22

1. Human Resources

Human resource management (HRM) is the area of administrative focus dealing with an organization's employees.

There are Four Main Job Roles in a business:

• Directors: Appointed to run the business on behalf of the owners. They make

sure the business objectives are met.

• Managers: Implement the decisions of the directors. Control the day to day

running.

• Supervisors: Control the workers who are carrying out the jobs.

• Operatives: People who carry out the specific tasks.

An organisation chart ensures:

Staff know who their manager is, therefore communication should be efficient. Staff know their chain of command and their span of control. Staff can see career path Staff know where the promotional line is

2. Recruitment and Selection

Recruitment is an important part of a business’ human resource planning.

In larger organisations recruitment and selection is usually one of the jobs of the personnel or

human resources department. In smaller businesses, the owner, or one of the partners, may

have to do it.

Recruitment: The process of finding and hiring the best-qualified candidate (from within or outside of an

organization) for a job opening, in a timely and cost effective manner. The recruitment process includes analyzing

An

organisation

chart

23

the requirements of a job, attracting employees to that job, screening and selecting applicants, hiring, and

integrating the new employee to the organization.

In all businesses, people are a vital resource - and they need to be managed.

The overall aim of the recruitment process is to obtain the number and quality of employees that are required in

order for the business to achieve its objectives.

The three main stages in recruitment:

1. Needs Analysis

(This involves the preparation of a job description and person specification.)

2. Advertising the post

3. Selecting from the applicants

Recruitment is a continuous process - because of……

The Recruitment and Selection Process in detail

Job Analysis

Job Description / Person Specification

Advertise the Post

Short-list (Approximately 6)

Interview Applicants

Offer Post to Successful Applicant

Inform Unsuccessful Applicants

Induction

Contract of employment

•Staff departures.

•Changes in the business

•Promotions.

•Changes in business location.

24

Recruitment is becoming more and more important in business.

• In particular, this reflects the increasing need for a well-motivated and flexible

workforce that requires less management supervision.

Work Skills and Attitudes:

• Getting a job depends on more than the right qualifications.

• Employers want their employees to have the right skills and attitude to meet the

companies’ objectives.

• You learn some of these skills in School, others take time to develop.

Recruitment and Selection:

Recruitment is the process of obtaining suitable candidates

Selection is the process of choosing the best candidate.

The process of Recruitment and selection

Recruitment

Person hands in notice as they want to leave or a new post is created.

Job Analysis

Job Description Person Specification

Essential + Desirable

25

The start point could be one of two ways:

Person hands in their notice; they want to leave the company

What are the choices for us in this situation?

1. Offer better conditions of services.

2. Direct replacement

3. Promote someone

4. Does the job need replacing

5. Absorb the tasks of the job

6. Get a machine to do the job?

7. Can we use part timers, or job share

All the above require a Job Analysis to be carried out.

Or a New post is required

Before we can actually employ someone we must sit down and consider what we want the person to do and do a

Job Analysis.

Job Analysis

This is the start of looking at anyone's job, to see what the tasks they do and all the duties they will be responsible

for.

What could we do to find out what the current job holder actually does?

• Interview the Job Holder

• Interview the job Holder’s Boss.

• Keep a diary while doing the job.

• Observe the person doing the job

Job analysis has to be very detailed and accurate. It will form the basis for two main important documents which will be used in selecting the correct person.

Job Description:

The job description is the main tool a manger will use to examine how well you can do

your job.

A job description is a brief description of a job and its duties which is given to job

applicants.

The information that may be included in the job description is job title, department,

function and responsible to.

26

Person Specification:

A person specification describes the requirements a job holder needs to be able to perform the job.

It includes the information on what type of person we want.

Great care must be taken to ensure you are not in breach of any Employment or Equal Opportunities Laws.

Information that would be included:

Education and qualifications

Training and experience

Personal qualities

The person specification will have Essential and desirable qualities on it. Essential are qualities the person must

have and Desirable qualities are ones which are a bonus and nice if the applicant has.

Internal and External Recruitment

Businesses wanting to recruit have a variety of ways in which they can seek applicants.

Internal Recruitment: A business appoints someone to a post who is already working for the

organisation.

External Recruitment: A person who is not working for the business is appointed.

We need to compose the advert, this must reflect what is in the Person Specification and Job

Description, and it must be accurate so you don’t get the wrong people applying.

Advertising the job:

Now that we have the person specification, and job description we need to

find a suitable place to advertise the job/post.

This will depend on the type of person you wish to recruit.

Here are some places we can use:

Careers Office or the Job Centre Commercial Radio

National or local papers We can use Recruitment agencies if we want to

stay anonymous.

Professional Magazines

27

Application Process:

Next decision is should you use an application form, or allow people to apply with a Curriculum Vitae (CV).

The trouble with CV’s is that you have no control on the layout or its contents.

Application Forms mean that you have control of the information you want and how it’s laid out. This makes it easier to sift through many applications in drawing a shortlist.

Curriculum Vitae:

• This is written by a job applicant.

• It enables the company to see the applicant’s skills and qualifications.

• A letter of application usually accompanies a C.V.

The letter of application should include:

• Why you want the job, why you want to work for the company and what you

will bring to the job.

Sending out Application forms

Some companies prefer applicants to fill in an application form.

• The application form usually asks for the following information.

• Personal details – Age; nationality

• Education and Training – schools; university and qualification / grades

• Previous Employment – Salary and reasons for leaving.

• Interests and Leisure activities

• Reasons for applying for the post

• References

Application Process:

• Send off CV or Application Form with a Covering Letter.

• Having received letters of application and CV’s businesses can start the Selection process.

Selection

Once you have got the applications in by the set end date, you can then start sift through them to produce a short

list for interview.

This is where the person specification becomes handy since you know what the minimum

requirements are for the post and anyone who has not got them will be discarded.

The only time this decision will be reversed is if no candidate meets the minimum

requirement.

28

• Interviews: Sometimes one interviewer but more often, there are two.

Objectives of a Job Interview

• To find out if the person is able to do the job well

• To find out if the person will “fit” in the organisation

An interviewer must:

• Treat all applicants fairly • Try and find out as much as possible about the applicant

Interviewing the candidate - Advantages

• Interviews give the interviewers the chance to meet the candidates.

• They can assess abilities and characters; see how they react to

situations.

Interviewing the candidate - Disadvantages.

• Some interviews do not test the relevant skills needed to do the job.

• Some candidates are naturally gifted to perform well at interviews.

• Interviewers sometime let personal prejudices influence their choice of candidate.

Methods of Selection:

Many firms use other methods of selection in addition to the interview.

• With some jobs, they test the candidates’ skills and personality.

• PERSONALITY TESTS or PSYCHOMENTRIC TEST (They may include

aptitude or ability tests, personality questionnaires or a combination of

both.)

• Management jobs may test endurance and leadership skills in outdoor

activity centres.

• Most companies check references and medical certificates.

29

3. Training and Inductions

Once the candidate has been selected we now need to ensure that they are trained appropriately.

Definition of training: A process by which someone is taught the skills that are needed for an art,

profession, or job.

The Human Resource department is also responsible for meeting the employee’s training needs.

Training is important and there are many reasons for training employees.

30

Advantages and Disadvantages of training:

Advantages

Less Absenteeism; easier to retain staff.

Lower Labour Turnover; (number of people who leave the

company)

Disadvantages

Some employees may be trained and then leave for another job.

Training is expensive and takes time.

Induction: Period of training for workers new to a business when they find out about the business and the job

they have to do.

Induction Programmes:

It is important that all externally recruited personnel have a company induction.

It introduces them to their job and the company.

Larger companies usually have elaborate and formal inductions.

It includes a tour around the building / companies rules / introduction to

colleagues.

Induction Programmes: Benefits

The programme helps to make recruits familiar with the company

and the working environment.

The company is presented in a favourable light, which might help

to increase employee loyalty and motivation.

What information do you think that you would be told at

induction?

Induction training

Induction training is important as it enables a new recruit to become productive as quickly as possible.

It can avoid costly mistakes by recruits not knowing the procedures or techniques of their new jobs.

31

The length of induction training will vary from job to job and will depend on the complexity of the job, the

size of the business and the level or position of the job within the business.

The following areas may be included in induction training:

Learning about the duties of the job

Meeting new colleagues

Seeing the layout the premises

Learning the values and aims of the business

Learning about the internal workings and policies of the business

On-the-job training

On the job training occurs when workers pick up skills whilst working alongside

experienced workers at their place of work.

For example this could be the actual assembly line or offices where the

employee works.

New workers may simply “shadow” or observe fellow employees to

begin with and are often given instruction manuals or interactive training

programmes to work through.

Off-the-job training

This occurs when workers are taken away from their place of work to

be trained. This may take place at training agency or local college, although

many larger firms also have their own training centres.

Training can take the form of lectures or self-study and can be used to

develop more general skills and knowledge that can be used in a variety of

situations, e.g. management skills programme.

The respective advantages of on-the-job and off-the-job training are summarised below:

On-the-Job Training Advantages

Cheaper to carry out Learn from specialists in that area of work who can provide more in-depth study

Training is very relevant and practical dealing with day to day requirements of job

Can more easily deal with groups of workers at the same time

Workers not taken away from jobs so can still be productive

32

Off-the-Job Training Advantages

Employees respond better when taken away from pressures of working environment

Employees who are new to a job role become productive as quickly as possible

Workers may be able to obtain qualifications or certificates

The Contract of Employment

• A contract of employment is an agreement between the employer and the employee.

• It specifies the terms and conditions under which a person consents to perform certain duties as directed

and controlled by an employer in return for an agreed upon wage or salary.

• Within 13 weeks of starting work an employee must receive a Contract of Employment.

This is a legal document

It should contain the:

• Name of employer and employee

• Date on which employment started

• Job title

• Rate of pay, frequency of pay and payment method

• Normal hours of work

• Holiday entitlement and holiday pay

• Conditions relating to sickness and injury

• Pension arrangements

• Length of notice required by both parties

• Disciplinary rules and procedures

• Arrangements for handling problems

33

4. Pay

Pay advice slips:

• A pay slip shows the amount of pay that a person receives and any deductions taken from that pay.

• A pay slip usually covers the period of a week or a month.

• Gross pay is the total income that a person receives before any

deductions are made.

• Net Pay is the amount that the person receives after deductions

have been taken off. The main deductions are for income tax, National

Insurance and pension contributions.

• A pay slip will also show any expenses paid to the worker. E.g. some workers use their own cars for work

and will usually be able to claim for the mileage they do.

SALARY vs WAGE

• SALARY - Usually for non-manual / professional workers. - Expressed as a yearly figure (per annum). - But paid monthly. - Stays the same no matter how many hours you

work.

• WAGE (Time Rate) - Tends to be paid to manual workers or for

short term contracts. - Expressed as an hourly figure. - Could be paid daily, weekly or monthly. - More hours worked = More pay.

But there are more ways to get paid………..

A Pay Slip

34

• Piece Rate- Workers pay based on how much they produce. • Commission- Earnings are determined by how much is sold. % of the sale goes to member of staff.

• Bonus- An additionally payment for achieving a target.

• Profit-sharing- The worker may be paid a share of any profits

that the firm makes.

• Fringe Benefits or perks- Payment in kind in a non-monetary

value. e.g. A company Car

• Overtime- Time worked over basic hours. Often gets paid at higher rate than basic hours.

• The method of pay that is appropriate for motivating workers will depend upon the work that the

workers do and the type of business that they work in.

• Commission is often used with sales workers and piece rates are used with production workers. Profit-

sharing may be useful when the individual contribution of workers cannot be worked out.

5. Motivation Definition: Internal and external factors that stimulate desire and energy in people to be continually interested

and committed to a job, role or subject, or to make an effort to attain a goal.

Motivation is present in every life function. Simple acts such as eating are motivated by hunger. Education

is motivated by desire for knowledge. Motivators can be anything

from reward to coercion.

Motivation is important and it influences the rate and

efficiency that we undertake tasks.

People who are highly motivated will generally work harder

and effectively than people who lack motivation.

For a business to motivate its employees it needs to know

what the person wants from the job.

Why do people work?

35

Methods to motivate

PAYMENT SYSTEM INCREASE THE EMPLOYEES WAGES OR SALARY.

IMPROVING COMMUNICATION MAKING THE EMPLOYEE FEEL VALUED BY

REGULAR FEEDBACK, PRAISE AND RECOGNITION.

JOB ROTATION AIMS TO PREVENT BOREDOM BY DOING THE

SAME JOB OVER AND OVER AGAIN. EMPLOYEE

WORKS IN A DIFFERENT DEPARTMENT.

JOB ENLARGEMENT THE BUSINESS FILLS THE EMPLOYEES SPARE TIME

WITH EXTRA TASKS AND DUTIES.

JOB ENRICHMENT GIVEN THE RESPONSIBILITY TO TRAIN NEW

MEMBERS OF STAFF. THE EMPLOYEE IS GIVEN

GREATER RESPONSIBILITY.

TEAM WORKING PLACING THE EMPLOYEES IN GROUPS WHO

WORK TO THE SAME OBJECTIVES.

Maslow’s Hierarchy of Needs

Maslow believed that all people are motivated by the same things.

He identified 5 human needs he believed people wanted to satisfy.

As one set of needs was satisfied by an individual, it would stop acting as a motivator, but the individual

would then be motivated by the next set of needs.

36

Names for the

Needs

Meaning Relevance to Business

Self-fulfilment The need to fulfil your potential. Employers allow staff to work at what they

are good at, and to organise their work in the

ways they wish to do it.

Self-esteem The need to be valued. Rewards if targets are met, pay rises,

promotion; employers offer praise and

acknowledge the good work of the

employee.

Social needs The need to belong to and work in a

group.

Team meetings, company magazines, staff

social events; working in groups.

Safety The need to be protected. Safe machinery; protection in employment;

contracts etc.

Physiological needs Food, warmth, sleep, clothes Heating, toilets, canteen; wages

Frederick Herzberg: 2 Factor Theory.

Herzberg interviewed accountants and engineers, asking them to identify what made them feel good and

bad about their jobs.

As a result developed a 2 factor theory of motivation based on hygiene factors and motivators:

37

Typical Hygiene Factors are: Working conditions Quality of supervision Salary Status Security Company Job Company policies and administration Interpersonal relations

Typical Motivation Factors include:

Achievement Recognition for achievement Responsibility for task Interest in the job Achievement to higher level tasks Growth

Herzberg 2 Factor Theory

Hygiene Factors include an employee’s salary, and the level of job security.

By themselves these are not motivators, but if they are removed they act as dissatisfies.

Motivators act as satisfiers, these are good feelings which include promotion, recognition and

achievement at work.

This suggests that challenging, interesting and rewarding work will motivate and satisfy employees.

Satisfiers = the job

Dissatisfies = working conditions

Douglas Mcgregor X and Y Theory

Mcgregor’s Theory X managers believes that an employee dislikes work and will

avoid it if possible.

As a result Theory X workers must be controlled, directed and

threatened with punishment if necessary to make them work.

Mcgregor’s Theory Y manager believes that an employee finds work as natural

as play or rest.

As a result they are able and willing to organise, control and direct

themselves, and to accept authority and responsibility.

Control and punishment are not effective ways to get the theory Y employee to work.

Mcgregor analysis shows that employers should treat their employees as individuals finding out what

motivates them.

38

McGregor realised there were 2 types of managers, he was a theory Y manager.

He believed if he empowered his employees, ultimately this would allow them to be happier at work and

more productive

It can be argued that businesses will need a number of theory X and a number of theory Y managers to be

effective, as some staff will need differing management styles to get the best out of them.

39

Leadership Styles

6. The Law

Businesses have to obey the law. If they fail to obey, they risk two things:

• They can be prosecuted (government) by a number of government departments and

agencies, such as the Health and Safety Executive, and possibly fined;

• They can be sued (individuals) by people or other businesses which have lost out as a

result of their actions. Damages might then have to be paid.

Employment law:

This is aimed at protecting the health, safety and rights of employees

• The main employment laws that a business needs to consider are:

The main employment laws

Equal Pay Act 1970: Employees who do equal work or work of equal value must receive the same pay as workers of the other sex.

Race Relations Act 1976: It is illegal to discriminate against someone on the basis of race, ethnic group or colour.

Sex Discrimination Act 1975: Employees cannot be sexually discriminated in employment, training or recruitment.

Health and Safety at Work Act 1974: The law makes it the responsibility of the employer to protect workers from dangers in the workplace.

Responsibilities include providing safe equipment, washing facilities and toilets, and adequate breaks. Minimum wage Act: This was introduced to stop workers being exploited by employers. It applies to

people over the age of 18. For people in the age range 18-21 the minimum hourly wage rate is less than those aged 22 years and over.

Employment Rights Act 1996: The firm does not need to give the worker a written contract of employment but it must give a ‘statement of particulars’ within eight weeks of starting work

Disability discrimination Act: The act is designed to give equal opportunities to disabled people. Employers cannot discriminate against disabled people when recruiting staff. They are expected to make reasonable changes to premises to permit access and mobility around them.

40

Benefits and Costs of Employment Law: Employment law imposes additional costs to the business because they

have to spend additional money on training, recruitment and pay.

Like the Health and Safety Act there are also benefits if the workers feel they are treated fairly and there is more

security, they will be more motivated.

Employment Tribunals: Employment tribunals are courts of law, and deal with most of the laws relating to

employment.

Redundancy: When a workers employment is ended because the work they do is no longer needed by a firm it is

called redundancy.

The law gives protection to workers who are made redundant. If they have worked for their employer for at least

two years, the employer must pay them ‘redundancy money’ as compensation for losing their job.

7. Trade Unions Trade Union Definition: An organization whose membership consists of workers and union leaders, united to

protect and promote their common interests.

The management at a company communicate with its workforce over a range of issues.

Such as: Pay, Holidays, Working Conditions, Contracts of employment.

Industrial Relations is the term used to describe the relationship between the two groups.

Sometimes the workforce turn to their trade union for advice and support about a range of issues or if they feel

the management or government are not dealing in their best interests.

Examples of trade unions are the National Union of Teachers and Unison, which represents works in public sector

organisations.

Trade unions set out to do two main jobs:

To act as a pressure group To protect the interests of its members.

To act as a pressure group:

A pressure group is an organisation that seeks to influence government to make laws that are in the

interests of its members.

A trade union, asking government to limit working hours more strictly, would be acting as a pressure

group.

41

To protect the interests of its members:

Unions help workers with all kinds of matters. These include:

Working conditions

Hours

Redundancy

Unfair dismissal

Safety at work

Race and sex discrimination

Pay

Holiday entitlement

Benefits of union membership

Unions are able to help workers with these kinds of matters because:

They have strength in numbers. The actions of a large group of workers will have more influence than the

actions of an individual.

They can give expert advice and support. Unions employ

specialists such as solicitors. These will be able to give workers

expert advice about the rights the workers have and what to do

in a dispute.

They have the money to help to pay for expensive court cases.

They will have trained negotiators who know how to deal with the employers.

Unions can also negotiate benefits for their members. Discounts in some shops and lower rates of

interest on loans are examples of these benefits.

Industrial Action

This term refers to the action that workers can take to

try to achieve what they want in a dispute with the employer.

Many disputes are settled before any industrial action takes

place.

Industrial action is designed to benefit the workers.

However, it may also have costs for the worker. It will also

harm the employer, the customers of the firm and the economy as a whole.

Types of industrial action:

Strike Nearly all workers have the right to withdraw their labour. Sometimes a strike can be selected by workers who have key jobs. It may be for one day or until the dispute is settled.

42

Overtime ban

This is when the workers will only work the hours stated in their contract of employment. They will not work any overtime.

Work to rule This is when the workers will only do what is included in their job description.

The costs of industrial action:

Costs to the workers 1. Lose wages

2. May lose bonuses, commission, overtime pay, etc.

3. If the firm suffers a loss of sales, workers may be laid off or made redundant.

Costs to customers 1. They are not able to buy the products they need.

Costs to the firm 1. Cannot produce or sell so loses income.

2. May make less profit

3. Customers may take their business to competitors.

Costs to the economy 1. People and firms will have less money to spend – businesses will lose sales revenue.

Single union agreements

In some places of work, several different unions may represent different kinds of workers. Different craft

unions may represent different kinds of skilled workers. White-collar

unions represent office workers.

This can make industrial relations complicated. In some firms there

are single union agreements. This means that all the workers agree to

be a member of the same union.

This can help the workers as well as the employers. The workers benefit because all the workers in the

firm will speak with one voice and this may add to their strength. For the firm it is easier to negotiate with

one union rather than several of them.

ACAS – Advisory, Conciliation and Arbitration Service

This organisation exists to try to settle disputes between workers and

employers.

First, it will give advice to both the employer and to the union.

Second, it will provide conciliation.

Third, it provides arbitration: When the two sides cannot reach an agreement,

ACAS appoints an arbitrator who hears the arguments and makes a decision.

43

1. Employment Process

Key Word Write in a definition……………

Employment

Retention

Recruitment Process

CV

Job Analysis

Job Description

Person Specification

Selection

Induction

Contract of employment

2. Training

On the job training

Off the job training

Job Enrichment

3. Pay

Pay

Wages

Salary

Piece Rate

Commission

4. Motivation Theories

Maslow

Herzberg

MCgregor

Theory X

Theory Y

5. Employment law and trade unions

Employment Law

Trade Union

Collective bargaining

Trade Union Rep

Management

Industrial Action

Strike

Work to rule

44