promotion demotions

1. Promotions,
Transfer &
Separation

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 all aspirants.
 Closed promotions: An organization or company in
which the candidate for higher position or vacancies is
restricted and not open for all the individuals within the
organization.
Frequently Companies Follow A Combination Of Both The
Systems.

6.  Dry promotions :Dry promotions refer to increase in
responsibility and status without increase in
compensation.
 Horizontal promotion :Promotions to higher grade
without any change in work content Ex – lower division
clerk to upper division clerk
.
 Vertical promotion : Those which change the
nature and extent of the work as well as
compensation. Ex – Supervisor to Manager.

7. 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 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.

8. 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’.

9. 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
 the plea is that there is a positive
correlation between length of the
service and talent
Merit
 Merit means ability and efficiency
to work .
 It denotes an individual
employee’s skill, knowledge,
ability, efficiency and aptitude as
measured from educational,
training and work record
 If the merit is adopted as basis
of promotion then the person,
shall be promoted ,no matter
even if he is junior most
 It encourage all employee to
improve their efficiency
Bases of Promotion

10. Seniority
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.
Disadvantage -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

11. Merit
Advantages -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
Disadvantage -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.

12. • A transfer is a horizontal or lateral movement of an employee
from one job, section, department, shift , plant 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

13. Purpose of Transfer
To meet organizational needs.
To meet employees own request.
To properly utilise services of an employee when he
is not performing at current place and management
feels he may be useful elsewhere.
To increase versatility of the employee.
To adjust the workforce.
To Punish Employee who are indulged in undesirable
activities.
To Provide Relief to the employees who
are overburdened hazardous work for long period

14. • 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

15. Intradepartmental transfers
 within same section or the same department
 effected without the issue of any transfer order to the employee.
 He may be given oral instructions.
 However employee 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

16. Types of Transfers
• Production Transfer: Surplus employees from one division are
transferred to those divisions or branches where there is shortage
• Remedial Transfer: A wrongly placed employee is transferred to more
suitable job in order to protect their interest.
• Replacement Transfer: Affected when labour requirements are
declining and are designed to replace a new employee by an
employee who has been in the organization for a sufficiently long time.
• Versatility Transfer: These transfers are also known as ‘job rotation’.
Employees are made to move from one job to another to gain varied
and broader experience of work.
• Shift Transfers: Employees are transferred from one shift to another
usually on the basis of mutual understanding and convenience.
• Penalty Transfer: An instrument to penalize employees’ involved in
undesirable activities in the organization.

17. 1. Meet the organizational requirements and also personal
requirements of employees.
2. Satisfy employee’s needs.
3. Utilize employees’ skill, knowledge etc., where they are
more suitable or badly needed.
4. Correct inter-personal conflicts.
5. Avoid favoritism and nepotism.
6. Creates transparency among the employees and their work.
7. Maintain healthy relationship among staff in order to
ensure harmonious environment and to avoid
unnecessary disputes.
8. Limits the ability of an employee to take advantage and sole
control over the seat or section.
Reasons for Transfer

18. • 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

19. Essentials of a Sound
Transfer Policy
• Consistency
• Written
• Objective
• Communicated to employees
• Specific
• Provide Clarity
• Avoid Frequent Transfers
• Provision for Appeal

20.  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.
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.
Demotion

21. 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.

22. 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.

23. 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

24. 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.