PROMOTION, DEMOTION

AND TRANSFER

PROMOTION

“Promotion is the advancement of an employee to a better job, better in terms of greater responsibility, more prestige or status, greater skill and specially increased rate of pay or salary”

-Pigou and Myers

“A promotion is the transfer of an employee to a job which pays more money or one that carries some preferred status”

-Scott and Clothier

PURPOSE OF PROMOTION

To boost morale of employees To develop a competitive spirit among employees

for acquiring knowledge and skills required by higher level jobs

To retain skilled and talented employees To utilize more effectively the knowledge and skill

of employees Inefficient persons will feel demoralized when

efficient people are rewarded with promotions. So the company can get rid of undesirable employee

BASIS OF PROMOTION

Every organisation has to devise some criterion on the basis of which promotion will be done. If promotion is not based on some solid basis then there will be resentment among employees. On the basis of SENIORITY and MERIT promotion process can be employed.

SENIORITY AS A BASIS OF PROMOTION

Seniority implies relative length of service in the organization and is counted from the date of his joining the organisation. This system is also based on the tradition of respect for older people.

ADVANTAGES OF SENIORITY AS BASIS OF PROMOTION

It is relatively easy to measure length of service

System is simple to understand and operate

No favoritism

Provides sense of satisfaction to senior employees

DISADVANTAGES OF SENIORITY AS A BASIS OF PROMOTION

Oldest is not always the ablest

Demotivates and demoralize the young employees who are talented

Kills ambition and zeal to improve performance

Fails to attract young employees

MERIT AS A BASIS OF PROMOTION

Merit implies the knowledge, skills and performance record of an employee.

ADVATAGES OF MERIT AS A BASIS OF PROMOTION

Motivates competent employees to work hard and acquire new skills

Helps to maintain efficiency of the organisation by recognizing talent and performance

Helps to attract and retain young and senior employees in the organisation.

DISADVANTAGES OF MERITAS A BASIS OF PROMOTION

Difficult to judge merit

When young employees are promoted over older employees, the old and experienced people may leave the organisation.

Old employees may feel insecure.

SENIORITY-CUM-MERIT

A proper balance between the two criteria can be created in several ways:

(a)Minimum length of service may be prescribed

(b)Relative weightage may be assigned to seniority and merit.

(c)Employees with a minimum performance record and qualifications are treated eligible for promotion.

PROMOTION POLICY

A clear cut promotion policy is essential for healthy industrial relations.

The management and employees should be clear about the criterion to be followed for promoting employees.

As discussed earlier promotion may be based on either seniority or merit or both.

This is one aspect which a promotion policy should incorporate.

FEATURES OF PROMOTION POLICY

Policy Statement Assessing Performance Promotion Routes Employee Training Maintaining Service Records Communication

DEMOTION

Demotion implies the assignment of an employee to a job of lower rank with lower pay.

It refers to downward movement of an employee in the organisation with lower status and lower salary.

It affects the status, career and income of the employee.

CAUSES OF DEMOTION

Breach of discipline

Inadequacy of knowledge

Unable to cope with change

Organisational re-organisation

PURPOSE OF DEMOTION POLICY

To provide directions on the circumstance under which an employee may be demoted and procedure to be followed in connection there with.

Such policy should contain the following point :

A clear–cut set of rules and regulation should be prepared , the violation of which should attract punishment like demotion.

2.The employee should be communicated the grounds which will attract action such as demotion .if the employees are not informed of such an action then they will resent such actions .

3) There should be machinery to investigation the violation of rules and regulation . The employee should be given an opportunity to explain their conduct and should state whatever they want in their defence.

4) For the violation , there should be consistent and equitable action against all employees . There should not be a pick and choose of any.

5)Demotion policy should have review provision an action once taken may be reviewed if situation so warrant.

6) There should be provision for appeal to top management.

7) It should be open rather than a closed policy.

What is Transfer?

Reassignments to similar positions in other parts of the firm

Usually involves no change in grade / salary

Can be initiated by the employee / employer

TRANSFERSTransfer is defined as “ a lateral shift causing movement of individuals from one position to another usually without involving any marked changes in duties , responsibilities ,skill needed or compensation ’’.

Transfer refer to a horizontal or lateral movement of an employee from one job to another job in same organization without any significant change in status and pay.

NEED AND PURPOSES OF TRANSFERS

1) Satisfy organisational Needs

2) To satisfy employee needs

3) To better utilise employees

4) To make employee more versatile

5) To adjust the work force

6) To maintain tenure system

7) To punish employees

Types of Transfers

1. Production Transfer: Such transfers are made when labour requirements in one factory or branch are declining. The surplus employees who are efficient or trained might be absorbed in other places to avoid layoff . Such transfers help to stabilise employment .

2. Replacement Transfer: This type of transfer is made to retain long service employees. The long standing employee replaces a new employee and thereby gets relief from the heavy pressure of work.

3.Versatility Transfer :

Also known as rotation this transfer is made to develop all round employees by moving them from one job to another . It also helps to reduce boredom and monotony.

4. Remedial Transfer:

Such a transfer is made to rectify mistake in selection and placement . As a follow up ,the wrongly placed employee may not be getting along with his supervisor or colleagues.

5. Shift Transfer :

Employees may be shifted from one shift to another for personal reasons .e.g. marriage , infant care , old parents , etc.

Transfer Policy •Every organisation should have a just and impartial policy concerning transfer of employee.

•Such a policy will help to aviod an adhoc and arbitrary approach to transfer.

• Transfers should not be made frequently or without justified reasons.

•Instead of deciding each case separately ,a policy should be formulated to govern all types of employee transfers.

A good transfer policy should include the following :

i. It should clarify the type of transfers and the condition under which transfers will be made.

ii. There should be specific authority which should initiated and implement transfers.

iii. The area of transfers should be specified. Whether these will take place between sections , divisions, plants ,should be specified.

iv. Indicate the basis of transfers – filling vacancies , accepting requests , administrative reasons etc .

v. Decide the rate of pay to be paid to the transferee.

vi. Intimate the fact of transfer to the concerned person well in time .

vii. Transfers should be writing and properly communicated to all concerned.

viii. Transfers should be minimum , not just for the sake of transfer.