Management Case Study

Module-06

Employee Relations

Prepared By

W A H C Leelarathne

PQHRM 50/31

1

Course: Professional Qualification in Human Resource Management

Contents

1. Acknowledgement

2. Introduction

3. ABC Perera Company PVT Ltd.

a) Evaluate the policy of grievance handling being applied by the company. Sug-

gest an appropriate policy and procedure of grievance handling for the com-

pany.

b) Assume that the tread union enters a collective agreement with the management

which provide for 20% wages increase and the management decided to grant

these benefits only to 107 workers who are members of the union. Do you agree

with the decision or not? Why?

c) To reduce the above worker entrusts as a HR and Admin manager what type of

action plan that you going to implement?

2

1) Acknowledgement

The authors would like to acknowledge the generous support and cooperation to complete

this assignment.

Authors also take this opportunity to appreciate their case study lecturer Mr. Asoka

Weerakoon for the guidance and support to complete the report.

Authors would like to thank their institute IPM, by providing enough library facilities in

order to refer books to successfully carry out this assignment.

3

2) Introduction

When we think about it, the success of many facets of your business can often be traced

back to motivated employees. From productivity and profitability to recruiting and

retention, hardworking and happy employees lead to growth and success.

 Unfortunately, motivating people is far from an exact science. There's no secret formula,

no set strategy, no check list to fill out. In fact, motivation can be as individual as the

personalities of the employees who work for you. One employee may be motivated only

by money. Another may appreciate a simple “thank you” for a job well done. Still others

may work harder if they have equity in the business.

 We can boil down employee motivation improvement to two basic actions -- finding out

what your employees want and finding a way to give it to them or enable them to earn it.

The following includes more insight and some interesting and helpful motivational

techniques used by successful CEOs.

One-on-one Approach-As CEO’s, business owners and managers we often make

decisions based on what we think (our experience) or feel (our mood).  When we do this

with decisions about employees and motivating them, we will most likely be more wrong

than right.  Therefore we need to adopt a one-on-one approach to our employee

motivation planning and actions.  Picking one plan of attack or approach for all

employees simply won’t bring results. 

What is Employee Relations?

Employee Relations involves the body of work concerned with maintaining employer-

employee relationships that contribute to satisfactory productivity, motivation, and

4

morale.   Essentially, Employee Relations is concerned with preventing and resolving

problems involving individuals who arise out of or affect work situations.

Advice is provided to supervisors on how to correct poor performance and employee

misconduct.   In such instances, progressive discipline and regulatory and other

requirements must be considered in effecting disciplinary actions and in resolving

employee grievances and appeals.   Information is provided to employees to promote a

better understanding of management's goals and policies.  Information is also provided to

employees to assist them in correcting poor performance, on or off duty misconduct,

and/or to address personal issues that affect them in the workplace.   Employees are

advised about applicable regulations, legislation, and bargaining agreements.   Employees

are also advised about their grievance and appeal rights and discrimination and

whistleblower protections.  

How to motivate employees

Motivating people is a very important. People cannot be motivated by others. They are

motivated from within. Leaders can however, set up an environment in which people are

able to motivate themselves.

To set up an environment that enables employees to be motivated, leaders need to under-

stand what the motivational needs of individuals and groups are. Determining the “what's

in it for me” for individual employees and workgroups that is consistent with goals and

strategies of the organization is the key to improving motivation for individuals and

groups of employees.

A base for understanding what motivates human beings is found in the theories by

Maslow and Herzberg.

5

Maslow's theory is that people are motivated by a hierarchy of needs: that hierarchy being

physiological needs, safety needs, belonging needs, esteem needs and self actualization

needs.

Physiological needs are the very basic needs such as air, water, food, sleep, shelter, etc.

Safety needs have to do with personal safety and security including job security. Belong-

ingness is the desire to belong to groups: clubs, work groups, religious groups, family,

gangs, etc. There are two types of esteem needs. First is self-esteem which results from

competence or mastery of a task. Second, there's the attention and recognition that comes

from others. The need for self-actualization is "the desire to become everything that one

is capable of becoming."

Maslow's theory postulates that humans are motivated by the needs above the minimum

set of needs which are fulfilled. People who have fulfilled a particular set of needs are not

likely to be motivated by an environment which fulfils needs at lower levels. Conversely,

people are also unlikely to be motivated by an environment which fulfils needs at a much

higher level when their lower level needs have not been fulfilled.

For example, people who are struggling to cope with the basic physiological needs of suf-

ficient water, food and shelter are unlikely to be motivated by self actualization, charac-

terized by seeking knowledge and “inner peace”. Similarly, people who have a safe

home, a secure family and a healthy ego fuelled by the accumulation of material goods

are not going to be motivated by the provision of financial rewards.

Herzberg's theory is about the hygiene factors needed to stop employees from being de-

motivated and the factors which, if the hygiene factors are taken care of, will provide an

environment to motivate people.

The hygiene factors included in the job environment encompass the company, its policies

and its administration, the kind of supervision which people receive while on the job,

6

working conditions interpersonal relations, salary, status and security. These factors do

not lead to higher levels of motivation but without them there is dissatisfaction.

Herzberg's motivation theory involves what people actually do on the job. The motivators

are achievement, recognition, growth or advancement and interest in the job.

When applying these theories, leaders must understand some of the personal circum-

stances of the individuals and groups to develop the environment that allows individuals

and groups to motivate themselves and provide an overall approach that reinforces the

desired motivation.

Understanding what employees consider to be the basic physiological needs is a starting

point. Do employees consider the basic needs to be a roof over their head and food for

their family or a house they own and a car? Is it different from one workgroup to an-

other? Be careful, the definition of these needs will change over time for individuals and

groups and they will not necessarily match your own definition.

In my own experience, the removal of a bonus for not hitting targets de-motivated staff

well beyond that which might be expected. In 20:20 hindsight the bonus had, over the

years, become a means by which the employees provided their basic needs of a home. It

had become part of their mortgage payments.

For employees whose basic needs are fulfilled, it may be necessary to understand whether

delegation of responsibility and authority will cater to their self esteem needs. For exam-

ple, giving them projects for which they are accountable and have the resources and com-

petence to complete.

Care has to be taken with processes and policies. Processes and policies which are in con-

tradiction of people's motivators will depress motivation. A study of Herzberg dis-satis-

fiers reveals that administration and policy has the highest impact on motivation being a

7

dis-satisfier on 36% of occasions. However, processes and policies which motivate indi-

viduals may not be aligned to an organization’s strategy and objectives.

Further, a robust performance management system that recognizes and rewards people in

a way that fits their motivators is necessary for developing an environment that allows in-

dividuals and groups to motivate themselves

3) ABC Perera company PVT Ltd

Question One

a) i) Evaluate the policy of grievance handling being applied by the company.

Mr Bimal Perera thought all the employees like him. He not has much experience. He

thought pay properly, give bonuses employee satisfied. After meantime actually Mr Bi-

mal perera has really effort give material resources and financial resources, not Human

resources. They not handle grievance handling procedure properly. If have proper griev-

ances handling procedure employees can learn more things through this.

People suffering from mental problems, but Mr Bimal only think technical problems. He

not discusses other things; only discuss how to improve production. Mr Bimal could not

discuss other things, he only discuss how to improve production. Mr Bimal not joins the

union too much. He is not a bad person. He only concentrates only operation.

He was not listening to any body. He think he always know every think. Anyone can’t

think every think with us.

When the employees working at the work place, there are occasions, where they could

become disappointed or aggrieved about managerial decisions, practices, policies, service

conditions, etc. Grievance is a wrong or hardship suffered which becomes the ground for

complaint. Grievances could be affected by the following variables such as the

level of education

8

size of enterprises and the workforce

type of management

culture, etc.

When an organization does not pay attention to a grievance, employees will arise against

management and demand for a solution. This can in turn, lead to a dispute. It is prudent

for an organization to set up a grievance handling procedure as its objectives are to settle

disputes, at the earliest possible stage.

ABC Perera and company is the Tea factory in the srilanka was founded and

developed in 1980 by the Mr.perera. Mr.Bimal Perera is the CEO of this company. He is

well qualified person and his lessons, theory what he is learned things early, he has been

used for upgrading his career life. While he studying for his diploma he worked on the

factory floor and he came across the method which could improve efficiency or

productivity. Mr.Bimal studied science subject for his higher education. When following

his diploma, Bimal had worked on almost all the machines in the factory and was

thoroughly familiar with all of the technical process of the organization.

Consider this case; Mr.Bimal tries to continue a good grievance handling procedure

for employees according to his knowledge. This company followed and open door policy

for grievance handling. But he is failed to do it successfully sometimes. Why there are

many reasons have been affected to this case. Although this organization has an open

door policy, employees don't feel it. Or else employees are not being like that. As the

Bimal thought, he believed that the employees come to his office with problems for

solving. It is wrong and hardship task. Employees are never done it so. Because it has

been a huge gap among this both parties. Otherwise there are lot of essential problems

must solve in the person of the CEO for organization survival. Therefore Mr.Bimal

shouldn't do it so but he can appoint the immediate supervisor for solving employees

9

matter. Furthermore Mr.Bimal do it as own his image is tarnished. Then decrease the

employee confidence about Mr.Bimal.

Mr. Bimal always gives full of priority for money and machines. Not listen about

employees burning problems. He is thinking that when machines are in good quality in an

organization improves the productivity and efficiency of employees.Mr.Bimal trained the

new employees for it and solved the technical difficulties. But sometime employees are

faced to the lot of problems. Although the top manager is better but line managers are not

supported to the employees properly. Then employees are going against their line

managers. Because machines, equipments are not only thing they are expected there are

lot of thing expect from managers as employees.

When the organization faced the problem, because of the employee behavior Mr.

Bimal always calling to the company accountant and marketing manager. And he asks the

reason and solution for current situation by them. They can't give the proper solution for

employees because they are not human resource managers. They are working in financial

side. They haven't sound knowledge to solve the employee matters. As they involve

solving employee matters the financial managers are unable to do their task better.

This organization has a poor middle management. They act as lethargic type in

solving employee matters. They haven't been done their task properly. Because of the

middle management don't support to the employees. If they have done their task properly

this organization may not be face the employee problems likewise. Employees are always

feeling being unfairly treated. The middle management doesn't pay attention to a

grievance, employees who working at this organization will arise against the management

and demand for the solution of their grievances. Therefore middle management should

understand these problems of employees. or else employee grievances are gone up to

industrial dispute.

Considering this all elements this organization hasn't a proper grievance

handling procedure. There are lots of mistakes their current procedure. Therefore they

10

should review their current process and establish the new process considering the present

situation.

a) II) Suggest an appropriate policy and procedure of grievance handling for the

company.

This organization has a poor grievance handling procedure. Mr.Bimal tries to

establish good open door policy in an organization but he is failed to do it because of the

lack of knowledge of employee relation and lack of qualifications for handle the

organization. This is his first appointment. So He has to do lot of thing for solving

employee burning matters and survival of organization.

First of all we should identify the need of grievance handling procedure. In that way

we should get a clearly understand about present situation of the organization. This

organization has lot of employee problems. They are always behaving boisterously till

win their demands. But employers of this organization don't know about this employee

matters. Considering this bad situation we can establish the proper grievance handling

policies to the organization. Then we can engage it to solve the employee problems.

Open Door Policy

An open door policy means, literally, that every manager's door is open to every em-

ployee. The purpose of an open door policy is to encourage open communication, feed-

back, and discussion about any matter of importance to an employee. When a company

has an open door policy, employees are free to talk with any manager at any time.

11

Following this case, as thoughts of Mr.Bimal this organization is following the good

open door policy. Although Mr.Bimal thinking likes that this organization is not act as his

wish. According to his perception, employees may inform their problem to Mr.Bimal.He

thought that this is the open door policy. But it is wrong. Hence there are lot of problems

occurred into the organization because of this reason. Because of this case Mr.Bimal

should appoint the immediate supervisor for listening employee matters. So this

supervisor should be trained for that. Through engaging this person Mr.Bimal can easily

understand about these employee problems.

Establish the Proper Human Resource Unit and Ladder System

When the organization faces the problems, Mr.Bimal always get assistance from

Accountant and Marketing manager. These problems are occurred due to poor employee

relations so how financial managers are getting the best alternative solution for this case.

Both these section are variety. Considering this case, this organization hasn't a proper

Human resource unit for solving employee matters. So Mr.Bimal has to establish the

Human Resource unit for it. Human Resource managers are usually help to the

employees; listen to the employees and so on. After established the Human resource unit

Mr.Bimal can Use the ladder system to solve the grievance problems of employees.

When an employee has a grievance, it may refer to the immediate supervisor. If the

dissatisfaction is with the immediate supervisor, it may refer to the Line manager he may

be human resource manager. Failing which it could be referred to the Human resource

manager and may be referred to head of human resource manager, if not yet resolved, to

refer to the Top management. Using this method Mr.Bimal can easily solve these

employee problems.

Worker Representation Meetings

If this organization adopts the worker representation meetings it helps

to find the employee problems. Because of this method number of workers represents the

all over employees and their problems in an organization. Then senior management can

12

identify the employee grievances and in order to resolve their problems in a speedy

manner.

Client surveys and Grievances or Suggestion boxes

Mr.Bimal can also use the client surveys and grievance and suggestion

boxes. In the client survey the management can distributes questionnaires to the workers

to bring up their grievances where they will communicate freely as they do not have to

write their names. This is a very successful method of administering grievances in

organizations. When using this client and suggestion boxes in work place will help the

employees to bring up their grievance then and there without delay, So that the

management will handle them in a timely manner.

Question Two

b) Assume that the tread union enters a collective agreement with the management

which provide for 20% wages increase and the management decided to grant these

benefits only to 107 workers who are members of the union. Do you agree with the

decision or not? Why?

No, if you do that they will demand more than that. The employees always try to win and

do things through union. Union is needed thing. But it is not the reason for all the prob-

lems, every employee who are working in the company needed same benefits. If it is not

it is not a good company and the employees who working at the company always de mo-

tivated.

We can’t pay only 107 workers. If do that things balance minded persons also try to join

the union. Then union crowd is improving. Then company can’t manage the profit to pay

all the employees.

13

Mr Bimal not think employees basic needs. Employees are human beings and need to sat-

isfy their lives giving their wanted things. Always need to treat to employees same as

possible.

Motivation is very important thing. Mr Bimal needs knowledge about human recourses

management and he need training about HUMAN RESOURSES MANAGEMENT. Mo-

tivation is very important part of the human recourses management. The first step on the

path to growing employee motivation is finding out what each employee wants or needs

and then move on to figuring out how you can get it to them.  Some of the considerations

are: 

Find out what motivates each employee

Find out by asking each employee

Find out by asking employee peers what motivates the employee

Offer what fits each employee’s wants – the menu approach

Give employees the opportunity to earn what they want

Be consistent in the value of what is given to each employee

Don’t turn what employees earn into entitlements

As we saw above, each employee has different needs and wants.  Here are some

examples of what we have seen. 

Provide what the employee considers interesting work

Allow employees independence

Assign employees to work they are best able to perform

Set achievable goals

14

Be visible to the employees so they feel they can talk to you

Allow the employee to test-drive a new role

All of employees and every one want to do things their way.  We sometimes make

unreasonable requests.  We often choose to ignore the rules.  Some of us even blame

other people for our mistakes.  Many of us expect company entitlements without having

to earn them.  The interesting thing is that these attitudes permeate the business

environment.  And, when they are allowed to go unchallenged they are attitudes that in

fact cause other employee dissatisfaction and demonization. 

 These attitudes cause employee dissatisfaction because they are not consistently

accepted or refuted by management.  So, we contend that the biggest negative impact on

employee motivation and morale is a lack of management consistency,

inspection/observation, control, and employee accountability. 

Maslow's theory postulates that humans are motivated by the needs above the minimum

set of needs which are fulfilled. People who have fulfilled a particular set of needs are not

likely to be motivated by an environment which fulfils needs at lower levels. Conversely,

people are also unlikely to be motivated by an environment which fulfils needs at a much

higher level when their lower level needs have not been fulfilled.

For example, people who are struggling to cope with the basic physiological needs of suf-

ficient water, food and shelter are unlikely to be motivated by self actualization, charac-

terized by seeking knowledge and “inner peace”. Similarly, people who have a safe

home, a secure family and a healthy ego fuelled by the accumulation of material goods

are not going to be motivated by the provision of financial rewards.

Herzberg's theory is about the hygiene factors needed to stop employees from being de-

motivated and the factors which, if the hygiene factors are taken care of, will provide an

environment to motivate people.

15

The hygiene factors included in the job environment encompass the company, its policies

and its administration, the kind of supervision which people receive while on the job,

working conditions interpersonal relations, salary, status and security. These factors do

not lead to higher levels of motivation but without them there is dissatisfaction.

Herzberg's motivation theory involves what people actually do on the job. The motivators

are achievement, recognition, growth or advancement and interest in the job.

Mr Bimal can improve these attitudes and thereby motivate their employees by: 

Documenting clear performance expectations

Documenting and stating clear objectives

Providing training resources and opportunities

Publicly recognizing good performance

Being visible and accessible to employees – manage by walking around

Showing employees they are valued

Managing company policy consistently

Compensating employees for exceptional performance – bonus, night-on-the-

town, weekend trip, etc.

Disciplining or removing earned items or situations as a consequence to employ-

ees who don’t meet company and job requirements.

To set up an environment that enables employees to be motivated, leaders need to

understand what the motivational needs of individuals and groups are.

16

Determining the “what's in it for me” for individual employees and workgroups that is

consistent with goals and strategies of the organization is the key to improving motiva-

tion for individuals and groups of employees.

Question three

C) To reduce the above worker entrusts as a HR and Admin manager what type of

action plan that you going to implement?

Recruitment and selection procedures need to conduct to select good employees. Mr Bi-

mal always thinks he is right and his concept right, so he tries to blame union people.

Management is the process of getting activities completed efficiently and effectively with

and through other people.Difference between personnel management and human re-

sources, the difference can be described as philosophical. Personnel management is more

administrative in nature, dealing with payroll, complying with employment law, and han-

dling related tasks.

Human resources, on the other hand, are responsible for managing a workforce as one of

the primary resources that contributes to the success of an organization. So need do in-

volve and understand these tasks very much.

Mr Bimal always thinks only administrative side. Human resources management is very

important and the knowledge of these sides is very important.

17

Human Resource Manager has the key responsibility in his contribution towards the

management of IR at National level as well as organizational level. Human Resource

manager should emphasize the need to formulate a national policy based on national

economic priorities.

Within organizations, HR managers should provide the leadership in effective

management of IR function thus facilitating achievement of corporate objectives. In the

performance of this task, HR practitioner cannot and should not deal with industrial

Relations in isolation. It has to be dealt along with other functions of Human Resource

Management, Which is "an integrated approach to managing Industrial Relations in

organizations", and HR practitioner should:

Formula, implement and monitor HRM Systems/Strategies in regard to the man-

agement of employees effectively in order to achieve corporate objectives.

o Define expectations during recruitment interviews, presenting the un-

favorable as well as the favorable aspects of a job in a' realistic job

preview'.

o Communicate in induction programmes for new starters the organiza-

tion's core values and HR procedures, indicating the standards ex-

pected of employees in such areas as quality and customer service.

o Issue and keep up-to date employee handbooks that confirm and rein-

force the information and messages delivered in induction pro-

grammes.

o Manage expectations by ensuring that performance management pro-

cesses are in place, which provide for the communication and agree-

ment of expectations as part of a continuing dialogue.

o Adopt a policy of transparency on company policies and procedures.

o Give employees a voice on matters that concern them about the em-

ployment relationship.

18

o Persuade management to treat people as stakeholders, relying on con-

sensus and co-operation rather than control and coercion.

o Develop a climate of employee relationships which generate mutual

trust.

o Ensure that the reward system is developed and managed to achieve

fairness, equity and consistency in all aspects of pay and benefits

o Ensure through manager and team leader training that they understand

what is expected of them in maintaining a positive employment rela-

tionship with their staff.

Assist the line management and collaborate with them in the management of their em-

ployee effectively through a process of providing quality HR services.

Review and improve the Human Resource Management systems/strategies in order to

meet the emerging demands of a changing business environment also the valuable points.

As well as Hr manager admin manager also has more responsibilities. Both managers

combination can solve problems easily. Some of admin mangers duties are

arranging travel;

organising meetings and appointments;

delegating work and workload planning;

ordering stationery;

dealing with post and emails;

writing reports;

supervising the work of clerical and secretarial staff, monitoring the workload and

work rate;

liaising with members of the senior management team;

19

keeping personnel records;

organising the recruitment of new staff;

chairing meetings;

controlling the office budget;

dealing with complex queries and complaints on the telephone, by email and in

person;

conducting appraisals and maintaining appraisal records;

administering payroll systems;

discussing problems with staff;

dealing with a wide range of human resource issues;

meeting with senior managers to review office performance;

devising and conducting induction programmes;

ordering office furniture;

organizing office maintenance and repair work;

supervising the implementation of new office systems;

arranging for health and safety equipment to be tested on a regular basis;

reviewing and updating health and safety policies.

To accomplish these tasks successfully, the HR practitioner should possess a high

degree of professionalism, determination and commitment in the discharging of his

responsibilities and do admin manager’s duties very successfully is very important.

20

This is the best way to reduce the company employee’s problems as Human recourses

and admin managers.

21