Chapter Fourteen - csun.eduswalkerl/M360/2009.2/PPTPost/M360_CH14.pdf · –Realistic Job Preview...

1/16/2009

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Slide content created by Charlie Cook, The University of West Alabama

Copyright © Houghton Mifflin Company. All rights reserved.

Chapter

Fourteen

Managing Human

Resources in

Organizations

Copyright © Houghton Mifflin Company. All rights reserved. 14–2

Learning Objectives

After studying this chapter, you should be able to:

1. Describe the environmental context of human resource management, including its strategic importance and its relationship with legal and social factors.

2. Discuss how organizations attract human resources, including human resource planning, recruiting, and selecting.

3. Describe how organizations develop human resources, including training and development, performance appraisal, and performance feedback.

4. Discuss how organizations maintain human resources, including the determination of compensation and benefits and career planning.


Learning Objectives

After studying this chapter, you should be able to:

5. Discuss labor relations, including how employees

form unions and the mechanics of collective

bargaining.

6. Describe the issues associated with managing

knowledge and contingent and temporary workers.

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The Environmental Context of

Human Resource Management• Human Resource Management (HRM)

– The set of organizational activities directed at attracting, developing, and maintaining an effective work force.

• The Strategic Importance of HRM

– HRM is increasingly important as firms realize the value of their human capital in improving productivity.

– HRM is critical to bottom-line performance of the firm.

– HR planning is now part of the strategic planning process.


The Legal Environment of HRM

• Equal Employment Opportunity

– Title VII of the Civil Rights Act of 1964

• Forbids discrimination in the employment relationship.

• Employers are not required to seek out and hire minorities but they must treat fairly all who apply.

– Adverse impact

• When minority group members pass a selection standard at a rate less than 80% of the rate of the majority group.

– Equal Employment Opportunity Commission

• Federal agency charged with enforcing Title VII as well as several other employment-related laws.



(cont’d)• Equal Employment Opportunity (cont’d)

– 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.

– Pregnancy Discrimination Act• Specifically outlaws discrimination on the basis of

pregnancy.

– Age Discrimination in Employment Act of 1967• Outlaws discrimination against persons older than 40

years of age.

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(cont’d)

• Equal Employment Opportunity (cont’d)

– Americans with Disabilities Act of 1990

(ADA)

• Forbids discrimination on the basis of

disabilities and requires employers to provide

reasonable accommodations for disabled

employees.



(cont’d)

• Equal Employment Opportunity (cont’d)

– 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.



(cont’d)

• 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.

• Salaried professional, executive, and administrative employees are exempt from the Act’s minimum wage and overtime provisions.

– 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.

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(cont’d)

• Compensation and Benefits (cont’d)

– 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.



(cont’d)

• 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.

• National Labor Relations Board (NLRB)—the federal agency empowered to enforce provisions of the NLRA.

– Labor Management Relations Act of 1947 (Taft-Hartley Act)

• Amended the 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.



(cont’d)

• 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).

• Emerging Legal Issues

– Sexual harassment

– Alcohol and drug dependence

– AIDS

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Social Change and HRM• Temporary Workers

– An increasing trend is to use more temporary workers without the risk that the organization may have to eliminate their jobs.

• Dual-Career Families

– Firms are increasingly having to

make accommodations for dual-

career partners by:

• delaying transfers

• offering employment to spouses

• providing more flexible

work schedules and benefits

packages


Change and HRM (cont’d)

• Employment-at-Will

– A traditional view of the workplace in which an organization can fire an employee for any or no reason.

– The new argument: an organization should be able to fire only people who are poor performers or who violate rules.

– Recent court cases have placed limits on an organization’s ability to terminate employees by requiring just cause for firing or dismissal as part of an organization-wide cutback.


Attracting Human Resources

• 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 use to perform the job.

• Job Specification

– A listing of the skills, abilities, and other credentials the incumbent jobholder will need to do a job.

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Attracting Human Resources

(cont’d)• Forecasting HR Demand

and Supply

– Replacement chart• A list of managerial positions in

the organization, the occupants, how long they will stay in the position, and who will replace them.

– Employee information system (skills inventory)

• A database of employees’ education, skills, work experience, and career expectations, usually computerized.


Figure 14.1: Human Resource

Planning

Figure 14.1: Human Resource

Planning


Recruiting Human Resources

(cont’d)

• Recruiting

– The process of attracting qualified persons to

apply for jobs that are open.

• Internal Recruiting

– Considering present employees as candidates for

openings.

• Advantage: promotion from within can help build morale

and reduce turnover of high-quality employees.

• Disadvantage: internal recruiting can create a ―ripple

effect‖ of having to successively fill vacated positions.

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Recruiting Human Resources

(cont’d)

• External Recruiting

– Attracting persons from outside the

organization.

– Realistic Job Preview (RJP) is considered

a successful method to ensure person-job

fit.


Selecting Human Resources

• Validation:

– Determining the extent to which a selection device is really predictive of future job performance.

– Predictive validation• Correlating previously collected test scores of employees

with the employees’ actual job performance.

– Content validation• The use of logic and job analysis to determine that

selection techniques measure the exact skills needed for job performance.

• Used to establish the job relatedness of a selection device.



• 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.

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(cont’d)

• 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.



(cont’d)• Assessment Centers

– A popular method for selecting managers and are particularly good for selecting current employees for promotion.

• A content validation of major parts of the managerial job.

• Other Techniques

– Polygraphs have declined in popularity due to passage of the Polygraph Protection Act.

– Employers now use physical exams, drug tests, and credit checks to screen prospective employees.


Figure

14.2:

The

Training

Process

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Developing Human Resources

(cont’d)• Training and Development

– Assessing training needs• Determining what needs exist is the

first step in developing a training plan.

– Common training methods• Lectures

– Work well for factual material.

• Role play and case studies

– Good for improving interpersonal relations skills or group decision-making.

• On-the-job and vestibule training

– Facilitates learning physical skills through practice and actual use of tools



(cont’d)

• Performance Appraisal

– A formal assessment of how well employees do

their jobs.

– Reasons for performance appraisal

• 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.



(cont’d)

• 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.

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(cont’d)• Performance Appraisal (cont’d)

– Judgmental methods

• Ranking—compares employees directly with each other.

– Difficult to do with large numbers of employees.

– Difficult to make comparisons across work groups.

– Employees are ranked only on overall performance.

– Do not provide useful information for employee feedback.

• Rating—compares each employee with a fixed standard.

– Graphic rating scales

– Behaviorally-anchored rating scale (BARS)


Figure 14.3: Graphic Rating

Scales for a Bank Teller


Figure 14.4: Behaviorally

Anchored Rating Scale

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(cont’d)

• Performance Appraisal (Cont’d)

– Performance appraisal errors

• Recency error

• Errors of leniency and strictness

• Halo error



(cont’d)• Performance 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.



(cont’d)

• Performance Feedback

– Properly training managers can

help them conduct more

effective feedback interviews.

– ―360 degree‖ feedback

• Managers are evaluated by

everyone around them.

• Provides a richer array of

performance information on which

to base an appraisal.

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Maintaining Human Resources

• Determining Compensation

– Compensation• The financial remuneration given by the organization to

its employees in exchange for their work.

– Wages

– Salary

– Incentives

– Purposes of compensation• Provide the means to maintain a reasonable standard of

living.

• Provide a tangible measure of the value of the individual to the organization.



(cont’d)• Determining Compensation (cont’d)

– 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.



(cont’d)

• Determining Compensation (cont’d)

– Wage-structure decision

• Job evaluations

• Wage surveys data and the wage structure

– Individual wage decision

• Factors such as seniority, initial qualifications, individual merit, and labor market conditions influence wage decisions.

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(cont’d)• 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.

– Managing benefits effectively:• Shop carefully for the best-cost providers.

• Avoid redundant coverage.

• Provide only the benefits that employees want.



(cont’d)• Determining Benefits (cont’d)

– Types of benefits• Pay for time not worked

• Insurance

• Employee service benefits

– Cafeteria benefit plans• Flexible plans that provide basic coverage and allow

employees to choose the additional benefits they want up to the cost limit set by the organization.

– Other benefits• On-site childcare, mortgage assistance, and paid-leave

programs.


Managing Labor Relations

• 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.

– The best way to avoid unionization is to practice good employee relations all the time by:

• Providing fair treatment with clear standards in pay, promotions, layoffs, and discipline.

• Providing a complaint and appeal system.

• Avoiding favoritism.

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Figure 14.5: The Union-

Organizing Process


Managing Labor Relations

(cont’d)• 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.


New Challenges in the

Changing Workplace• Managing Knowledge Workers

– Knowledge workers• Employees whose contributions to an

organization are based on what they know (e.g., computer scientists, engineers, and physical scientists).

– Tend to work in high-technology areas

– Are experts in abstract knowledge areas.

– Like to work independently and identify strongly with their professions.

– Have skills that require continual updating and additional training.

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Changing Workplace (cont’d)

• Knowledge Worker Management and Labor

Markets

– Demand is strong for knowledge workers.

• External labor market pressures

• Internal labor market pressures

• Contingent and Temporary Workers

– Trends in contingent and temporary workers

• There have been dramatic and consistent increases in

contingent workers—10% of the U.S. workforce is either

contingent or temporary.



Changing Workplace (cont’d)• Contingent and Temporary Workers (cont’d)

– Managing contingent workers

• Careful planning allows for integrating contingent workers into the organization in a coordinated fashion for well-defined time periods.

• Understanding contingent workers and acknowledging their advantages and disadvantages.

• Carefully assess and document the true labor-cost savings of using contingent workers.

• Decide early on how similarly contingent employees will be treated relative to permanent employees.


Key Terms

• human resource management

• human capital

• Title VII of the Civil Rights Act of 1964

• adverse impact

• Equal Employment Opportunity Commission

• Age Discrimination in Employment Act

• affirmative action

• Americans with Disabilities Act

• Civil Rights Act of 1991

• Fair Labor Standards Act

• Equal Pay Act of 1963

• Employee Retirement Income Security Act of 1974

• Family and Medical Leave Act of 19933

• National Labor Relations (Wagner) Act

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Key Terms (cont’d)

• National Labor Relations Board (NLRB)

• Labor-Management Relations (Taft-Hartley) Act

• Occupational Safety and Health Act of 1970 (OSHA)

• employment-at-will

• job analysis

• replacement chart

• employee information system (skills inventory)

• recruiting

• internal recruiting

• external recruiting

• realistic job preview (RJP)

• validation

• training

• development

• Behaviorally Anchored Rating Scale (BARS)

• 360-degree feedback

• compensation


Key Terms (cont’d)

• performance

appraisal

• job evaluation

• benefits

• labor relations

• collective bargaining

• grievance procedure

• knowledge workers

Chapter Fourteen - csun.eduswalkerl/M360/2009.2/PPTPost/M360_CH14.pdf · –Realistic Job Preview...

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