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HUMAN RESOURCEMANAGEMENT

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NTPC

NTPC incorporated in 1975 has evolvedas progressive, high performingorganization capable of competing

globally. ONGC a Maharatana considered as one

of the best company to work.

TATA spends over 250 cr annually forup keeping the Jamshedpur city.

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HRM

NTPC People first & in 2008 rankedno. 1 as best workplaces for largeorganization.

ONGC HR is strength. TATA Value HR

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HRM

Management of work force of anorganisation ie how to manage thedifferent people working together in a

organisation.

HRM is a management function that

helps managers recruit, train anddevelop members for an organisation.

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HRM

HRM is concerned with the peopledimension in management. Since everyorganisation is made up of people,acquiring their services, developing

their skills, motivating them to higherlevel of performance, and ensuring thatthey continue to maintain theircommitment to the organisation areessential to achieving organisationalobjectives. This is true, regardless ofthe type of organisation ie government,

business, education, health.

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Objectives of HRM Societal objectives To be socially responsible to

the needs of the society.

Organisational Objective To recognise the role ofHRM in bringing about organisational effectiveness.

Functional objective To maintain departmentscontribution at a level appropriate to theorganisations needs.

Personal Objective To assist employees in achievingtheir personal goals, at least in so far as these goalsenhance the individuals contribution to theorganisation.

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Objective of HRM

HRM Obj. Supporting function

Societal Objective

1. Legal compliance

2. Benefits

3. Union Management relations

Organisational

Objectives

1. HRP

2. Employee relations

3. Selection

4. Training & Development5. Appraisal

6. Placement

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Objectives of HRM

HRM Obj. Supporting function

Functional objectives1. Placement

2. Assessment

Personal Objectives 1.Training & Development2. Compensation

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Competitive challenges and HR

1. Going global2. Embracing new technology

3. Managing change and organisationculture

4. Responding to the market

5. Containing costs Downsizing

Outsourcing and employee leasing

Enhancing productivity

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Other challenges faced

Demographic and Employee concerns Diversity of backgrounds

Age distributions

Gender distribution Rising level of education

Cultural changes

Concern for employee rights Changing attitude towards work

Balancing work and family

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Functions of HR

MANAGERIALFUNCTIONS

PlanningOrganising

Directing

Controlling

OPERATIVEFUNCTIONS

Staffing

Development

Compensation

Motivation

Maintenance

Integration

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Operative functions of HR

STAFFING Job analysis, HRP, Recruitment,Selection, Placement, Induction,Internal Mobility

DEVELOPMENTCompetency profiling, Training anddevelopment, Performance &potential management, Careermanagement, 360 degree feedback

COMPENSATION& MOTIVATION

Job design, Work scheduling, Jobevaluation, Compensationadministration, Incentives and

benefits

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Operative functions of HR (contd.)

MAINTENANCE Health, Safety, Welfare

INTEGRATIONEmployment relations, Grievance,Discipline, Trade unions,Participation

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Scope of HRM

Labouror Personnel aspectRecruitment, Selection, Transfer,Promotion etc.

Welfare aspect Housing, Lunch room,Health and Safety, Transport,education etc.

Industrial relation aspect UnionManagement relations, Negotiation,Grievance handling etc.

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HRM Environment - External

Professionalism

Social & cultural

Union

Political & legal

Economic

Technology

HRM

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HRM Environment - Internal

Mission OrganisationalConflict

Policies

HRM

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Xerox

In 2000 Xerox was in debt of $17billion, stock was tumbling & it wasloosing money.

Securities & exchange commission wasinvestigating the way company had beenaccounting for copier leases.

Company made the remarkable comeback & returned to profitability and thestock prices increased.

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Xerox ?

Question How did thecompany turn around?

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HR the Xerox way

Cost cutting but major focus remaintowards quality ie product, servicesthrough Quality .....?

Xerox CEO Anne M. Mulcahy saidcompanys strategy of offering worldclass products & services requires worldclass people.

Brand of employment employerbranding through implementing express

yourself initiative.

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HR the Xerox way

Employer branding justified through making Xerox a place where passion,diversity, ideas & contributions of everymember of the family proves thecapability for bold innovation andleading edge work environment.

Xerox relies on HR service center takes care of routine as well as criticalHR services as well as with R & D.

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HR the Xerox way

During rainy times HR at Xerox played aresponsible role and supported eventhose employees who were to separate.

Laid off employees who were nearretiring age were treated with dignity &was given a year off with out paid whichkept their status active and all qualifiedfor retirement benefits.

Employee surveys to know the internalcustomers perception / views oncompany & its practices.

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HR the Xerox way

During sunny days Xerox focuses ontalent management by improving KSA &prepare future leaders by exposingemployees to different environmentwhich includes transfers oninternational assignments.

Xerox top managements philosophy every employee is unique and is able tobring valuable difference.

Treat HR as Biggest Asset

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Possibility..

Properly managing human resourcescan provide solutions to how best tosatisfy the objectives of multiple

stakeholders, even when theobjectives seem to conflict.

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HRM Cycle

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HRM Policies

Policy is predetermined course of actionestablished to guide the performance of worktowards accepted objectives.

Importance -:

(1) Clear Thinking

(2)Uniformity & Consistency of Admin.(3)Sence of Security

(4)Control

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Types of HR Policies

Originated policies Made by topManagement.

Appealed policies Made on request to handlecertain situation, or if certain aspects are

missing in the main policy. Imposed policies Imposed by Govt & Legal

authorities.

General policies Do not relate any issue, mayrepresent the priority of Top Mgmt. (WPM).

Specific Policy Related to specific issueslike Recruitment, Transfer, Promotion etc.

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GHRM or IHRM

Scope -:1. Cross cultural management

2. Comparative industrial relation

3. HRM in multinational firms

Cross CulturalManagement

IHRM inMNC

ComparativeIR systems

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HRM v/s GHRM

HRM activities includes

1. HRP

2. Staffing3. Performance Management

4. Training & Development

5. Compensation & benefits6. IR

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HRM v/s GHRM

GHRM- includes1. Broad HR activities (procurement,

allocation & utilization)

2. National or Country categories iea) Host country Subsidiary may be

located

b) Parent country Firm is Headquartered

c) Other country Source of labour

3. Category of employees ie HCN, PCN & TCN

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GHRM

HCN Host country national like Indiancompany has its unit in US and employsUS locals.

PCN Parent country nationals likeIndian company employs Indian locals orIndian company sends Indian employeeto US unit.

TCN Third country National likeIndian company employs Japanese towork in US unit.

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Expatriates

In GHRM the staff generally moves across nationalboundaries into various roles, these employees aretraditionally been called as expatriates.

An expatriates is an employee who is working and

temporarily residing in a foreign country. Some firms prefer to call them international

assignees.

PCN & TCN are always expatriates but what when

HCN transferred to Parent country of theorganization?

Inpatriate or expatriates.

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Is GHRM complex? In addition to complexity, there are four other variables

that moderate differences between domestic andinternational HRM. These variables are below:

1. The Cultural Environment cultural shock &

nepotism.2. Industry Type

3. Reliance of the Multinational on its Home-Country

Domestic Marketsmall homemarket.

4. Attitudes of Senior Management to International

Operationsfailure in managing humanresources.

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Global staffing

Ethnocentric approach PCN preferred

Polycentric approach HCN preferred

Geocentric approach Best people forkey jobs.

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Approaches to staffing - GHRM Ethnocentric approach PCN preferred, because of lack of

qualified HCNs and also to have better 3 Cs at initialinternationalization process.

Polycentric approach HCN preferred, treat subsidiary asseparate entity, PCN dont get transferred to subsidiary,chances of promoting HCN to hold key position in HQ, furthereliminates language issues, adjustment issues & reduces theexpenses in terms of training cost.

Geocentric approach Best people for key jobs, helps MNC todevelop international executive teams, it overcomes federationdrawback of polycentric approach, supports cooperation &resource sharing across units.

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Approaches to staffing - GHRM Ethnocentric approach High compensation package,

adapting to culture & environment.

Polycentric approach Career path of HCN & PCN,complexities in bridging the gap between HQ &subsidiary.

Geocentric approach Host country requirement toplace high number of their citizen, extensivedocumentation related to expatriates, increasedtraining & relocation cost.

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Barriers to GHRM There are a number of unique problems that global

companies face when trying to implement consistentpractices across their global HR networks. Theseproblems act as barriers to effective Global HRM.These are:

Variations Perception of HR Attitude and actions of headquarters toward HR Resistance to change Cultural differences in learning and teaching styles

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Human Resource Planning Meaning Assessment of Human Resource

Requirements & also the time & stages ofrequirement.

Right person ---At Right place ---At Righttime.

Definition HRP is defined as the process by

which management determines how an orgshould move from its current manpowerposition to its desired manpower position.

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Objectives of HRP

To ensure optimum use of existing HR. To forecast future requirement for HR.

To provide control measures to ensure

that necessary HR are available as andwhen required.

To asses the surplus and shortage of

HR. (Downsizing/expansion). To anticipate the impact of technology

on jobs and HR.

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Objectives of HRP Contd.

To determine the level of Recruitmentand Training.

To estimate the cost of HR and Housing

needs of employees. (Or HRA). To provide the basis of MDP.

To meet the needs of expansion and

diversification programmes.

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Importance of HRP Future Personnel needs defective planning leads to surplus or

shortage. Govt. companies.

Creating highly talented personnel Talent management.

International Strategies - Diversification & expansion

Foundation of personnel function

Resistance to change and move Test of loyalty & dedication?

Increasing investment in HR

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Factors Affecting HRP

Outsourcing

Strategy of

Organisation

Environmental

Uncertainties

Organisational

growth cycle

& planning

HRP

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Organisation growth cycle and planning-:

HRP is Critical when organisation enters

the growth stage.

Mature organisations experiences less

flexibility and variability, growth slowsdown. HRP is dominated by Layoffs,Retrenchment, Retirements.

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Environmental Uncertainties -:

When Political, Social and other changes

affect the organisation, HR plannersdeal with uncertainties.

It can result in Recruitment, Training,Succession Planning, Retrenchment etc.

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Strategy of Organisation -:Strategic plan of the organisation defines theorganisations HR needs.

Internal Growth

Informal

Reactive

Narrow

Inflexible

Growth through Mergers

Broad

Formal

Proactive

Flexible

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HRP Process

HR Need Forecast

HR Programming

HRP Implementation

Control & Evaluation

ShortageSurplus

Environment

Org objectives & policies

HR Supply Forecast

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HRP Process (Contd.)

Environmental Scanning - :1) Economic factors including general &regional conditions

2) Technological Changes including automation

3) Demographic changes including age,composition & literacy

4) Political and legislative issues including

laws & administrative rulings5) Social concerns including child care &

educational facilities

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Org objectives and policies-:

HR plans need to be based on org

objectives, this implies that theobjectives of the HR plan must bederived from Org objectives.

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HR Demand forecast-:

The process of estimating the future quantityand quality of people required.

The basis of forecast will be annual budgetand long term corporate plans.

Demand forecasting must consider several

factors like internal (Budget constraints,employee separations, production level) andexternal (Competition, laws, change intechnology).

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HRP Process (Contd.) Demand forecasting techniques are-:

Managerial judgment Managers sit to gather to reach acommon solution.

Ratio trend analysis Based on the past sale & worker ratiopredicting the future.

Delphi technique Expert surveys & formulate the report but

the process goes on till every one reaches the commonconclusion. Regression analysis Similar to ratio trend analysis but more

use of statistical tool.

HR Supply forecasting-:

Supply forecasting measures the number of people likely to beavailable from within and outside an org.

Based on existing HR, internal & external sources of supply.

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HRP Process (contd.)

HR Programming-: Once the Orgs HR Demand and Supplyare forecast, the two must bereconciled or balanced in order that

vacancies can be filled by the rightemployee at the right time.

HR Plan Implementation-:

Implementation requires converting anHR plans into action. (Recruitment,Training, Succession plan, retentionplan, redeployment etc.)

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HRP Process (contd.)

Control and Evaluation -:Critical to have proper control andregular checks to know the

achievements of HRP.

Surplus Shortage

Restricted hiring R & S

VRS, Lay off

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E - HRM

E-HRM is the planning, implementation andapplication of information technology for bothnetworking and supporting at least twoindividual or collective actors in their shared

performing of HR activities. E-HRM is not the same as HRIS or VHRM

VHRM - a network-based structure built onpartnerships and typically mediated byinformation technologies to help theorganization acquire, develop, anddeploy intellectual capital

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HRIS

HRIS is a database system that keepsimportant information about employeesin a central and accessible location.

The information provided by HRIS canhelp the organisation to gaincompetitive advantage. (SWOT of org.)

f f

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Information categories of HRIS

Basic non confidential information-:

Employee name, Org name, Worklocation

General non confidential information -:

Social security number, Position relatedinformation (codes, tittles, effectivedate)

f f HR ( d )

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Info categories of HRIS (contd.)

General information with salary -:

Current salary, Effective date, Amount

of last change, Reason for last change.

Confidential information with salary -:

Information of previous category,Educational data

f f HR ( d )

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Info categories of HRIS (contd.)

Extended information with salary -:

Information of previous category, Bonusinformation, Projected salary increaseinformation, Performance evaluation

information.

J b A l i

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Job Analysis

Job analysis is the process of collectingjob related information. Suchinformation helps in the preparation ofjob description and job specification.

Job Analysis

Job Description Job Specification

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P f J b A l i

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Purposes of Job Analysis

HRP

Recruitment & Selection

Training & Development Remuneration

Safety & Health

Performance Appraisal

M th d f C ll ti J b D t

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Methods of Collecting Job Data

Observation

Interviews

Questionnaire Technical Conference Method

P f J b A l i

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Process of Job Analysis

Strategic Choices

Gather Information

Process Information

Job Description

Job Specification

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P bl ith J b A l i

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Problems with Job Analysis

Support from Top management

Single Means or Source

No Training or Motivation

Activities may be Distorted

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M th ds f J b D si

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Methods of Job Design

Job Design Methods -:

Job

Design

Job

Simplification

Job

Enlargement

Job

Enrichment

Job

Rotation

J b d si n

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Job redesign

Restructuring the elements including tasks,duties and responsibilities of a specific job inorder to make it more encouraging andinspiring for the employees or workers is

known as job redesigning. The process includes revising, analyzing,

altering, reforming and reshuffling the job-related content and dimensions to increase

the variety of assignments and functions tomotivate employees and make them feel as animportant asset of the organization.

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Advantages of Job redesign

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Advantages of Job redesign

Enhances the Quality of Work-Life Increases Organizations andEmployees Productivity

Brings the Sense of Belongingness inEmployees

Creates a Right Person-Job Fit

Job carving

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Job carving

Job carving is a technique used by our jobdevelopers as they probe the needs ofprospective employers. They analyze anorganization's operations in order to identify

repetitive tasks that do not make the bestuse of a current employee's time. Then withthe help of the employer combine such tasksinto a position matching the skills of our

internal customer. This is a win-win approachthat increases the productivity of allconcerned

Job carving

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Job carving

Job Carvingis a way of splitting jobs toensure the most suitable person carriesout each task.

It is a concept that can benefit bothemployers and employees throughincreasing productivity by realigningworkers tasks.

Advantages to employer

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Advantages to employer

Develop existing employee skills Create a diverse workforce

Increase understanding of Disability

Positive impact in your local community Access to a valuable, committed source

of recruitment

Advantages to employee

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Advantages to employee

Improved confidence and self-esteem Learn new work-based skills

Increased independence

Better social networks Career development

Recruitment

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Recruitment

The process of finding and attractingcapable applicants for employment. Theprocess begins when new recruits aresought and ends when their applications

are submitted. The result is a pool ofapplicants from which new employeesare selected.

Recruitment is a process of invitingapplications from prospectiveemployees.

Recruitment is a positive process.

Purpose & Importance of

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p pRecruitment

Determine the present and futurerequirements of the organisation inrelation with the HRP and Job Analysis.

Increase the pool of job candidates atminimum cost.

Meet the organisations legal and socialobligations regarding the composition ofits workforce.

Sources of Recruitment

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Sources of Recruitment

Internal Sources -:Transfer , Promotions.

External Sources-:Press Advertisements , EducationalInstitutions, Placement Agencies,

Employment Exchange, LabourContractors, Recruitment at factoryGate.

Recruitment Process

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Recruitment Process

Recruiting Required Personnel

Search for Perspective Employees

Internal Sources

External Sources

Evaluating effectiveness of process

Recruitment Process

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Recruitment Process

Personnel Requisition -: Requisition forrecruitment from other deptt., Containsinfo like no of person required, duties tobe performed, desired qualification,

time of appointment, info about job. Locating and developing sources of

required no and type of employees.

Identifying the prospective employeeswith required characteristics.

Process (contd )

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Process (contd.)

Communicating the info about the org,the job and the terms and condition ofservice.

Encouraging the identified candidatesto apply for jobs in the org.

Evaluating the effectiveness ofrecruitment process.

Alternatives to Recruitment

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Alternatives to Recruitment

Overtime

Employee Leasing

Temporary Employment

Selection

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Selection

Selection is the process of pickingindividuals (out of the pool of jobapplicants) with requisite qualificationsand competence to fill jobs in the

organisation.

Selection is a negetive process.

Selection Procedure

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Selection Procedure

Preliminary Interview

Application blank

Selection Test

Employment Interview Reference Check and Background

Analysis

Medical Examination Final Approval

Evaluation

Test and Interview

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Test and Interview

Psychological tests -: Aptitude test

Informal Interview

Formal Interview Depth Interview

Stress Interview

Induction Or Orientation

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Induction Or Orientation

Planned introduction of employees totheir jobs, their co workers and theorganisation.

Orientation also called Induction, isdesigned to provide a new employee withthe information he or she needs tofunction comfortably and effectively inthe organisation.

Objectives of Induction

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Objectives of Induction

To help new comer overcome his naturalshyness and nervousness in meeting newpeople in the environment.

To develop among the newcomers asense of belonging and loyalty to theorganisation.

To develop a close and cordialrelationship between newcomers and theold employees and their supervisor.

Objectives (contd )

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Objectives (contd.)

To ensure that the newcomers do notform negative or false impression andattitude towards the organisation orthe job because first impression is the

last impression. To give newcomers necessary

information such as leave rules, rest

period, locker room etc.

Advantages of Formal Induction

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Advantages of Formal Induction

Helps in build up a two way channel ofcommunication between management andworkers.

Proper induction facilitates informalrelations and teamwork amongemployees.

Effective induction helps to integratethe new employees into the organisationand to develop the sense of belonging.

Types of Induction Programme

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Types of Induction Programme

Formal

Informal

Individual

collective

Contents of Induction Programme

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Contents of Induction Programme

History and operation of company

Products and services of company

Policies and procedures of company

Grievance procedure Benefit and services for employees

Opportunities for training and

development, promotion, transfer etc.

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Placement Problems

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Placement Problems

Difficulty with the placement is thatwe tend to look at the individual butnot at the job.

Job in this context may be classifiedinto three categories.

1. Independent

2. Sequential

3. Pooled

Training & Development

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Training & Development

Training is an attempt to improvecurrent or future employeeperformance by increasing an employeesability to perform through learning,usually by changing the employeesattitude or increasing his or her skills

and knowledge. Training refers to the process of

imparting specific skills. (Employees)

T & D

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T & D

Development refers to learningopportunities designed to helpemployees grow. (Executive)

Education is theoretical learning inclassroom.

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Difference between T & Edu

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Difference between T & Edu Training -:

1. Application base,2.Job Experience,3. Specific Task,

4. Narrow Perspective.

Education -:1.Theoretical Orientation,2. Classroom learning,3. General Concepts,4. Broad Perspective.

Inputs in T & D

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Inputs in T & D

Skills

Education

Development Ethics

Attitudinal Changes

Decision making and Problem solvingskills

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Training Program

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ra n ng Program

Need Assessment

Deriving Instructional Objectives

Designing Training & Development Program

Implementation of Training Program

Evaluation

Training Process

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ra n ng rocess

Need Assessment -: Diagnoses the present

problems & future challenges to be metthrough training and development.

Need Assessment Methods -: As follows Group Assessment (intro of new product.)

1. Org goals & objectives.

2. Personnel skill inventories3. Exit interviews

4. Customers Satisfaction data

Training Process

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g

Needs Assessment & Remedial measures

Lack of Skill &

Knowledge

TrainingNon Training

Measures

Other Causes

Performance

Deficiency

Training process

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g p Individual Analysis -:1. Performance Appraisal2. Interviews3. Questionnaires

4. Attitude Surveys.

Issues in need assessment -:1. Org Support2. Org Analysis3. Task and KSA analysis4. Person Analysis

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Training process

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g p

Implementation of training program

Evaluation

Types of training

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yp g

On the job -:

1. Orientation Training ie Induction

2. Job instruction Info about how to

conduct the job.3. Apprentice training - ITI

4. Internship / Assistantship - Doctors

5. Job rotation - Bank6. Coaching Cricket team

Types of training

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yp g Off the job -:1. Vestibule Utilisation of actual equipments.2. Lecture Verbal presentation of

information.

3. Role playing is to create realistic situation.4. Simulation technique that duplicates asnearly as possible actual conditionencountered on the job.

5. Laboratory / Sensitivity training smallergroup ie 12 or less. Provides awarenessabout their own behaviour & how otherpercieve them.

Performance Appraisal

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pp

It is the systematic evaluation of theindividual with respect to his or herperformance on the job and his or herpotential for development.

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Objective of Performance Appraisal

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j pp

To decide upon pay rise where regularpay scales have not been fixed.

Finally, performance Appraisal can beused to determine whether HRprogrammes such as selection, trainingand transfers have been effective or

not.

Relationship of PA and Job Analysis

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p y

Job Analysis Describe work andPersonnel requirement of a particularjob.

Performance Standards Translate jobrequirements into levels of acceptableor unacceptable performance.

Performance Appraisal Describes the

job relevant strengths and weaknessesof each individual.

PA and Competitive Advantage

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p g

Improving Performance

Making Correct decisions

Minimizing job dissatisfaction and turnover

Consistency between organizationalstrategy

Performance Appraisal process

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pp pObjective of Performance Appraisal

Establish Job expectations

Design an Appraisal Programme

Appraise Performance

Performance Interview

Use Appraisal Data for Appropriate Purposes

P A Process

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Objective Correct or Improve performance

Expectation In forming what is expectedfrom employee

Design Appraisal Helps in posing question

which needs answers like Formal v/s InformalAppraisal, whose performance should be rated(group, team, individual), Who are Raters,What should be rated (Quality, Quantity,

Time, Cost effectiveness, Need ForSupervision), When to Evaluate, WhatMethods to be opted.

P A Process

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Appraise the Performance Quantity,Quality and time of Output.

Performance Interview

Use the Appraisal Data HRP,Promotion, Remuneration, Training andDevelopment etc.

Performance Appraisal Methods

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pp

90 Degree Only Supervisor is

Evaluator. 180 Degree Superior and Peer Group 270 degree Superior, Peer and

Subordinates 360 Degree Superior, Peer,

Subordinates, Clients and Self

540 Degree - Superior, Peer,Subordinates, Clients and Self 720 Degree - Superior, Peer,

Subordinates, Clients, Self and Family


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Past Oriented Methods - : Rating Scales Excellent-Good-Acceptable-

Fair-Poor (Simplest & most popular) Checklist Yes / No (Is employee interested

in job? Does have adequate qualification?) Forced Choice Method Two Choices and no

other option (The rater is forced to selectstatements which are readymade) Learns fast----- Work hard.

Critical Incident Method this approachfocuses on certain critical behaviours of anemployee


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Behaviourally Anchored Rating Scales On the basis of the behavioural criteriaof the employee rating is being done bythe superior.

Field Review Method Some one outsidethe assessees own department, usuallyfrom corporate office or HR

department.

Future Oriented Methods

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360 Degree Appraisal

Assessment Centers (PotentialAppraisal)

Psychological Counseling

Problems in Performance Appraisal

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Leniency or Severity

Central Tendency

Halo Error Rater Effect Rating based on raters

attitude towards ratee

Primacy or Recency effects Perceptual Set Raters perception

Job Evaluation

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Job evaluation seeks to determine therelative worth of each job so thatsalary differentials can be established.

In job evaluation only jobs are ratedunlike in performance appraisal whereonly job holders are rated.

Job Evaluation Process

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Objectives of Job Evaluation

Job Analysis

Job Description Job Specification

Job Evaluation Programme

Wage Survey

Employee Classification

Methods of Job Evaluation

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Non Analytical Methods

Analytical Methods

Non Analytical method

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Ranking Method The evaluationcommittee assesses the worth of eachjob on the basis of its title or on itscontents, if the later is available.

Job Grading Method There is ayardstick in the form of job classes or

grades.

Compensation

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Remuneration is the compensation an

employee receives in return for his orher contribution to the organisation.

Society Some people see pay as a

measure of justice. Stockholders To stockholders,

executive pay is of special interest, as

linking executive pay to companyperformance is supposed to increasestockholders wealth.

Compensation

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Managers Compensation influencestheir success in two ways. First, it is amajor expense. In addition to treatingit as an expense, a manager also uses it

to influence employee behaviour andimprove organisation performance.

Employees The pay individuals receive

in return for the work they perform isusually the major source of theirfinancial security.

Components of Compensation

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Financial :

1. Hourly and monthly rated wage andsalary.

2. Incentives ie individual plans and groupplans.

3. Fringe benefits ie PF , Gratuity,Medical care, Group Insurance.

4. Perquisites are Company car, furnishedhouse (Offered to retain competentexecutives)

Components of Compensation

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Non Financial -: Recognition, GrowthProspects.

Factors Influencing EmployeeRemuneration

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Remuneration External -:1. Labour Market Demand & Supply,

Going Rate2. Cost of Living Escalatory clause

3. Labour Unions4. Labour Laws Payment of wages

act1936, Minimum wages act 1948,

Payment of Bonus act 1965, Equalremuneration act 1976, Payment ofgratuity act 1972.

5. Society

Factors Influences EmployeeRemuneration

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Remunerat on

Internal -:

1. Business Strategy Rapid growth =High Pay

2. Job Evaluation and Performance

Appraisal3. Employee Performance , Experience,Seniority

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Challenges of Remuneration

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Salary reviews

Pay secrecy

Skill based pay

Employee Participation Above Market or Below Market Rates

Monetary V/S Non Monetary Rewards

Comparable Worth

Concept of Wages

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Minimum Wage Wage for sustenance of life

plus for preservation of the efficiency ofworker. (Determined through Legislation)

Fair Wage Equal to the rate prevailing in the

same trade and in the neighborhood or equalto the predominant rate for similar workthroughout the country.

Living Wage Higher than fair wage. Provides

for bare essentials plus frugal comforts.

Incentives

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Incentives are variable rewards grantedto employees according to variations intheir performance. The other name for

incentives is Payments by results. Butthe word Incentives is mostappropriate because of its motivational

content.

Importance of Incentives

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Motivation of worker for higher

efficiency and greater output. Earning of employees would be enhanced

due to incentives.

Increased earning helps employee toimprove standard of living. Other advantages Reduced

Supervision, better utilisation ofequipments, reduced lost time, reducedabsenteeism and turnover and increasedoutput.

Disadvantages of Incentives

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Deteriorate the quality of product as

employee want to earn more by producingmore quantity of products.

When job is restudied there are chances that

it may yield in lower earning in terms ofearning incentives as new and high challengingjobs offers more scope for earning ascompared to old jobs.

Increases jealousy among the workers as theperson earning less is jealous of the personearning more.

Employee benefits

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Employee benefits and services includeany benefits that the employee receivesin addition to direct remuneration.

Employee benefits and services arealternatively known as fringes or hiddenpayroll.

Types of employee benefits

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For fringe benefits three criteriasare needed to be fulfilled.

1) It should be computable in terms ofmoney.

2) The amount of benefit is not generallypredetermined.

3) No contract, indicating when the sumis payable, should exists.

Fringe benefits

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Legally required payments -: Old age,survivors, disability and healthinsurance.

Contingent benefits -: pension plans,

group life insurance, group healthinsurance, maternity leave, sick leave,service awards.

Other benefits -: payments for the timenot worked like holidays, leaves.

Benefits and services

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Treats -: free lunches, festival bashes,dinner for the family.

Awards -: trophies, certificates, letterof appreciation.

Office environment -: flexible hours.

Tokens -: movie tickets, vacation trips.

On the job -: job rotation, representingthe company at public meetings.

Administration of fringe benefits

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Establish benefits objectives

Assess environmental factors

Access competitiveness

Communicate benefit information

Control benefit cost and evaluation

Executive remuneration

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Components of remuneration -:

1) Salary

2)Bonus3) Commission

4) Long term incentives

5) Perks

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Industrial Relation

Industrial Relations

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IR is concerned with the system , rulesand procedures used by unions andemployers to determine the reward for

effort and the conditions ofemployment, to protect the interest ofthe employed and their employers, and

to regulate the ways in which employerstreat their employees.

IR contd

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IR is concerned with the relationship

between management and workers and therole of regulatory mechanism in resolvingany industrial dispute.

IR specially covers the following areas-:1) Collective bargaining2) Role of management , unions and govt.

3) Machinery for resolution of industrialdispute4) Individual grievance and disciplinary policy

and practice

Approaches to IR

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Unitary Approach Direct negotiation with

employee and participation of Govt. Tribunals,and unions are not sought.

Pluralistic Approach (a) org as coalitions ofcompeting interest, where the managementsrole is to mediate amongst the differentinterest group.

(b) TU are legitimate representatives of

employee interest.(c) Stability in IR is a product of concession and

compromises between management and unions.

Approaches to IR

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Marxist Approach same as Pluralisticbut feels conflict arises not because ofrift between management and workers,

but because of the division in thesociety between those who ownresources and who have only labour to

offer.

Parties to IR

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Employees

Employee Associations

Government

Employer Employee Relations

Employers Employer Associations

Courts and Tribunals

Trade Unions

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TU are voluntary organisations ofemployees or employers formed topromote and protect their interest

through collective action. Though theterms employees and employers areused, when we say trade unions they

generally refer to employees.

Why do employees join unions?

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Dissatisfaction

Lack of power

Union Instrumentality

Union Tactics

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Unions employ several tactics to deal

with management are-:

1) Strike

2) Invoking political patronage

3) Blackmailing

4) Unionising

Strategic choices beforeManagement

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Mgmt must decide whether the org shouldremain union free or allow unionisation.

If mgmt decide company should remain union

free then they must take steps to keep unionaway from the org.

If unionisation should be allowed, managersmust decide what type of union mgmt

relations they want. Mgmt must also choose the type of tactic to

use while negotiating a new wage settlement.

Strategic choices before Unions

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Bread and Butter V/S Political objective

Adversarial V/S Co operative role

Traditional issues V/S New services

Strategies and Tactics for remainingUnion - Free

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Effective supervision Open communication

Effective personnel search Healthy and Safe working environment

Effective Employer and Employee

relations Effective remmuneration

Some of the major Trade Unions

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INTUC Indian National Trade UnionCongress

CITU Centre of Indian Trade Unions

HMS Hind Mazdoor Sabha

AITUC All India Trade Union Congress

BMS Bhartiya Mazdoor Sangh UTUC United Trade Union Congress

Disputes and Their Resolution

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Acc to Industrial Dispute Act, 1947,industrial dispute mean any dispute ordifference between employers and

employers or between employers andworkmen, workmen and workmen, whichis connected with the employment or

non employment or terms ofemployment.

Causes of Disputes

W D d

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Wage Demands

Union Rivalry (Singareni Collieries - 445TU loss 3.12 million tones)

Political Interference (ideology differs,union works on party lines, CITU-Communist love to fight but hate to winso they have not signed any settlementin last 15 years)

Causes of Disputes

U f i L b P i

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Unfair Labour Practice - :

a) Management unwillingness to recognisea particular TU and dilatory tactics.

b) Negotiation of settlement of disputethe representatives of employers takethe side of management which resultsin disputes.

Multiplicity of Labour Laws

Settlement of Disputes

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Collective Bargaining (reps of employees &employers meet to solve the issue)

Collective Bargaining Process-:

a) Preparing for negotiationb) Identifying bargaining issues

c) Negotiations

d) Reaching the agreemente) Ratifying the agreement

f) Administration of agreement

Settlement Contd.

C ll ti B i i t k l h

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Collective Bargaining takes place when

representatives of trade union meetmanagement representatives todetermine employee wages and benefits

and to solve other issues.

Collective Bargaining is the most

effective method of resolving industrialdisputes.

Settlement of Disputes

G i P d

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Grievance Procedure

Arbitration Conciliation

Adjudication

Consultative Machinery

Settlement Contd.

G i P d

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Grievance Procedure -:

Stage One (Sectional Head) 5 days

Stage two (Deptt Head) 5 days

Stage Three (Divisional Head) 10 days

Fourth Stage (Union)

Settlement Contd

A bit ti f t th d i hi h

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Arbitrations refers to the procedure in which

a neutral third party studies the dispute,listen to both the parties and collects theinformation , and make recommendationswhich are binding on both the parties.

Conciliation -: As per the Industrial Disputeact 1947, Sec 4, says that the govt shall

appoint conciliation officers and their mainduty is to mediate and promote settlement ofIndustrial Dispute.

Settlement Contd

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Adjudication a mandatory settlement ofIndustrial Dispute by a labour court orTribunal.

Consultative Machinery

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Safety and Health

Bh l G s T d

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Bhopal Gas Tragedy

23 years ago, there was a gas leak froma Union Carbide plant which led to killingover 20000 thousands of people in

Bhopal and become the worst industrialaccident in India due to negligence ofproper safety features. Survivors still

suffer from various diseases andbattling for life and waiting for theirturn to get compensated.

Safety and Health

Major Accident in last decade (India) :

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Major Accident in last decade (India)-:

1) Bhopal gas leak in December 1984.2) Delhi gas leak from Sriram foods and

fertilizers in December 1985.

3) Gwalior blast at a dyeing departmentof GRASIM in December 1991.4) Khalgaon boiler explosion in NTPC in

October 1992.5) Mumbai ONGCs helicopter crash in theoffshore Heera Panna oilfields Neelamarea in August 2003.

Safety and Health

M j r Int rn ti n l ccid nt :

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Major International accident-:

1) NASA Columbia space shuttle brokeapart during reentry on Feb 1, 2003.

Wing damage sustained during launch bya chunk of fuel tank insulation was citedas the accident cause.

Safety and Health

Safety : refers to the absence of

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Safety -: refers to the absence of

accidents. Stated differently, safetyrefers to the protection of workersfrom the danger of accidents.

Research says Every twenty secondsof working minute of every hour

throughout the World, someone dies asa result of an industrial accident.

Safety and Health

Types of accidents :

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Types of accidents -:

Accidents

Internal External

Major Minor

Fatal Disability

Safety and Health

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Disability

Temporary Permanent

Partial Total Partial Total

Safety and Health

Internal If a bone is fracture which

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Internal If a bone is fracture which

cant be seen and judged from open eyes. External wounds which are seen

through our open eyes.

Major Accidents results in death orresults in prolonged injury. Minor A scratch or injury does not

seriously disable. Temporary If a person recovers

disability from which he can recoverfully after certain period.

Safety and Health

Permanent Any injury which

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Permanent Any injury which

permanently disabled the person.

Safety and Health

Need for safety -:

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Need for safety -:

1) Cost saving Direct cost iecompensation and Indirect cost ie lossof production, damages of equipment,

wastage of time.2) Increased productivity Safetypromotes productivity, employees feelsafe and produce good quality and

quantity.

Safety and Health

3) Moral Providing safety to the

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3) Moral Providing safety to the

employee has moral dimension, inaddition to being a legal requirement. Anemployer has no right to cause accidentto an employee which might kill theperson. Monetary compensation does notbring the person back as a healthyindividual.

Can monetary compensation be asubstitute for person?

Safety and Health

4) Legal Supreme court says An

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4) Legal Supreme court says An

enterprise which is engaged in ahazardous dangerously industry whichposes a potential threat to the healthand safety of the persons working inthe factory or industry must ensurethat neither the workers nor thesociety suffers any kind of damages .

All safety related requirements to befulfilled by the industry as legalrequirement before start of work.

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Safety and Health

2) The most important function of safety

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2) The most important function of safety

programmes is to identify potential hazards,provide effective remedial actions.

This is possible only if there are -:

a)

Effective system for reporting all accidentscausing damage or injury.

b) Adequate accidents records.

c) Systematic procedures for carrying out

safety checks, inspections.d) Methods of ensuring that safety equipment

is maintained.

Safety and Health

3) Safety policy of the organisation should be

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3) Safety policy of the organisation should be

determined by the top management and itmust continuously involved in monitoringsafety performance.

4) The management and supervision must bemade fully accountable for safetyperformance in the working areas theycontrol.

5) All employees should be given thoroughtraining in safe methods of work and theyshould get regular guidance on eleminatingsafety hazards.

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Safety and Health

Strategic choices Management must make

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Strategic choices Management must make

decision regarding safety of their workers.Some strategic choices are-:

1) Must determine the level of protection.Some co because of financial constraintsprefer low level.

2) Must decide whether a safety program willbe formal or informal. Formal have written

regulation & carefully monitored. Informalare enforced because of pressure andinclude good training.

Safety and Health

3) Management can be proactive or

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3) Management can be proactive or

reactive.4) Management can use safety of workers

as a marketing tool of the organisation.

Safety and Health

Health - : The well being of the employees in

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Health : The well being of the employees in

an industrial establishment is affected byaccidents and by ill health physical as wellas mental.

Health in Industry can be discussed throughfollowing angles-:

1) Physical health

2) Mental health

3) Noise control4) Stress management

5) Violence at work place

Safety and Health

Health hazards -:

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Health hazards :

Health hazards Causes

Lung cancer oven emissions, smokes

Leukemia Radiation

Reproductive problems Radiation

Vision Chemical fumes, Office equip.Hearing High noise level

Safety and Health

Mental health -: Specially at executive

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Mental health : Specially at executive

cadre. Three reasons for thisdevelopment are mental breakdownsbecause of pressure & tensions. Mental

disturbances because of reducedproductivity & lower profits. Mentalillness alcoholism & poor humanrelations.

Safety and Health

Noise Control -: Noise can only be

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Noise Control : Noise can only be

minimised but can not be totallyeliminated. Constant exposure to noisenot only effects hearing ability but also

effect the general health of theemployees.

Safety and Health

Work stress -: refers to an individuals

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Work stress : refers to an individuals

response to a disturbing factor in theenvironment . Stress is mostlyunderstood to be negative, but it has

positive dimension also. When stressbrings out something better from anindividual, it is called eustress.

V l k l

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