The document discusses the concepts of promotion, transfer, separation, and demotion within an organization, outlining their definitions, purposes, types, and policies. It highlights the importance of a well-structured promotion policy that balances internal promotions with merit-based advancement, and details the implications of transfers as a means to enhance organizational effectiveness and employee job satisfaction. Additionally, it covers the reasons and procedures for employee separation and voluntary retirement schemes, emphasizing the need for fair practices in managing workforce changes.

1. Promotions,
Transfer &
Separation
Ms. Anubha Rastogi
Astt. Prof, Vidya School Of Business
2015-16

2. PROMOTION:
‘A movement to a position in which responsibilities and presumably, prestige
are increased’
• Advancement within a organization is ordinarily labeled as ‘Promotion’.
• It is an upward movement of an employee from current job to another that is
higher in pay, responsibility, status and organizational level.
• A mere shifting of an employee to a different job which has better working
hours, better pleasant working conditions does not imply promotion.
• It is a vertical movement in rank and responsibility.

3. • According to E.B. flippo “ promotion involves a change from one job to another that
is better in the terms of status and responsibilities.
• According to Scott and Spreigal: “A Promotion is the transfer an employee to a job
that pays more money or that enjoys some preferred status.:
Examples of promotion:
 HR Assistant receives a promotion to HR Generalist
 HR Generalist receives a promotion to a dual role of HR Generalist and Employee
Development Coordinator
 HR Generalist is given a promotion to HR Manager
 HR Manager is given a promotion to Manager of Human Resources and
Administration
 HR Manager is promoted to HR Director

4. Purpose / Objective of Promotion:
Promotions have a positive impact on the employees. Beside higher wages
they also satisfy the higher order needs of employees.
Purpose / Objective of Promotion:
 To recognize an individual’s performance and reward him for his work.
 To put the employee in a position where he will be of greater value to the company.
 To promote job satisfaction among the employees and give them an opportunity for
unbroken continuous service.
 To build up morale , loyalty and a sense of belonging on the part of the employees.
 To demonstrate effective career development plans.
 To attract suitable and competent employees for the organization.
 To create among employees a feeling of contentment with their present conditions
and encourage them to succeed in the company.

5. Types of Promotion:
 Open promotions: An organization or a company considers all individuals
within it as a potential candidate and announces it to various aspirants internally.
 Closed promotions: An organization or company in which the candidate for
higher position opening or vacancies is restricted and not open for all the
individuals ,within the organization and also does not announce the vacancies
internally.
Frequently Companies Follow A Combination Of Both The Systems.
 Multiple Chain promotions: Which provides for a systematic linkage of each
position to several others. Such promotions identify multi-promotional
opportunities through clearly defined avenues of approach.
 Dry promotions :Dry promotions are those that are given in lieu of increase in
compensation.
 Horizontal promotion :Promotions have similar kind of work. Ex – lower grade
to higher grade without any change in work content.
 Vertical promotion : Those which change the nature of the work. Ex –
Supervisor to Manager.

6. Promotion Programme:
It must provide for a uniform distribution of promotional opportunities
throughout the organization. This means that the ratio of internal promotions to
external recruitment must be the same at various levels in all departments.
 A sound promotion programme is that it must tell employees in advance what
avenues for advancement exist.
 There should be some definite system for the selection of employees who are to
be promoted from within the promotion zone.
 Finally all sanctions must be approved by the concerned line heads.
 A sound promotion policy must provide for suitable system of follow up and
review.

7. Promotion Policy
Every organization should have a promotion policy.
Each organization should strike a balance between the internal sources of
personnel promotion and external sources of recruitment on one hand and
between merit and ability as against length of service on the other.
Characteristics of a sound promotion policy:
1) It should have consistency and be co-related to the career planning.
2) It should be fair and impartial.
3) It should be a planned activity , so that there is no phenomena of
‘bunching’ or no period of ‘ promotional drought’.

8. Seniority
 Seniority means length of
recognized service in an organization
 Seniority means the calculation of
time from when an employee has
joined the company and served for
how many years in the company.
 The senior most person in the lower
grade shall be promoted as and
when there is an opening in the
higher position
 Seniority is suggested as the criteria
for promotion on the plea that there
is a positive correlation between
length of the service and talent
Merit
 Merit means ability to work .
 It denotes an individual
employee’s skill, knowledge, ability,
efficiency and aptitude as
measured from educational,
training and past record
 If the merit is adopted as basis of
promotion then the person in the
lower grade ,no matter his junior
most in the company, shall be
promoted.
 It encourage all employee to
improve their efficiency
Bases of Promotion

9. Seniority Merit
Advantages - Easy to measure the length of service
-Trade union generally emphasis on
seniority.
-Security and certainty is also plus point
-Minimize the scope of grievances and
conflicts
-Reducing labour turnover
-It provides a sense of satisfaction to
senior employees and is in line with the
Indian Culture of respecting seniority in
all walks of life.
-It implies the knowledge, skills and performance
record of an employee.
-It motivates competent employees to work hard
and acquire new skills.
-It helps to maintain the efficiency of the
organization by recognizing talent and
performance
-It helps to attract and retain young and
promising employees in the organization
Disadvantages -The assumption that the length of the
service indicates talent is not valid
because beyond a certain age a person
may not learn.
-Performance and potential of an
individual is not recognized.
-It demotivates and demoralize the
young employees who are talented
-Kills the zeal and interest for self
development
-The concern fails to attract young and
hardworking employees
-Measuring Merit is not easy, subjective
judgement may involve.
-Many Employee, particularly trade unions
distrust the management’s integrity in
judging merit.
-And when younger employees are
promoted over the older one, the older
employees may feel insecure.
-They may leave the organization as well.

10. • A transfer is a horizontal or lateral movement of an employee from one job,
section, department, shift plant or position to another at some other place where
salary, status and responsibility are usually the same.
• Transfer is defined as “a lateral shift causing movement of individuals from one
position to another usually without involving any kind of change in duties,
responsibilities, skills needed or compensation”.
Meaning of Transfer
Purpose of Transfer
• To meet organizational needs.
• To meet employees own request.
• To utilise properly services of an employee when he is not performing and management feels he may be
useful elsewhere.
• To increase versatility of the employee.
• To adjust the workforce.
• To replace new employee by an employee who has been in the organization for a sufficiently long time.
• To penalise employee or due to avoid trade union pertaining issues.

11. • The policy must be impartial and known to each employee.
• The basis of the transfer should be indicated i.e. based on seniority or skill.
• Decide the rate of pay to be given to the transferee.
• Intimate the fact of transfer to the person concerned well in advance.
• Should be in writing and duly communicated to all concerned.
• Locate the authority in some officer who may initiate and implement transfers.
• Transfer cannot be made frequently and not for the sake of transfer only.
• Facilities such as leave, special allowance for shifting, etc. should be clearly
prescribed to the transferee.
Policy for Transfer

12.  Intradepartmental transfers
 within same section of the same department and effected without the
issue of any transfer order to the employee. He may be given oral
instructions. However must be informed of such transfers.
 Interdepartmental transfers
 from one department to another are decided by mutual consultations
among the departmental heads when such transfers are of the
permanent nature or long duration. Written orders signed by the
personnel manager are issued to the employee.
Types of Transfer

13. • Increase in productivity and effectiveness of the organization.
• Greater job satisfaction to employees.
• Stabilize fluctuating job needs.
• Improve employee skills.
• Remedy for wrong placement.
• Improve labour relationships.
• Develop employees for future promotions.
• Avoid monotony and boredom.
Benefits of Transfer

14.  Demotion has been defined as the assignment of an individual to a
job of lower rank and pay usually involving lower level of difficulty
and responsibility.
 Demotions serve as a useful purpose in the sense that they keep
the employees alert and alive to their responsibilities and duties.
Demotion
Causes of Demotion
 When departments are combined, bosses are often required to accept
lower level position since jobs are eliminated.
 Inadequacy on the part of the employees in terms of job performance,
attitude and capability.
 When older employees are unable to adjust as per change in
technology.
 Ill health or personal reasons.
 Demotion is also used as disciplinary measure.

15. SEPERATION
Separation means cessation of service with the organisation for one or other reason.
The employee may be separated from HR payroll due to:
• Resignation
• Discharge and dismissal
• Suspension and retrenchment
• Lay off
RESIGNATION: Resignation may be put in voluntary by the employees on the ground of
health, better opportunities elsewhere or maladjustment with the company policy and
officers or for reasons of marriage.
DISCHARGE: A discharge involves permanent separation of an employee from the pay roll for
violation of company rules or for inadequate reasons. Proper procedure of discharge must be
conducted and it should not be an impulsive act. There has to be a written warning for the
same along with discharge letter at the time of discharge. Adequate provision should exist
for review of discharged employee’s case.

16. SEPERATION
DISMISSAL: A dismissal is the termination of services of an employee by the way
of punishment for some misconduct or for some unauthorised and prolonged
absence from duty.
SUSPENSION: It may be awarded during inquiry is being conducted. During
suspension employee gets subsistence allowance.
RETRENCHMENT: Permanent termination for economic reasons of the
organisation. In the Industries Disputes ACT 1947, defines retrenchment as
termination by the employer of the services of workmen for any reason.
A 3 months’ notice in writing needs to be given to the employee and wages in
lieu of such notice.

17. VRS
VRS (Voluntary retirement schemes)
VRS is legally found to be giving no problem to employers, employees and their
unions. The essence of the voluntary retirement scheme which is approved by the
government involves voluntary separation of employees who are above age of 40
years or have served company for minimum 10 years. The company may offer
various benefit for employees which are tax exempted till 5Lakh.
REASONS FOR PROPOSING VRS
• Recession
• Intense competition resulting in downsizing
• Changes in technology
• Joint ventures with foreign establishments
• Take overs and mergers
• Business reengineering process
• Product technology obsolescence

18. MERIT:
• There is no legal obstacle in implementing the VRS
• It offers an employee an attractive financial compensation than permitted under
law.
• Voluntary nature of the schemes precludes the need for enforcement which may
give rise to conflicts and disputes.
• It allows flexibility and can be applied only to certain divisions, department where
there is excess manpower
• It allows overall savings in the employee costs thus lowering the overall costs
DEMERITS OF VRS
• To a certain extent it creates fear, a sense of uncertainty among
employees
• Sometimes the severance costs are heavy
• Trade unions generally protest the operation of such schemes and may
cause disturbance in normal operations.
• Some of the good, capable and competent may apply which may cause
embarrassment.