Human Resource Roles & Functions

Unit - I
 A set of systematic and planned activities
designed by an organization to provide its
members with the necessary skills to meet current
and future job demands.
 Employee needs extend beyond the training
classroom
 Includes coaching, group work, and problem
solving
 Need for basic employee development
 Need for structured career development
 Human resource management (HRM)
encompasses many functions
 Human resource development (HRD) is just one
of the functions within HRM
 Human resource planning
 Equal employment opportunity
 Staffing (recruitment and selection)
 Compensation and benefits
 Employee and labor relations
 Health, safety, and security
 Human resource development
 Organization and job design
 Performance management/ performance appraisal
systems
 Research and information systems
 Training and development (T&D)
 Organizational development
 Career development
 The process of improving an organization’s
effectiveness and member’s well-being through
the application of behavioral science concepts

 Focuses on both macro- and micro-levels

 HRD plays the role of a change agent

 Ongoing process by which individuals progress
through series of changes until they achieve their
personal level of maximum achievement.
 Career planning
 Career management
 Strategic management and HRD
 The supervisor’s role in HRD
 Organizational structure of HRD
 Strategic management aims to ensure
organizational effectiveness for the foreseeable
future – e.g., maximizing profits in the next 3 to 5
years
 HRD aims to get managers and workers ready for
new products, procedures, and materials
 Implements HRD programs and procedures
 On-the-job training (OJT)
 Coaching/mentoring/counseling
 Career and employee development
 A “front-line participant” in HRD
 Depends on company size, industry and maturity
 No single structure used
 Depends in large part on how well the HRD
manager becomes an institutional part of the
company – i.e., a revenue contributor, not just a
revenue user
 Executive/Manager
 HR Strategic Advisor
 HR Systems Designer/Developer
 Organization Change Agent
 Organization Design Consultant
 Learning Program Specialist
 Instructor/Facilitator
 Individual Development and Career Counselor
 Performance Consultant (Coach)
 Researcher
 Employees as organisation’s assets
 Driving business strategy
 Spanning organizational functions
 HRD Deliverables:
 Performance
 Capacity Building
 Problem solving/consulting
 Org. change and development
 Integration of HRD with strategy formulation and
implementation
 Long-term view of HR policy
 Horizontal integration among HR functions
 Vertical integration with corporate strategy
 SHR as core competitive advantage
 Role/Cell Deliverable/ Metaphor Core Activity
Outcome

Mgmt of SHR Executing corp. Strategic Partner Aligning HR and bus.

strategy Strategy
Mgmt of Firm Building an efficient Administrative Expert Reengineering org.
Infrastructure infrastructure Processes

Mgmt of Employee Increasing employee Employee Champion Providing resources

Contributions commitment and to employees
capability
Mgmt of Organizational Change Agent Managing
Transformation/Chan renewal transformation and
ge change,
 Human resources are an important part of the
value chain
 They can be unique, and thus a source of core
competence in an organization
 If a core competence is related to HR, then HR
can contribute to competitive advantage
 People related strategies may be important to new
strategy (for example, a change in the way the
organization does business)
 In today’s technologically complex business
world, analysis of existing human resources is
important in order to determine what options are
available
 The network of people within an organization and
their relationships with people can be an
important part of strategy
 In some industries, people are the most important
factor in success
- advertising and creative development
- leisure and tourism
- management consulting
- hospitals and medical professions
 The adaptability of people to changing environments is
an important skill
 “The ability to learn faster than your competitors may
be the only sustainable advantage” – Arie De Geus,
former head of planning at Royal Dutch Shell
 Changing workforce demographics
 Competing in global economy
 Eliminating the skills gap
 Need for lifelong learning
 Need for organizational learning
 New technologies
 Need for more skilled and educated workers
 Cultural sensitivity required
 Team involvement
 Problem solving
 Better communications skills
 High Performance Organizations

 Design  Traditional
 High Performance Organizations
 Multi-skilled team players
Components Organizations
 People  Narrow expertise  Dispersed
 Decision Systems  Rugged individuals  Open
 Human Resources
 Centralized  Realistic job interviews
 Structure
 Closed  Continuous learning
 Values & Culture
 Standardized selection  Performance-based pay

 Routine training  Enriched jobs

 Job-based pay  Flat, flexible hierarchies

 Narrow, repetitive jobs  Self-contained businesses

 Tall rigid hierarchies  Promote involvement

 Functional departments  Innovation and cooperation

 Promote compliance
 Routine behaviors
 The process by which a job vacancy
is identified and potential employees are notified.
 The nature of the recruitment process
is regulated and subject
to employment law.
 Main forms of recruitment through advertising in
newspapers, magazines, trade papers and internal vacancy
lists.
 Job description – outline of the role
of the job holder
 Person specification – outline
of the skills and qualities required
of the post holder
 Applicants may demonstrate their suitability through
application form, letter or curriculum vitae (CV)
 The process of assessing candidates and
appointing a post holder
 Applicants short listed –
most suitable candidates selected
 Selection process –
varies according to organisation:
 Interview – most common method
 Psychometric testing – assessing the personality of the applicants – will
they fit in?
 Aptitude testing – assessing the skills
of applicants
 In-tray exercise – activity based around what the applicant will be doing,
e.g. writing a letter to a disgruntled customer
 Presentation – looking for different skills
as well as the ideas of the candidate
  Increasingly important
aspect of the HRM role
 Wide range
of areas for attention
 Adds to the cost of the
business

Even in a small business, the legislation

relating to employees is important –
chemicals used in a hairdressing salon for
example have to be carefully stored and
handled to protect employees.
 Crucial aspects
of employment legislation:
 Race
 Gender
 Disability

Disability is no longer an issue for employers

to ignore, they must take reasonable steps
to accommodate and recruit disabled workers.
Copyright: Mela, http://www.sxc.hu
 Firms cannot just ‘sack’ workers
 Wide range of procedures and steps
in dealing with workplace conflict
 Informal meetings
 Formal meetings
 Verbal warnings
 Written warnings
 Grievance procedures
 Working with external agencies
 Developing the employee
can be regarded as investing
in a valuable asset
 A source of motivation
 A source of helping the employee fulfil potential
 Similar to development:
 Provides new skills for the employee
 Keeps the employee up to date
with changes in the field
 Aims to improve efficiency
 Can be external or ‘in-house’
***Good Afternoon Budding Managers***

***Unit 01 HR Roles and Functions***

contd
 Conscience Role
 Counsellor
 Mediator
 Spokesman
 Problem solver
 Change Agent
 - As a Specialist
 - As a Source of help and also a controller
 MANAGING DIRECTOR
(CEO) DISCIPLINARY
COMMITTEE

ADMINISTRATIVE
ASSISTANT HEAD HUMAN RESOURCES
DEPARTMENT
CHANGE
MANAGEMENT

Manpower planning and Salaries Unit Relationship

Employee Relations Loans, Benefits &
Development Management
Unit Systems Unit

-Staff Recruitment
-Trade unions
-Staff Training & -Staff Loans -Statutory
-Team Building
Development -Retirement Benefits Deductions-
-CSR Activities This is a new
-Staff Deployment -Medical Cover NSSF,NHIF
-HIV/AIDS strategy by large
& Transfers -Overtime Claims
-Sexual Harassment Corporate entities
-Staff Performance -Leave Allowances -Tax Returns
-Staff welfare to manage many
Management -Daycare for Staff -Pay slips
-Staff Canteen Staff in many
-Promotions Children production
-Staff Clinic Departments /
-
-Staff Health, Safety Branches
& Security
The organizational structure of HR is
usually very flexible and it reflects the
immediate need of the organisation.
There is no modern organisation where
the HRM organizational Structure
stayed the same for 18 months.
 HR department in line organisational structure.
 HR department in functional organisational
structure.
 HR department in line and staff organisational
structure.
 HR department in divisional organisational
structure.
 HR department in matrix organizational structure.
 C.E.O.

H R Manager

Employment Officer Training Officer Wage & Salary Officer Welfare Officer

clerks clerks clerks clerks

 C.E.O.

H R Manager

Employment Officer Training Officer Wage & Salary Officer Welfare Officer

clerks clerks clerks clerks

 C.E.O.

H R Manager

Employment Officer Training Officer Wage & Salary Officer Welfare Officer

clerks clerks clerks clerks

Line Function
Staff Function
 C.E.O.

H R Manager

H R Officer H R Officer H R Officer H R Officer

(Northern Division) (Southern Division) (Eastern Division) (Western Division)

Employment Officer Training Officer Wage & Salary Officer Welfare Officer

clerks clerks clerks clerks

 C.E.O.

G.M.

Engineering H. R. Finance Marketing

Department Department Department Department

Project A

Project B

Project C
Human Resource
Development
 It refers to the Knowledge, skills, abilities,
talents, aptitude, values and beliefs of an
Organizational Work force.
 HR is complete humanbeing, emp enter with their
own values and sentiments.
 Competencies are developed through HRD
Programmes.
 Background, expectations and values vary from
person to person, hence every one should be
managed differently.
 HRD is a systematic approach
 HRD is a continuous Process approach
 HRD is multidisciplinary
 HRD is embodied with techniques and processes
 HRD develops skills at all fn levels
 Recruiting with possibilities of Dev.
 Selecting to meet future demands
 Analysing, Appraising & developing
performance of employees
 Training to acquire new skills
 Planning for succesion
 Learning through Group dynamics, Job rotation,
Enlargement & empowerment.
 Changes in Economic policies
 Changing Job requirements
 Need for multi skilled HR
 Orgn Visibility and Transformation Process
 Technological Advances
 Organizational Complexity
 Human Relations
 To Prepare the employee to meet the present and
changing future job requirements.
 To prepare for higher level jobs.
 To enhance Orgn. Capabilities.
 To ensure smooth and efficient working of the
Orgn.
 Performance Appraisal
 Employee Training
 Executive Development
 Career Planning & Development
 Succession plng
 Involvement in Quality Circles
 Worker’s Participation in Mgt
 Performance App / Potential Appraisal
 Career Plng / CareerDevelopment
 Employee Training / Executive development
 Organizational Change / Orgn Development
 WPM / Qly Circles
 Employee Councelling / Team work / Role Analysis
 Monetary rewards/Employee Benefits/Grievance
Mechanism
HR Strategies &
Organizational
Strategies
 Unified, comprehensive and integrated plan
designed to ensure that the basic objectives of the
enterprise are achieved”
 StrategicManagement:
 Cross functional process to view the Orgn as a
Single system.
 Matching Strengths with Opportunities.
 Set of decisions and actions to achieve Orgn.
Objectives.
 Vision: An Organizational Vision is to identify
What they want to be? / What they want to
create?
 Mission: It relates to the Company’s existence
with the needs of the Society.
 Objectives: These are ends towards which
activity is aimed. Accomplishment of Mission
requires formulation of number of objectives.
 SWOT Analysis.
 Formulation of Strategies.
 Selecting the best Strategy.
 Strategy Implementation.
 Strategy Evaluation and Control.
 Corporate Level Strategies.
 Stability Strategy.
 Growth Strategies.
 Concentration Strategies.
 Merger and Acquisiton Strategies.
**Horizontal Integration. ( Related Diversification )
**Conglomerate Diversification. ( Diversification into unrelated activity )
**Joint Ventures. ( Two firms carry out a specific project )
 Retrenchment Strategies. ( Liquidation & Divestment )

 SBU Level Strategies.

 Low cost Leadership. ( Enhancing Labour Productivity )
 Differentiation Strategy. ( Produce pdt different from others )
 Focus/ Niche Strategy. ( Concentrate on a specific product )

 Functional Level Strategies.

International HRM (
Global
Environment )
 International Co: “Export the Pdt manufactured
in the home country.”

 Multinational Co: “ Establishes

branches/subsidiaries in various countries and
operate as a domestic company”
 Global Co: Produces Globally and Market
Locally (or) Produces locally and Market
Globally.

 Transnational Co: Produces, Markets, Invests and

Operates across the world.
 Parent Company Nationals.

 Host Company Nationals.

 Third Country Nationals.

 Ethnocentric Approach
 Polycentric Approach
 Geocentric Approach

 ## Concept of Expatriates
 Expatriate Pay
 Gratuity
 Allowances
 Taxation
UNIT II
 HR Planning is the process of examining an organizations’
future human resource need.
 It involves:
 Identifying and acquiring the right number of people with the proper
skills
 Motivating them to achieve high performance
 Creating interactive links between business objectives and resource
planning activities
Human Resource Planning (HR Planning) is both a process and a set of plans.

It is how organizations assess the future supply of and demand for human resources.

An effective HR plan also provides mechanisms to eliminate any gaps that may exist
between supply and demand. Thus, HR planning determines the members and types of
employees to be recruited into the organization or phased out of it.

Dynamic by nature, the HR planning process often requires periodic readjustments as

labor market conditions change.
 Strategic Planning Human Resource Demand Human Resource Supply

Technological
Technologicalforecasts
forecasts Annual
Annualemployment
employment Existing
Existingemployment
employmentinventory
inventory
Economic forecasts
Economic forecasts requirements
requirements After application of expected
After application of expected
Market Compared
Marketforecasts
forecasts Numbers
Numbers loss
lossand
andattrition
attritionrates
rates
Organizational
Organizationalplanning
planning Skills
Skills with
Investment planning
Investment planning Occupational
Occupationalcategories
categories
Annual
Annualoperating
operatingplans
plans

If none
Variances
Variances End
End

IfIfsurplus
surplus IfIfshortage
shortage

Decisions
Decisions Decisions
Decisions
Action
Layoff,
Layoff, Overtime,
Overtime,
Decisions
retirement,
retirement, recruitment,
recruitment,
etc.
etc. etc.
etc.

End
End End
End
All effective HR planning shares certain features. It is generally agreed that HR
planning involves four distinct phases or stages:

Situation
Situation analysis
analysis or
or environmental
environmental scanning
scanning

Forecasting
Forecasting demand
demand for
for human
human resources
resources

Analysis
Analysis of
of the
the supply
supply of
of human
human resources
resources

Development
Development of
of plans
plans for
for action
action
 HRP is a sub-system of total organizational planning.
 HRP facilitates the realization of the company’s objectives
for the future by providing the right type and number of
personnel
 HRP is also called Manpower planning, Personnel planning
or Employment planning
 Create reservoir of talent
 Prepares people for future
 Expand or Contract
 Cut Costs
 Succession Planning
 Managerial Judgment
 Ratio trend analysis
 Work Study Techniques
 Delphi Technique
 Flow Models
 Others
 Social factors – Working conditions, Govt. regulations,
environmental conditions, religious, cultural.
 Technological Factors
 Political Factors – Trade restrictions, War etc.
 Economic Factors
 Demand generation
 Growth
 Employee Turnover
 Job Analysis is not a one time activity as jobs are changing
constantly

 The job and not the person – an important consideration in

job analysis is conducted of the job and not of the person

 It simply highlights what are the minimum activities that are

entailed in a job.
 Skill Range
 Does the job cover a reasonable but not too extensive
range of different tasks?
 Are there opportunities to use knowledge and skills
associated with effective performance of the job?
 Can the individual make full use of their skills and
develop their skill base?
 Job Purpose
 Is the purpose of the job clearly and unequivocally
 Is its contribution to the organisation’s objectives
evident?
 Is its contribution to its dept obvious?
 Is the post holder responsible for the successful
completion of the whole job?
 Do the internal systems help the post holder do the
job?
 Relationships
 Are the formal relationships clearly specified and
related to the achievement of the objectives?
 Is there opportunity to develop working relationships
within and across the department’s boundaries?
 Are colleagues available with whom the post holder
can discuss professional issues
 Job Outcomes:
 Can the post holder see the result of their efforts?

 Can the results of the post holders efforts be

recognised?
 Does the post holder have the opportunity to influence

their own levels of performance?

 Rewards
 Are the rewards appropriate and obtainable?
 Are the rewards linked directly with the performance
of the post holder?
1. Organizational Analysis – Overview of various jobs in the
organization and the linkages between them and the
contribution of various jobs towards achieving organizational
efficiency and effectiveness.
2. Uses of Job Analysis Information
3. Selection of jobs for analysis
4. Collection of Data
5. Preparation of Job description – tasks, duties, responsibilities
6. Preparation of Job Specification – personal attributes
required in terms of education, training, aptitude and
experience to fulfill the job description
 Job Analysis: A Basic Human Resource Management Tool

Human Resource Planning

Tasks Responsibilities Duties
Recruitment
Selection
Training and Development
Job Descriptions Performance Appraisal
Compensation and Benefits
Job
Analysis Safety and Health
Job Specifications
Employee and Labor
Relations
Legal Considerations
Job Analysis for Teams
Knowledge Skills Abilities
 A job description
 Clarifies work functions and reporting relationships,
helping employees understand their jobs.
 Aids in maintaining a consistent salary structure.
 Aids in Performance evaluations.
 Is a set of well written duty statements containing
action words which accurately describe what is being
done.
 Duty statements
 should focus on primary, current, normal, daily duties and
responsibilities of the position (not incidental duties, an employee’s
qualifications or performance, or temporary assignments). Related or
similar duties should be combined and written as one statement.

 Should be a discreet, identifiable aspect of the work assignment,

described in one to three sentences, and should be outcome-based,
allowing for alternate means of performing the duty, changes in
technology, preferences of employees and supervisors, and
accommodations of workers with disabilities, without altering the
nature of, and/or the duty itself.
 Duties are to be listed in order of importance, not necessarily
frequency.
 There is no need to group tasks/duties under sub headings,
however it is acceptable.
 Commence each statement with a verb eg 'processes',
'maintains', 'records' etc, .
 Avoid using the term 'responsible for' rather describe the action
e.g. 'obtains', 'coordinates' etc.
 Frequencies should be identified in multiples of 5%.
Duties that take less than 5% of the officer's time should
not be shown as separate but grouped with other duties.

 Use action verbs which tell what the position does.

Examples include "supervises", "programs", "directs" and
"analyzes". Provide specific examples to illustrate the
duties Avoid ambiguous terms such as "oversees" or
"manages", instead, describe the activities involved in
overseeing or managing. Quantify activities when
possible. Examples may include: How often is the activity
performed? How much money does this position manage?
What is the volume of work handled?
 What is the Position's objective?
 What is the Role of Position (including key relationships)?
 Position summary [Briefly state the purpose or objective of
the position]:
 Essential job functions [State the major responsibilities,
indicate New (N) or Existing (E), and the estimated percent
of time devoted to each - include descriptive statements of
typical or representative tasks associated with the major
responsibilities/functions]:
 State briefly the general function of your position,
including the basic nature of the department and the
relationship of your position with other positions in your
work area
 Person Specification is a statement derived
from the job analysis process and the job
description

 Of the characteristics that an individual

would need to possess in order to fulfill the
requirements of a job
 Staffing – would be haphazard if recruiter did not know
qualifications needed for job
 Training and Development – if specification lists a
particular knowledge, skill, or ability, and the person
filling the position does not possess all the necessary
qualifications, training and/or development is needed
 Compensation and Benefits – value of job must be known
before dollar value can be placed on it
 Safety and Health – helps identify safety and health considerations
 Employee and Labor Relations – lead to more objective human
resource decisions
 Legal Considerations – having done job analysis important for
supporting legality of employment practices
 The people who participate in job analysis
should include, at a minimum:
 The employee
 The employee’s immediate supervisor
 Other key stakeholders in the organization
HR Processes – An Employee Life Cycle
 Manpower planning
 Recruitment and Selection
 Training & Development
 Appraisals – Performance Management
 Transfers / Promotions
 Compensation and Benefits
 Culture Management
 Change Management
 Cross Cultural Issue Management
 HR Audit
 HR Accounting
 Outsourcing of HR
 VRS / Existing Employee Management / Succession
Planning
Business HR Policy HR Recruitment
Planning Planning Selection

Performance Compensation Talent Training

Management Management Management Development

HR Systems Employee Occupational

Data Mgmt Relations Health and Safety
 Definitions

 Recruitment: Overall process of defining

jobs profiles and inviting applicants.

 Selection: Specific process of narrowing

the focus and selecting the perfect fit
 Business Needs
 Financial Feasibility
 Future Plans
 Brand Name
 Why does the position exist?
 Temporary Replacement
 Permanent Replacement
 Creation of new position
 Business Plan
 Related HR Plan
 Competencies
 People
 Compensation and Benefits
 Numbers
 Current : Budgeted and Actual
 Future : Short Term and Long Term
 Three Conditions
 Current = Future
 Maintenance B = A
 Vacancy Filling B > A
 Current > Future
 Redundancy Planning
 Current < Future
 Recruitment Plan
 Recruitment Plan
 Position Description/Specifications
 Person Specifications
 Method of Recruitment
 Internal
 Reference/Promotions/Transfers
 External
 Advertisement
 Where to advertise

 Writing an advertisement

 Consultants
 Retainer

 Multiple

 Internet
 Receiving Applications and Screening/Filing
 Screening /Short-listing
 Coding
 Computer aided screening
 Selection Tools
 Written Tests
 Group Discussions
 Interviews
 Assessment Centres
 Reference Checks
 Offer
 Joining
 Gives direction to job.
 Helps focus on important job areas.
 Assists review and change in job emphasis.
 Provides a basis for appraisal, counselling and
feedback.
 Increases mutual job understanding with superior.
 Delivering time-lines
 Ensuring timely adherence
 Auditing the objectives jointly with line
managers
 Ensuring objectives are in line with
organisational goals
 Requesting modification if required
UNIT III
 Performance appraisal is an evaluation of the
performance of an employee against the job
standards in terms of quantitative, qualitative and
behavioural aspects at the workplace.
 A successful PA process involves explaining the
job, communicating expectations, observing and
documenting behaviour and providing frequent
informal feedback.
 It helps the supervisor and the employee to –
 Understand individual strengths & weaknesses of
performance
 Mutually understand expectations for performance
 Form a basis for personnel action
 Determine training & development needs of
employees
 Review org. goals to associate preferred org. results
in terms of units of performance i.e. quality, quantity,
cost or timeliness.
 Specify desired results for the domain, gives guidance
& focus on results needed by other domains
Learning goals
 Prioritize the range of results needed from the
employee helps the supervisor understand what
training needs to be given.
 Identify measures to evaluate if an how well the
domain’s desired results were achieved.
 Identify standards for evaluating how well the desired
results were achieved.
 Document a performance plan – desired results,
measures and standards.
 Conduct ongoing measurement to track the
performance of the employee.
 To provide an opportunity for the employee for
introspection, Self-evaluation and goal-setting so that he
remains on the path of development.
 To prepare the employees for higher jobs by reinforcing
development of behaviour & qualities for these higher
level positions.
 To generate relevant data on each employee periodically.
 To enable employee to adopt the norms and values of the
organization and develop commitment.
 Done on certain criterions or standards fixed in
advance.
 Employee should be aware of those yardsticks.
 Steps in PA
 Establishing standards
 Communicating stds. to employees
 Measuring actual performance.
 Comparing actual with stds.
 Discussing reports with employees
 Taking corrective action
 Individual Evaluation Methods
 Confidential report
 Essay evaluation
 Critical incidents
 Checklists
 Graphic rating scale
 Behaviorally anchored rating scale
 MBO
 Group Appraisal
 Ranking
 Paired comparison
 Forced distribution
 Performance tests
 Field review technique
Performance Appraisal Methods

1. Confidential report Traditional

2. Essay evaluation methods
3. Critical incidents
4. Checklists
5. Graphic rating scale
6. Straight Ranking
7. Paired comparison
8. Forced distribution
9. Grading system
10. Field review technique
11. Nominations
12. Work samples
Performance Appraisal Methods

Modern methods

1. Assessment centre
2. Human resource accounting – costs &
contribution
3. Behaviorally anchored rating scale
4. MBO
5. 360º performance apparaisal
Ex: A fire, sudden breakdown, accident

Workers reaction scale

A informed the supervisor immediately 5

B Become anxious on loss of output 4
C tried to repair the machine 3
D Complained for poor maintenance 2
E was happy to forced test 1
 weights performance rating
(scale 1 to 5 )
Regularity 0.5
Loyalty 1.5
Willing to help 1.5
Quality of work 1.5
Relationship 2.0
Criteria Rating

1.Regularity on the job Most Least

•Always regular
•Inform in advance for delay
•Never regular
•Remain absent
•Neither regular nor irregular
 • Continuous Rating Scale
• Discontinuous Rating Scale

Employee name_________ Deptt_______

Rater’s name ___________ Date________
------------------------------------------------------------------------
Exc. Good Acceptable Fair Poor
5 4 3 2 1 _
Dependability
Initiative
Overall output
Attendance
Attitude
Cooperation
Total score Continuous Rating Scale
 Indifferent
Enthusiastic

Attitude

No Interested Very
Interest enthusiastic
Step 1. Identify critical incidents

Step 2. Select performance dimension

Step 3. Retranslate the incidents

Step 4. Assign scales to incidents

Step 5. Develop final instrument

 Set organizational goals
 Defining performance target
 Performance review
 feedback
 Group Appraisal
 Ranking
 Paired comparison
 Forced distribution
 Performance tests Field review technique
Employee Rank

A 2

B 1

C 3

D 5

E 4
 A B C D E Final Rank
A - - - + + 3

B + - - + + 2

C + + - + + 1

D - - - - + 4

E - - - - - 5
No of Positive evaluation
Total no. of evaluation * 100 = employee superior evaluation
No.
of
employees

10% 20% 40% 20% 10%

poor Below average good Excellent

average

Force distribution curve

Performance subordinate peers superior customer
Dimension

Leadership ^ ^

Communication ^ ^

Interpersonal skills ^ ^

Decision making ^ ^ ^

Technical skills ^ ^ ^

Motivation ^ ^ ^
 For top managers
 Return on capital employed
 Contribution to community development
 Degree of upward communication from middle-
level executives
 Degree of growth and expansion of enterprise.
 Departmental performance
 Coordination among employees
 Degree of upward communication from supervisors
 Degree of clarity about corporate goals and policies
 Quality and quantity of output in a given period
 Labor cost per unit of output in a given period
 Material cost per unit in a given period
 Rate of absenteeism and turnover of employees
 No of accidents in a given period
UNIT - IV
 All forms of
 financial return,
 tangible services and
 benefits
 that employees receive as part of their
employment relationship
 Financial
 Direct
 wages, salaries, commissions, bonuses
 Indirect
 insurance plans
 life, health, dental, disability
 social assistance benefits
 retirement plans, social security, workers’ comp
 paid absences
 vacations, holidays, sick leave
 Non-Financial
 The Job
 interesting, challenging, responsible
 opportunity for recognition, advancement
 feeling of achievement
 Job Environment
 policies, supervision, co-workers, status symbols,
working conditions, flextime, compressed work
week, job sharing, telecommuting, flexible benefits
programs
 Conditions of
Labor Market Compensation
Policy of
Organization
Area Wage
Rates Worth of
Job
Cost of WAGE
Living
MIX Employee’s
Relative Worth
Collective
Bargaining
Employer’s
Legal Ability to Pay
Requirements
 Factors to consider:
 Other firm’s rates
 Union demands
 Cost-of-living changes
 Firm’s ability to pay
 Employ a job evaluation system
 Ranking
 Job Classification
 Point System
 Factor Comparison
 Results:
 pay grades
 rate ranges
 Inputs:
 Performance appraisal information
 Seniority system
 I. Compensation Objectives
 II. Foundation Concepts
 III. Techniques for Management
 Organization Performance
 Labor Costs
 Attitudes and Behaviors
 Laws and Regulations
 Influence forms & procedures
 For example:
 if objective is pay for performance, emphasize
incentives, merit pay plans
 if objective is stable, experienced workforce,
emphasize seniority-based pay
 Equity
 External Equity
 Comparison: outside organization
 Internal Equity
 Comparison: inside organization, among jobs
 Employee Equity
 Comparison: individuals doing same job for
same organization
 A. Pay Level
 B. Pay Structure
 C. Individual Pay Rates
 Defined: average rates paid by employer
 Applicable concept: External Equity
 3 Pure Alternatives
 lead competition
 match competition
 lag competition
 Mechanism used: Market Wage Survey
 Select key jobs.
 Determine relevant labor market.
 Select organizations.
 Decide on information to collect:
wages/benefits/pay policies.
 Compile data received.
 Determine wages and benefits to pay.
 evel
g eL
a
s W
y A’ v el
n e
mpa g eL
a vel
Co t W L e
a rke a ge
M B ’s W
y
m pan
Co

•Which company is leading the market?

•Which company is lagging the market?
•What would the wage level line look like for a company
that was meeting/matching the market?
 Defined: pay rates for different jobs within a
single organization
 Applicable concept: Internal Equity
 Pay more for jobs with
 greater qualifications
 less desirable working conditions
 more valuable output
 Mechanism used: Job Analysis & Job Evaluation
 defined: the systematic evaluation of job descriptions
 outcome: a hierarchy of organizational jobs
according to their content and value to the
organization
 Methods:
 ranking
 classification
 factor comparison
 point method
 Simplest and oldest system of job
evaluation by which jobs are arrayed
on the basis of their relative worth
System of job evaluation by which jobs
are classified and grouped according
to a series of predetermined wage grades
 Quantitative job evaluation procedure
that determines the relative value of a job
by the total points assigned to it
 Job evaluation system that permits the
evaluation process to be accomplished
on a factor-by-factor basis by developing
a factor comparison scale
Job evaluation technique using three
factors – knowledge, mental activity,
and accountability – to evaluate
executive and managerial positions
 Defined: pay rates for different individuals
doing the same job within an organization
 Applicable concept: Employee Equity
 2 Techniques
 Flat Rate
 Pay Ranges
 Mechanisms used: Performance or Seniority
 Curve in a scattergram representing
the relationship between relative worth
of jobs and wage rates
Groups of jobs within a particular class
that are paid the same rate or rate range
 Laborers & Trades, up to 20%
 Clerical, Technical, Para-professional, 15-49%
 First Level Supervisors, Professionals 30-50%
 Middle and Senior Level Management, 40-100%
 Compra-Ratio
 Formula:

Actual Average Pay for Grade

Midpoint Pay for Grade
 A compra ratio < 1 indicates lag
 A compra-ratio > indicates excess
 An individual whose current pay is beyond
the maximum of the pay grade for his/her
job

An individual whose current pay is

below the minimum of the pay grade
for his/her job
Davis-Beacon Act
of 1931

Walsh-Healy Act of
1936

Fair Labor
Standards Act of
1938
 Employees covered by the overtime
provisions of the Fair Labor Standards Act
 Employees not covered by the overtime
provisions of the Fair Labor Standards Act
The concept that male and female jobs
that are dissimilar, but equal in terms
of value or worth to the employer,
should be paid the same
 Compression of differentials between
job classes, particularly the differential
between hourly workers and their managers
Unit V
 Simply the relationship between employer and employee is called
Industrial Relation.
 But it also covers the relation between employer vs. employer and
employees vs. employees.
 To safeguard the interests of the all the parties, harmonious
relationship is necessary for both employers and employees of the
production.
 In order to maintain good relationship with the employees, the
main functions of every organization should be to avoid any
dispute with them or settle it as early as possible, so as to ensure
industrial peace and harmony with higher productivity. The
Industrial Relation relations is also called as labor - management,
employee-employers relations.

174
175
 Industrial Relation deals with the manpower of the
enterprise and the management which is concerned with –
whether machine operator, skilled worker or manager.
 Industrial Relation is a relation between employer and
employees, employees and employees and employees and
trade unions. and the “process by which people and their
organizations interact at the place of work to establish the
terms and conditions of employment.” - Industrial dispute
Act 1947

176
The healthy industrial relations are key to the progress and
success. Their significance may be discussed as under-

1. Uninterrupted production – The most important benefit of industrial

relations is that this ensures continuity of production. This means,
continuous employment for all from manager to workers. The resources are
fully utilized, resulting in the maximum possible production. There is
uninterrupted flow of income for all. Smooth running of an industry is of
vital importance for several other industries; to other industries if the
products are intermediaries or inputs; to exporters if these are export goods;
to consumers and workers, if these are goods of mass consumption.

177
 2. Reduction in Industrial Disputes – Good industrial
relation reduce the industrial disputes. Disputes are
reflections of the failure of basic human urges or
motivations to secure adequate satisfaction or expression
which are fully cured by good industrial relations. Strikes,
lockouts, go-slow tactics, gherao and grievances are some of
the reflections of industrial unrest which do not spring up in
an atmosphere of industrial peace. It helps promoting co-
operation and increasing production.

178
 3. High morale – Good industrial relations improve the
morale of the employees. Employees work with great zeal
with the feeling in mind that the interest of employer and
employees is one and the same, i.e. to increase production.
Every worker feels that he is a co-owner of the gains of
industry. The employer in his turn must realize that the gains
of industry are not for him along but they should be shared
equally and generously with his workers. In other words,
complete unity of thought and action is the main
achievement of industrial peace. It increases the place of
workers in the society and their ego is satisfied. It naturally
affects production because mighty co-operative efforts alone
can produce great results.

179
 4. Mental Revolution – The main object of industrial
relation is a complete mental revolution of workers and
employees. The industrial peace lies ultimately in a
transformed outlook on the part of both. It is the business
of leadership in the ranks of workers, employees and
Government to work out a new relationship in consonance
with a spirit of true democracy. Both should think
themselves as partners of the industry and the role of
workers in such a partnership should be recognized. On
the other hand, workers must recognize employer’s
authority. It will naturally have impact on production
because they recognize the interest of each other.

180
 5. New Programmes – New programmes for workers
development are introduced in an atmosphere of peace
such as training facilities, labor welfare facilities etc. It
increases the efficiency of workers resulting in higher and
better production at lower costs.

 6. Reduced Wastage – Good industrial relations are

maintained on the basis of cooperation and recognition of
each other. It will help increase production. Wastages of
man, material and machines are reduced to the minimum
and thus national interest is protected.

181
 Thus, from the above discussion, it is evident that good
industrial relation is the basis of higher production with
minimum cost and higher profits. It also results in increased
efficiency of workers. New and new projects may be
introduced for the welfare of the workers and to promote the
morale of the people at work.
 An economy organized for planned production and
distribution, aiming at the realization of social justice and
welfare of the massage can function effectively only in an
atmosphere of industrial peace. If the twin objectives of rapid
national development and increased social justice are to be
achieved, there must be harmonious relationship between
management and labor.

182
 "Trade Union" means any combination, whether temporary
or permanent, formed primarily for the purpose of regulating
the relations between workmen and employers or between
workmen and workmen, or between employers and
employers, or for imposing restrictive conditions on the
conduct of any trade or business
 Trade unions are formed to protect and promote the interests
of their members. Their primary function is to protect the
interests of workers against discrimination and unfair labor
practices.
 Representation
 Negotiation
 Voice in decisions affecting workers
 Member services
(a) Education and training
(b) Legal assistance
(c) Financial discounts
(d) Welfare benefits
 (i) Militant functions
(a) To achieve higher wages and better working
conditions
(b) To raise the status of workers as a part of
industry
(c) To protect labors against victimization and
injustice
 To take up welfare measures for improving the morale of
workers
 To generate self confidence among workers
 To encourage sincerity and discipline among workers
 To provide opportunities for promotion and growth
 To protect women workers against discrimination
 Trade unions help in accelerated pace of economic development in many
ways as follows:
 by helping in the recruitment and selection of workers.
 by inculcating discipline among the workforce
 by enabling settlement of industrial disputes in a rational manner
 by helping social adjustments. Workers have to adjust themselves to the
new working conditions, the new rules and policies. Workers coming from
different backgrounds may become disorganized, unsatisfied and frustrated.
Unions help them in such adjustment.
Indian trade union movement can be divided into
three phases.

* The first phase (1850 to1900)

* The second phase (1900 to 1946)
* The third phase (in 1947).
The Indian workforce consists of 430 million workers,
growing 2% annually. The Indian labor markets consist of
three sectors:
 The rural workers, who constitute about 60 per cent of the
workforce.
 Organized sector, which employs 8 per cent of workforce,
and
 The urban informal sector (which includes the growing
software industry and other services, not included in the
formal sector) which constitutes the rest 32 per cent of the
workforce.
 A strike is a very powerful weapon used by trade unions and
other labor associations to get their demands accepted. It
generally involves quitting of work by a group of workers for
the purpose of bringing the pressure on their employer so that
their demands get accepted. When workers collectively cease
to work in a particular industry, they are said to be on strike.
According to Industrial Disputes Act 1947, a
strike is “a cessation of work by a body of
persons employed in an industry acting in
combination; or a concerted refusal of any
number of persons who are or have been so
employed to continue to work or to accept
employment; or a refusal under a common
understanding of any number of such persons
to continue to work or to accept employment”.
 Strikes can occur because of the following reasons:
 Dissatisfaction with company policy
 Salary and incentive problems
 Increment not up to the mark
 Wrongful discharge or dismissal of workmen
 Withdrawal of any concession or privilege
 Hours of work and rest intervals
 Leaves with wages and holidays
 Bonus, profit sharing, Provident fund and gratuity
 Retrenchment of workmen and closure of establishment
 Dispute connected with minimum wages
 Economic Strike
 Sympathetic Strike
 General Strike
 Sit down Strike
 Slow Down Strike
 Sick-out (or sick-in )
 Wild cat strikes
 A lockout is a work stoppage in which an
employer prevents employees from working. It is
declared by employers to put pressure on their
workers. This is different from a strike, in which
employees refuse to work. Thus, a lockout is
employers’ weapon while a strike is raised on
part of employees.
 Define
 Collective bargaining
 Bargaining in good faith
 Past practice
 Strike
 Union shop
 Closed shop
 Define
 Open shop
 Dues check-off
 Agency shop
 Fair-share agreement
 Maintenance of membership
 Right-to-work
 Explain the primary differences between
private sector labor relations and public sector
labor relations.
 Identify and explain three categories of
subjects for collective bargaining:
 Mandatory, prohibited, and permissive
 Explain dispute resolution mechanisms used for
three types of impasse disputes:
 Representational, interest, and grievance
 Explain the duty of fair representation.
 Explain how Weingarten and Garrity rights
serve to protect employees.
 Process
 Employer and duly appointed representatives of
the employees negotiate an agreement
 Pertaining to wages, hours, and other terms and
conditions of employment
 Active participation in deliberations
 Intention to find a basis for agreement
 Sincere effort to reach common ground
 Does not require either party to make a
concession
 Defined in Labor Relations Act
 Authorizes labor board to impose sanctions
and orders for violations
 Representation
 Interest
 Grievance
 Wages, hours, and other terms and conditions
of employment
 Three subjects
1. Mandatory
2. Permissive
3. Prohibited
 Impact bargaining
 Unilateral changes to workplace
 Past practices
 Pie enlarging NOT Pie splitting
 Gain sharing – improving profitability
 Future sharing – improving competitiveness
 Power sharing – Placing Stockholders and
Stakeholders on a even keel
 Self actualisation – availing opportunity to
contribute meaningfully
A system of communication and consultation,
either formal or informal, by which employees of
an organisation are kept informed about the
affairs of the undertaking and through which they
express their opinion and contribute to the
management decisions
KF Walker Model
Employee Area Union
Planning Directors of
H
Managerial I
Organizing Works Colle- E
R
Motivating Council ctive A
Hierarchy R
Controlling Suggestion Barga- C
Schemes ining H
Y
Participative Supervision
and Job enlargement

Doing Workers
 Informative
 Information Sharing
 Involving
 Consultative
 Idea generating
 Democratic functioning
 Co deterministic
 Joint decision making
 Partnering
Dimension Industrial Relation HRM/HRD
Psychological Compliance Commitment
contract
Norms, customs and
Behaviour practices Values / Mission
referent
Low trust, pluralist, High trust, unitarist,
Collective Individual
Relations
Formal roles, hierarchy, Flexible roles,
Organisation Division of labour, Flat structure/teamwork
and design Managerial controls Autonomy, self-control
Commitment to ORGANISATION
t
High / High
o Common / integrated High / Low
U Goals & Values
N Business Partnership Habitual Resistance
I
O Low / High Low / Low
N Co-operation Indifference
 Organisations view HRM and IRM as
Either – Or options
 HRM focused on Individual

 Industrial Relations focused on Collective

 The new realism :

High emphasis on both HR & IR management