullying Common in Workplace,” San Francisco Chronicle, November 6,
2011, pp. A1, A10; Robert Half International, “6 Tips for Dealing with the Office Bully,” The Arizona Republic, November 29, 2015, p. 4E; G. James, “This Is Exactly What to Do if Your Boss
Is a Bully,” Inc., February 22, 2018, https://www.inc.com/geoffrey-james/this-is-exactly-what-to-do-if-your-boss-is-a-bully. html?cid=search; S. Lucas, “Study: Bullied at Work? No Matter
What You Do, You’re Screwed,” Inc., February 23, 2017, https://www.inc.com/suzanne-lucas/study-bullied-at-work-no-matter-what-you-do-youre-screwed. html?cid=search; S. M.
Heathfield, “How to Deal with a Bully at Work,” The Balance, September 30, 2017, https:// www.thebalance.com/how-to-deal-with-a-bully-at-work-1917901.
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 QUESTION #4
Stan is constantly telling off-color jokes and using
profanity in front of his administrative assistant. This
could be considered a(n)
A. difficult atmosphere.
B. hostile work environment.
C. intimidating surroundings.
D. quid pro quo situation.

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 LABOR-MANAGEMENT ISSUES
National Labor Relations Board
• Enforces procedures whereby employees may vote for a union
and collective bargaining.
Collective bargaining
• Negotiations between management and employees about
disputes over compensation, benefits, working conditions, and
job security.
Labor unions
• Organizations of employees formed to protect and advance
their members’ interests by bargaining with management over
job-related issues.

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 WHO’S in a UNION (2017)?
Snapshot of Today’s U.S. Union Movement
• 10.7% of full-time U.S. workers. Down from a high of 35.5% in 1945 but also up about a
quarter million workers since 2016.
• 6.5% of private-sector workers (7.6 million)
• 34.4% of public-sector workers (7.2 million)
• Most members, public sector: local government (40%), including teachers, police
officers, and firefighters
• Most members, private sector: utilities (23%), transportation and warehousing (17%),
telecommunications (16%), construction (14%)
• Union membership rate by gender: men (11%), women (10%)
• Union membership rate by race and ethnicity: Blacks (13%), whites (11%), Asian
Americans (9%), Hispanic Americans (9%)

Table 9.5
Source: Bureau of Labor Statistics, “Union Members 2017,” News Release, January 19, 2018,
https://www.bls.gov/news.release/pdf/union2.pdf.

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 FOUR KINDS of WORKPLACE
LABOR AGREEMENTS
Table 9.6.
WORKPLACE DEFINITION STATUS
Closed shop Employer may hire only Illegal
workers for a job who are
already in the union
Union shop Workers aren’t required to be Not allowed in 22 states (right-
union members when hired for to-work states)
a job but must join the union
within a specified time
Agency shop Workers must pay equivalent Applies to public-sector
of union dues, but aren’t teachers in some states,
required to join the union prohibited in others
Open shop Workers may choose to join or Applies in 22 states (right-to-
not join a union work states)

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 STATES with RIGHT-to-WORK LAWS

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 COMPENSATION
Two-tier wage contracts
• New employees are paid less or receive lesser benefits
than veteran employees.
Cost-of-living adjustment (COLA)
• This is a clause during the period of the contract that ties
future wage increases to increases in the cost of living.
Givebacks
• The union agrees to give up previous wage or benefit
gains in return for something else, such as a no-layoff
policy.

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 SETTLING LABOR-MANAGEMENT DISPUTES
Grievance
• A complaint by an employee that management has
violated the terms of the labor-management agreement.
Mediation
• Process in which a neutral third party, a mediator, listens
to both sides in a dispute, makes suggestions, and
encourages them to agree on a solution.
Arbitration
• Process in which a neutral third party, an arbitrator,
listens to both parties in a dispute and makes a decision
that the parties have agreed will be binding.

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 CAREER
CORNER MODEL of CAREER READINESS
Figure 9.5
©Kinicki and Associates, Inc.

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 CAREER
CORNER
MANAGING YOUR CAREER
READINESS
Becoming a Better Receiver of Feedback
Step 1: Identify your tendencies.
Step 2: Engage in active listening.
Step 3: Resist being defensive.
Step 4: Ask for feedback.
Step 5: Practice being mindful.

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