Standard Grade Business Management - Human Resources
Human Resources How do people contribute to business?
Why do people work? There are 5 levels. Maslow believed that people start at the bottom of the hierarchy: when they have achieved the 1 st level such as food and shelter, these needs are no longer as pressing and they become aware of needs at the next level. The American psychologist Abraham Maslow developed a model of human needs to show how people are motivated to work. This model is called a hierarchy of needs because it starts with basic needs at the bottom and climbs to higher needs at the top.
<ul><li>In short – most of us work for one or more of the following 5 reasons: </li></ul><ul><li>we want to earn money </li></ul><ul><li>we want security – to know that we will have money in the future </li></ul><ul><li>we want to have friends and a sense of being part of a team </li></ul><ul><li>we want to feel good about what we do, what we’ve achieved and who we are </li></ul><ul><li>we want to be encouraged and allowed to do better </li></ul>Why do people work?
What format can jobs take? <ul><li>The 2 main types of employment a worker can be offered are: </li></ul><ul><li>FULL TIME </li></ul><ul><li>PART TIME </li></ul><ul><li>Both full time and part time jobs can last many years or only 2-3 weeks, as some are PERMANENT and some are TEMPORARY. </li></ul><ul><li>Permanent – the job lasts as long as the company is in business </li></ul><ul><li>Temporary – the job lasts for a limited period of time. </li></ul>Casual workers tend to be hired and released as and when they are needed, and at present they do not have the same employment rights as full- or part-time workers. They may be employed for a number of weeks at peak seasonal times, eg Christmas.
What are the main types of worker? <ul><li>Unskilled Workers – also known as manual or blue collar workers. Unskilled workers work in a variety of businesses where they perform manual or repetitive tasks . They tend to have no formal qualifications (eg degrees etc) and have limited work experience. </li></ul><ul><li>Skilled Workers – also known as professional or white collar workers. Skilled workers tend to be multi skilled and perform a variety of different tasks. They are expected to be responsible for the quality of their output and to be motivated. They tend to have formal qualifications and have to accept responsibility with their job. Skilled workers can be grouped under 2 categories – Tradesmen/Craftsmen (eg electricians, engineers, joiners and mechanics), and Professionals (eg lawyers, doctors, teachers, managers and administrators) </li></ul>
Employment Trends Businesses want as flexible a workforce as possible which has resulted in changes to working practices. More organisations are operating a flexitime system. Flexitime allows employees the option to start work early and finish early, so long as they have worked the core hours for that day (eg 10am – 12 noon, and 2pm – 4pm). Also if the employee builds up extra hours by working late, they may be able to take this time off at a later date in lieu of (instead) payment. Another working practice adopted by many organisations is job-sharing where two or more employees share a full time job between them, and receive wages/salary in proportion to the amount of hours worked.
Employment Trends (continued) Having a flexible workforce means that organisations will be able to react quickly to changes in the market place and in technology. This need for flexibility has led to an increase in the amount of part-time workers, temporary workers, people working form home, job sharing and casual work. Flexibility in the workplace has also resulted in there being more women working. It also gives single parents the opportunity to work at times convenient to them, eg part-time evening work, flexi-time arrangements and job-sharing. There has been a major increase in people working for tertiary sector organisations, at the expense of primary and secondary sectors, such as farming, shipbuilding and car manufacturing.
Rewards for working Pay is the reward for working. It is part of the reason why everybody works. Workers receive either a wage or a salary . Wages Manual or “ blue collar ” workers are usually paid weekly wages . These are calculated according to the number of hours worked eg 36 hours per week. If more hours are worked, the worker is paid overtime . Fringe Benefits These are rewards given to workers that aren’t included in their pay packet. These benefits are often known as perks . They may include a company car, company pension scheme, private health care, subsidised cafeteria, or discounts on goods and services. These are often seen as a good way of motivating workers. Salaries Non-manual workers or “white collar” workers are usually paid a salary. A salary is a fixed amount per year divided into 12 equal monthly payments regardless of the number of hours worked eg if you are contracted for 40 hours per week and you work 50 hours, then you are not paid for the extra 10 hours you have worked.
Payment Systems Different types of payment systems are used to reward workers doing different types of jobs. If employees reach production/sales targets they may receive an additional payment. This is used an an incentive to increase sales and productivity. Bonus Payments/ Commission When employees work a set number of hours, overtime may be offered for them to work extra hours. Their normal hourly rate usually rises for any overtime worked (eg, double-time) Overtime Many workers are paid an hourly rate (eg £4.85 per hour). This method rewards employees for the amount of time they spend at their work. It does not add incentive to produce quality work. Time Rate Workers are paid according to the number of items they produce. Usually used in factories to encourage increased output. It is important to ensure that quality is not sacrificed for quantity. Piece Rate Description Payment System
Functions of Human Resource Management Recruitment & Selection Training & Development Maintenance of Personnel Records Legislation Employee Relations Grievance & Discipline
The Recruitment Process (the process used by an organisation to find applicants for a job vacancy) IDENTIFY A JOB VACANCY CONDUCT A JOB ANALYSIS (Identify tasks, duties, skills and responsibilities of the position) PREPARE A JOB DESCRIPTION PREPARE A PERSON SPECIFICATION ADVERTISE THE VACANCY INTERNALLY EXTERNALLY
Job Description <ul><li>Job Title </li></ul><ul><li>Location </li></ul><ul><li>Tasks </li></ul><ul><li>Duties </li></ul><ul><li>Responsibilities </li></ul><ul><li>Holiday Entitlement </li></ul><ul><li>Hours to be worked </li></ul><ul><li>Benefits </li></ul>Person Specification <ul><li>Qualifications (eg Educated to Degree level, must have Standard Grade English at Grade 3 etc) </li></ul><ul><li>Experience </li></ul><ul><li>Personal Qualities (eg must be able to work as part of a team, can use their initiative etc) </li></ul><ul><li>Skills (eg Good IT skills) </li></ul>
Advertise the Vacancy The business advertises the post in some of the following ways: <ul><li>INTERNAL ADVERTISING </li></ul><ul><li>Memos </li></ul><ul><li>Staff Bulletins </li></ul><ul><li>Notice Boards </li></ul><ul><li>E-mail </li></ul><ul><li>The job is advertised, in the first instance, to employees within the organisation. </li></ul><ul><li>This can result in the vacancy being filled quickly and cuts down on induction and training costs. However, as one vacancy is filled, another arises. </li></ul><ul><li>EXTERNAL ADVERTISING </li></ul><ul><li>Internet </li></ul><ul><li>Newspapers and magazines </li></ul><ul><li>Job Centres </li></ul><ul><li>Employment Agencies </li></ul><ul><li>External recruitment results in an outsider being hired by the organisation. </li></ul><ul><li>This may result in the vacancy taking longer to be filled, however, it should result in someone with new ideas and more experience being appointed. </li></ul>The advert will inform applicants how to apply, eg Application Form, CVs etc
The Selection Process (the process used by an organisation when choosing the best person for a job vacancy) APPLICATION FORMS/CVs/REFERENCES ~ The applications are all studied and checked against the job description and person specifications. A short list of candidates will be compiled. <ul><li>TESTING ~ Tests can be used to provide additional information about a candidates ability and personality. </li></ul><ul><li>Tests include: </li></ul><ul><li>Attainment tests (eg Speed typing test) </li></ul><ul><li>Aptitude tests (eg numeracy tests for financial jobs) </li></ul><ul><li>Psychometric tests (personality tests) </li></ul><ul><li>Medical tests </li></ul>
Each candidate should be asked the same questions so that the process is fair . An interview can help a firm assess how confident a candidate is and if they will fit in with the corporate culture within the organisation. INTERVIEWS Shortlisted candidates are invited for interview. Interviews can be one-to-one (one interviewer conducts all the interviews), panel interviews (several people will conduct each interview) or successive (where each candidate has more than one interview, possibly with different interviewers).
Contract of Employment <ul><li>Within 13 weeks of starting employment, the new employee must receive their Contract of Employment. </li></ul><ul><li>The Contract will provide details of the following: </li></ul><ul><li>Job Title and responsibilities </li></ul><ul><li>Date job commences </li></ul><ul><li>Hours of work and rate of pay </li></ul><ul><li>Holiday entitlements </li></ul><ul><li>Period of notice required (if leaving the organisation) </li></ul><ul><li>Pension scheme arrangements </li></ul><ul><li>Disciplinary and Grievance procedures </li></ul>
Job Training <ul><li>On-the-job training occurs in the workplace. The employee learns from more experienced workers. </li></ul><ul><li>Off-the-job training occurs outside the workplace, eg at a local college or Training Centre. The employee learns from professional instructors. </li></ul><ul><li>Induction training occurs when someone starts a new job. This may cover rules and responsibilities etc. </li></ul><ul><li>Upgrading training means existing staff becoming trained in new skills for them to do their job. </li></ul>
Costs v Benefits of Training <ul><li>BENEFITS </li></ul><ul><li>Staff become more competent at their jobs </li></ul><ul><li>Staff motivation increases </li></ul><ul><li>Staff become more productive </li></ul><ul><li>COSTS </li></ul><ul><li>Financial cost of training can be high </li></ul><ul><li>Work time is lost when staff are being trained </li></ul><ul><li>Output is lost when staff are being trained </li></ul>
Appraisal <ul><li>Informal Staff Appraisal means evaluating an employees performance based upon observations made by the line manager. </li></ul><ul><li>It is not usually discussed with staff. </li></ul><ul><li>A Formal Appraisal will be carried out at regular intervals. The line manager and employee will meet to: </li></ul><ul><li>discuss issues and problems </li></ul><ul><li>set targets </li></ul><ul><li>discuss future career prospects </li></ul>Staff appraisal gives managers the opportunity to review their employees progress. This can be done informally or formally.
The Human Resources department is responsible for holding information on the employees within the organisation. <ul><li>Examples of information held on file could include: </li></ul><ul><li>Name and Address </li></ul><ul><li>Designation and Department </li></ul><ul><li>Emergency Contact details </li></ul><ul><li>Salary and Bank details </li></ul><ul><li>Appraisals Reports </li></ul><ul><li>Training undertaken </li></ul>All information stored on a computer database is protected by the Data Protection Act.
Employee Relations <ul><li>If a business is to succeed, good working relationships between employers and employees is vital. </li></ul><ul><li>The management will meet with employees’ representatives to discuss issues such as: </li></ul><ul><li>pay and working hours </li></ul><ul><li>equal opportunities </li></ul><ul><li>training for employees </li></ul><ul><li>disputes and grievances </li></ul><ul><li>health and safety issues in the workplace </li></ul><ul><li>Representatives include Trade Unions and Works Councils . </li></ul>The term employee relations refers to the interaction between the business and its employees.
Trade Unions <ul><li>A Trade Union is an organisation that represents employees during discussions with management. </li></ul><ul><li>Examples of Trade Unions: </li></ul><ul><li>EIS – represents Scottish Teachers </li></ul><ul><li>TGWU – represents Transport and General Workers </li></ul><ul><li>FBU – represents Fire Fighters </li></ul><ul><li>Unison – represents people working in the public sector </li></ul><ul><li>In a large organisation it is impractical for management to hold discussions individually with every employee. Also, there is a greater chance of success if efforts are combined.This is known as collective bargaining . </li></ul>
Works Councils <ul><li>A works council is made up of an equal number of employees and managers. </li></ul><ul><li>They meet to discuss any suggestions for change and any changes being introduced. </li></ul><ul><li>Any major changes should be discussed at a works council first before being implemented. </li></ul><ul><li>The works council can take on the role of a trade union in the absence of a trade union during negotiations and disputes. </li></ul>
INDUSTRIAL ACTION <ul><li>When employers and employees cannot agree on </li></ul><ul><li>certain issues, industrial action may be taken. </li></ul><ul><li>Types of Industrial Action: </li></ul><ul><li>Sit in – employees remain at the workplace but do no work </li></ul><ul><li>Overtime Ban – employees refuse to work overtime </li></ul><ul><li>Work to Rule – employees carry out only those tasks detailed in their job descriptions </li></ul><ul><li>Go Slow – employees produce work at a slower rate </li></ul><ul><li>Strike – usually the last resort. Employees refuse to enter work. </li></ul>
Advisory, Conciliation and Arbitration Service ACAS is an organisation funded by Central Government. It will assist in disputes where an agreement between employees and employers cannot be reached. It offers: ADVICE – to employers and employees and trade unions on any work related issue CONCILIATION – it tries to encourage a settlement that both the employees and employers are happy with. ARBITRATION – ACAS assesses a dispute and recommends a solution to the dispute that both parties must abide by. For more details visit the ACAS website ( http://www. acas .org. uk / )
Legislation Sex Discrimination Act 1975 Race Relations Act 1976 Equal Pay Act 1970 Office, Shops and Railway Premises Act 1963 Health & Safety at Work Act 1974 Minimum Wage Act Employment Rights Act 1996 Disability Discrimination Act 1995
Employment Legislation Covers a wide range of duties and rights of an employer and employee. It includes the right of an employee to a Contract of Employment , itemised pay slips and rights of employees regarding Sunday working, maternity and termination of employment. Employment Rights Act 1996 This states that all employees should receive the same rate of pay where work of ‘ equal value ’ is undertaken. Jobs do not need to be identical but require the same skills, qualifications and expertise etc to be regarded as of ‘equal value’. Equal Pay Act 1970 This makes it unlawful to discriminate on the grounds of race , colour , religion or ethnic origin regarding recruitment, training, promotion or any other work related matter. Race Relations Act 1976 This makes it unlawful to discriminate on the grounds of sex or marital status regarding recruitment, training, promotion or any other work related matter. Victimisation and sexual harassment are also unlawful. Sex Discrimination Act 1975
Employment Legislation (cont) This states some basic health and safety regulations that employers must meet regarding minimum working temperatures , toilet and washing facilities , first aid , cleanliness and storage space . Office, Shops and Railway Premises Act 1963 This law added to the OSRP Act 1963 by stating that employees’ duties with regard to health and safety as well as those of employers. Employees now have a duty of care to take reasonable care of their own health and safety as well as other employees’. Health and Safety at Work Act 1974 This details the minimum rate of pay that employees should receive. There are different rates depending on age. Minimum Wage Act This provides disabled people at work protection from discrimination. This means that employers must not treat a disabled person less favourably because of their disability and are required to make reasonable adjustments to working conditions or the workplace where that would help to accommodate a particular disabled person. Disability Discrimination Act 1995
Employment Legislation For more information on employment rights visit the ACAS website by clicking here
Grievance Procedures A grievance is a complaint by an employee against their employer . It may be because of the way they have been treated by another member of staff such as their manager. There will be a process that must be followed in such circumstances. The process may include approaching the HR department, trade union representatives and management. If the employee is unhappy with the action of the organisation they can involve ACAS and eventually an Industrial Tribunal . Discipline Procedures <ul><li>Disciplinary procedures will be in place in an organisation in order to deal with employees that have done something wrong. This ranges from an employee being persistently late and misusing e-mail to theft . </li></ul><ul><li>If the action is very serious the employee may be sacked on the spot. </li></ul><ul><li>The usual procedure involves: </li></ul><ul><li>Verbal Warning (perhaps 1 or 2) </li></ul><ul><li>Written Warning </li></ul><ul><li>Dismissal </li></ul>
Terminating Employment There are many ways in which a person’s employment can be terminated: <ul><li>RESIGNATION – where the employee voluntarily chooses to leave the business, perhaps because they have found a new job. </li></ul><ul><li>RETIREMENT – the general age for retirement is 65, however should an employee wish to take early retirement this may be possible. </li></ul><ul><li>REDUNDANCY – Redundancy occurs when the organisation has more staff than required. Reasons for this include: the business is in the process of downsizing, and; the business has entered into bankruptcy/receivership. </li></ul><ul><li>DISMISSAL – an employee can be ‘sacked’ for a number of reasons. Dismissal can be ‘fair’ – where the organisation has a legitimate reason for dismissing the employee, eg the employee has broken organisational rules or has destroyed company property. </li></ul><ul><li>Dismissal can also be ‘unfair’ – where it is deemed to be unlawful to sack an employee, eg because they are female, pregnant, of different race or because they are a member of a Trade Union. </li></ul>