MANAGEMENT OF PEOPLE AND FINANCEOutcome 1

Human Resource Management

Higher Business Management

What would you do in HR?

Role and Function of HR• Workforce Planning• Recruit, select and retain quality staff• Training, development and appraise• Maintenance of Personnel Records• Employee Relations• Grievance and Discipline• Ensure safe working conditions• Ensure staff treated fairly

Roles and Functions - FACES

•FACILITATOR•AUDITOR•CONSULTANCY•EXECUTIVE•SERVICE

Using P99 summarise each of these roles into your jotter

Changing Patterns of Employment

• Decline in full-time, permanent work• More women working • Increase in service sector employment• Increase in public sector employment• Higher unemployment amongst older men• Increased number of fixed length-contracts• Increased self-employment• Increase in flexible working practices

Changing Patterns of Employment

• Flexible Working Practices• Part-time work• Variable Hours• Flexi-time• Homeworking• Teleworking• Hot-desking• Job Share• Temporary work• Self-employment

Write a definition of each of these into your jotter.

Modern Employment PatternAdvantages• Core employees can

focus on core activities only

• Saves on salaries and space

• No need to pay for pensions, holidays or redundancy

• Reduced NI contributions

• Allows flexibility and can respond quickly to change

DisadvantagesFrequent recruitment and selectionOccasional staff shortagesLess commitment from staffIncreased need for training due to high staff turnoverLack of continuity of staff - customers may become unhappy

The Core WorkersEssential workers - managers, skilled workers - permanent and well-paid

The Contractual FringeSub-contractors - suppliers of components or services - cheaper (no pensions, holidays etc)

The Flexible Labour ForcePart-time, temporary - help core workers at peak times - low rates of pay

The Modern Working Environment

Contractors/Outsourcing• Contractors are people/businesses who

provide goods and services that the organisation does not wish to provide for itself.

• Examples: cleaners, consultants, security guards, suppliers

• Because they are not permanent they are less expensive (no pension pay or holiday entitlement for example)

Reasons for Sub-Contracting/Outsourcing

• More skilled workforce• Expertise• Economies of scale• Can concentrate on core activities• Saves money in equipment/training

• What are common examples of outsourced departments?

Manpower Planning

If firm’s labour supply is more than demand:

• Redundancy• Retraining• Early retirement• ‘Natural wastage’

If firm’s labour supply less than demand:

• Additional advertising

• Retraining programmes

• Increase pay & other incentives

Keeping Personnel Records on EVERY employee (database)

Key Fields: Unique identifiers like National Insurance Number (AB Council uses this)

• Attendance• Discipline• Performance• Communicating (Correspondence)• Selection of staff (promotion, training,

teams, specific jobs)

• Includes info on appraisals, training etc

• Conforms to the Data Protection Act

Task!1) Describe 3 objectives of the Human Resources department.

2) Identify the 5 roles of Human Resources.

3) Differentiate between full time and part time employment.

4) Differentiate between temporary and permanent employment.

5) Describe what is meant by outsourcing or contracting.

6) Write a short report or create a powerpoint presentation illustrating the changing patterns of employment over the past 40 years.

Make reference to sectors of the economy, increase in part-time employment and include examples of flexible working practices.

Steps in Recruitment

1. Identify a job vacancy2. Conduct a job analysis3. Prepare a job description4. Prepare a person

specification5. Advertise the job

(Internally or Externally)

Prepare Job DescriptionThis states:• Job title• Location• Tasks• Duties & Responsibilities• Hours• Holiday Entitlements

See P102

Prepare Person Specification

A description of the type of person suitable for post is drawn up. This includes:

• Skills• Qualifications• Experience• Personal qualities• Hobbies & Interests

See P102

Advertising PostInternal and ExternalInternal

• Newsletters• Notice board

External

• Newspaper Adverts• Internet• Job Centre• Recruitment Agency• Schools/Colleges/

Universities

Internal Recruitment

Advantages• Applicant & ability

familiar to organisation• Organisation may have

invested in person through training

• Individual aware of culture (no need for induction training)

Disadvantages• Limited skills pool• Own Job needed to

be filled• Resentment from

overlooked staff

External Recruitment• Advantages• Can target

specific sections of population

• Wider job skills pool

• No need to fill another post

• Disadvantages• Expensive• Time taken can

be long• Successful

candidates may turn down job

Selection Process

1. Application forms/CVs (shortlist created)2. Testing

• Attainment, aptitude, IQ, psychometric and medical tests

3. Assessment Centres4. Interviews (1-2-1, successive and panel)5. Selection and notification6. Reference checks

Application Forms

• Initial contact

• checked against the Person Specification to select suitable candidates for vacancy

CV

Curriculum Vitae or life history

• Personal Details• Education• Qualifications• Work Experience• Hobbies/Interests• Additional Info

Testing, Testing

1. Describe and discuss 4 tests that may be used in the selection process.

2. Take a personality test!

http://www.outofservice.com/bigfive/ www.myworldofwork.co.uk - my DNA TEST

Assessment CentresActivities:• Team building• Role Play• Interviews

Qualities looked for:

• Social skills, leadership qualities & personality

Intensive assessment held over one or two days

Allows business to see large amount of applicants at once

Interviews

• One-to-one

• Successive

• Panel

A ‘Good’ InterviewAn interviewer should:• Be open minded and unbiased• Be prepared• Welcome the interviewee• Control the interview• Supply the information• Close the interview• Follow-up

Task

•Activity 3 – Questions Only

Reasons for Training and Development (CPD)• Improve staff performance• Improve productivity• Staff more flexible• Increase job satisfaction• Staff more motivated• Upgrade staff skills• Reduce injuries & accidents• Organisation gains good image

TrainingCosts

• Financial costs• Expenses• Loss of output• Staff may leave after training

• Staff may request pay rise

• Quality of training must be high

Benefits

• Flexibility• Upgrade skills• Employee satisfaction

• Improved image for organisation

• Motivation and productivity

Induction Training

• For new employees

• Covers aspects of:• Company procedures• Meeting colleagues• Tasks of job• Health & safety

Training Methods

• On the job – training conducted at employee’s place of work. Some organisations offer training schemes and work-based qualifications.

• Off the job – training occurs outside of work e.g. university or college

Training Methods• “Sitting next to Nellie” Demonstration –

task demonstrated then trainee undertakes task

• Coaching – trainee taken through step by step by trainer

• Job Rotation – trainee learns tasks in different departments/jobs

• Distance learning – trainee receives resources and works on their own (and VLE’s)

Tasks

1. Outline the advantages and disadvantages of using VLE’s.

2. Outline the advantages and disadvantages of work training schemes and work-based qualifications.

3. Activity 4 - Training

4. Exam Prep Questions• P89 – Q16a and b• P93 – Q24a and b

Use P82-85 to help

Staff Development - Appraisals

Assessment of staff performance usually held annually. Uses Appraisal/PRD form then interview

• To identify future training needs• Consider individual’s development

needs• Improve employee performance• Provide feedback on performance• Identify promotion hopefuls

Problems:• Difficult to measure• Personality clashes

Read P93 on other

appraisal types

Factors of Motivation• Pay levels• Open door policy• Flexible working practices• Job security – permanent contracts• Bonuses and incentives• Training and CPD• Profit sharing schemes• Employee of Month• Quality circles• Team building/social events• Promotional prospects• Responsibility and empowerment• Working conditions• Fringe benefits • Participation in decision-making• Working in a team

Motivation & Needs

Maslow’s Hierarchy of Needs

• Needs at top more important than at bottom

• But lower needs have to be satisfied first

P86

Adam’s Equity Theory

•Pay•Praise•Rewards•Conditions•Recognition

• Time• Effort• Loyalty• Commitment

Herzberg’s Two Factor Theory

• Frederick Herzberg believed there were two factors that affected people at work:

• Hygiene Factors – ones with potential to cause dissatisfaction at work (salary, working conditions, status, over-supervision)

• Motivator Factors – aspects of a job that can lead to positive job satisfaction (achievement; recognition; meaningful, interesting work; psychological growth and learning)

MotivationFinancial Methods• Flat rate, piece rate, commission. Performance Related Pay, profit sharing, share ownership

Non-Financial Methods• Empowerment, delegation, job enrichment, job enlargement, job rotation, quality circles, career structures, work councils

Describe 3 financial and 3 non-financial methods of motivating staff.

LeadershipLeaders should influence and encourage employees to work towards achieving the organisational goals.

• AutocraticPower is with the leader and all decisions made by them. One directional communication and no empowerment of employees.

•DemocraticConsultation and communication with employees. Encourages participation and often seen as motivating.

• Laissez-faireDoesn’t exercise control and employees are ‘left’ to get on with job themselves with no direction or structure.

Leadership Theory

Another theory is McGregor’s X and Y Leadership theory.

1. Research this theory (P87) and summarise it into your jotter.

2. What do YOU think about this theory? Write down your thoughts on this

theory under the summary.

Empowerment…Subordinates can exercise power over their working lives.

• MORE responsibility • MORE independence• MORE involvement in decisions

Empowerment benefits to employee• May feel valued• Greater chance of promotion• Improved pay• Improved skills• Employees may be given extra training

• Improved motivation

Empowerment Benefits to firm• Improved productivity• Increased staff motivation and morale• Faster decision making• Fresh ideas can improve quality

decisions• Organisation may become more competitive

• Faster communication • Improved management/employee relations

Criticisms of Empowerment

• Is it more work for less money?

• Not all workers like freedom and responsibility. Some like to be told what to do.

• QUESTION: Discuss methods of empowering staff within an organisation.

Costs of Labour Turnover

• Costs of advertising, interviewing & training new employee

• Loss of production while place is being filled

• Low morale amongst other employees

Keeping Personnel Records on EVERY employee (database)

Key Fields: Unique identifiers like National Insurance Number (AB Council uses this)

• Attendance• Discipline• Performance• Communicating (Correspondence)• Selection of staff (promotion, training,

teams, specific jobs)

• Includes info on appraisals, training etc

• Conforms to the Data Protection Act

Employee Relations

• “The formal relationship between employees and employers”

• Trade Union recognition

• Collective Bargaining

• Employee relations procedures

Grievance• Grievance is a complaint by employee

against employer

Can be taken up by:• Industrial tribunal• ACAS• Trade Union

Discipline

• Discipline procedures are taken against employee by employers

• Employees must be aware of rules

• verbal & written warnings given for breaking rules

• Suspensions can follow then dismissal

• Negotiation - reach an agreement, but needs some middle ground between the two positions held. Settlement or compromise.

• Consultation - Informing employees of changes and ask for thoughts. Final decision by the EMPLOYER.

• Arbitration - When no agreement occurs, then a third party, an independent arbitrator eg ACAS is called. Arbitrators are neutral and unbiased and will listen to both sides and offer a fair and practical solution

Industrial Action• Employee Action

• Sit in• Overtime ban• Work to rule• Go slow• Strike

• Employer Action

• Withdrawal of overtime

• Lock out• Closure

TASK – describe each of these

Trade Unions• Organisation representing workers re: pay

negotiations, working conditions, dismissal, redundancy, training and development.

• TUC and EIS are examples of Unions

• Trade Unions are funded by annual subscriptions by its members

ACAS – Advisory, Conciliation & Arbitration Service

• Provides impartial information to people with problems at work

• Prevents & resolves problems at work

• Settles complaints about employee’s rights

• Run workshops & seminars on latest employment issues & legislation

Collective Bargaining

• Begins with a change in existing contracts

• Employers make offer to employee reps• Reps tell members & counter-claim

occurs• Negotiations begin• Eventually a compromise is usually

reached

Employers Associations• These are organisations that represent

the views and interests of companies within one sector of industry

• Newspaper Society, Engineering Employers’ Association are such examples

They provide a range of services:• They act as a pressure group• A collective market research organisation• A public relations voice for the industry• Can provide negotiating teams

Professional Associations• These organisations represent

‘professional’ occupations such as the GTC for teachers, BMA (British Medical Association) for Doctors, for the Police – the Police Federation and even for footballers: the PFA

• They sometimes perform similar roles to unions, and also are involved in maintaining standards, etiquette and codes of conduct

Employment Rights Act (1996)

Covers:

• Unfair dismissal

• Redundancy

• Maternity leave

Contract of Employment• Job title• Rules/duties • Salary and pension info• Hours of work• Holiday entitlement•Arrangements in event of illness• Terms of notice• Grievance procedures• Disciplinary procedures

Equalities Act 2010

This new act encompassed older discriminatory Acts into 1 legislation including – Equal Pay Act 1970Sex Discrimination Act 1975Race Relations Act 1976Disability Discrimination Act 1995 That protects discrimination in employment on grounds of religion or belief, sexual orientation and age

Equalities Act 2010The Equality Act 2010 is the law which bans unfair treatment and

helps achieve equal opportunities in the workplace and in wider society.

The act covers nine protected characteristics, which cannot be used as a reason to treat people unfairly. Every person has one or more of the protected characteristics, so the act protects everyone against unfair treatment. The protected characteristics are:

• age• disability• gender reassignment• marriage and civil partnership• pregnancy and maternity• race• religion or belief• sex• sexual orientation

National Minimum Wage Regulations 1999• This states the minimum

wage amount to be paid to employees.

• There are 3 hourly rates – • 16-17 year olds - £3.57• 18-21 year olds - £4.83• 22 or over - £5.80

Health & Safety at Work Act (1974)

Covers:

• Working conditions• Provision of safety equipment• Workplace hygiene

Health & Safety at Work Act 1974 – the EMPLOYER’S responsibilities

• Look after employee’s welfare Provide protective clothing where necessary.

• Provide First Aid facilities

• Keep records of any accidents or incidents which occur.

• Prepare a Health & Safety policy

Health & Safety at Work Act 1974 – the EMPLOYEE’S responsibilities

• Look after their own and their colleagues’ health and safety.

• That they report any accidents or faulty equipment

• Cooperate at all times with their employer

Office, Shops and Railway Act

Covers:• Operating dangerous

machinery• Seating & Storage space• Lighting• Fire• Temperature/ventilation• Premises, Toilets etc…

• Not all workers like freedom and responsibility. Some like to be told what to do.

Freedom of Information Act 2000 (ICT)

A law to make provision for the disclosure of information held by public authorities or by persons providing services for them and to amend the Data Protection Act 1998 and the Public Records Act 1958; and for connected purposes.

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Data Protection Act 1998• Covers information that is held on computers eg customers, staff, suppliers

etc

• Aims to protect the rights of the individual by providing legislation to govern the collection, storage and use of information that is held on electronic or paper file systems

• There are 8 basic principles

• Businesses must register with the Data Protection Registrar who oversees enforcement and application

What are they?

Computer Misuse Act 1990

• Aims to deal with the problem of hacking computer systems

• It is an offence to:• Try to gain unauthorised access to computer material• Gain unauthorised access with intent to commit further offences• Unauthorised modification of computer material B

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Copyright, Designs and Patents Act

• The Copyright , Designs & Patents Act makes sure that there is no unauthorised copying of material that has been produced.

• Examples of items which are copyrighted are:• Music CDs, Books, Textbooks, CD-Roms, Newspapers etc etc

• If anyone would like to copy information they have to seek permission from the owner.

• It is easy to identify which materials have been copyrighted by identifying the copyright symbol: ©

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70Apple was awarded £665 million in a landmark victory over Samsung, which was found guilty over intellectual property infringement.

Questionsa) Describe the role of the human resources

department within an organisation (3)b) Explain how legislation will affect the

running of a business in the areas of:• Health and safety• Employment• Use of ICT