Table of ContentsHuman Resources – Introduction.........................................................................................................3

Managerial Functions......................................................................................................................3Operative Functions.........................................................................................................................3

Human Resource Management.............................................................................................................4Objectives Of HRM.........................................................................................................................5HRM Policy.....................................................................................................................................5

Organization.........................................................................................................................................5Steps in designing organization structure........................................................................................5Roles Of HR Manager.....................................................................................................................6Qualities of a line manager..............................................................................................................6

Job Analysis..........................................................................................................................................6Job Description includes..................................................................................................................6Job Specification includes ..............................................................................................................7Process of job analysis:....................................................................................................................7Uses of Job description & specification .........................................................................................7Potential Problems with Job Analysis .............................................................................................7

Job Design............................................................................................................................................7Factors affecting Job Design............................................................................................................8Techniques of Job Design................................................................................................................9

HR Planning.........................................................................................................................................9Meaning of HR planning: ...............................................................................................................9Objectives of HR Planning............................................................................................................10Benefits of HR Planing..................................................................................................................10Factors effecting HR Plan..............................................................................................................10Process of HRP .............................................................................................................................11Problems in HRP............................................................................................................................11

Recruitment.........................................................................................................................................11Objectives......................................................................................................................................11Factors effecting recruitment.........................................................................................................11Recruitment Policy........................................................................................................................12Recruitment Process......................................................................................................................12Evaluation of Recruitment Process................................................................................................12Evaluation of Recruitment Method................................................................................................12

Selection.............................................................................................................................................13Selection Test.................................................................................................................................13Advantages of Centralized Selections...........................................................................................13Selection Process Involves.............................................................................................................13Do's ...............................................................................................................................................13Dont's ............................................................................................................................................14Contract of Employment: Should include following ....................................................................14Common interview problems – Interviewers.................................................................................14Barriers of effective selection .......................................................................................................14

Training...............................................................................................................................................15Need for Training...........................................................................................................................15Objectives of Training...................................................................................................................15Training Methods...........................................................................................................................15Training Procedure.........................................................................................................................15Evaluation......................................................................................................................................16

Performance Appraisal.......................................................................................................................16

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Objectives Of PA...........................................................................................................................16Appraisal Program ........................................................................................................................16Appraisal Contents ........................................................................................................................16Problems Of PA.............................................................................................................................17How to minimize PA Problems......................................................................................................17Methods of PA ...............................................................................................................................18Uses/advantages of PA...................................................................................................................18

Job Evaluation....................................................................................................................................18Objectives......................................................................................................................................18Principal of Job Evaluation............................................................................................................19Job Evaluation Procedure..............................................................................................................19Job Evaluation Methods/Techniques.............................................................................................19Advantages.....................................................................................................................................19

Remuneration.....................................................................................................................................19Components...................................................................................................................................19Objectives......................................................................................................................................20Theories of Remuneration.............................................................................................................20Factors Affecting Salary................................................................................................................20Remuneration plan Morning..........................................................................................................20

Social Security....................................................................................................................................21Social security legislations in India ..............................................................................................21Need for extended social security programs..................................................................................21Objectives......................................................................................................................................21Types of Social security programs ................................................................................................22Classification of Fringe Benefits...................................................................................................22Non-monetary benefits .................................................................................................................23

Promotion...........................................................................................................................................23Purpose of Promotion....................................................................................................................23Principles of Promotion ................................................................................................................23Types of promotion........................................................................................................................24

Transfer...............................................................................................................................................24Reason for transfer.........................................................................................................................24Principles of transfer......................................................................................................................25Types of Transfers..........................................................................................................................25Transfers........................................................................................................................................25

Separation...........................................................................................................................................25Lay-off...........................................................................................................................................25Dismissal........................................................................................................................................25Retrenchment.................................................................................................................................26VRS................................................................................................................................................26

Industrial Accident..............................................................................................................................26Causes of accidents........................................................................................................................26

Grievance............................................................................................................................................27Need for grievance procedure........................................................................................................27Causes of Grievances.....................................................................................................................27Prerequisites of Grievance.............................................................................................................27

Discipline............................................................................................................................................27Meaning.........................................................................................................................................27Objectives......................................................................................................................................28The Red Hot Stove Rule................................................................................................................28

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Domestic Enquiry..........................................................................................................................28Disciplinary Procedure..................................................................................................................28Types Of Punishment.....................................................................................................................29

HR Audit.............................................................................................................................................29Objectives......................................................................................................................................29Benefits..........................................................................................................................................29Scope Of HR Audit........................................................................................................................29

Topics Left IndisciplineOrientation & PlacementChallenges of Human Resource ManagementEmployee Safety

Human Resources – Introduction

Managerial Functions

it influences the operative functions

Involves• Planning• Organizing• Directing• Controlling

Operative Functions

It involves securing & employing the people necessary to achieve the kind & level of human resources necessary to achieve organization objectives. It includes

• Job Analysis • Process of study & collection of information relating to operations &

responsibilities of a specific job. It involves• Collecting & recording job information• Preparing job description based on the information• Determine the skills, abilities & knowledge required on the job• Updating the information from time – time

• HR Planning • Process by which organization ensures that it will have the right kind & right

number of employees, at the right time, at the right place capable of effectively & efficiently completing tasks that will help the organization achieve its objectives

• Recruitment • Process of searching for perceptive employees & stimulating them to apply for

jobs• Identification of internal sources of applicants & developing them• Creation & identification of external sources• Stimulating candidates to apply for jobs in the organization• Seeking balance between internal & external

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• Selection • Process of selecting individuals from a pool of job applicants who have required

qualifications & competence to fill the vacancies. It involves• Framing & developing application blanks• Creating & validating reliable testing & interview techniques• Checking & verifying academic records, references & employment record• Letter of approval/rejection• Employing the candidate who reports on duty

• Placement • Process of assigning the selected candidate with the most suitable job

• Induction & orientation • Techniques by which employees are rehabilitated to the change surroundings &

introduce to to the philosophy, policies, purposes & people of the organization

Human Resource ManagementHuman Resource Management – Process of improving, moulding & changing skills, creative ability, attitude, aptitude values commitment etc. based on present & future job & organization requirements

Includes• Performance appraisal• Training• Management Development• Career planning & Development• Internal Mobility• Transfer• Promotion'• Demotion• Change & organization development

Compensation• Job Evaluation• Wage & Salary Administration• Incentives• Bonus• Fringe Benefits• Social Security Measures

Human Relations is an area of management integrating people in a work situation in way that motivates them to work productively, co-operatively with economic, psychological & social satisfaction

Industrial Relations refers to relation among employee, employer, government & trade unions

Includes• Labour market

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• Trade unionism• Collective bargain• Industrial conflicts• Worker participation in management• Quality circles

Objectives Of HRM

• Create & utilize able & motivated workforce to achieve organization goals• Create sound organizational structure & establish desirable working relationships

among all employees• Secure integration with individual & group within the organization by co-ordination of

individual & groups goals with those of the organization• Create facilities & opportunities for individual & group development so as it matches

with the growth of the organization• Attain effective utilization of workforce for the achievement of organizational goals• Identify & satisfy individual & group needs by providing fare & equitable wages,

incentives, benefits, job security, social security measures for challenging work, recondition, status & prestige

HRM Policy

Policy is a plan of action. It is a set of proposals & actions which act as reference point for manager dealing with employees. Personnel polices guides the course of action intended in handling personnel objectives. Policies are based on the following sources

• Past experiences• Existing practices & experience in other organization of same nature• Attitude/philosophy of management at various levels, employees, trade unions etc.• Knowledge & experience of line managers & personnel managers in handling

personnel issues• Policies of the organization

OrganizationOrganization is set of economic & social entities in which a no of people perform various task to attain common goal

Steps in designing organization structure

• Present & future analysis of circumstances & environmental factors. Organization analysis is basis for organization design & process of defining aim, objectives, activities & structure of enterprise. It includes analysis of◦ External factors◦ Overall aim & purpose of the organization◦ Activities◦ Objectives◦ Decision to be taken on vertical & horizontal dimension◦ Relationship◦ Organization structure & Job structure◦ Organization climate

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◦ Management style◦ Human Resources

• Planning & implementation.

Roles Of HR Manager

HR manager plays a vital role in the modern organization. He plays different strategic roles at different levels of the organization. They include

• Ethical Role – Role of humanitarian reminding the managements of its morals & obligation towards the employees

• Counsellor’s Role – Council & help employees solve their personal problem related health, martial, family, mental, physical etc.

• Mediator's Role – Role of peacemaker in settling disputes between the management & the employees

• Spokespersons Role – Acts as spokesperson of the organization• Problem Solver – Solve problem relating to issues that involve HRM & overall long

range HR• Changed Event – To introduce changes in various existing programmes• Other role: welfare, clerical & fire-fighting roles

Qualities of a line manager

• Intelligence• Educational Skill• Discriminating Skill• Experience & Training• Professional Attitude• Knowledge – Job, Labour Law etc.• Tactical Skills & Good Judgement

Job AnalysisJob Analysis – It is a process of studying & collection information relating to operations & responsibilities of a specific job. Outcome – Job Description & Job Specifications

Involves• Collecting & recording job information• Checking the information for accuracy• Preparing job description based on the information• Determine the skills, abilities & knowledge required on the job• Updating the information from time – time

Job Description includes

• Job Title• Location• Job Summary• Duties• Machines, Tools & Equipment• Materials & forms used

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• Supervision given or received• Working conditions & hazards

Job Specification includes

• Education• Experience • Training• Judgement• Physical efforts & skills• Responsibilities• Communication skills• Emotional characteristics• Sensory demands such as sight, smell, hearing

Process of job analysis:

• Strategic Choices • Gather information • Process information • Job description • Job specification

Uses of Job description & specification

• Personnel planning • Performance appraisal • Hiring • Training & development • Job evaluation & compensation • Health & safety • Employee discipline • Work scheduling • Career planning

Potential Problems with Job Analysis

• Support from top management • Single means & source • No training & motivation • Activities may be distorted

Job DesignJob Design – Process of deciding the content of the job in terms of duties & responsibilities of the job holders, methods to be used to carry out the job in terms of techniques, procedures & systems & the relationship that must exist between the job holder & superior, sub ordinates & colleagues

Involves

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• Specification of each individual task• Specification of method to be used to perform each individual task• Specification of specific jobs assigned to an individual

Factors affecting Job Design

• Organization Factors• Characteristics of task

• Job design requires assembly of task into a job. An individual may perform one main task which may consist of several interrelated task. On the other hand a group may perform a task or set of tasks. The internal structure of the task consist of three main elements planning, execution & evaluation. The responsibility of a job is measured by the amount

• Ergonomics • It is concerned with designing & shaping the jobs to fit the physical abilities &

characteristics of an individual so as they can perform their job effectively • It helps employers design jobs in a way that individual physical ability & jobs

demands are balanced• Work-flow

• The flow of work in an organization is strongly influenced by the nature of product or service. The product or service usually suggest the sequence & balance of jobs if the work is to be done efficiently. After the sequence of job is determined the balance between the jobs is established

• Work Practices • Work practices are a set of ways of performing work. They may arise from

traditional or collective choice of employees. Either way HR Dept. flexibility is limited especially when these practices are a part of union-management relationship. Failure to consider work practices can have unfavourable outcomes

• Environment Factors• Employees ability & availability

• Efficiency of work must be balanced against ability & availability of people who will do the work.

• Social & cultural expectations • Job must be designed to meet the social & cultural expectations like hours of

work, holidays on religious occasion, vacation, reset period, management styles, sophistication & attitude

• Behavioural Factors• Feedback

• Individual must receive meaningful feedback about their performance preferably by evaluating themselves & defining the feedback

• Autonomy • Autonomy is being responsible for what one does. It is the freedom to control

responses to the environment. Job that give workers the authority to take their own decisions will provide added a sense of recondition & self esteem. Absence of autonomy can cause lack of interest or poor performance

• Use of abilities • The job must be perceived by individual as requiring them to use their

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abilities they in order to perform the job efficiently• Variety

• Lack of variety can boredom which may lead to fatigue & mistakes. By injecting variety to the job, the personnel specialist can reduce errors caused by fatigue

Techniques of Job Design

• Work Simplification • The job is more simplified or specified. The job is broken down them into small

sub-parts & each task is assigned to an individual. The process involves mechanical pacing of work, repetitive work-process, working on only one task predetermining tools & techniques, restricted interactions with workers, few skill requirements. It is done when job designers feel that job is not specialized enough. The method is defective in the sense that over specialization leads to boredom, mistakes & other problems.

• Job Rotation • It refers to employees movement from one job or another. It reduces boredom &

monotony, it improves employees skills regarding various job & prepares competent employees & provides personal growth. Frequent job rotation is not as advisable as it may be a negative effect on employees effectiveness & enthusiasm

• Job Enlargement • It involves adding more & different task to a specialized job to provide greater

variety. It tackles dissatisfaction & reduces monotony by increasing variety & scope to a task. It leads to specialization & worker satisfaction, quality of production & improvement in overall efficiency of the organization

• Job Bandwidth • Another approach is narrow job design & broad job design. Narrow job design

deals with few task & responsibilities. Broad job design deals with with wider variety, range of task & greater responsibilities

• Job Enrichment • It deals with adding duties & responsibilities to a job to provide skill variety, task

identity, task significance, autonomy & feedback on performance. It tries to deal with job dissatisfaction by adding to depth of the job

HR PlanningHRP is a process by which organization ensures that it will have the right kind & right number of employees, at the right time, at the right place capable of effectively & efficiently completing tasks that will help the organization achieve its objectives

Meaning of HR planning:

HR Planning may be view• A process by which organization can move from current man power to its desired

man power• Foreseeing the human resource requirement & the future supply of human

resources• Making necessary adjustments between these two & organization plans

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• Foreseeing the possibility of developing the supply of human resources in order to meet with the requirements by introducing necessary changes in functions of human resource management

Objectives of HR Planning

• Recruit & retain HR of required quality & quantity at required place & time. • Foreseeing & minimizing employee turnover & filling up of consequent vacancies. • Meet the needs of programmes of the expansion, diversification etc. • Foresee the impact of technology on work and HR requirement• Improve employees skill, knowledge, standards, ability, discipline etc. • Assess the surplus or shortage of human resources & take necessary measures • Maintain congenial (friendly/pleasant) industrial relations• Minimize imbalances caused due to HR fluctuations • Make the best use of its human resources • Estimate the cost of human resources

Benefits of HR Planing

• Checks corporate plans• Balances uncertainties & change to maximum extent possible• Enable organization to have required quality and quantity of HR at the right time &

right place• Controls function, operations & contribution of HR• Foresees changes in values, attitude & aptitude of employees• Plans for physical facilities, working conditions & fringe benefits• Plans for development of employees to meet organization needs• Plans for advancement & development of employees• Plans recruitment & selections processes• Plans for all cost of HR

Factors effecting HR Plan

• External Factors • Government policies for labour law, Industrial relations policy, reservation policy • Level of development of economy & HR in the country & its future supply• Business environment factors like mix & volume of production & demand of HR

in future• Advancement in technologies & requirement of business• International factors – Demand & supply of HR in other countries

• Internal Factors • Company strategies regarding expansion, diversification etc.• Human Resource policies regarding quality, compensation and work-life of HR• Job analysis – kind & quality of HR requirement• Time horizon – Company's current business environment i.e. stable or unstable• Quality & accuracy of HR info of company• Company production/operation policy – How much does the company produce,

procure & outsource• Trade unions terms regarding employee's working

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Process of HRP

• Analysing the unit & corporate level strategies. • Demand & Supply forecasting• Estimating the net human resource requirements. • In case of surplus, plan for redeployment, retrenchment, lay-off. • In case of deficit, forecast the future supply of human resources• Plan for Recruitment, development & internal mobility • Modify or adjust the organizational plan if future supply will be inadequate

Problems in HRP

Though HRP is beneficial to the organization, employees & trade unions, some problems crop up in the process of HRP.

• Resistance by Employers & Employees◦ Employers feel that it increases the cost of manpower as trade unions demand

for more facilities & benefits including training & development. ◦ They also feel that employees will be easily available as & when required

considering the growing population & unemployment situation in India.◦ Employees resist HRP as they feel that it increases their work load.

• Uncertainties due to absenteeism, seasonal employment, labour turnover technological change & marketing conditions cause imperfections in HRP

• Inadequacies of Information Systems & reliable data about the economy, Industries, labour market, trends in human resources

RecruitmentRecruitment is a process to discover the sources of manpower to meet the requirements of staffing schedule & to employ effective measures for attracting that manpower in adequate number to facilitate effective selection process of an efficient workforce

Objectives

• To determine the present & future requirements of the organization• To increase the pool of job applicants at minimum cost• Help improve effectiveness of selection process by reducing the no of over qualified

or under qualified job applicants• Helps reduce job applicants turnover rate once recruited & selected• Meet the organization legal & social obligations regarding workforce composition• Begin identifying & preparing job applicants who will be appropriate candidates• Evaluate the effectiveness of various recruitment techniques & sources of all job

applicants

Factors effecting recruitment

• External • Supply & demand• Unemployment Rate• Labour Market• Political & Social Considerations

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• Sons of Soil• Image of the company

• Internal • Recruitment Policy• Human Resource Planning• Size of Firm• Cost• Growth & Expansion

Recruitment Policy

• Derived from personnel policies• Should consider government regarding reservation• Should consider policies regarding merit, internal sources & social responsibilities• Should consider personnel policies like improving HR, motivation through internal

promotion, improving loyalty by absorbing entrenched or laid off employees• Should consider personnel policies of competing organization• Should consider recruitment sources, needs, cost, select criteria & preferences

Recruitment Process

• Planning – for quality, type and no of HR required• Strategy development

◦ Make (hire less skilled workers & train them) or buy (hire skilled workers & place them immediately on job) employees

◦ Technological advancement – has help employer & job seekers get connected easily and get better access to organization requirement

◦ Where to look – Which labour market to tap in to for HR◦ How to look

▪ Internally – present employees, employee referral, previous job applicants etc.

▪ Externally – campus placements, walk-in, advertisement etc.• Screening – process to knock out visibly unqualified applicants at an early stage• Evaluation & control – Methods used should be tested, validated for effectiveness.

Required as lot of cost is incurred in the process.

Evaluation of Recruitment Process

• Return rate of applicants send out• No of suitable candidates• Retention & performance of candidates• Cost, time lapsed & quality of recruitments process

Evaluation of Recruitment Method

• No of initial inquiries which resulted in completed application forms• No of candidates at various stages• No of candidates recruited

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• No of candidates retained after a period

SelectionSelection is a process of selecting individuals from a pool of job applicants who have required qualifications & competence to fill the vacancies

Selection Test

Ability Test – to measure ability of an individual to perform a task related to jobAptitude Test – to measure individual potential to learnPersonality – to measure individual motivation to particular working environmentInterest Test – to check individual preferencesGraphology Test – To analyse individual handwritingPolygraph Test – To check individual information for accuracyTechnical Test – To check individuals technical knowledgeMedical Test – To check individual medical fitness

Advantages of Centralized Selections

• Easier for applicants to send application to single Dept.• Issues pertaining to employment can be resolved at a central location• Helps operation managers concentrate on their work instead selection• Hiring can be done by specialist• Applicant is assured of greater variety of job options• Hiring cost can be reduced

Selection Process Involves

• Preliminary interview• Selections Test• Employment Interview• Reference & Background Analysis• Selection Decision• Physical Examination• Job Offer• Employment Contract• Evaluation

Do's

• Plan the interview • Establish an easy and informal relationship • Encourage the candidate to talk • Cover the ground as planned • Probe where necessary • Analyse career and interests to reveal strengths, weakness and patterns of

behaviour • Maintain control over the direction and time taken for interview

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Dont's

• Start interview unprepared • Plunge too quickly into demanding questions • Ask leading questions • Jump to conclusions on inadequate evidences • Pay too much attention to isolated strengths or weaknesses • Allow the candidate to gloss over important facts • Talk too much

Contract of Employment: Should include following

• Job Title • Duties and responsibilities • Join date, Training period, Permanent date • Work rules including working hours, environment • Compensation • Holidays and Leaves • Termination, Notice period • Grievances and disciplinary procedures

Common interview problems – Interviewers

• Do not have the complete/accurate job details and requirements.• May make snap judgement early in the interview, thereby blocking further potentially

useful information. • Permit one trait or job related attribute to influence their evaluation of the remaining

qualities of an applicant. • Tendency to be swayed by negative information about the applicant. • Information obtained from interviews is not integrated in a systematic manner• Judgement are often affected by the pressure to favour a candidate• Judgement regarding an applicant is often affected by the list of available

applicants. E.g. a good person looks better in contrast to a group of average applicants.

• Sex, race, background etc. similar/preferential to Interviewer may lead to bad judgements

Barriers of effective selection

• Perception: Interviewers inability to understand others accurately is probable the most fundamental barrier.

• Fairness: Fairness requires that no individual should be discriminated against on the basis of religion, region, race or gender.

• Validity: A test that has been validated can be differentiate between the employees who can perform well and those who will not.

• Reliability: A reliable method is one which will produce consistent results when repeated in similar situations.

• Pressure: Pressure from politicians, bureaucrats, relatives, friends, and peers to favour a particular candidate

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TrainingTraining is act of improving skill & knowledge of HR at particular job

Need for Training

• To match employees specifications with job requirements & organization needs• organization viability & transformation process• technological advances• organizational complexity• Human relations• change in job assignment

Objectives of Training

• To prepare new & current employees for current as well future requirements• To prepare them for high level task• To assist them by exposing them to latest technology, information & techniques &

developing their skills• To prepare second line of competent employees & assigning them more

responsibilities• To improve productivity & quality to ensure economic output• To promote individual & collective moral, sense of responsibilities, co-operative

attitudes & good relationship

Training Methods

On-Job Training Method – The individual is placed on the job & is taught skills necessary to perform the job. The individual is placed under guidance & supervision of skilled employees

• Job rotation• Coaching• Job instructions• committee assignments

Off-Job Training Method – The trainee is separated from job situation & his attention is focused on learning material related to his future job performance

• Vestibule training• role playing• lectures• conference of discussion• programmed instructions

Training Procedure

• Prepare the instructor• Prepare the trainee• Get ready to teach• Presenting the operation• Try out the trainee performance

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• follow up

Evaluation

• Immediate assessment of trainees reaction about the program• Trainees observation during the program• Expectations of trainees before the program & view of attainment after the program• Opinions of trainees superiors/subordinates/colleges about his performance after

the program• Measuring trainees skill level before & after the program• Measuring trainees behaviour, attitude on job• Cost benefit analysis of the program

Performance AppraisalPerformance appraisal is formal, structural way of measuring & evaluating employee's job related behaviour & outcomes to discover how & why the employee is presently performing on the job & how can the employee perform more effectively in future so that the employee, organization & society will benefit

Objectives Of PA

• To let employee know where they stand in terms of performance & assist them with constructive criticisms & guidance for their development

• To maintain satisfactory level of performance• To confirm services of probationary employees• To provide feedback on level of achievement & behaviour• To identify training & development needs• To decide upon pay rise & facilitate fair & equitable wages based on performance• To effect promotion based on competence & performance• To prevent grievances & indisciplined activities• To check whether HR programs like selection, training & transfer have been

effective

Appraisal Program

• Formal or Informal appraisal • Whose performance should be appraised? • Who are raters? • What & when should be evaluated • Problems encountered & how to solve them • Methods of performance appraisal

Appraisal Contents

Quality, Quantity, Timeliness, Cost effectiveness, Need for supervision, Interpersonal impact.

Organization should decide the content to be appraised which is usually determined on the basis of job analysis. The content may vary with the purpose of appraisal & the type & level of employees. It

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includes • Regularity of attendance • Self expression: written & oral • Ability to work with others • Leadership styles & abilities • Initiative • Technical skills / ability / knowledge • Ability to grasp & learn new things • Ability to reason • Originality & resourcefulness • Creativity • Area of interest & suitability • Judgement skills • Integrity • Capability for assuming responsibility • Level of acceptance by subordinates, colleagues, superiors • Honesty & sincerity • Thoroughness in job & organizational knowledge • Knowledge of systems & procedures • Quality of suggestions offered for improvement

Problems Of PA

• Rating Biases • Halo effect – Tendency of raters to depend excessively on the ratings of one trait

or behaviour consideration in rating all other traits or behavioural considerations. • Error of central tendency – Follow play safe policy and avoid rating the

employees at both the extremes of the scale. • Recency Effect – Rating people based on their recent performance • Leniency & strictness – Tendency to be liberal by assigning higher rates • Personal Prejudice – Rating people at lower end if the rater dislikes them

• Failure of superiors in conducting performance appraisal & post performance appraisal interview

• Appraisal is based on subjectivity• Less reliability & validity of appraisal techniques• Negative rating effects interpersonal relations• Absence of inter-rater reliability• Influence of external & uncontrollable internal factors• Performance appraisal in a few minutes• Management emphasis on punishment rather than development

How to minimize PA Problems

• Conduct an open meeting with appraisers about employees performance before, during & after performance review

• Encourage each one to comment about each others achievement & areas of improvement

• Appraiser should tell truth & reality

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• Conduct counselling meeting with appraiser to to appraise them to reason for their performance & its consequences

Methods of PA

• Past Oriented • Rating Scales • Check-lists • Forced choice method • Forced distribution method • Critical incident method • Behaviourally anchored scales • Field review methods • Performance tests & observations • Annual confidential reports • Essay method • Cost accounting approach • Comparative evaluation approach

• Future Oriented • Management by objectives • 360 Degree appraisal • Psychological appraisals • Assessment centres

Uses/advantages of PA

• Helps review &/correct earlier decisions relating to◦ Organization & HR planning◦ Organization effectiveness through development◦ Fixation of salary, allowances, benefits etc.◦ Training & development needs◦ Career plaining & development of employees

• Helps evaluate existing systems, information system, job analysis, internal & external environmental factors effecting performance

• Helps improve employees performance & self-development• Helps improving inter-personal relationship through close interactions & better

understanding

Job EvaluationJob evaluation is process of analysing & assessing the content of a job in order to place them in acceptable rank which can be used as a basis of remuneration system

Objectives

• To gather data & information about job description, job specification & employees specification of various jobs

• To compare duties, responsibilities & demands of a job with other jobs• To determine the hierarchy & place of a job with in an organization

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• To determine rank or grade of job• To ensure & fair equitable wage distribution on basis of relative wroth or value of job• To avoid discrimination on basic on gender, caste, religion etc.

Principal of Job Evaluation

• Rate the job & not the employee• Elements should be properly selected, clear defined & easily understood• Concerned employees & supervisors should be convinced about program• Encourage supervisors & employees to participate in the program• Discuss with them about the rating but about assigning money values to points• Do not create too many occupational wages

Job Evaluation Procedure

• Analyse & prepare the job description• Select & prepare job evaluation plan• Classify the jobs• Install & maintain the program

Job Evaluation Methods/Techniques

• Quantitative Methods • Points Rating Method• Factor Comparison Method

• Non-Quantative Methods • Ranking: Simple Ranking Method, Ranking Key Jobs• Job Classification & Grading Method

Advantages

• It is logical & to certain extent an objective way of ranking & grading jobs• It helps fit new created jobs• It helps in reducing employee grievances & complaints about wage• It satisfies principles of fair wage, wage equity uniformity in wage etc.• It helps in redesigning the jobs by reallocating easy & difficult task among various

jobs• It helps in minimizing wide wage differentials

RemunerationRemuneration is compensation of an employees in return for his contribution to the organization

Components

• Wages & Salary• Incentives: Performance based additional payment• Fringe Benefits: pension, gratuity fund, medical care, health insurance etc.• Perks: company car, club membership, paid holiday• Non-monteray benefits: recognition of merit, responsibilities, work environment

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Objectives

• To acquire competent qualified personnel• To retain present employees• To secure internal & external quality• To ensure desired behaviour like performance, loyalty, accepting new

responsibilities• To facilitate pay roll administration of budgeting & salary control• To maintain labour & administrative cost in line with organizations ability to pay• To pay according to job content & difficulty in tune with efforts & merit of employees

Theories of Remuneration

• Reinforcement & Expectancy Theory: Reinforcement theory postulates that a behaviour which has a rewarding experience is likely to be repeated. Expectancy theory focuses on the link between rewards & behaviour. Vroom’s expectancy theory focuses on the link between rewards & behaviour. Motivation, according to the theory, is the product of valence (positive or negative emotion), instrumentality & expectancy. Remuneration differs according to the impact of these factors on the motivational component.

• Equity Theory : Equity theory posits that an employee who perceives inequity in his rewards seeks to restore equity. The theory emphasizes equity in pay structure of employees’ remuneration. Employee’s perception of how they are being treated by their organization is of prime importance. When employees perceive inequity, it can result into lower productivity, higher absenteeism, or increase in turnover.

• Agency Theory : The Agency theory focuses on the different interests & goals of the organization’s stakeholders (employers & employees) & the way that employee remuneration can be used to align these interests & goals. Employees expect high remuneration while the employers seek to minimize it. The Agency theory says that the principal (employer) must choose a contracting scheme that helps align the interests of the agents (employees) with the principle’s own interests. These contracts can be either behaviour-oriented (e.g. merit pay) or outcome-oriented (e.g. stock option, profit sharing, commission).

Factors Affecting Salary

• Ability to pay• Cost of living• Productivity• Union pressure & strategies• Government legislation & labour law• Economy• Business strategy• Job evaluation & performance appraisal• Employee

Remuneration plan Morning

Wage & salary plans are derived from the assessment of what will attract & retain the right people, what the organization can afford & what will meet the organization strategy

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Plan must be based on• Job Description• Job Evaluation• Job Hierarchy• Pricing Jobs• Pay surveys

Challenges• Skill based pay• Pay reviews• Pay secrecy• Comparable worth• Employee participation

Social SecuritySocial security is primarily a social insurance program providing social protection or protection against social recognized conditions such as old age, poverty, disability, unemployment etc. It may refer to

• Social insurance• Services• Income maintenance• Basic security referring to basic necessities

Social security legislations in India

• Workmen’s compensation act 1923: compensation for any personal injury due to accident at workplace, for loss of earnings

• The employee’s state insurance act 1948: provide sickness benefits, disablement benefits, dependant's benefits, medical benefits

• The employee’s provident fund & misc provisions act 1952: provident fund, deposit liked insurance

• The maternity benefits act 1961: medical benefits, medical leaveThe payment of gratuity act 1953: gratuity at retirement

Need for extended social security programs

Fringe benefits are provided for following reasons • Employee demands • Trade union demands • Employer’s preference • As a social security • To improve human relations

Objectives

• To create & improve sound industrial relations • To boost up employee morale • To motivate the employees by identifying & satisfying their unsatisfied needs

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• To provide qualitative work environment & work life • To provide security to the employees against social risks like old age benefits &

maternity benefits• To protect health of the employees & to provide safety to the employees against

accidents • To promote employee’s welfare by providing welfare activities like recreational

facilities • To create a sense of belongingness among employees & to retain them. • To meet requirements of various legislations relating to fringe benefits

Types of Social security programs

• Employment security: unemployment insurance, leave travel pay, overtime pay, leave for maternity / grievances, holidays, cost of living bonus, lay-off pay, jobs to the sons/daughters of the employees

• Health protection: Accident insurance, disability insurance, hospitalization, medical care, sick leave.

• Old age & Retirement: deferred income plans, pension, gratuity, provident fund, old age: assistance / counselling, medical benefits for retired employees, travelling concession to retired employees, jobs to the sons/daughters of deceased employees

• Personnel Identification, Participation & Stimulation: anniversary awards, attendance bonus, canteen, cooperative credit societies, educational facilities, housing, income tax aid, quality bonus, recreational programs, stress counselling, safety measures

Classification of Fringe Benefits

• Payment for time not worked ◦ Hours of work◦ Paid holidays◦ Shift premium ◦ Holiday pay◦ Paid vacation

• Employee security◦ Retrenchment compensation ◦ Lay-off compensation

• Safety & Health ◦ Workmen’s compensation ◦ Health benefits: sickness benefits, maternity benefits, disablement benefits,

dependant’s benefits, medical benefits◦ Voluntary arrangements

• Welfare & recreational facilities ◦ Canteen ◦ Consumer society ◦ Credit society ◦ Housing ◦ Legal aid ◦ Counselling

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◦ Welfare organizations & welfare officers ◦ Holiday homes ◦ Educational facilities ◦ Transportation ◦ Parties & picnics ◦ Miscellaneous

• Old age & retirement benefits ◦ Provident funds ◦ Pension ◦ Deposit linked insurance ◦ Gratuity

Non-monetary benefits

• Treats, free lunch/tea/coffee, picnic, dinner with the family, birthday treats • Desk accessories, watches, tie pins, diaries, planners, calendars, wallets, t-shirts • Awards: trophies, citations, certificates, letter of appreciation• Social acknowledgement: informal recognition, recognition at office get-together,

suggestions• Office environment: work from home, flexible working hours, redecoration• Tokens: movie tickets, vacation trips, early time-offs• On-the-job: increased responsibility, training

Advantages: motivate, build self-esteem, loyalty, healthy work environment, no extra cost involved, create close bonding between company & employee family

Disadvantages: de-motivate if not implemented properly, rewards may result in short sighted & hasty decision making or may result in unhealthy competition between employees, may intrude home life of employees, monetary rewards should be present otherwise it is not effective

PromotionPromotion is an improvement in position, responsibilities, pay scale of an employee within an organization

Purpose of Promotion

• To motivate employees for higher productivity• To attract & retain services of qualified & competent employees• To reward employees for their efficiency & performance• To improve the effectiveness of the employee & organization• To build loyalty, morale & sense of belongingness• To impress upon others that opportunities area available for them too if they perform

well• To fill vacancies within the organization

Principles of Promotion

It is the responsibility of the HR department to lay down a clear cut & sound promotion

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policy & ensure its implementation. This policy should be clear on following matters • Recruit from outside or promote internally • The basis of promotion: merit &/or seniority

◦ Merits of Seniority ▪ Easy to administer ▪ Less scope for subjectivity/biased behaviour in fixing seniority ▪ Trade unions welcome it ▪ It is the right option, as seniority & experience go hand in hand ▪ Subordinates are willing to work under an older boss ▪ Loyalty is rewarded

◦ De-Merits of Seniority ▪ Seniority is no indication of performance ▪ No single criteria for fixing seniority ▪ Young & competent employees may feel frustrated & might leave

◦ Merits of Competence▪ Efficiency is encouraged, recognized & rewarded ▪ Competent people are retained ▪ Productivity increased

◦ De-Merits of Competence▪ Discontentment among senior employees ▪ Scope for favouritism

Types of promotion

• Horizontal Promotion • Change in responsibilities, pay• Change in designation• Example – Jr Clerk promoted to Sr Clerk

• Vertical Promotion • Change in responsibilities, pay, prestige• Change in nature of job• Example – Clerk promoted to Manager

• Dry Promotion • Promotion in terms increase in remuneration• Change in designation but no change is responsibilities• Get one or two annual increments

TransferTransfer means change in job (accompanied by change in place of job) but no change in responsibilities & remuneration

Reason for transfer

• Shortage of employee because of heavy demand• Removal of incompatibilities between workers• Correction of initial faulty placement• Change in interest & capacity of an individual

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• To break monotony in job over a period of time• Unhealthy climate for employees health• Family related problems

Principles of transfer

A policy based on the following principles should be framed by the HR Dept.• Frequency & minimum period between transfers. Well informed to all employees• Authority to handle transfers. can be centralized• Well defined criteria for transfers• Temporary or permanent transfers• Effect of pay & responsibilities should be evaluated• Job description & employee analysis should be done• Interest of the organization should be given importance

Types of Transfers

• Transfers designed to enhance training & development• Transfers to make possible adjustment to varying volumes of work within the firm• Transfer to remedy problems of poor placement

Transfers

• Production – Shortage or surplus employees are transferred to avoid lay-offs• Replacement – When operations are declining, retain old employees• Versatility - To make employee versatile & competent on more than one skill• Shift – On rotation basis or special request• Remedial – Correction of initial fault placement

SeparationResignation – Employee willingly leaves the job when he finds a better offer.

Lay-off

• Temporary separation for defined period• Failure, refusal or inability of employer to give employment to a worker who is in the

pay roll but has not been retrenched• Lay-off are due

◦ Shortage of stock◦ Accumulation of stock◦ Breakdown of machinery◦ Any unforeseen reason

• 50% Payments• Laid off employees are called back asap to normalize production

Dismissal

• Termination of employee initiated by employer• Should be supported by just & sufficient reasons• Drastic steps should taken after careful thought

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• Reason for dismissal ◦ Poor or below standard performance◦ Excessive Absenteeism◦ Serious Misconduct◦ False statement of qualification given at time of employment◦ Theft of company property◦ Not abiding by company rules

• Should be avoided as far as possible & should taken after all the efforts of salvaging in the employee have failed

Retrenchment

• Labour is replaced by machinery• Closure of Department• All the employees plus employer lose their job

VRS

• Employees sent home willingly• Handsome compensation is paid• Painless method of trimming staff down

Industrial AccidentAccording to Factories Act, 1948 -If an employee suffers a bodily injury in industrial establishment and is unfit to resume his duties within 48 hours and It is an unexpected event which is neither anticipated nor designed to occur then he/she is entitled to Workmen's Compensation Act, 1923

Causes of accidents

• Unsafe conditions at work place ◦ Defective plants, equipments, tools, material, infrastructure etc. ◦ Improperly guarded equipments ◦ Hazardous arrangement or procedure in & around equipments ◦ Unsafe storage, congestion & overloading ◦ Inadequate safety devices ◦ Wrong / faulty layout & bad location ◦ Improper illumination: glare, insufficient light ◦ Improper ventilation ◦ Poor house keeping

• Unsafe acts ◦ Operating without authority ◦ Failing to warn other employees of possible danger ◦ Not using safety equipments ◦ Throwing material on the floor carelessly ◦ Operating or working at unsafe levels of speed ◦ Using unsafe equipments or using equipments unsafely ◦ Taking unsafe position

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◦ Distracting, teasing, abusing, quarrelling, day-dreaming • Other causes

◦ Untrained/young employees sustain more injuries ◦ Addiction to alcoholism or drugs ◦ Aggressive & negative supervision ◦ More frequency at night shifts ◦ Working in adverse conditions, stress, fatigue, boredom, insecurity ◦ Women employees have better safety records

GrievanceGrievance is dissatisfaction or feeling of injuries in connection with ones employment situations that is brought to notice of the management

Need for grievance procedure

• Grievance disturbs the employee which effects his moral, productivity & willingness to work with others. If it causes an explosive or distributive event a well designed grievance procedure can handle it better.

• It serves as outlet for employee gripes, discontent & frustration. • It serves a check on arbitrary actions of management

Causes of Grievances

• Complaints & demands of compensation• Complaints against colleagues, supervisor, disciplinary measures & procedure,

promotion/ demotion / transfers, individual assessment

Prerequisites of Grievance

• Conformity with prevailing legislature• Clarity• Simplicity• Promptness• Training• Follow ups

DisciplineDiscipline regulates the behaviour of an employee in the organization as law regulates the behaviour of people in the society

Meaning

• Discipline refers to condition or attitude prevailing in employees with respect to rules & regulations of an organization

• It means co-operating & behaving in an orderly way as a responsible person• A force the prompts individual & groups to observe rules, regulations & procedure

necessary for effective functioning

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Objectives

• To obtain a wiling acceptance of rules, regulations & procedures to obtain goals• To develop an element of certainty despite several difference in informal behaviour

patterns• To develop a sprite of tolerance & desire to make adjustments• To give & seek direction & responsibility• To create an atmosphere of respect of human personality & human relations• To increase efficiency & morale so as to increase productivity

The Red Hot Stove Rule

The Red Hot Stove Rule – Without the continual support & regard of the of the subordinates, no manager can get the things done. But disciplinary action against offending employee is painful & generates resentment on his part. Hence a question arises as to how to impose discipline without generating resentment.

This is possible through what Douglas McGregor called the “Red Hot Stove Rule” which draws an analogy between touching a hot stove & undergoing discipline

• The burn is immediate • He had a warning. When the stove was red hot, he knew what would happen if he

touched it. • The effect is consistent. Everyone who touches the hot stove gets burnt. • The effect is impersonal. A person is burnt not because of who he is but because he

touched the hot stove.

The same thing is true with discipline. The disciplinary procedure should start immediately after an omission is noticed. It should give a clear-cut warning regarding the extent of punishment for an offence. The same punishment should be consistently given for the same type of offence. Irrespective of an offence, a punishment should be imposed.

Domestic Enquiry

• Disciplinary procedure from within the organization• Immediate supervisor or personnel manager does the enquiry• Call for employee explanation, Issue show cause notice if necessary, full fledged

enquiry, Call for witness/documents/events, enquiry report• Final report to the management

Disciplinary Procedure

• Issue a letter of charge & call the employee for the explanation• Consider the explanation• Show cause notice• Full fledged enquiry• Consider the enquiry proceeding, findings & make a final report• Follow up

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Types Of Punishment

• Oral warning• Written warning• Loss of privileges & fines• Punitive suspension• Withholding increment• Demotion• Termination

HR AuditHR audit refers to examination & evaluation of policies, practices & procedures to determine the efficiency & effectiveness of Human Resource Management. It is quality control check of HR activities in a department or company & evaluation of how these activities support organization strategy.

Objectives

• To evaluate the management problems• To seek explanation & information on questions like Why & what• To evaluate how much of the polices the managers have implemented• To evaluate the employees

Benefits

• Identification of contribution of HR Department• Improvement of image of HR Department• Encouragement of greater responsibilities & duties• Clarification of responsibilities & duties• Stimulation of uniformity of HR polices & procedures• Finding critical problems• Ensuring compliance with legal requirements• Acceptance of necessary changes• Review of information system

Scope Of HR Audit

HR audit must cover activities of department along with personnel functions, uses of its procedures by managers & its impact on employees. Scope of audit

• Human resource functions – for each HRM functions, auditor must◦ define objective of the function◦ Identify who is responsible for its performance◦ Review the performance◦ Develop corrective action plan if any deviation◦ Follow up action plan

• Managerial compliance ◦ Involves audit of managerial compliance of personnel policies, procedures &

legal provision• Human resource climate

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◦ It has an impact on employee motivation & satisfaction. The quality of the climate can be measured by employee turnover, absenteeism, safety records & attitude survey

• Corporate audits ◦ Corporate strategy helps organization gain competitive advantage.

Understanding has strong implications on HR planning, staffing, remuneration, industrial relations & other HR activities

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