1. Human Resource Management and Labor Relations
Chapter 10
Human Resource Management and Labor Relations
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Learning Objectives
Define human resource management and explain how managers plan for their organization’s human resource needs.
Identify the tasks in staffing a company and discuss ways in which organizations select new employees.
Describe how managers develop the workforce in their organization through training and performance appraisal.
Describe the main components of a compensation system and describe some of the key legal issues involved in hiring, compensating, and managing workers in today’s workplace.
Discuss the legal context of human resource management and identify the contemporary legal issues.
Discuss workforce diversity, the management of knowledge workers, and the use of a contingent workforce as important changes in the contemporary workplace.
Explain why workers organize into labor unions.
Describe the collective bargaining process.
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3. Foundations of Human Resource Management (HRM)
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What is HRM
Human Resource Management (HRM) is a set of organizational activities directed at attracting, developing, and maintaining an effective workforce.
Human has a great impact on a firm’s bottom-line performance.
Many firms are developing strategic HR plans that are integrated with other strategic planning activities.
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HR Planning
The starting point in attracting qualified human resources is planning.
HR planning involves job analysis and forecasting the demand for, and supply of, labor.
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Job analysis
Job analysis is a systematic analysis of jobs within an organization.
A job analysis results in two things:
1. Job Description: is the list of the duties and responsibilities of a job, its working conditions, and the tools, materials, equipment, and information used to perform it.
2. Job Specification: is the list of the skills, abilities, and other credentials and Qualifications required by a job.
Job analysis information is used in many HR activities:
Using appropriate selection methods.
creating performance appraisal systems.
setting compensation rates.
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7. Forecasting HR Demand and Supply
The manager starts forecasting by assessing:
- Trends in past HR usage.
- Future organizational plans.
- And general economic trends.
Forecasting the supply of labor is really two tasks:
Forecasting internal supply: The number and type of employees who will be in the firm at some future date.
Forecasting external supply: The number and type of people who will be available for hiring from the labor market at large.
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8. Important HR Planning Techniques
Replacement Chart is a list of each management position, who occupies it, how long that person will likely stay in the job, and who is qualified as a replacement.
It is a technique commonly used to plan for specific positions at higher organizational level.
Skills Inventories (Employee Information Systems): is a computerized systems that contain information on each employee’s education, skills, work experience, and career aspirations.
How can we forecast the external supply?
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9. Matching HR Supply and Demand
After comparing future demand and internal supply, managers can make plans to manage predicted shortfalls or overstaffing.
If a shortfall is predicted:
New employees can be hired, present employees can be retrained and transferred into understaffed areas, individuals approaching retirement can be convinced to stay on, or labor-saving or productivity-enhancing systems can be installed.
If overstaffing is expected:
Options are transferring the extra employees, not replacing individuals who quit, encouraging early retirement, and laying off workers.
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10. Staffing the Organization
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When managers have determined that new employees are needed, they must then turn their attention to recruiting and hiring the right mix of people.
This involves two processes:
Acquiring staff from outside the company (External staffing)
Promoting staff from within (Internal staffing).
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12. Recruiting Human Resources
Recruiting: is the process of attracting qualified persons to apply for jobs an organization is seeking to fill.
There are two types of recruiting:
Internal Recruiting: is considering present employees as candidates for openings. Methods include:
Promotions
Skill inventory system
External Recruiting: is attracting persons outside the organization to apply for jobs. Methods include:
Posting jobs on the company website or other job sites (e.g. Monster.com).
Campus interviews.
Employment agencies.
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13. Selecting Human Resources
The intent of the selection process is to gather from applicants the information that will predict job success and then to hire the candidates likely to be most successful.
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14. Selections Devices include
Application Forms: is an efficient way of gathering information about the applicant’s work history, education, and other demographic data.
Tests: Tests of ability, skills, aptitude, or knowledge relevant to a particular job are usually the best predictors of job success, although tests of general intelligence or personality are occasionally useful as well.
Interviews:
Structured interview, questions are written in advance, and all inter­viewees follow the same question list with each candidate.
Unstructured interview, questions are asked at random.
Other Techniques: Organizations often require applicants to take physical exams and drug tests. Some organizations also run credit checks on prospective employees.
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15. Developing the Workforce
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Training
Training is a necessary practice if the organization wants to maintain a qualified and effective workforce.
On-the-Job Training: Training, sometimes informal, conducted while an employee is at work.
Off-the-Job Training: Training conducted in a controlled environment away from the work site.
Vestibule Training: off-the-job training conducted in a simulated environment.
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17. Performance appraisals
Performance Appraisal: is the evaluation of an employee’s job performance in order to determine the degree to which the employee is performing effectively.
The appraisal process begins when a manager defines performance standards for an employee. The manager then observes the employee’s performance.
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18. Performance Evaluation Form
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19. Compensation and Benefits
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Compensation System: is the total package of rewards that organizations provide to Individuals in return for their work.
Finding the right combination of compensation elements is always complicated by the need to make employees feel valued, while holding down company costs.
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Wages and Salaries
Wages compensation in the form of money paid for time worked.
Salary compensation in the form of money paid for performing of a job.
In setting wage and salary levels, a company may start by looking at its competitors’ levels. Firms must also decide how their internal wage and salary levels will compare for different jobs.
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Incentive Programs
Incentive Program is a special compensation program designed to motivate high performance.
There are two types of incentive programs:
Individual Incentives.
Companywide Incentives.
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23. 1. Individual Incentives
Examples could be:
Sales bonus
Merit salary systems: link pay raises to performance levels in non- sales jobs.
Stock options: Executives commonly receive Stocks as incentives
Pay for Performance (or variable pay) in which middle managers are rewarded for especially productive output.
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24. 2. Companywide Incentives
Are incentive programs apply to all the employees in a firm.
Profit-sharing plans: Profits earned above a certain level are distributed to employees.
Gain sharing plans: Distribute bonuses to Employees when a company’s costs are reduced through greater work efficiency.
Pay for Knowledge plans: Pay workers to learn new skills and to become proficient at different jobs.
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Benefits Programs
Benefits: are compensation other than wages and salaries and other incentives offered by a firm to its workers.
Benefits examples could be:
Health, life, and disability insurance.
On-site child-care centers.
Reduced membership fees at gyms and health clubs.
Retirement Plans or (pension plans)
Cafeteria Benefits Plan benefit plan that sets limits on benefits per employee, each of whom may choose from a variety of alternative benefits.
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