Attract, Train, and Retain Human Resource Management (HRM) The set of organizational activities directed at attracting, developing, and maintaining an effective work force. Attract, Train, and Retain Strategic Importance of HRM HRM is increasingly important as firms realize the value of their human capital in improving productivity. The process of hiring and training employees is both time consuming and expensive. You want to hire the right individual for each position. HR planning is now part of the strategic planning process. Copyright © Houghton Mifflin Company. All rights reserved.

The Legal Environment of HRM Human Resource Management practices are governed by a country’s laws and regulations. Laws and Regulations: reduce employment discrimination reduce unfair practices limit management discretion in human resource decisions Copyright © Houghton Mifflin Company. All rights reserved.

The Legal Environment of HRM Equal Employment Opportunity Compensation and Benefits Labor Relations Health and Safety Title VII of Civil Rights Act of 1964 Fair Labor Standards Act of 1938 (FLSA) National Labor Relations Act of 1935 (Wagner Act) Occupational Safety and Health Act of 1970 (OSHA) Pregnancy Discrimination Act Equal Pay Act of 1963 Labor Management Relations Act of 1947 (Taft-Hartley Act) Age Discrimination in Employment Act Employee Retirement Income Security Act of 1974 (ERISA) Americans with Disabilities Act Family and Medical Leave Act of 1993 (FMLA) Civil Rights Act of 1991 © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Equal Employment Opportunity Title VII of the Civil Rights Act of 1964 Forbids discrimination in the employment relationship. Civil Rights Act of 1991 Amended the original Civil Rights Act, making it easier to bring discrimination lawsuits while also limiting punitive damages that can be awarded in those lawsuits. Pregnancy Discrimination Act Outlaws discrimination on the basis of pregnancy Age Discrimination in Employment Act of 1967 Outlaws discrimination against persons older than 40. Americans with Disabilities Act of 1990 (ADA) Forbids discrimination on the basis of disabilities and requires employers to provide reasonable accommodations for disabled employees

Affirmative Action Intentionally seeking and hiring qualified or qualifiable employees from racial, sexual, and ethnic groups that are underrepresented in the organization. Several executive orders require federal contractors to develop affirmative action plans and take affirmative action in hiring veterans and the disabled. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Compensation and Benefits Fair Labor Standards Act of 1938 (FLSA) Sets a minimum wage and requires overtime pay for work in excess of 40 hours per week for non-exempt employees. Equal Pay Act of 1963 Requires men and women to be paid the same amount for doing the same jobs; exceptions are permitted for seniority and merit pay. Employee Retirement Income Security Act of 1974 (ERISA) Sets standards for pension plan management and provides federal insurance if pension plans go bankrupt. Family and Medical Leave Act of 1993 (FMLA) Requires employers to provide up to 12 weeks of unpaid leave for family and medical emergencies. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Labor Relations National Labor Relations Act of 1935 (Wagner Act) Set up procedures for employees to vote whether to have a union; if the vote is for a union, management is required to bargain collectively with the union. Labor Management Relations Act of 1947 (Taft-Hartley Act) Amended NLRA to limit the power of unions and increase management’s rights during organizing campaigns. Allows the U.S. president to prevent or end a strike that endangers national security. Wagner Act expanded unions power, then Taft-Hartley restricted unions power.

Health and Safety Occupational Safety and Health Act of 1970 (OSHA) requires that employers: Provide a place of employment that is free from hazards that may cause death or serious physical harm. Obey the safety and health standards established by Occupational Safety and Health Administration (OSHA). © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Major Responsibilities of HRM Plan for Staffing Needs Recruiting (Attract Qualified People) Selection (Hire the Best Employee) Training & Development Performance Appraisal Compensation & Benefits Attract, Train, Retain Copyright © Houghton Mifflin Company. All rights reserved.

Just Cause—The New Argument Employment-at-Will A traditional view of the workplace in which an employer can fire an employee for any or no reason. Just Cause—The New Argument An organization should be able to fire only people who are poor performers or who violate rules. Courts have limited an employer’s ability to terminate employees by requiring just cause for firing or dismissal as part of an organization-wide cutback. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Planning for Staffing Needs Job Analysis A systematic analysis of jobs within an organization. Job Description A listing of the job’s duties; its working conditions; and the tools, materials, and equipment used to perform the job. Data Conversion Operators use a computer terminal to prepare mail for automated sorting equipment. They read type or handwritten addresses from a letter image on the terminal screen, and then select and type essential information so an address bar code can be applied to the letter. Job Specification A listing of the skills, abilities, and other credentials the incumbent jobholder will need to do a job. Typing or data entry experience is required. Applicants must demonstrate the ability to type the required number of words and/or numbers per minute in a performance test. Once understand the organization’s jobs, then plan for future HR needs. Copyright © Houghton Mifflin Company. All rights reserved.

Recruiting Recruiting Internal Recruiting External Recruiting The process of attracting qualified persons to apply for jobs that are open. Internal Recruiting Considering present employees as candidates for openings. Advantage: build morale and retain high-quality employees. Disadvantage: internal recruiting can create a “ripple effect” of having to successively fill vacated positions. External Recruiting Attracting persons from outside the organization Realistic Job Preview (RJP) is considered a successful method to ensure person-job fit. Copyright © Houghton Mifflin Company. All rights reserved.

Selecting Selection Devices: Application Blanks - Used to gather information about work history, educational background, and other job-related demographic data. Must not ask for information unrelated to the job. Tests - Ability, skill, aptitude, or knowledge tests are usually the best predictors of job success. Must be validated, administered, and scored consistently. Interviews - Interviews can be poor predictors of job success due to interviewer biases. Interview validity can be improved by training interviewers and using structured interviews. Assessment Centers – Popular method for selecting managers and current employees for promotion. Two to three days of managerial exercises. Other Techniques - Physical exams, drug tests, and credit checks to screen prospective employees. Copyright © Houghton Mifflin Company. All rights reserved.

Selecting Validation: Determining the extent to which a selection device is really predictive of future job performance. Copyright © Houghton Mifflin Company. All rights reserved.

Training and Development Assessing Training Needs Determining what needs exist is the first step in developing a training plan. Lectures Role play and case studies On-the-job and vestibule training Common Training Methods Web-based and electronic training © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Performance Appraisal A formal assessment of how well employees do their jobs. Should be done regularly to: Validates the selection process and the effects of training. Aids in making decisions about pay raises, promotions, and training. Provides feedback to employees to improve their performance and plan future careers. Errors of leniency and strictness Halo error Recency error Rater Errors in Performance Appraisal Copyright © Houghton Mifflin Company. All rights reserved.

Performance Appraisal (cont’d) Objective measures of performance Actual output (units produced), scrap rate, dollar volume of sales, and number of claims processed. Can become contaminated by outside factors resulting in “opportunity bias” where some have a better chance to perform than others. Special performance tests are a method in which each employee is assessed under standardized conditions. Performance tests measure ability and not motivation. Judgmental methods Ranking—compares employees directly with each other. Rating—compares each employee with a fixed standard. Graphic rating scales Behaviorally-anchored rating scale (BARS) Copyright © Houghton Mifflin Company. All rights reserved.

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Performance Feedback 360 degree” Feedback Is best given in a private meeting between the employee and immediate supervisor. Discussion should focus on the facts: The assessed level of performance How and why the assessment was made. How the employee’s performance can be improved. 360 degree” Feedback Managers are evaluated by everyone around them: Boss Subordinates Peers Provides a richer array of performance information on which to base an appraisal.

Compensation Determining Compensation The financial remuneration given by the organization to its employees in exchange for their work. Wages Salary Incentives What determines the level of compensation? Copyright © Houghton Mifflin Company. All rights reserved.

Determining Compensation Wage-level decision The wage-level decision is a management policy decision to pay above, at, or below the going rate for labor in an industry or geographic area. Factors that affect the wage-level decision: the size and current success of the firm. the level of unemployment in the labor force. Area wage surveys Can provide information about the maximum, minimum, and average wages for a particular job in a labor market. Factors such as seniority, initial qualifications, individual merit, and labor market conditions influence wage decisions Copyright © Houghton Mifflin Company. All rights reserved.

Benefits Determining Benefits Benefits (Indirect compensation) Things of value other than compensation that an organization provides to its workers. The average company spends an amount equal to more than one-third of its cash payroll on employee benefits. A good benefit plan encourages employees to stay with the company and attracts new employees. Benefits do not necessarily stimulate high performance. Shop carefully for best-cost providers Managing Benefits Effectively Avoid redundant coverage Provide only benefits that employees want

Maintaining Human Resources (cont’d) Managing Benefits Effectively Shop carefully for best-cost providers Avoid redundant coverage Provide only benefits that employees want © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Managing Labor Relations The process of dealing with employees when they are represented by a union. Organizations prefer employees remain nonunion because unions limit management’s freedom. Why Unions Have Declined Increased standards of living made union membership less important. Unionized manufacturing industries have declined. Globalization of business has caused many unionized jobs to be lost overseas.

Managing Labor Relations Provide a complaint and appeal system Avoid favoritism Provide fair treatment with clear standards Avoiding Unionization © 2010 South-Western, Cengage Learning, Inc. All rights reserved.

Managing Labor Relations Collective Bargaining The process of agreeing on a satisfactory labor contract between management and labor. The contract contains agreements about wage, hours, and working conditions and how management will treat employees. Grievance Procedure The step-wise means by which a labor contract is enforced. Grievances are filed on behalf of an employee by the union when it believes employees have not been treated fairly under the contract. Copyright © Houghton Mifflin Company. All rights reserved.

Contingent and Temporary Workers Trends in Contingent and Temporary Workers Consistent increases in contingent workers—10% of the U.S. workforce is either contingent or temporary. Challenges in Managing Contingent Workers Integrating contingent workers into the organization in a coordinated fashion. Understanding their advantages and disadvantages. Calculating labor-cost savings of contingent workers. Deciding how similarly contingent employees will be treated relative to permanent employees. © 2010 South-Western, Cengage Learning, Inc. All rights reserved.