INTRODUCTION

HUMAN RESOURCE MANAGEMENT

Human Resource Management is a relatively new approach to managing human beings
in any organization. Human beings are considered as the key resource in this
approach. Since an organization is a body of people, their acquisition, development of skills,
motivation for higher levels of attainments, as well as ensuring maintenance of their level of
commitment are all significant activities. All these activities fall in the domain of Human
Resource Management.
Human Resource Management is responsible for maintaining good human relations in
the organization. It is also concerned with development of individuals and achieving
integration of goals of the organization and those of the individuals.
Human Resource Management, or HRM, is the practice of managing people to achieve
better performance. For example, if you hire people into a business, you are looking for
people who fit the company culture as they will be happier, stay longer, and be more
productive.
DEFINITIONS OF HRM
Human resources management (HRM) is a management function concerned with hiring,
motivating and maintaining people in an organization. It focuses on people in organizations.
Human resource management is designing management systems to ensure that human talent is
used effectively and efficiently to accomplish organizational goals.
According to Edwin Flippo , HRM as “planning, organizing, directing, controlling of
procurement, development, compensation, integration, maintenance and separation of human
resources to the end that individual, organizational and social objectives are achieved.”
According to the Invancevich and Glueck, “HRM is concerned with the most effective
use of people to achieve organizational and individual goals. It is the way of managing people at
work, so that they give their best to the organization”.

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 According to Dessler (2008) the policies and practices involved in carrying out the
people or human resource aspects of a management position, including recruiting, screening,
training, rewarding, and appraising comprises of HRM.
FEATURES/ CHARACTERISTICS OF HRM
The features of human resource management can be highlighted as follows:
1. It is an inherent part of management: Human resource management is inherent in the
process of management. This function is performed by all the managers throughout the
organisation rather that by the personnel department only. If a manager is to get the best
of his people, he must undertake the basic responsibility of selecting people who will work
under him.
2. It is a pervasive function: Human Resource Management is a pervasive function
of management. It is performed by all managers at various levels in the organisation.
3. It is basic to all functional areas: Human Resource Management permeates all the
functional area of management such as production management, financial
management, and marketing management. That is every manager from top to
bottom, working in any department has to perform the personnel functions.
4. It is people centered: Human Resource Management is people centered and is
relevant in all types of organisations. It is concerned with all categories of employees
from top to the bottom of the organisation. The broad classification of employees in an
industrial enterprise may be as follows: (i) Blue-collar workers (i.e. those working on
machines and engaged in loading, unloading etc.) and white-collar workers (i.e. clerical
employees), (ii) Managerial and non- managerial personnel, (iii) Professionals (such as
Chartered Accountant, Company Secretary, Lawyer, etc.) and non-professional personnel.
5. It involves Personnel Activities or Functions: Human Resource Management involves
several functions concerned with the management of people at work. It includes
manpower planning, employment, placement, training, appraisal and compensation of
employees. For the performance of these activities efficiently, a separate department
known as Personnel Department is created in most of the organisations.
6. It is a continuous process: Human Resource Management is not a “one shot”
funct io n. It must be performed continuously if the organisational objectives are to be
achieved smoothly.

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 7. It is based on Human Relations: Human Resource Management is concerned
with the motivation of human resources in the organisation. The human beings can‘t be
dealt with like physical factors of production. Every person has different needs,
perceptions and e x p ec t a t i o n s . The managers should give due attention to these
factors. They require human relations skills to deal with the people at work. Human
relations skills are also required in training performance appraisal, transfer and promotion
of subordinates.
NATURE OF HRM
Organization is consists of men, machine and materials but the HRM is the one which
organize and manage the organization.
 HRM recruit, develop, maintain and remunerating the employees in organization.
 The decisions related to employees are taken by HRM.
 The HRM systematically approach in handling man power resources.
 HRM is an ongoing activity.
 It is interdisciplinary, Combination of Sociology, psychology, economics and so
on.
 It is based on Human Relations: Human Resource Management is
concerned with the motivation of human resources in the organization.
 It is people centered: Human Resource Management is people centered and is
relevant in all types of organizations. It is concerned with all categories of
personnel from top to the bottom of the organization.

OBJECTIVES OF HRM
1. To create and utilize and motivate workforce to accomplish the basic organizational goal.

2. To establish and maintain sound organizational structure and create working relationship
among all the members of an organization

3. To secure the integration of individual and groups within the organization by

coordination of the individual and group goals with those of the organization

4. To create facilities and opportunities for individual or group development so as to match

it with the growth of the organization.

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 5. To attain an effective utilization of human resources in the achievement of organizational
goals.

6. To identify and satisfy individual and group needs by providing adequate and equitable
wages incentives employee benefits and social security and measures for challenging
work, prestige, recognitions, status etc.

7. To develop and maintain a quality of work life.

8. To provide the organization with well-trained and well-motivated employees

9. To inculcate the sense of team spirit, team work and inter-team collaboration.

FUNCTIONS OF HRM
The functions of human resources management may be classified as:
1. Managerial function
2. Operative function

Figure 1
Managerial Functions
Planning: Planning means forecasting or predicting the future activity in a specific manner or
structure. It is the basic function and essential for all the organization.

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Organizing: It is collection or joining of all the resources available within the organizational
and outside, in order to achieve the organizational goal with efficiency.
Staffing: It involves appointing the right man for the right job at the right time. The
management is to analyse the human resource, see if he is suitable for the job and accordingly
allocate the work in the organization.
Directing: It is showing the correct path or correct way to achieve the organizational goal
within the specified time.
Controlling: Controlling as a function that concerns on regulating the person or monitoring
him whether he performs in a better way to achieve the common goal efficiently.
Coordinating: It is a type of support function. It involves accumulating the work to achieve the
task.
Operative Functions
Procurement: Procurement refers to a series of activities undertaken by the human resource
manager filling the present and future vacancies of the organisation.
• Job Analysis
• HRP
• Recruitment and Selection

Development: Development refers to both employees training and management development.

Human resource managers are responsible for conducting and supervising training and
development programmes for employees.
• Career planning
• Workers Training
• Executive development
• Organisational Development

Compensation: Compensation refers to determination of the pay scale and other benefits for
the employees. HR manager must ensure fair and equitable pay rates, Reward system incentive
plans bonus and flexible work schedules.
Maintenance: It aims at retaining efficient and experienced employees in organisation. The HR
managers are responsible for offering occupational safety, Health promotion, Physical fitness,

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 Canteen facilities, Recreation activities, transportation programmes, Employee suggestion
schemes and creating a positive work environment.
• Employee well being
• Social security
• Workers
• Job Rotation

Integration: It aims at ensuring good relations between the management and the employees.
• Industrial Relations
• Discipline
• Grievance
• Dispute settlement
• Collective bargaining

IMPORTANCE OF HRM
Human Resource Management is related with effective utilization of human resources.
The importance of HRM can be discussed as:
1. Organizational Importance
Human Resource Management can help an organization to achieve to its objective more
efficiently and effectively in the following ways:
(a) Procurement of required talents through recruitment, selection, placement, inducting,
training, compensation and promotion policies.
(b) Secures co-operation of all employee of the organization for achieving goals.
(c) Proper utilization of human resources for the success of the enterprise.
(d) Ensure a future team of efficient competent workers required for the organization.
2. Professional Importance
Professional competency among employees can be achieved through the following ways.
(a) Human resource management provides maximum opportunities to employees for their
personnel development.
(b) Providing healthy relationship among employees
(c) Proper allocation of work among employees.
(d) Providing training facilities for the individual development of employees.

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 3. Social Importance
(a) Human resource management enhances the dignity of labour.
(b) Provides suitable job to suitable person and it will help to satisfy the psychological and
social satisfaction of employees.
(c) Helps to provide reasonable compensation to workers, which leads them to have a good
standard of living.
(d) Helps to maintain a balance between jobs and job seekers in terms of numbers,
qualification, aptitude etc.
(e) Takes health and safety measures which ensures physical and mental health of
the employees.

4. National Importance
Effective management of human resources will speed up the economic growth of
nation. This in turn leads to better standard of living and more job opportunities.

SCOPE OF THE HRM

1. Human resources planning: – Human resource planning is a process by which the

company to identify the number of jobs vacant, whether the company has excess staff or
shortage of staff and to deal with this excess or shortage.
2. Job analysis design: – Another important area of HRM is job analysis. Job analysis
gives a detailed explanation about each and every job in the company. Based on this job
analysis the company prepares advertisements.
3. Recruitment and selection: – Based on information collected from job analysis the
company prepares advertisements and publishes them in the newspapers. A number of
applications are received after the advertisement is published, interviews are conducted
and the right employee is selected thus recruitment and selection are yet another
important areas of HRM.
4. Orientation and induction: – Once the employees have been selected an induction or
orientation program is conducted. The employees are informed about the background of
the company. They are told about the organizational culture and values and work ethics
and introduce to the other employees.

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5. Training and development: – Every employee goes under training program which helps
him to put up a better performance on the job. Training program is also conducted for
existing staff that have a lot of experience. This is called refresher training. Training and
development is one area where the company spends a huge amount.
6. Performance appraisal: – Once the employee has put in around 1 year of service,
performance appraisal is conducted i.e. the HR department checks the performance of the
employee. Based on these appraisal future promotions, incentives, increments in salary
are decided.
7. Compensation planning and remuneration: – There are various rules regarding
compensation and other benefits. It is the job of the HR department to look into
remuneration and compensation planning.
8. Motivation, welfare, health and safety: – Motivation becomes important to sustain the
number of employees in the company. It is the job of the HR department to look into the
different methods of motivation. Apart from this certain health and safety regulations
have to be followed for the benefits of the employees.
9. Industrial relations: – Another important area of HRM is maintaining co-ordinal
relations with the union members. This will help the organization to prevent strikes
lockouts and ensure smooth working in the company.

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ORGANIZATIONAL STRUCTURE OF HRM DEPARTMENT

Figure 2 ROLE
OF HRM / HUMAN RESOURCE ACTIVITIES
Human Resource Management undertakes the following activities:
1. Human resource or manpower planning.
2. Recruitment, selection and placement of personnel.
3. Training and development of employees.
4. Appraisal of performance of employees.
5. Taking corrective steps such as transfer from one job to another.
6. Remuneration of employees.
7. Social security and welfare of employees.
8. Setting general and specific management policy for organizational relationship.
9. Collective bargaining, contract negotiation and grievance handling.
10. Staffing the organization.

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 11. Aiding in the self-development of employees at all levels.
12. Developing and maintaining motivation for workers by providing incentives.
13. Reviewing and auditing manpower management in the organization
14. Potential Appraisal Feedback Counseling.
15. Role Analysis for job occupants.
16. Job Rotation.
17. Quality of work life
DIFFERENCE BETWEEN HUMAN RESOURCE MANAGEMENT AND PERSONNEL

MANAGEMENT
Human Resource Management Personnel Management
1. HRM is proactive in nature; it is not only PM is mainly reactive in nature. It satisfies
concerned with the present organizational itself by ensuring peaceful labor management
conditions but foresees future necessities and relations the present.
the acts appropriately.

2.HRM as a resource centered focuses more PM which is basically employee-centered

on the managerial aspects, in term of aims at hiring, Training, compensating and
delegating the responsibility of HRM to line maintaining the existing workforce of the
authority organization.

3. The term, used in broader sense, refers to The term however used, To refers the task of
the task of managing people belonging to the managing the employees of the concern.
different sections of the society.

4. Measures are taken for the overall progress Measures are taken to satisfy economic needs
of the employee i.e. his economics social and of the employee.
psychological needs are fulfilled.

5. The amount spent on the employee is The amount spent on the employees is seen as
viewed as an investment. expenditure incurred.
6. HRM seeks to develop the competencies of Employees get uniform reward based on job
the employees on a sustained basis. evaluation and job worth.

Table 1
QUALITIES OF GOOD HR MANAGER
1. Good Communication
2. Educational Qualification
3. Discriminating Skill
4. Leadership Qualities

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 5. Fair and honest in his dealings
6. Ability to take a decision independently
7. Professional altitude
8. Ability to solve complex HR problems
9. Experience (of his/her specific field)
10. Personality
11. Risk taking
12. Creative and innovative
RESPONSIBILITIES/ROLE OF HR MANAGER
Human Resource Manager is one of the most important key to open a lock hanging on the door
of success in an organisation. If a Human Resource Manager is efficient enough to handle and to
take out best from his team members any oragnisation, it can achieve more from his target goals.
Human Resource manager plays a very important role in hierarchy and also in between the
higher management and low level employees.
Stated below are major responsibilities of Human Resource Manager:-

Figure 3
EVOLUTION OF HRM
Awareness regarding HRM was felt during the industrial revolution around 1850 in Western
Europe and U.S.A. Only during the beginning of 20th century, it was felt in India. The evolution
of the concept of Human Resource Management can be categorized as follows:

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Period before industrial revolution – The society was primarily an agriculture economy
with limited production. Number of specialized crafts was limited and was usually carried out
within a village or community with apprentices assisting the master craftsmen. Communication
channel were limited.
Period of industrial revolution (1750 to 1850) – Industrial revolution marked the
conversion of economy from agriculture based upon industry. Modernization and
increased means of communication gave way to industrial setup. A department was set up to
look into workers’ wages, welfare and other related issues. This led to emergence of personnel
management with the major task as
 Workers’ wages and salaries
 Worker’s record maintenance
 Worker’s housing facilities and health care

An important event in industrial revolution was growth of Labour Union (1790) the works
working in the industries or factories were subjected to long working hours and very less wages.
With growing unrest, workers across the world started protest and this led to the establishment of
Labour unions. To deal with labour issues at one end and management at the other Personnel
Management department had to be capable of politics and diplomacy, thus the industrial relation
department emerged.
Post Industrial revolution – The term Human resource Management saw a major evolution
after 1850. Various studies were released and many experiments were conducted during this
period which gave HRM altogether a new meaning and importance.
A brief overview of major theories release during this period is presented below
1. Frederick W. Taylor gave principles of scientific management (1857 to 1911) led to the
evolution of scientific human resource management approach which was involved in
 Worker’s training
 Maintaining wage uniformity
 Focus on attaining better productivity.
2. Hawthorne studies, conducted by Elton Mayo & Fritz Roethlisberger (1927 to
1940). – Observations and findings of Hawthorne experiment shifted the focus of
Human resource from increasing worker’s productivity to increasing worker’s efficiency
through greater work satisfaction.

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 3. Douglas McGregor Theory X and Theory Y (1960) and Abraham Maslow’s Hierarchy of
needs (1954) – These studies and observations led to the transition from the
administrative and passive Personnel Management approach to a more dynamic
Human Resource Management approach which considered workers as a valuable
resource.

As a result of these principles and studies, Human resource management became increasingly
line management function, linked to core business operations. Some of the major activities
of HR department are listed as-
 Recruiting and selecting skilled workforce.
 Motivation and employee benefits
 Training and development of workforce
 Performance related salaries and appraisals.

Strategic Human Resource Management Approach

With increase in technology and knowledge base industries and as a result of global
competition, Human Resource Management is assuming more critical role today. Its major
accomplishment is aligning individual goals and objectives with corporate goals and objectives.
Strategic HRM focuses on actions that differentiate the organization from its competitors and
aims to make long term impact on the success of organization.
HR POLICIES
Human resource policies are systems of codified decisions, established by an organization, to
support administrative personnel functions, performance management, employee relations and
resource planning.
HR policies are also defined as that body of principles and rules of conduct which govern the
organization in its relationship with employees.
Each company has a different set of circumstances, and so develops an individual set of human
resource policies.
IMPORTANCE/ SIGNIFICANCE OF HR POLICY:
 Delegation
The HR Policies help managers operating at different levels to act with confidence
without the need for consulting superiors every time.

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  Speedy Decisions
Policies can accelerate decision-making by providing a blanket framework within which
personnel decisions can be made. They condense past experience.
 Coordination
HR policies help in achieving coordination. In case organisational members are guided
by the same policies, they can forecast more accurately the actions and decisions. They
ensure a steady course of action and prevent unwarranted deviations from planned
operations.
 Better Control
As HR policies specify the relationship that is shared between the organisation,
management and its employees besides they allow members to work towards
achievement of the objectives of the organisation without friction/conflict, paving the
way for better control.
 Standards of Efficiency
Policies serve as standards in the execution of work. They enable the management to
view if they have been translated into action by various organisation or not. On the basis
of the light of actual performance, existing policies may be subjected to
amendment/refinement.
 Uniformity
The HR Policies increase the chances of different people at different levels of the
organisation making similar choices, when independently facing similar situations. They
make the actions of organisational members more consistent.
 Confidence
Policies create confidence in employees while confronting routine and recurring
problems as they make them aware where they stand in an organisation. They reduce
chances of misinterpretation, misrepresentation and consequent friction.

STEPS IN POLICY FORMULATION

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In developing HR Policies, there should be clear and consistent statements of the organization’s
policies regarding to all conditions of employment and procedures for their equal and fair
implementation.

1. Identify the Areas:

The areas where HR policies are needed are to be identified. Important areas of HR like
recruitment, selection, training, compensations must have specific policies clearly spelt out. If
need arises, additional policies may have to be formulated for dealing with newer HR issues.

2. Collecting Data:
After selecting the areas, relevant information should be collected for facilitating policy

formulation. The company’s records, past practices, industry practices and top management

policies should be studied. The organizational culture and employee aspirations should also be

taken into account while formulating policies.

3. Evaluating Alternatives:
Once data have been collected, various alternative policies can be designed. Each alternative has

to be evaluated in terms of their contribution towards the desired objectives. The policies should

be for the betterment of the existing HR system and formulated in congruence with other

organizational policies. The policies should be finalized after discussion with those people who

are directly affected by its implementation.

4. Communicating the Policy:

The policy details should be conveyed to all the workers throughout the organization. Policy

manual, in-house journals, notice boards, intranet, etc., can be used to create awareness among
employees at various levels. Special communication programmes can be conducted to inform all

the concerned people about the new policy.

5. Evaluation of the Policy:

Policies should be evaluated regularly at periodic intervals to ascertain their effectiveness. The
actual policy results should be compared with predetermined standards to check if the policy was

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 successful in achieving its objectives. Policies may be reviewed at the organizational level, or

outside experts may be invited to review it.

HR policies should be designed to promote common interest, create safe and healthy working

conditions, give proper recognition for work and accomplishment, recognize impact of change

on people, encourage employees’ participation and recognize the functions and responsibilities

of the trade unions.

DIFFERENCE BETWEEN HRM AND HRD

Table 2
EMPOWERMENT
Empowerment is based on the idea that providing employees with the resources, authority,
opportunity, and motivation to do their work, as well as holding them accountable for their
actions, will make employees happier and more proficient.
In other words, allowing employees to take leadership of their roles results in high impact and
positive long-term effects for the company and its individuals. The empowered employee
becomes “self-directed” and “self-controlled”. Empowerment focuses on employees to make use
of their full potential.

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3 Levels of Employee Empowerment in the Workplace
Employee empowerment can happen on different organizational levels, and the most common
segmentation includes:
 empowerment on the organizational level
 empowerment on the managerial level
 empowerment on the individual level
1. Employee Empowerment on the Organizational Level
An organization that cultivates employee empowerment can better:
 Embrace change such as digital transformation
 Recognize employees' contribution to the business
 Reward responsible ownership in the workplace
 Support collaboration, including cross-departmental collaboration in the workplace
 Foster a culture of employee engagement
 Retain top talent
2. Employee Empowerment on the Managerial Level\
Empowered team leaders can:
 Better support the team and help each team member reach their targets
 Provide the information the teams need when they need it
 Inspire and motivate employees
 Help better connect employees, including the ones working remotely
 Facilitate work processes
 Spread team spirit in the workplace
 Better communicate the business goals and long-term vision
 Make the teams more successful
3. Employee Empowerment on the Individual Level
When employees feel empowered and trusted, they:
 Are more willing to go the extra mile for the team and the business
 Take ownership over their work
 Generate ideas
 Know how to take prudent risks to take the business to the next level
 Find meaning and purpose at work

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  Feel proud of the company they're working at
 Feel more motivated and engaged

Figure 4
Empowerment on the organizational and managerial levels should exist by default. However,
achieving individual empowerment requires much more work and effort and it involves several
functions in the organization.
IMPORTANCE OF EMPLOYEE EMPOWERMENT
1. The investment in employees can improve productivity, which can reduce the costs.
2. Individual employees experience a feeling of self-esteem, self-efficacy and self-
confidence.
3. Employee empowerment also helps in making employees more self-reliant.
4. It allows independent decision-making by the employees.
5. Empowerment of employees helps a firm to assign different projects to hone the
competence of employees.
6. More freedom given to employees can be utilized for taking judicious decisions.
7. Assigning proper authority can improve the organizational effectiveness.

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 8. Independent decision-making can improve self-confidence among the employees.
9. It can boost up the morale of the employees.
10. The overall efficiency of an organization can be multiplied due to empowerment of the
employees.

DOWNSIZING
Downsizing refers to the process of reducing the size of workforce by terminating the
employment of employees. It is also referred as layoff.
Downsizing literally means reducing the size of the organisation in order to cut costs, hive
off unprofitable operations and improve operational efficiency.
In fact, it is a restructuring process to meet the challenges of the environment. In the context
of human resource management, downsizing involves elimination of certain jobs with a view
to cut pay bill and improves work efficiency.
Downsizing is also given such names as restructuring and rightsizing. Irrespective of the
name used, it almost always means reducing the size of the organizations permanent full-time
staff. It is the process of minimizing the strength of a man power to enhance and ensure the
quality of performance and involvement in the business process of the company. This will
help the company to channelize the work and focus on expected output when the company is
overloaded with employees.
REASONS FOR DOWNSIZING

To Solve the Problem of Initial Over-Staffing:

Due to faulty HR planning or to fulfill social commitment, some organizations may employ more
employees as against their actual requirement. Most government departments and public sector
enterprises of Government of India face the problem of over-staffing. This is because the
government has the social responsibility to reduce unemployment in the country.

To Deal with the Adverse Consequences of Economic Recession:

Recently, many organizations, under the pressure of the global economic recession, downsized
their organizations by laying off or retrenching employees. For example, Tata Motors laid off
6,000 temporary workers to tide over economic recession. Citigroup, an American financial

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 company, axed 52,000 jobs globally, and its Indian arm, Citi India, laid off 37 employees,
including senior executives.

To Take Advantage of Technological Advancements:

In the present times, rapid developments are taking place on the technology front. Automation,
computers, and the internet have changed the way business operations are carried out. Due to
this, the man-machine ratio has undergone a drastic change. Today, an organization requires less
manpower to perform the same amount of work, if not more. Thus, technological developments
made downsizing of organizations somewhat inevitable.

To Concentrate on Core Activities and to Outsource Non-Core Activities:

To be successful in today’s competitive environment, most organizations prefer to concentrate

on activities in which they have core competence and outsource non-core activities. As a result,
people employed in non-core activities become surplus, thereby necessitating the need to
downsize the organization.

ROLE OF HR IN DOWNSIZING

• Proper Communication with Employees

• Convincing Employees’ Unions and Winning their Support
• Providing Outplacement Services
• Working out Alternatives to Termination
• Offering Incentives for Early Retirement
• Retaining all Employees with Reduced Work Hours

VOLUNTARY RETIREMENT SCHEME (VRS):

Voluntary retirement scheme (VRS) refers to voluntary retirement scheme, when company faces
the problem of surplus labor, they have to remove the extra workers. This needs to be done to
avoid increase in cost. One of the methods used by the companies is the VRS scheme.

REASONS FOR OFFERING VRS BY EMPLOYERS:

(a) Recession in the economy forces the organization to opt for VRS in order to survive.

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 (b) Globalization has brought intense competition in terms of innovation, knowledge of
manpower, knowledge of technological and management systems. Every organization wants to
recruit fresh management and techno-workers who can adapt to the latest developments easily.
Thus, the old workforce is asked to retire.

(c) Intense competition has led to mergers and takeovers in the economy. Every organization
wants to merge or amalgamate to others to become more powerful and sustainable. These
ventures keep lean structure and want to be more cost competitive. They show doors to many old
workers.

EMPLOYEES’ REASONS FOR ACCEPTING VRS:

(1) Employee‘s personal financial position – Since a hefty compensation is paid upfront by the
employer, the employee feels tempted to seek early retirement. The compensation amount so
received can be utilized by the employee for meeting family members‘needs, say, to set up
business, and so forth.

(2) Employee‘s physical health – Failing health condition may compel an employee to opt for
VRS and utilize the compensation amount on health improvement and leading a healthy life
thereafter.

3) Extent of job satisfaction – No or low level of work satisfaction is a potent driving factor for
employees to quit their jobs and take advantage of VRS.

(4) Possibility of future lay-offs – Employees anticipating complete or partial downturn in

company‘s business may think it wise to seek early retirement with immediate financial gain
under VRS.

(5) Inability to meet work responsibilities – If an employee finds himself inadequate to perform
the duties and meet the demands of his current job, he may decide to leave the organization and
take advantage of VRS.

(6) Better alternative job opportunities – An employee having a better alternative employment
opportunity may find the time opportune to quit the present job and enter into the alternative
field of work.

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ADVANTAGES OF VRS:

(i) VRS is a more humane way to reduce surplus workforce than terminating services of
employees. The firm‘s reputation remains intact.

(ii) Payment of heavy compensation to retiring employees prevents resentment on their part.

(iii) Trade unions also do not object to VRS as it is voluntary in nature.

(iv) Despite of heavy initial upfront costs in the form of heavy compensation package, VRS
reduces payroll costs or wage bills significantly over time. The firm is saved from paying
monthly wages or salaries to the employees opting for VRS.

DISADVANTAGES OF VRS

(i) Efficient employees may leave the firm and inefficient stay back. This would reduce the skill
base of the firm.

(ii) VRS might increase the workload of existing employees if it is used to cut the pay bill.

(iii) VRS might create a sense of insecurity in the minds of employees not opting for VRS and
deciding to stay with the firm.

WORKFORCE DIVERSITY

We live in times when global corporations and their reach across the world bring benefits in
terms of innovative HR policies as well as challenges in terms of managing the workforce
composed of diverse races and ethnicities. Further, the issue of gender diversity in terms of more
women and third gender participating in the workforce has been a trend that has accelerated in
the last two decades in India and much earlier in the developed countries.
When an organization has people of different caste, creed, religion, minorities and different
genders, then, naturally the question arises as to how to reconcile the differences between these
employees without causing too much friction in everyday interactions.

The challenge for HR manager therefore, is to make their organizations more accommodating to
divers groups of people by addressing different life styles, needs, values and work styles.

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DEFINITION

Workforce diversity means the heterogeneous composition of employees of an organization in

terms of age, gender, language, ethnic origin, education, marital status, etc. Managing such
diversity is really a challenge to HRM professionals.
According to Moorhead and Griffin – “Workforce diversity is concerned with the similarities
and differences in such characteristics as age, gender, ethnic heritage, physical abilities and
disabilities, race, and sexual orientation, among the employees of organizations.”
DIMENSIONS OF WORKFORCE DIVERSITY

The characteristics that describe the workforce of an organization may be categorized under two
groups, namely, primary dimensions and secondary dimensions.

Primary Dimensions:
Primary dimensions such as age, gender, race, ethnicity, sexual orientation, and physical abilities
represent those elements that are either inborn or exert extra influence on early socialization.
These dimensions make up the essence of who we are as human beings. They define us to others,
making them react towards accordingly. These are an enduring aspect of our personality.
These are core elements about each member of the workforce that can’t be changed such as age,
race, gender, physical and mental abilities and sexual orientation. These inborn elements are
interdependent and exert an important influence on individual’s behaviour throughout the life.
Together they form an individual’s ‘self-image’.

Secondary Dimensions:

Secondary dimensions represent those elements that we learn or over which we have some
control throughout our lives, such as education, marital status, religious beliefs, language, etc.
Secondary dimensions add an additional layer of complexity to the way we see ourselves and
others, and in some instances can exert a powerful impact on our core identities. These constitute
the elements that can be changed or at least modified. They include a person’s health habits,
religious beliefs, education and training, general appearance, status relationship, ethnic customs,
communication style and level of income. All these factors add an additional layer of complexity
to the way we see ourselves and others and in some instances can exert a powerful impact on our
core identities.

24
TYPES OF WORKFORCE DIVERSITY

• Age Diversity-Age diversity means working with people of different ages and most
importantly, generations.
• Gender Diversity- Gender diversity is equitable or fair representation of people of
different genders. It most commonly refers to an equitable ratio of men and women
• Cultural Diversity- It is the concept of multiculturalism where people following different
cultures put together in a workplace.
• Race/ Ethnic Diversity- Race are defined as “a category of humankind that shares
certain distinctive physical traits.” The term ethnicities is more broadly defined as
“large groups of people classed according to common racial, national, tribal, religious,
linguistic, or cultural origin or background.” So it is about the differences in the
physical traits and origin of the people working together
• Diversity based on Physical Ability – Similarities and dissimilarities based on the
physical skills strength and ability of the people
• Diversity based on Mental Ability – Similarities and dissimilarities based on the
interpersonal skills, values, mindset, and beliefs attitudes of the people.

HUMAN RESOURCE INFORMATION SYSTEM

DEFINITION:

According to Hedrickson, HRIS can be briefly described as integrated system used to gather,
store and analyze information regarding an organization human resources.

OBJECTIVES OF HRIS:

1. To provide accurate updated information about employees and job

2. Provide timely information in a cost effective manner.

3. To provide excess and safe storage of employee data.

4. To enable organization access the effectiveness of HR policies and producers.

25
 5. To improve productivity of HR system.

6. To access programs, policies and practices of HR.

7. To aid efficient business planning and decision making.

8. Align human resource functions with the company’s business strategy.

9. To improve employee and company performance and productivity.

10. To stream line the function of HR department.

11. To ensure accuracy and avoid errors.

SCOPE AND COMPONENTS OF HRIS:

1. HR administration

2. Human resource planning.

3. Wages and salary administration.

4. Leave and absence.

5. Training and development.

6. Attendance system

7. Skills invention.

8. Carrier planning

ADVANTAGES OF HRIS:

1. Improves the efficiency and ease of managing the HR function.

26
 2. Provides variety of applications in HR function such as requirement, selection, attendance,
training and development, payroll, compliance etc.,

3. Centralized storage of information excess from anywhere within the company.

4. Employees can access and exchange information in a convenient manner.

5. Avoid and eliminates redundant information.

6. Helps to analyze large volume of data and generate reports in an accurate and quick manner.

7. Enables empowerment to productivity of employee to better else of their skills.

8. Helps HR manager to better plan, managing control HR cost.

9. Quick access to update information and supports decision making.

10. Better Decision making.

LIMITATIONS OF HRIS:

1. It is expensive to install and maintain.

2. It may require huge additional investment in future.

3. Employees need to train which involves times, cost and effects their existing work.

4. May meet with employee’s resistance.

5. The HRIS may not be in tune with existing human resource system.

6. Lack of proper documentation can lead to problem in usage.

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 QUESTION BANK PART - A

1. Define Human Resource Management.

2. State the characteristics of Human Resource Management.
3. How are HR functions classified?
4. List out the Objectives of HRM.
5. State the importance of HRM
6. Write down the Operative functions of HRM
7. State the scope of HRM
8. List out the qualities of HR Manager.
9. Draw an organizational chart of a typical HR department.
10. List out the responsibilities of HR manager.
11. Point out the types of diversities

PART - B
1. Explain the evolution of HRM in Indian Scenario.
2. Describe the functions HRM with relevant examples.
3. . Sketch the managerial and operative functions of HRM.
4. Analyze the Role of HRM.
5. Explain the traditional and modern HRM concept.
6. Produce the qualities and qualifications required to become HR
manager.
7. Explain the barriers of HRM.
8. Explain HR policies serve as guideline to personnel decisions.
9. Elucidate the challenges of HRM in global environment.
10. Describe the importance of HRM in modern workplace.
11. Interpret HRIS with its advantages and disadvantages

REFERENCES
 Human Resource Management, Gary Dessler, 16th Edition. 2017
 Human Resource Management, Aswathappa. McGraw-Hill Education (India) Pvt
Limited, 2010
 Principles of Human Resource management, Bohlender and snell,Cengage learning, 17th
edition, 2016.

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 SCHOOL OF MANAGEMENT STUDIES

UNIT – II – Human Resource Management – SBAA1205

1
ACQUISITION OF HUMAN RESOURCE

Human Resource Planning-Quantitative and Qualitative dimensions-job analysis-job description

and job specification-Recruitment-Concept and sources-Selection-Concept and process-test and
interview-Placement, induction and orientation.

HUMAN RESOURCE PLANNING MEANING:

The process of determining the manpower needs of an enterprise so that it is possible to fill up any
vacancy as and when it arises. This plan eliminates the risk of surplus or shortage of staff at any
time.

DEFINITION:

1) E.W. Vetter-- HRP is the process by which a management determines how the organization
should move from its current manpower position to its desired manpower position. Through
planning the management strives to have the right number and right kind of people at the right
places, at the right time, doing things which results in both the organization and the individual
receiving, maximum long range benefit.

2) Dale S. Beach-- HRP is a process of determining and assuming that the organization will have an
adequate number of qualified persons available at the proper times, performing jobs which meet the
needs of the enterprise and which provide satisfaction for the individuals involved

IMPORTANCE OF HRP

1. It helps the organization to procure the required manpower.

2. It helps to replace employees.
3. It ensures optimum investment in HR.
4. It provides scope for advancement and development of employees through training,
development etc.
5. It helps to tackle the problem of surplus or shortage of manpower.

2
 6. HRP reduces the problem of labor turnover.
7. To foresee the need for redundancy and plan to check it or to provide alternative employment
in consultation with trade union.
OBJECTIVES OF HRP
1. To ensure that the HR plan helps to attain the overall objective of the enterprise.
2. To keep the cost of recruitment and selection pf employees low.
3. To ensure that that the organization does not face the problem of either surplus or shortage of
manpower.
4. To ensure the selection of the right man for the right job.
5. To make available the required manpower when expansion and diversification activities are
undertaken.
6. To eliminate or minimize the adverse effects of labour turnover.
7. To find a suitable replacement for those employees who retire, die or dismissed from service.
FACTORS INFLUENCING HRP
Internal Factors
1. Recruitment policy of the organization or company strategies.
Company’s policies and the strategies relating to expansion, diversification, alliances etc.
determine the human resources demand in terms of quality and quantity.
2. Human resource policies.
HR policies of the company regarding quality of human resources, compensation level,
quality of work life etc. Influence human resource plan.
3. Job analysis.
Determine the qualifications and skills from perspective applicants required.
4. Time horizons.
Companies with a stable competitive environment can plan for long run.
5. Company’s production policy.
Company’s policy regarding how much to produce influencing the number of people
required.
6. Trade unions.
Influence of trade unions regarding the number of hours of work recruitment sources etc.
affect HRP.

3
 External Factors.

1. Government policies.
Government policies like labor policy, Industrial relations policy, policy towards reserving
certain jobs for different communities affect HRP.
2. Level of economic development.
Determine the level of supply of human resources in future in the country.
3. Willingness of job seekers.
4. The terms and conditions of service are acceptable to the job seekers if they find it
unreasonable they may not be willing to apply.
5. Trend in the industry.
Creates demand for particular job.
6. Level of technology.
Determine the kind of human resources required.
HUMAN RESOURCE PLANNING PROCESS
Human resource planning is a process through which the right candidate for the right job is
ensured. For conducting any process, the foremost essential task is to develop the organizational
objective to be achieved through conducting the said process. Six steps in human resource
planning are presented in the figure

4
 Figure 1

1. Analysing Organizational Objectives:

The objective to be achieved in future in various fields such as production, marketing, finance,
expansion and sales gives the idea about the work to be done in the organization.

2. Inventory of Present Human Resources:

From the updated human resource information storage system, the current number of employees,
their capacity, performance and potential can be analysed. To fill the various job requirements,
the internal sources (i.e., employees from within the organization) and external sources (i.e.,
candidates from various placement agencies) can be estimated.

3. Forecasting Demand and Supply of Human Resource:

The human resources required at different positions according to their job profile are to be
estimated. The available internal and external sources to fulfill those requirements are also
measured. There should be proper matching of job description and job specification of one
particular work, and the profile of the person should be suitable to it.

4. Estimating Manpower Gaps:

Comparison of human resource demand and human resource supply will provide with the surplus
or deficit of human resource. Deficit represents the number of people to be employed, whereas

5
 surplus represents termination. Extensive use of proper training and development programme can
be done to upgrade the skills of employees.

5. Formulating the Human Resource Action Plan:

The human resource plan depends on whether there is deficit or surplus in the organization.
Accordingly, the plan may be finalized either for new recruitment, training, interdepartmental
transfer in case of deficit of termination, or voluntary retirement schemes and redeployment in
case of surplus.

6. Monitoring, Control and Feedback:

It mainly involves implementation of the human resource action plan. Human resources are
allocated according to the requirements, and inventories are updated over a period. The plan is
monitored strictly to identify the deficiencies and remove it. Comparison between the human
resource plan and its actual implementation is done to ensure the appropriate action and the
availability of the required number of employees for various jobs.

LIMITATIONS OF HRP:

Expensive- Preparation and implementation of HRP is expensive in terms of time, efforts

and money required.

Inaccurate forecasts- HRP is prepared based on forecasts, inaccurate forecasts result in the
failure of the plan.

Uncertainties- Absenteeism, seasonal nature of certain jobs can bring uncertainties in HRP.

Trade union resistance- Trade unions think that this will increase the work load or it will
create redeployment of the existing employees.

Focus on quantity- The HRP focuses on quantity to HR rather than quality. Quantities
without quality do more harm than good.

6
JOB ANALYSIS

Developing an organizational structure, results in jobs which have to be staffed. Job analysis is
the procedure through which you determine the duties and nature of the jobs and the kinds of
people (in terms of skills and experience) who should be hired for them.

Some of the definitions of job analysis are

According to Michael L. Jucius, “Job analysis refers to the process of studying the operations,
duties and organizational aspects of jobs in order to derive specifications or as they called by
some, job descriptions.”

According to DeCenzo and P. Robbins, “A job analysis is a systematic exploration of the

activities within a job. It is a basic technical procedure, one that is used to define the duties,
responsibilities, and accountabilities of a job.”

METHODS OF JOB ANALYSIS:

The methods or approaches are utilized in analyzing jobs. They are:
1. Personal Observation: The materials and equipment used, the working conditions and
probable hazards, and an understanding of what the work involves are the facts which should be
known by an analyst.
2. Sending out of Questionnaires: Properly drafted questionnaires are sent out to job- holders for
completion and are returned to supervisors.
3. Maintenance of Long Records: The employee maintains a daily record of duties he performs,
marking the time at which each task is started and finished.
4. Critical Incidents: In this method, job holders are asked to describe incidents concerning the
job on the basis of their past experience. The incidents so collected are analyzed and classified
according to the job areas they describe.
5. Personal Interviews: Personal interviews may be held by the analyst with the employees, and
answers to relevant questions may be recorded. But the method is time-consuming and costly.
6. Technical Conference Method: This method utilizes supervisors with extensive knowledge of
the job. Here, specific characteristics of a job are obtained from the “experts.”
7. Functional Job Analysis: Functional job analysis (FJA) is employee- oriented analytical
approach of job analysis. This approach attempts to describe the whole person on the job.

7
PROCESS OF JOB ANALYSIS:
Following are the important steps in the process of job analysis:
1. Determine the Use of the Job Analysis Information: Start by identifying the use to which the
information will be put, since this will determine the type of data you collect and the technique
you use to collect them.
2. Collection of Background Information: According to Terry, “The make-up of a job, its relation
to other jobs, and its requirements for competent performance are essential information needed
for a job evaluation. This information can be had by reviewing available background information
such as organization charts and the existing job descriptions.
3. Selection of Jobs for Analysis: Job analysis is a costly and time consuming process. Hence, it
is necessary to select a representative sample of jobs for the purposes of analysis. Priorities of
various jobs can also be determined.
4. Collection of Job Analysis Data: Job data on features of the job, required employee
qualification and requirements, should be collected either from the employees who actually
perform a job; or from other employees who watch the workers, or from the outside persons.
5. Processing the Information: Once job analysis information has been collected, the next step is
to place it in a form that will make it useful to those charged with the various personnel
functions. Several issues arise with respect to this. First, how much detail is needed? Second, can
the job analysis information be expressed in quantitative terms? These must be considered
properly.
6. Preparing Job Descriptions and Job Classifications: Job information which has been collected
must be processed to prepare the job description form. It is a statement showing full details of the
activities of the job. Separate job description forms may be used for various activities in the job
and may be compiled later on. The job analysis is made with the help of these description forms.
These forms may be used as reference for the future.
7. Developing Job Specifications: Job specifications are also prepared on the basis of
information collected. It is a statement of minimum acceptable qualities of the person to be
placed on the job. It specifies the standard by which the qualities of the person are measured.
JOB DESCRIPTION
Job description is an organizational, factual statement of duties and responsibilities of a specific
job. In brief, it should tell what is to be done, how it is done and why.

8
 Job description is a written statement showing job title, tasks, duties and responsibilities involved
in a job. It also prescribes the working conditions, stress that it can produce and the relationship
with other jobs.

Job description contains the following information:

1. Job title, department,

2. Job contents in terms of activities or tasks performed.

3. Job responsibilities towards effective performance of the job.

4. Working conditions specifying specific hazards

5. Social environment prevailing at the workplace.

6. Machine tools and equipment.

7. Extent of supervision given and received.

JOB SPECIFICATION

Job specification is a statement of the minimum acceptable human qualities necessary to perform
a job properly.

1) The personal characteristics such as age, sex, education, job experience and extra co-
curricular activities.

2) Physical characteristics such as height, weight, chest, vision, hearing, health etc.

3) Mental characteristics such as general intelligence, memory, judgement, foresight, abilities

to concentrate etc.

4) Social and psychological characteristics such as emotional stability, flexibility manners.

Initiative, creativity, etc.

9
RECRUITMENT MEANING

It is the process of searching for and obtaining applicants for jobs, from among whom the right
people can be selected.

DEFINITION

According to Prof. William B.Werther and Keith Davis “It is the process of finding and
attracting capable applicants for employment. The process begins when new recruits are starts
and ends when their applications are submitted. The results are a pool of applicants from which
new employees are selected”.

PURPOSE AND IMPORTANCE OF RECRUITMENT


Determine the present and future requirements of the organization with its human
resource planning and job analysis.

Increase the pool of job applicants at minimum cost.


Help to increase the success rate of the selection process, by reducing the number of
visibly under qualified and over qualified applications.


Help to reduce the probability of the job applicants, will leave the organization after a
short period of time.

Begin identifying and preparing potential job applicants.

Increase organizational and individual effectiveness in the short term and long term.


Evaluate the effectiveness of various recruiting techniques and source for all types of job
applicants

10
FACTORS INFLUENCING RECRUITMENT:

The following diagram represents the various factors or determinants of the effectiveness of the
recruitment process done by the organization.

Figure 2
SOURCES OF RECRUITMENT

The sources of recruitment can broadly be classified into two; internal and external. I. Internal
Sources

1.Internal Sources

An internal source refers to the present working force of a company. In the event of a vacancy,
someone already on the payroll is promoted. Thus, at the Tata Engineering and Locomotive
Company and at Hindustan Unilever Ltd., outside recruitment is resorted to only when
requirements cannot be met from internal promotions.

Filling a vacancy form internal sources by promotion people has the advantages of increasing the
general level of morale of existing employees and of providing to the company a more reliable
information about the candidate‘s suitability who has already worked with the company on a
lower post.

11
The major weakness of this source are that it results into inbreeding depriving the organization
of a fresh outlook, originality and initiative and offers limited choice.

Advantages of Internal Sources of Recruitment

 Familiarity with the organisation and employees

 Better use of talent
 Economical and less time consuming
 It will help to improve the morale, loyalty and belongingness of an employee
 It will motivate the employees

Disadvantages of Internal Sources of Recruitment

 Limited choice
 Discourage competition
 Creates conflicts

2. External Sources

The more commonly used external sources are the following;

1. Advertisement in the newspapers

Senior posts are largely filled by this method. This method is however, followed by
companies in 3 different ways
2. Employment Exchange
An employment exchange is an office set up by the government for bringing together as
quickly as possible those men who are in search of employment and those employers who
are looking for men. Employment exchange register unemployed people and maintain
records of their names, qualifications, etc. the employers on their part intimate the
exchange about the vacancies which occur in their factories and types of employees they
required for from among the employment seekers already registered with it and forwards
their names to the employers for consideration.
3. Field Trips

12
 An interviewing team makes trip to towns and cities which are known to contain the
kinds of employees required. Arrival dates and time and venue of interview are
advertised in advance.
4. Educational Institutions
Sometimes recruiters are sent to educational institutions where they meet the members of
the faculty and persons in charge of placement services who recommend suitable
candidates. Some companies send representatives of professional meetings and
convention to recruit people.
5. Labour
Contracts In many industries workers are recruited through contractors who are
themselves the employees of these organizations.
6. Employee Referrals
Some industries with a record of good personnel relations encourage their employees to
bring suitable candidates for various openings in the organization. Companies offer rich
rewards also to employees whose recommendations are accepted.
7. Unsolicited Applicants
These are persons who gather at the factory gates to serve as casual workers or who send
in their applications without any invitation from the factory. Sometimes already
employed person may seek additional jobs. This is called moon-lighting. The number of
unsolicited applicants at any point of time depends on economic condition, the image of
the company and the job-seekers perception of the type of jobs that might be available in
the company.
8. Labour Unions Organisations with ‘closed shop‘agreements with their unions are
required to recruit union members only.

Advantages of External Sources of Recruitment

 Availability new and talented candidates
 Opportunity to select the best candidates with innovative or creative thoughts
 Provides healthy competition among the employees

13
 Disadvantages of External Sources of Recruitment
 Expensive and time consuming
 Unfamiliarity with the organisation
 Lack of mutual relations
 Chances of faulty selection

SELECTION MEANING:

Selection is the process of picking individuals (out of the pool of job applicants) with requisite
qualifications and competence to fill jobs in the organisation. The objective of selection process
is to determine whether an applicant meets the qualifications for a specific job and to choose the
applicant who is most likely to perform well in that job.

DEFINITION:

According to Prof. Thomas H. Stone defined selection as, “It is the process of differentiating
between applicants in order to identify (& hire) those with a greater likelihood of success in a
job”.

SELECTION PROCESS:

Selection is a long process, commencing from the preliminary interview of the applicants and
ending with the contract of employment. In practice, the process differs among organisation
between two different jobs within the same organisation. Selection procedure for Senior
Manager will be long-drawn and rigorous, but it is simple and short while hiring shopfloor
workers.

14
 Figure 3
Preliminary Interview
This is a very general and basic interview conducted so as to eliminate the candidates
who are completely unfit to work in the organisation. This leaves the organisation with
a pool of potentially fit employees to fill their vacancies.
Receiving Applications
Potential employees apply for a job by sending applications to the organisation. The
application gives the interviewers information about the candidates like their bio-data,
work experience, hobbies and interests.
Screening Applications
Once the applications are received, they are screened by a special screening committee
who choose candidates from the applications to call for an interview. Applicants may be
selected on special criteria like qualifications, work experience etc.

15
Employment Tests

Before an organisation decides a suitable job for any individual, they have to gauge
their talents and skills. This is done through various employment tests like
intelligence tests, aptitude tests, proficiency tests, personality tests etc.

Employment Interview
The next step in the selection process is the employee interview. Employment interviews are
done to identify a candidate’s skill set and ability to work in an organisation in detail.
Purpose of an employment interview is to find out the suitability of the candidate and to give
him an idea about the work profile and what is expected of the potential employee. An
employment interview is critical for the selection of the right people for the right jobs.

Checking References
The person who gives the reference of a potential employee is also a very important source
of information. The referee can provide info about the person’s capabilities, experience in
the previous companies and leadership and managerial skills. The information provided by
the referee is meant to keep confidential with the HR department.
Medical Examination
The medical exam is also a very important step in the selection process. Medical exams
help the employers know if any of the potential candidates are physically and mentally fit
to perform their duties in their jobs. A good system of medical checkups ensures that the
employee standards of health are higher and there are few cases of absenteeism,
accidents and employee turnover.

Final Selection and Appointment Letter

This is the final step in the selection process. After the candidate has successfully
passed all written tests, interviews and medical examination, the employee is sent or
emailed an appointment letter, confirming his selection to the job. The appointment
letter contains all the details of the job like working hours, salary, leave allowance etc.
Often, employees are hired on a conditional basis where they are hired permanently
after the employees are satisfied with their performance.

16
IMPORTANCE OF THE SELECTION PROCESS

1. Proper selection and placement of employees lead to growth and development of the
company. The company can similarly, only are as good as the capabilities of its employees.

2. The hiring of talented and skilled employees results in the swift achievement of
company goals.

3. Industrial accidents will drastically reduce in numbers when the right technical staff
is employed for the right jobs.

4. When people get jobs they are good at, it creates a sense of satisfaction with them and
thus their work efficiency and quality improves.

5. People who are satisfied with their jobs often tend to have high morale and motivation
to perform better.
TESTS

A test is a sample measurement of a candidate’s ability and interest for the job different
types of test are conducted.

1. Aptitude Test conducted to know whether candidate has the potentials to learn the skills
necessary to the work. Ex: salesman.
2. Intelligence Test to test the mental capacity of the candidates like, reasoning, word
fluency, memory, vocabulary, etc.
3. Proficiency Test is conducted to measure a person’s skill to do his job. Ex: typist.
4. Interest test to measure a candidate’s interest in a particular work.
5. Personality Test helps to judge the personal traits of a candidate’s quality like, courage,
values, initiative, curiosity, judgment, temperament, etc.
6. In Basket the candidate is supplied with actual letters, telephone, conversation, reports
and adequate information about job and organization. The candidate is asked to take
decision on various items based on the information.
7. Thematic Apperception Test (TAT) candidates are shown a series of pictures and are
asked to write a story based on these pictures. This test measures candidates conceptual,
imaginative and projective skills.

17
 8. Ink-Blot Test The candidates are asked to see the ink- blots and make meaningful
concepts out of them. The examiner keeps a record of the responses, emotional
expressions and incidental behaviors.
INTERVIEW

It is a face to face oral examination of a candidate by an employer. The final interview

enables the employer to examine the candidate thoroughly.

KINDS OF INTERVIEW:

1. Direct Planned Interview: This interview is a straight forward, face-to-face, question an

answer situation intended to measure the candidate‘s knowledge and background.
Although it also provides an opportunity for observing the candidate‘s personal
characteristics and nothing his attitudes and motivations but the presentation is usually
superficial. The interviewer, however, does some advance planning.
2. Indirect Non-directives Interview: In this type of interview the interviewer refrains from
asking direct and specific questions but creates an atmosphere in which the interviewer
feels free to talk and go into any subject he considers important. In such atmosphere the
information obtained by the interviewer is more likely to be an accurate representation of
what the individual believes than if the employee is asked specific questions. The
interviewer, therefore, plays mainly a listening role.
3. Patterned Interview: In this interview a series of questions which can illuminate the
strategic parts of the applicant‘s background are standardized in advance and validated
against the record of employees who have succeed or failed on the jobs. Answers to these
questions are compared with a critical score and used in determining who is to be
selected.
4. Stress Interview: In this interview the interviewer deliberately creates stress to see how
an applicant operates under it. To induce the stress, the interviewer responds to the
applicants‘answer with anger, silence, criticism or a flurry of incisive follow-up
questions. Events such as noise, interruptions, or change of schedules are introduced to
see how determined and inventive an applicant can be. The interviewer can add realism
by acting uncooperatively and by raising objections.

18
 5. Systematic Depth Interview: In this interview, the interviewer has a plan of areas he
wishes to cover. Ordinarily, the interviewer exhausts one are before launching into the
next so that he can be more certain of complete coverage. Each answer must be
interpreted in the context of many other interrelated circumstances. So the interviewer
must weigh the meaning of various answers.
6. Panel or Board Interview: In the board interview, more than one person interviews an
applicant at the same time. Areas of questioning are allowed to each interviewer before
the interview starts. One possible disadvantage of this method is that on being stimulated
by each other‘s questioning, interviewer may start competing with one another and thus
create conditions of stress for the candidate.
7. Group Interview: In this interview 5 or 6 applicants are placed together in a situation in
which they must interact. The situation may be structured or unstructured. It is usual for
the selector to remain silent throughout the discussion and make notes of the applicant‘s
interactions unobtrusively. The applicant who verbalizes better and who has a better
personality is likely to be selected under such circumstances.
8. Walk-in-Interview: In this interview candidates are not required to apply for the post
beforehand. They are asked to approach the employer for interview on the advertised
date, time and place with their bio-data and a copy of their passport size photograph.

PLACEMENT

When the candidate reports for duty, the organization has to place him initially in that job for
which he is selected. The organization decides the final placement after the initial training is over
and performance during the training. The probation period ranges between six months to two
years. If the performance is not satisfactory the organization may extend the probation period or
ask the candidate to quit the job. If the performance is satisfactory his services will be
regularized and he will be placed permanently on a job.

PROBLEMS IN PLACEMENT

1. Employee expectations- If the employee expects high salary independent and challenging
work and the job offers low salary, dependent work then the employee finds himself misfit
to the job.

19
 2. Job expectations- Sometimes the expectations from the employee are more than the
employee’s abilities or skills. Then the HR manager finds the mismatch between the job and
the employees.

3. Change in technology- Technological changes brings changes in job description and

specification. This may mismatch.

4. Changes in organizational structure- The organization may do merger, acquisition,

downsizing etc. That may result in mismatch between job and employee.

HOW TO MAKE JOB PLACEMENT EFFECTIVE

1) Job rotation: Rotating the employee among different job in the department enables the
employee to satisfy his aptitude for challenging work.

2) Team work: The teamwork allows employees to use their skill, knowledge, abilities, etc. and
it minimizes the problems in placement.

3) Training & development: Continuous training & development help the employee to acquire
new skills and knowledge.

4) Job enrichment: Provides challenging work and decision making authority to the employees.
It gives the opportunity to use his skills.

5) Empowerment: Makes the employee to exploit his potentialities and make use of them.

ORIENTATION

MEANING:

Orientation is one component of the new employee socialization process. It is the ongoing
process of instilling in all new employees prevailing attitudes, standards, values, patterns of
behavior that are expected by the organisation and its departments.

DEFINITION OF ORIENTATION:

Orientation defined by Prof.Robert .L.Mathis and John H.Jackson as, “It is a process of planned
introduction of employees to their jobs, their co-workers and the organization”.

20
PROBLEMS OF ORIENTATION

 Supervisor not trained and is too busy

 Overwhelmed with too much information in a short time.
 Overload with forms to complete
 Employee asked to perform task where there are high chances of failure that could
needlessly discourage the employee.
 Employee is forced to fill in the gaps between a broad orientation by the HR department
and a narrow orientation at the department level.
 Employee thrown into action too soon
 Employee mistake can damage the company
 Employee may develop wrong perception because of short period spent on each job

INDUCTION

Induction is the process of receiving and welcoming an employee when they first joint a
company and giving them the basic information what they need to settle down quickly and
happily to start the work. Lecture, film, group, seminar are used to impart the information to new
employee about the environment of the job and organization in order to make a new employee
comfortable themselves

CRITERIA FOR A SUCCESSFUL INDUCTION PROGRAMME. (STEPS OR

PROCESS)

1. About the company history.

2. Objectives of the company.

3. Policies

4. Procedures

5. Rules and regulations

6. Code of contact

7. About the department

21
 8. About the superiors and subordinates

OBJECTIVES OF INDUCTION AND ORIENTATION

1. Putting the new employees at east.

2. Greeting interest in his job and the company.

3. Providing basic information about working arrangements.

4. Indicating the standard if performance and behavior expected of him making the
employee feel that his job however small is meaningful that he is not a knowledge in
the vast field his job.

5. Informing him about the trading facilities.

6. Creating the feeling of social security.

7. Minimizing the reality which the company provide offers regarding pay, benefits, status,
working conditions, responsibility, opportunity for growth, innovation, creative ideas

DIFFERENCE BETWEEN ORIENTATION AND INDUCTION

Figure 4

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 QUESTION BANK

PART - A
1. Define Human Resource Planning.
2. List out the factors influencing the manpower planning.
3. Review the objectives of human resource planning.
4. Define job analysis.
5. Define job specification.
6. State the term recruitment.
7 What is interview?
8. List out the types of interviews.
9. Identify the effects of low morale?
10. State the meaning of psychological tests.
11. Define induction
12. State the meaning of employee placement.

PART- B
1. Categorize the techniques or steps involved in human resource
planning.
2. Explain the process of human resource planning.
3. Explain the problems faced in human resource planning.
4. What is job specification? How does it differ from job
description?
5. Compute the process of recruitment.
6. Explain the advantages and disadvantages of internal and
external recruitment.
7. Illustrate different steps involved in selection process.
8. Discuss different types of interviews and tests.
9. Describe the steps involved in an orientation program.

REFERENCES

 Human Resource Management, Gary Dessler, 16th Edition. 2017

 Human Resource Management, Aswathappa. McGraw-Hill Education (India) Pvt Limited,
2010
 Principles of Human Resource management, Bohlender and snell,Cengage learning, 17 th
edition, 2016

23
 SCHOOL OF MANAGEMENT STUDIES

UNIT – III – Human Resource Management – SBAA1205

1
 TRAINING AND DEVELOPMENT

Concept and Importance- Identifying Training and Development Needs- Designing Training
Programmes- Role specific and Competency- Based Training- Evaluating Training Effectiveness-
Training Process Outsourcing-Management Development- Career Development.

CONCEPTS OF TRAINING

It is the process of providing inputs and knowledge to empower and develop the manpower
or employee according to the industrial expectation is called as training. It is a tool that helps to
increase the efficiency and the capacity of employees by importing specified knowledge, talent,
idea, skill and experience for the development of the company.
Training is a process of learning a sequence of programmed behavior. It is an application of
knowledge. It gives people an awareness of the rules and procedures to guide their behavior. It
attempts to improve their performance on the current job or prepare them for an intended job.

DEFINITION:
Training is the act of increasing the knowledge and skills of an employee for doing a
particular job. — Edwin B. Flippo

Development is the Process in which someone or something grows or Changes and

becomes more updated and advanced

Training & Development Need = Standard Performance – Actual Performance

TOOLS TO BE USED FOR TRAINING (MODE OF PROVIDING TRAINING):

 Classroom teaching
 Seminar
 Presentation
 Guest lecture
 Video presentation
 Management games
 E – learning
 Coach and mentorship
 Tutorial or remedial class

2
IMPORTANCE OF TRAINING

 To provide job related knowledge to the workers.

 To impart skills among the workers systematically so that they may learn quickly.

 To bring about change in the attitudes of the workers towards fellow workers,
supervisor and the organization.
 To improve the productivity of the workers and the organization.
 To reduce the number of accidents by providing safety training to the workers,

 To make the workers handle materials, machines and equipment efficiently and thus
to check wastage of time and resources.
 To prepare workers for promotion to higher jobs by imparting them advanced skills.

BENEFITS OF TRAINING:

1. Leads to improve productivity and profitability of organisation

2. Improve the job knowledge and skills at various level of organisation.
3. Improve job morale and confidence of work.
4. Improve the relationship between employee and employer
5. Helps in understanding organisational policy.
6. Provide information in future need in all areas of organisation.
7. It helps in reduce the cost and expenses in business.
8. It helps in maximizing quality of work and standard of employees.

9. It helps in to prevent stress, tension and misunderstanding of

employees.
10. It improves labour and management qualifications.
11. It increases the level of job satisfaction and s p e ci fi ca t i o n among employees.

12. It helps in developing sense of growth in learning.

13. It improves interpersonal skills in a company.

14. It provides a good climate for learning, growth, motivation and co- ordination

15. It creates the organization is a better place to work and live.

3
OBJECTIVES OF TRAINING:

 To prepare the employees to meet present and future recruitment of the job in the
organization.

 To provide basic knowledge and skills which they need for intelligence
performance of particular job.
 To prepare employee for achieving higher level task.
 To develop the potential of people for next level of job.
 To ensure smooth and efficient working condition of particular department.

 To ensure economical output of required quality and standard.

 To promote individual responsibility, attitude in right direction.

 To build up the overall capacity and strength of employee to challenges in
organisation.

IDENTIFYING THE NEED OF TRAINING & DEVELOPMENT

• To improve Productivity

• To improve Quality

• To help a company fulfils its future personnel needs

• To improve organizational Climate

• To improve health and Safety

• Obsolescence Prevention

• Personal Growth.

• Technology update

• Industrial safety

• Effective management

4
PROCESS OF TRAINING OR STEPS INVOLVED IN TRAINING:

1) Assessment of training needs.

The basic step in training is to identify the need and purpose the training program based
on the organizational policy and objective of the company. Normally this will be
determined by the expectation and need of employees in the company.

2) Setting the training objectives.

The theme and objective of the training program should be fixed based on the employee
need , technological change, level of task and nature of work.

3) Selection of training method.

The optimum method should be adopted based on urgency, demand, situation, need,
Importance, budget and cost.

4) Conduct of training.
Training program should be conducted and implemented as per the schedule and plan to
develop the level of employee to the next level in terms of knowledge, skill, technology
and Idea.

5) Evaluation of training program and Follow up

The proper examination and audit should be conducted to review the impact and feed
back of training .this will help us to identify the problems and strength of the training
which help us to follow or modify the training.

5
TYPES (OR) METHODS OF TRAINING

Figure 1
On the Job Training Method
1. Job Rotation
Job Rotation is a management approach where employees are shifted between two or more
assignments or jobs at regular intervals of time in order to expose them to all verticals of an
organization. It is a pre-planned approach with an objective to test the employee skills and
competencies in order to place him or her at the right place.

2. Coaching
Coaching is a process that aims to improve performance and focuses on the ‗here and now‘
rather than on the distant past or future.

3. Job Instruction
Job Instruction Training (JIT) is a step-by-step, relatively simple technique used to train
employees on the job. It is especially suitable for teaching manual skills or procedures; the
trainer is usually an employee's supervisor but can be a co-worker.

4. Committe assignment
Committee assignments refer to the method in which the trainees are asked to solve an actual
organizational problem. In committee assignments, trainees have to work together in a team
and offer solution to the problem.

6
 5. Internship training
Under the Internship Training programme, an educational or a vocational institute enters into
an arrangement with the industrial enterprises to provide experiential knowledge to their
students. Usually, the internship training lasts for few months and can either be paid or
unpaid.

Off the Job Training Method

1. Case study method
The case study is a method which provides descriptive situations which stimulate trainees to
make decisions. As a training tool, the case study method can be used to develop decision-
making skills, enhance team spirit, better communication and interpersonal skills and
strengthen the analytical skills of trainees

2. Incident method
Critical incident method or critical incident technique is a performance appraisal tool in
which analyses the behavior of employee in certain events in which either he performed
very well and the ones in which he could have done better.

3. Role play
Role Play, or Role Playing, allows a learner to assume the role or tasks of a job by
practicing or simulating real working conditions. The objective of role playing is to learn,
improve or develop upon the skills or competencies necessary for a specific position.

4. Inbasket method
In basket training is a training method to acquaint employees about their job where a
number of problems are kept in the "in basket " (usually kept on the desk of the
employee). The worker has to look at the problems which could also be complaints from
different employees and simultaneously deal with those problems

5. Business games
Business Games refers to the training method for managers. This form of training is based
on an artificial environment that simulates the real situation in the management of the
organization. Business games allow monitoring of the consequences of decisions, and
respond naturally to various situations

7
 6. Grid Training
The Grid Training is the comprehensive organization development programme developed
by Blake and Mouton, which focuses on the overall development of individuals, groups
and the organization as a whole.

Figure 2

7. Lectures
Lecturing refers to giving an instructional talk on some subject — usually in front of a
class or a group of people. Eg.Class rooms

8. Stimulation Training
Simulated Training is a devised job training that is not on the job but away from the job.
It teaches a complicated, critical and hazardous task. Enough practice gives the trainees
enough exposure and renders him better prepared for the real life problem.

9. Management (Games) education

Management Games, Business Simulators refers to the training method for managers.
This form of training is based on an artificial environment that simulates the real situation
in the management of the organization, whether it's planning, decision making, control,
communications or management itself

10. Conferences and seminars

A conference is a formal meeting where people congregate to discuss a specific area of
common interest while a seminar is an educational forum where members meet to acquire
knowledge about a particular area.

8
ROLE OF TRAINING
• Help in addressing employee weaknesses

• Improvement in worker performance

• Consistency in duty performance

• Ensuring worker satisfaction

• Increased productivity

• Improved quality of service and products

• Reduced cost

• Reduction in supervision

• Develop positive attitude

• Reduced employee turnover

COMPETENCY FOR EFFECTIVE TRAINING

• A Deep Knowledge of the Business

A deep and thorough understanding of the business or organisation you are part of is
among the greatest assets that you as a training manager can possess. A good rule of
thumb is whether you can articulate both what your company does and how it does it in a
few simple, concise sentences.
• The Ability to Measure and Assess Staff Training Needs
Awareness of how the training needs of your employees is critical to developing your
team. Professional trainers are expected to conduct a thorough training needs analysis
before undertaking a training assignment, and as a manager, you'll need to as well. This
process will help you determine two things - what needs to be learned by your team, and
how to priorities the learning.

9
 • Strong Communication and Interpersonal skills
Regardless of whether you conduct your own training programs or not, it is imperative
for a good training manager to be highly efficient in communication of all kinds.
Understanding problems, conveying ideas, conducting training – all of this is carried
through words.

• A Passion for Continuous Learning & Enthusiasm for lifelong updating

Every day around the world thousands of academic papers are submitted, hundreds of
seminars are given, and thousands of blog posts written discussing new research and
insights into age-old management problems. As a corporate trainer who wants to remain
on top of the game you need to keep yourself abreast of the latest developments in your
field. A passion for learning will make this less of a chore and more of a spirited
endeavor.

• Innovative Thinking
The prospect of attending yet another training session can make anyone, from seasoned
corporate executives to employees who have just started, want to shoot themselves in the
head. We've all been in plenty of repetitive and monotonous training sessions. We've all
sat through presentations that were boring or were clearly being taught with a minimum
of effort by the instructor.

• Embrace Efficiency
Training budgets are almost never static. They're one of the last things to be increased by
management in response to growth, and they're one of the first things to be cut! Training
managers almost never had the resources they need, whether it's time, money, tools, or
buy-in from the rest of the company. These are the realities of the training business
though, and they're not going to change, so make sure you develop an acute appreciation
of and desire for efficiency.

TRAINING OUTSOURCING

Training Process Outsourcing in Human Resources Management is drawing attention in

the management to build a dedicated and high caliber, human resource with maximum
skills and knowledge.

10
 Outsourcing is the business practice of hiring a party outside a company to perform
services and create goods that traditionally were performed in-house by the company's
own employees and staff.

NEED OF OUTSOURCING

 
COST EFFECTIVE
This is one primary reason from where the need of outsourcing came into the picture.
Mainly with the developed countries like US and UK, the skilled and proficient labor
available in these countries is very expensive according to the minimum wage policies
available with them. So, the processes like marketing, Sales, web development etc they
started outsourcing to the developing countries like India where they could find good
quality skilled labor with very fewer wages.
 
SKILLED SPECIFIC VENDORS
These outsourcing vendors are the ones specialized in the task assigned as they have the
good number of skilled labor with them, who knows all the complexities of the task and
ready with all the possible solutions required which makes the process handling smoother
than having done in-house by hiring people as it turns out to be less feasible in terms of
quality. Being skilled specific it helps the business to improve the effectiveness of the
job.
 
SAVES ON INFRASTRUCTURE AND TECHNOLOG

One important aspect of outsourcing is it eliminates the need of investing more in

infrastructure and further technologies. Outsourced business partner shares the
responsibility and do invest in them which again saves on the business capital and makes
the business person use that fund to procure more needed and latest technologies related
to core business activities which turn out to be a more beneficial deal for any
organization raising the need of outsourcing.

11
 
RISK SHARING

When one needs to take all the responsibilities related to business and the whole risk lies
on them, then they use to refrain them from doing certain things. It turns out to be one
demotivating factor actually. And at the same time, if one outsources certain business
activities it certainly divides the risk also as one need not worry about the loss of data
during a technical crisis, accident, natural calamities or market fluctuation. Your
outsourced business partner will always be there to assist you in any such kind of crisis.
This definitely is one important factor and raises the need for outsourcing.


DEALS WITH TALENT SHORTAGE

One of the reasons why outsourcing is considered is the lack of required resources in a
particular country or locality. While choosing an outsourcing agency one does their
homework well and choose the area where require an amount of skilled resource
available that too in a cost-effective manner. India is being considered on priority while
outsourcing as it‘s been a pool of highly skilled and technologically sound resources with
effective English communication skills.


IMPROVED CUSTOMER SERVICES

By relying on more skilled and qualified people for specified jobs you tend to serve better
quality to your clientele which ensures more satisfied customers giving you more
business and increasing your revenue which definitely calls for the need of outsourcing.

AREA OF OUTSOURCING IN HR

• Workforce Administration Solution

• HRMS Model

• Recruitment

• Learning and Performance

12
 • Leave Administration

• Time and attendance

• Employee self-service and query resolution

• Payroll and Benefit Administration

• Payroll Administration

• Tax Processing

• Flexible Benefits /Compensation

• Regional Payroll Solution

• Document Management system

MANAGEMENT DEVELOPMENT

Management Development is a systematic process of training and growth by which

managerial personnel gain and apply skill, knowledge, altitude and insights to manage the
work in their organization effectively and efficiently. In other words, it is managements'
responsibility of ensuring the success of the organization.

It is continuous process of learning. It implies that there will be a change in knowledge

and behavior of the individuals undergoing development programme. The employee will
be able to perform his present job better and will increase his potential for future work.

DEFINITION:
“A conscious and systematic process to control the development of managerial resources in
the organisation for the achievement of goals and strategies”. - Yoder

13
CHARACTERISTICS OF MANAGEMENT DEVELOPMENT

1. It is an organised process of learning rather than a haphazard or trial and error

approach.

2. It is a long term process as managerial skills cannot be developed overnight.

3. It is an ongoing exercise rather than a ―one-shot‖ affair. It continues throughout an

executive‘s entire professional career because there is no end to learning.

4. Management development aims at preparing managers for better performance and

helping them to realise their full potential.

5. Executive development is guided self-development. An executive can provide

opportunities for development of its present and potential managers.

NEED OF MANAGEMENT DEVELOPMENT

• Social Obligation
Organization is a part of society. Society has expectations, demands for its growth and
development from societal members including organization/s functioning in the society.

• Effect of Globalization
Because of globalization, multinational corporations (MNCs) and trans-national
corporations (TNCs) have entered in the market resulting in, stiff competition amongst
the market players. In such a situation, it becomes difficult for the domestic companies to
survive in the context of quality goods they supply and the price they fix for the
customers.

• Effective Functioning of Line Management

Line management/technocrats are well conversant with technicalities of production
activities but, they may lack adequate skill, abilities in human relations development and
conceptual areas of the company. For effective functioning of their work they need
improvement, development of their skills in those areas where they lack.

14
• Excellent Quality of Work of Non-Technical Higher Management
Technical skill is required for excellent performance by nontechnical managers.
Requirement of technical skill of management personnel varies in degree considering
grade/strata of the management to which they belong. Higher level management may
need some knowledge/skill in technical areas and so, for better functioning they need to
acquire skill in this area.

• Use of Latest Technologies

Every organization needs to use latest technologies in its operational and service
activities so that, quality goods at minimum cost can be produced to face competition
with the market players but, these latest technologies cannot be effectively used if, the
managers are not given proper training to have acquaintances with technologies, its
operative areas, use, effectiveness, probable problems, etc.

• Change in Economic Policy

Change in economic policy creates a new business climate and work culture in
organization where re-inventing of management practices appears to be of much
necessity. New areas are required to be explored for expansion and diversification of
business; continuous improvement of quality in services and products needs to be
emphasised; issues like retention of customers and search out for new customer be
prioritized.

• Smooth and Effective Functioning of Business Activities

Workers perform business and industrial activities under the guidance and supervision of
management. Management personnel play the role of guide, coach, motivator, leader of
the people at work. Workers can be effective if the decisions, directions, guidance of the
management are proper, perfect and accurate.

15
CAREER DEVELOPMENT

Career development is the series of activities or the on-going process of developing one's
career. It involves training on new skills, moving to higher job responsibilities, making a
career change within the same organization, moving to a different organization or starting
one's own business

According to Edwin Flippo, ―A career is sequence of separate but related work activities
that provide continuity, order and meaning to a person‘s life.‖ It is not merely a series of
work-related experiences, but consists of a series of properly sequenced role experiences
leading to an increasing level of responsibility, status, power and rewards. It represents an
organised path taken by an individual across time and space

NEED FOR EFFECTIVE CAREER DEVELOPMENT

i. Making Available Needed Talent:

Career development is a natural extension of strategic and employee training. Identifying staff
requirements over the intermediate and long-term is necessary when a firm sets long-term goals
and objectives. Career development will help organizations in putting the right people in the right
job.
ii. Attracting and Retaining Talents:
There is always a scarcity for talented people and there is competition to secure their services.
Talented people always prefer to work in organizations which care for their future concern and
exhibit greater loyalty and commitment to organizations where there is career advancement. As
career development is an important aspect of work life as well as personal life, people prefer to
join firms which offer challenges, responsibility and opportunities for advancement.
iii. Reduced Employee Frustration:
Along with educational level and knowledge, the aspirational level of occupations is also
increasing. When these levels are not met due to economic stagnation frustration sets in. When
organizations downsize to cut costs, employee career paths, career tracks and career ladders tend
to collapse resulting in aggravation of frustration. Career counseling comes a long way in
reducing frustration.

16
 iv. Enhancing Cultural Diversity:
Fast changing scenarios in globalization reflects a varied combination of workforce representing
different types of races, nationalities, religious faiths, ages and values in the workplaces.
Effective career development programmes provide access to all levels of employees.
v. Improving Organizational Goodwill:
It is quite natural that if employees think their organizations care about their long-term well-
being through career development they are likely to respond in kind by projecting positive
images about their organizations. Career development does help organization in impressing
image and goodwill.

vi. Motivating for best result:

Normally the career development will motivate the employee to attain the result effectively with
maximum amount of interest and wish; since their personal growth is granted for sustainalability.

vii. Maximizing Interest on achieving task or work:

When the employees are motivated that induce the mount of happiness and interest among the
employees to do give their full support on their respective works.

viii. Reducing absentee:

The ultimate factor in career development is to minimize the amount of absentee and make the
employee to maintain the proper percentage of attendance for providing best performance.

STEPS IN CAREER DEVELOPMENT (PROCESS)

• Identifying Career Needs

Some large organizations have assessment centres or conduct career development
workshops wherein a group of employees are brought together to undergo psychological
testing, simulation exercises, and depth interviews.

• Developing Career Opportunities

Career opportunities are identified through job analysis. The manager should identify
career path for employees in the organization. He/she should discuss with the employees
what jobs are available in the organizational hierarchy and at the same time find where
the employee would want to go up in the organization in future.

17
 • Integration of Employee Needs with Career Opportunities
It is necessary to align the needs and aspirations of the employees with career
opportunities in order to ensure right people will be available to meet the organizational
manpower requirements. Therefore, emphasis is placed on the training, on- and off-the-
job, counselling and coaching by supervisor, and planned rotation in positions of varying
functions and in different locations.

• Regular Monitoring
It is necessary to regularly monitor the progress of the employee towards his/her career
development plans and see that the support is being provided to develop those career
plans.
STRATEGIES IN CAREER DEVELOPMENT

Individual strategy

 Do it Now
Suppose you have made decisions that will have an impact on your career. Do not
delay in implementing the decisions. Do not wait for an auspicious day to come; for
completing an academic activity, for settling down, and for any other reasons.
 Know Yourself
You need to know your own strengths and weaknesses. Take the help of someone,
whom you like and regard, to help you to identify your strengths and weaknesses.
You must know how others see you; view your behavioural pattern, and opinions they
possess. You must have the ear to hear what others are telling about you.
 Analyze Career Opportunities
Try and examine the sources of career opportunities. There are many sources of
information concerning occupations and career opportunities. Many B -schools are
publishing placement manuals or brochures containing information regarding career
opportunities. You may also collect information from some of your friends or
relatives who keep themselves informed. Spend few hours browsing the internet to
determine what potential employers are seeking.

18
  Establish Career Goals
In the preceding three steps, you have learned that you should not delay in
implementing decisions, you need know yourself, and you must analyse career
opportunities. Using these as your arsenal, you should now develop your specific
career goals.

 Obtain Feedback
Feedback from relevant people help one correct his/her errors. You are required to
think and plan how you will gather feedbacks from others with regard to your self-
analysis and current career planning.
 Manage Your Career
Managing career is not just implementing your plan. It is not a one-shot operation; but
rather an on-going process. The self-management spreads over your entire working
life. You need to constantly look for opportunities, and take advantage of them.

Organizational Strategy
 Improving Human Resource Planning
Considering and analysing the targets of the organization, it should develop the job
specifications and recruit personnel of the required quantity and requisite quality.
 Improving Dissemination of Career Option Information
Employees always remain impatient to know about their career and the various career
options available. Companies having career planning system should share the
information with the employees through administrative manuals, circulars, or other
documents. The information calms their restless minds and they can concentrate on
the work assigned to them.
 Initial Career Counseling

Career counseling is a way of periodic performance appraisal. In addition to

appraising performance, counseling provides excellent opportunity to discuss career
problems of employees; their goals, and opportunities available for developing in
career.

19
  Support of Education and Training
Education and training system supports all levels of employees to improve their
careers. The prerequisites for further career growth are first identified, and need-
based training is conducted accordingly. Furthermore, for enhancing an employee s
overall growth, education is imparted.

 Job Posting
Employees aspire to advance in their careers. In larger organizations, the aspirations
are higher. Employees need to get information for advancement in their careers.
Organizations must provide all employees with information concerning job openings.
 Special Assignments and Job Rotation
Doing the same job over a long period of time generates boredom. Employees should
get the opportunity of gaining new experience by way of performing special
assignments and through job rotation. These actions enable employees to learn new
things first-hand and performing them in different settings. Simultaneously,
management can also ascertain the capacity and potential of an employee to accept
challenges, working in new settings, and with new people.
 Career Development Workshops
Considering the importance of employees‘ career development, organizations are
arranging workshops and seminars as essential career development activities. These
workshops clearly indicate organizations‘ concern for career development.
 Flexible Rewards and Promotional System
Organizations use both financial and non-financial rewards to recognize employees.
The scope of rewards and determining success criteria are really limited; presumably
due to limited thinking about them.

SELF-MANAGEMENT

Self-assessment is essential for self-management. Self-assessment is researching within

you; finding who you are, what you like or love, what you have to offer, and so forth.
Self-management enables you to take decisions about your career. Findings of self-
assessment should be recorded on paper.

20
 Self-assessment includes some vital aspects such as:
 Achievements,
 Skills and abilities,
 Personal values,

 Interests,
 Disabilities,
 Personal and family circumstances, etc.
i. Achievements:

Thinking deeply and writing down your achievements enables you to rediscover
yourself. The easiest way of reflecting your achievements is to start with your
academic achievements at your school or university. Do not hesitate to include your
achievements in co-curricular activities. Identify what led you to select a course of
study. Think about the strengths you have developed along with specific knowledge
gained.
ii. Skills and Abilities:

While pursuing self-analysis, never underestimate yourself; never say, have “I don’t
have any skills” You must have many skills and abilities which are unknown to you.
Skill is a vital element of Mckinsey‘s 7-S framework. Skills are the essence of what
we contribute to the world. Skills bring perfection.
iii. Personal Values:

A value guide a person to lay importance over things, turn him on and off gives
happiness in circumstances or otherwise, helps to decide the extent of integrity he
needs in his work or life, exercise power and responsibility in the work place, and so
on.
iv. Interests:

There are many things that generate your interests. First, you make a list of 25 or 30
things you love to do. Thereafter, pick up the favourites and shortlist the interests. The
job you are doing must have some of these. Give some thoughts to areas which
fascinate and mesmerize you the most, that is, production, quality control, quality
system, maintenance, purchase or planning, administrative, computational, scientific,
indoor or outdoor work, etc.

21
 v. Disabilities (If Known):
Your disabilities cannot stop you from achieving that you most aspire for. Your
strong will always supports you to reach your goal. Be honest with your known
disabilities or physical impairments that may impact upon what you want to do. You
may have allergies, colour blindness, back problems, asthma, etc. The presence of
anyone or two disabilities does not mean you cannot do a particular job. You need to
be aware of how you would manage any roadblocks restricting you to achieve. Your
strong will lead you to success.
vi. Personal and Family Circumstances:
You now know your achievements, skills and abilities, personal values, interests, etc.
Prepare yourself to face the impacts of these on your employment in terms of hours,
financial commitments, limitations, etc. You will definitely be able to overcome the
roadblocks.

QUESTION BANK
PART - A

1. Explain the term vestibule training.

2. Summarize the meaning of brain storming.

3. Define the term programmed learning.
4. Define the term training.
5. List out different types of training.
6. Differentiate between training and development.
7. Differentiate between fatigue and monotony.
8. What is meant by career developement?
9. State the meaning of self-management
10. List out characteristics of management development

22
 PART - B

1. Explain the factors that necessitate training in an

organization.
2. Summarize the steps to be taken to make T&D effective in
a multinational company.
3. Enumerate the different training methods.

4. Explain the important steps involved in setting up a good

T & D department for a large organizations.
5. What are the steps HR managers must take to maximize
the effects of training?
6. Compose and design the need for effective management
development
7. Describe the various strategies of career development
8. Discuss the concept of training outsorcing

REFERENCES

 Human Resource Management, Gary Dessler, 16th Edition. 2017

 Human Resource Management, Aswathappa. McGraw-Hill Education (India) Pvt Limited,
2010
 Principles of Human Resource management, Bohlender and snell,Cengage learning, 17 th
edition, 2016

23
 SCHOOL OF MANAGEMENT STUDIES

UNIT – IV – Human Resource Management – SBAA1205

1
 PERFORMANCE APPRAISAL

Nature, objectives and importance- Modern techniques of performance appraisal- potential appraisal
and employee counseling- job changes- Compensation- concept and policies- job evaluation- methods
of wage payments and fringe benefits- performance linked compensation.

NATURE OF PERFORMANCE APPRAISAL

Performance Appraisal refers to all the formal procedures used in working organizations to
evaluate the personalities and contribution of group members.

DEFINITION:

”‘Performance Appraisal is a formal, structured system of measuring and evaluating an

employee‘s job related behavior and outcomes to discover how and why the employee is
presently performing on the job and how the employee can perform more effectively in the
future so that the employee, organization and society all benefit”.

OBJECTIVES OF PERFORMANCE APPRAISAL

 Basis for job change and promotion

 Training and development program

 Feedback to the employee

 Incentive to all the employees

 Provide the rational foundation for the payment of price, rate , wages, bonus etc.,

 Evaluating the effectiveness of devices used for the selection and classification of
workers.

IMPORTANCE OF PERFORMANCE APPRAISAL

 The performance appraisal boosts the morale of the employees and motivates them to
work more
 It help to analyze an individual‘s performance and their role

 It is the best way to identify the weak areas and the strength areas of the employee.

2
  It establishes a merit-based system that motivates the employees to put their best foot
forward.
 It provides a systematic approach for reaching out to the management for clearing out
expectations and to have discussions about future plans.
 It is a very effective way to promote employees based on their performances.

 It is used to scale the level of contribution of employees in the business

 It is used to provide salary high and job rotation.

 It helps the managers to arrange refreshments and career and development programs
for the employees as per their performance evaluation.
 It is a part piece rate system in wages administration.

METHODS (OR) TECHNIQUES OF PERFORMANCE APPRAISAL

Figure 1

3
I . Traditional Methods

1. Ranking Method:
The oldest and simplest method of performance appraisal is to compare one man with all other
men and place him in a simple rank order. In this way, ordering is done from best to worst of all
individuals comprising the group.

2. Paired Comparison Method

Paired Comparison Method is a handy tool for decision making; it describes values and compares
them to each other. It's often difficult to choose the best option when you have different ones that
are far apart. This method is also known as the Paired Comparison Method and Pairwise
Comparison.

3. Grade scale
It is a systematic evaluation of an individual with respect to performance on the job and individual's
potential for development Grading Scale Method.

The Grading scale method is a performance appraisal method that rates employees according to
using evaluators records their judgments about performance on a scale .

4. Forced distribution method

The forced distribution method of performance appraisal derives its name from the fact that those
responsible for providing evaluations, the raters, are ―forced‖ to distribute ratings for the
individuals being evaluated into a ―pre-specified‖ performance distribution.

5. Forced Choice method

It consists of a number of statements which describe an individual being rated. These statements
are grouped into two, three or four. Sometimes all groups of the form are made of favorable
statements. Sometimes all have unfavorable statements only and sometimes they have both
statements. Nevertheless, the rate is compelled to check a ‗most‘ and a ‗least‘ in each group-
hence the term ‗forced choice‘.
6. Check list method
This consists of a member of statements about the worker and his behavior. Each statement on
this list is assigned a value depending upon its importance. Both statements and their values are
derived from preliminary research in which the pooled judgments of persons familiar with the
job are used.

4
 7. Critical incident method
In this method the first step to draw up for each job a list of critical job requirements, that is,
those requirements which are vital for success or failure on the job.
8. Graphic scale method
As the very name implies these methods provide some kind of a scale for measuring absolute
difference between individuals. The scales used are generally of two types;

i. Discrete ii. Continuous

9. Essay evaluation method

Essay Appraisal is a traditional form of Appraisal also known as ―Free Form method.‖ It
involves a description of the performance of an employee by his superior which needs to be
based on facts and often includes examples to support the information.

10. Field review method

The personnel officer meets small groups of raters from each supervisory unit and goes over
each employee‘s rating with them to

 Help the group arrive at a consensus

 Determine that each rater conceives of the standards similarly.
 Identify areas of inter-related disagreement

11. Confidential method

A confidential report by the immediate supervisor is still a major determinant of the
subordinate‘s promotion or transfer. The format and pattern of this report varies with each
organization.
II. Modern Methods

1. MBO (Management by Objectives)

Introduced by Prof. Peter Drucker. It is a process whereby the superior and subordinate
managers of an organization jointly identify its common goals, define each individual‘s major
areas of responsibility in terms of results expected of him or use these measures as guides for
operating the unit and assessing the contributions of each of its members.

5
 2. 360 Degree Feedback
In this method, performance information is collected ‗all-around‘an employee, from his
supervisors, subordinates, press, and internal and external customers. It is used for Training &
Development rather than for pay increase.

3. Assessment center Method

The purpose of this method is to test the candidates in a social situation, using a number
of assessors and a variety of procedures. Evaluators observe and evaluate participants as they
perform activities common found in these higher level jobs. Many evaluators join together to
judge employee use of a variety of criteria.
4. Behaviourly anchored rating system ( BARS)
Behaviorally anchored rating scales (BARS) are scales used to rate performance.It is an
appraisal method that aims to combine the benefits of narratives, critical incidents, and
quantified ratings by anchoring a quantified scale with specific narrative examples of good,
moderate, and poor performance
5. Psychological appraisals
This method focuses on analyzing an employee's future performance rather than their past work.
Qualified psychologists conduct a variety of tests (in-depth interviews, psychological tests,
discussions, and more) to identify an employee's emotional, intellectual, and other related traits

NEED FOR MODERN PERFORMANCE APPRAISAL METHODS

 Define goals clearly

 Provide real-time feedback
 Enhance employee performance
 Spot training and development needs
 Offer insights on counter-productive tasks
 Improve employee engagement and retention

6
PITFALLS (OR) DISADVANTAGES OF PERFORMANCE APPRAISAL
 The lack of objectivity

Bias is generally defined as an inclination or prejudice for or against one person or

group, especially in a way considered to be unfair. In the context of performance
evaluation, this bias is directed towards the employees or teams that are being
assessed and it has an impact on their overall performance review.

 The halo effect

This type of problem arises when the person carrying out the appraisal generalizes the
positive or negative impression to several individual performance categories, thus
resulting an overall performance assessment influenced by this type of extrapolation.

 The regency effect

It implies the evaluator‘s tendency to focus on an employee‘s recent activities,

behaviours and performance (good or bad), rather the performance registered
throughout an extended period of time. An employee‘s errors or increased
performance shortly before the beginning of the performance review period should
not be defining for the overall employee assessment. An unbiased and fair appraisal
should take into consideration the performance registered throughout the entire
appraisal period.

 The Additional Workload

Most of the managers are packed with many works and they are busy with their own
schedules and plans, In-spite of all those things they are forced to do this kind of
work. So they may be felt that, this process could be a additional work load to them.
 The contrast tendency

In this case, evaluators are faced with three types of errors: the strictness tendency,
when almost all those evaluated are rated below average, the central tendency, when
no one is rated really bad or really good in terms of performance, and the leniency
tendency, when all those assessed are considered to have performed above average.

7
  The prejudice (stereotype)

It entails the identification of an employee with a certain group and the assumption
that the characteristics of that group apply to the employee as well. Irrespective of its
positive or negative nature, this type of approach prevents the evaluator from
identifying the characteristics of individuals and getting to know them in order to
conduct an objective and fair evaluation of their performance.

 The distributional tendency

In this case, evaluators are faced with three types of errors: the strictness tendency,
when almost all those evaluated are rated below average, the central tendency, when
no one is rated really bad or really good in terms of performance, and the leniency
tendency, when all those assessed are considered to have performed above average.

 Lack of Continuous Assessment

Normally most of the assessments will be done only the time of month or year end ,
so may not get the real and actual output or contribution of employees during the
particular period. The result may vary if we don‘t have a Continuous assessment.

POTENTIAL APPRAISAL

The potential appraisal refers to the appraisal i.e. identification of the hidden talents and
skills of a person. The person might or might not be aware of them. Potential appraisal is
a future – oriented appraisal whose main objective is to identify and evaluate the potential
of the employees to assume higher positions and responsibilities in the organizational
hierarchy. Many organizations consider and use potential appraisal as a part of the
performance appraisal process.

PURPOSE OF POTENTIAL APPRAISAL

 To inform employees of their future prospects
 To enable the organization to draft a management succession programme;
 To update training and recruitment activities
 To advise employees about the work to be done to enhance their career opportunities

8
TECHNIQUES OF POTENTIAL APPRAISAL
 Self – appraisals
 Peer appraisals
 Superior appraisals
 MBO
 Psychological and psychometric tests

 Management games like role playing

 Leadership exercises etc.

DIFFERENCE BETWEEN POTENTIAL APPRAISAL AND PERFORMANCE APPRAISAL

Potential Appraisal Performance Appraisal

• Forward looking process • Backward looking process

• Based on forecasting • Based on existing data
• Focus on finding Hidden Talents • Focusonfindinglevel of
• Scope for Employee Empowerment productivity
• Leads for Confidence • Scope for Employee development
• Part of Motivation • Leads for Corrections
• Part of competitive enhancement

Table 1
COUNSELLING

Counselling is a method of understanding and helping people who have technical, personal and
emotional or adjustment problems that usually has emotional contents that an employee with the
objective of reducing it so that performance is maintained at adequate level or even improved
upon

DEFINITION:
According to Keith Davis – “Employee counselling involves a discussion of an emotional
problem with an employee with the general objective of decreasing it”.

9
NEED FOR EMPLOYEE COUNSELLING

 There is a need for the employees to come out from the problems, gives a new way to
deal with the problems.
 The employees need to know as to how much the employer care for the employee.

 There is also a need to identify the work related problems and the poor performance.

 There is a need to increase the productivity of employee and the confidence about the
work.

OBJECTIVES OF EMPLOYEE COUNSELLING

 Counselling is an exchange of ideas and feelings between two persons.

 It is concerned with both personal and work problems.
 Counselling may be performed by both professionals and non-professionals.
 Counselling is usually confidential so as to have free talk and discussion.

 It tries to improve organisational performance by helping the employees to cope with

their problems

JOB CHANGES

Job Change: A job change is a revision to an employee's existing job description that
does not represent a new position for the employee and is not a promotion. Job
descriptions can regularly be updated to reflect duties the employee is expected to
perform to meet the work needs of the department. A job change will not normally result
in a change in compensation.

OBJECTIVES:

 To maximize employee efficiency.

 To improve organizational effectiveness.
 To ensure discipline.
 To cope with changes in operations

10
CAUSES OF JOB CHANGE
 Changes in the structure of the organization involving job redesign, job regrouping
etc
 Changes in technology.
 Changes in political environment.
 Changes in demand of trade union.
 Fluctuation in volume of work due to expansion, diversification etc.

 Changes in legal policies

 Changes in the knowledge, skills and values of employees.

TRANSFER & PROMOTION

Transfer: A transfer is a lateral move to a vacant position in either the employee's current
department or a new department. A transfer will not normally result in a change in
compensation.

Promotion: A promotion is a move by an employee to a vacant position at a higher grade

level either within the current department or in a new department. Promotions generally
result in a salary increase at the time of promotion

OBJECTIVES & NEED OF TRANSFER & PROMOTION

 To Meet Organisational Needs

 To Satisfy Employee Needs
 To Better Utilize Employee
 To Make the Employee More Versatile
 To Adjust the Workforce
 To Provide Relief
 To Punish Employee
 To Direct the company
 To lead the workforce

11
TYPES OF TRANSFER

(A) Production Transfers:

In order to stabilize the employment in the company and avoidance of lay off, an employee may
be transferred from one department to another department. Such a transfer is known as
production transfer.

(B) Replacement Transfers:

An employee with a long service may be transferred in some other department to replace a
person with a shorter service.

(C) Versatility Transfers:

The versatility transfers are made for the purpose of preparing the employees for production and
replacement transfer. An employee is trained on different jobs so as adjust him on a different job
when there is no work at his seat or job.

(D) Shift Transfers:

In case of manufacturing concerns, there are normally three shifts. Usually these shifts are
rotating. In case shift assignments are not rotating, an employee may be transferred from one sift
to another shift.

(E) Remedial Transfers:

In case an employee does not feel comfortable on his job, he may be transferred to some other
job. His initial placement might be faulty; his health might have gone down; he may not be
getting along with his supervisor or workers i.e., he might have developed personal friction with
his boss or fellow employees.

(F) Miscellaneous Transfers:

Transfers may also be classified as temporary or permanent transfers. If a transfer is from one
department to another, it is known as departmental transfer. If a transfer is made within the
department, such a transfer is known as sectional transfer. An employee may be transferred from
one plant to another plant. Such a transfer is known as inter-plant transfer.

12
 TYPES OF PROMOTION

(a) Limited Promotion

Limited promotion is also known as upgrading. It is the movement of an employee to a more
responsible job within the same occupational unit and with a corresponding increase in pay.
Thus, upgrading means an increase of pay on the same job or moving to a higher scale without
changing the job.

(b) Dry Promotion

Dry promotion is a promotion as a result of which there is no increase in the employee‗spay.
Dry promotions are those which are given in lieu of increases in compensation. It is usually
made decorative by giving a new and longer title to the employee.
(c) Multiple Chain Promotion
Multiple chain promotion provide for a systematic linking of each position to several other
positions. Such promotions identify multi-promotional opportunities through clearly defined
avenues of approach to and exist from each position in the organization.
(d) Up and Out Promotion
Up and Out Promotion often leads to termination of services. In this type of promotion, a person
must either earn a promotion or seek employment elsewhere.
(e) Horizontal and Vertical Promotion
These kind of promotion will be given based on Organizational Hierarchy and the level of
management in the company . Promoting the employee from bottom level to top level is Vertical
promotion, the same way promoting the employees from Production department to operation
department is Horizontal promotion.

JOB EVALUATION

Finding the financial value or worth of assigned task or work, by using this method a company
can easily fix the wages to their employees

MERITS OF JOB EVALUATION

 It is the only logical and systematic way of doing wage and salary administration.

 An exercise is job evaluation stabilizes internal norms and standards. Otherwise, there
would be chaos in measuring what each job is expected to do.

13
  It removes wage inequalities because it links the job worth to the wages.
 It ensures proper wage cadres and classifications – also wage differentials.
 Jobs are properly classified as unskilled, semiskilled, etc.

 Helpful for recruitment.

 It helps in promotions.

 For job rotation and training. It is the basis for resolving job anomalies, wage
anomalies (high job paid low, low job paid high)and such other complaints.

METHODS :
 Ranking
 Grading method
 Point rating method
 Factor comparison method

COMPENSATION
MEANING OF COMPENSATION
Compensation is the practice of the organization that involves giving monetary as well as
non-monetary rewards to the employees, in order to compensate for the time they allocate to
their job. Compensation management involves ―maximizing the return on human capital.‖

Components of Compensation:
 Basic pay - For the skill of employee

 Increment - For continued learning of the skill year after year.

 Incentive - For efficiency of employee
 Dearness allowances- For cost of living.
 Overtime - For clearing extra workload which cannot be done during
normal hours.
 H.R.A. - Allowance for rent.
 C.C.A. - To meet additional cost of living in metros.

14
  Social Security Schemes- like ESI and PF and pension.

 Welfare-fringe benefits-perquisites - like transport, medical facilities, housing,

schooling, etc. - not related to efficiency or skill
 Bonus- Sharing the profit for employee motivation.

FACTORS INFLUENCING REMUNERATION

External Factors

Labour Market
 
Cost of Living
 
Society & Economy
 
Government Legislation
 
Labour Unions

Internal Factors

Business Strategy
 
Job evaluation
 
Job Requirements
 
Increment System
 
Capacity of the Organization
 
Performance Appraisal

WAGE PAYMENTS AND INCENTIVES PLANS

The establishment of an implementation of sound policies and practices of employee
compensation. It includes such areas as job evaluation, development and maintenance of wage
structures, wage changes, wage surveys and related issues.

Payment made usually at the end of the day‘s work. The term further denotes payment made to
workers doing physical work.

Advantages
• Attract And Retain The Employees
• Builds High Morale
• Satisfied Employees
• Image of Progressive Employer

15
 • Ensure Minimum Wages
• Harmonious Industrial Relations
• No Favoritism/Bias

BASIC KINDS OR TYPES OF WAGE PLANS

A) Time rate system

Time rate system is a method of wage payment to workers based on time spent by them
for the production of output

MERITS AND DEMERITS

Merits:
• It is simple, wage can be easily calculated

• As there is no time limit for execution workers pay attention to the quality of their
work
• Same wages are paid to same kind of job, avoids jealousy among workers slow and
study peace of the worker, there is no rough handling of machinery
• This is a profitable system where output cannot be measured

• It ensures a stable income to workers

Demerits
• All the persons are paid equally without considering ability difference
• Labour changes for a particular job do not remain constant, hence quoting rates for a
particular piece of work becomes difficult
• As there is no specific demand for the period of time of work there is possibility of
systematic evasion.
• The employees does not know the amount of work done by each other, so total
expenditure on wages cannot be adequately assessed
• As no record of workers output is maintained, it becomes difficult for the employees
to determine the efficiency for the purpose of promotion

16
B) Piece wage plan

Piece rate system is a method of wage payment to workers based on the quantity of output
they have produced

Merits and Demerits

Merits
• Pay is according to the workers efficiency as reflected in the amount of work.
• Efficiency of the workers is adequately rewarded which gives him a direct stimulus to
increased his production
• Supervision is less required since wage depends upon the amount of work done or
output shown by the worker
• For the continuity of the work breakdown is prevented by the worker which in turn
reduces the maintenance charge
• Direct labour cost per unit of production remain constant hence calculation of cost for
filling tenders becomes easy
• Not only as output increase wage increase, the method of production also increases

Demerits

• Rate per piece or output ids not done on scientific basis

• Rate is done by rule of thumb method
• Workers wish to perform their work at speed, may consume more power and result
in high cost of production
• Excessive speeding of work may result in wear and tear
• Trade union often appose to this system and might lead to labour disputes

C) Incentive Scheme

It is an extra motivation. They are designed to stimulate human effort by rewarding the
person, over and above the time rated remuneration, for improvements in the present or targeted
results.

17
 Merits and Demerits

Merits
• Strengthens productivity
• Advantages for both workers and employers.
• Reduces supervision.
• Low absenteeism.
• Healthy industrial relations and reduces chances of dispute.
• Better scheme for developing human resource.
• Develops the feeling of co-operation among workers.

Demerits

• There is possibility of reducing productivity.

• Difficult to consider and achieve psychological and social dimensions.
• Employment is uncertain.
• Difficult to measure proportionate value of the extra work done.
Various types of incentive plans

1. Halsey Plan
Halsey Plan. Definition: Under Halsey Plan, the standard time for the completion of a job
is fixed and the rate per hour is then determined. The usual bonus share paid to the
worker is 50% of the time saved multiplied by the rate per hour (time-rate).
2. Rowan Plan
Under Rowan Plan, the standard time for the completion of a job and the rate per hour is
fixed. If the time taken by the worker is more than the standard time, then he is paid
according to the time rate, i.e. time taken multiplied by the rate per hour.
3. Halsey premium plan
Halsey premium plan. A wage incentive program established as the first in the US
industry. The incentive program was created by Frederick A. Halsey as a method for
improving the straight piece-rate system in an effort to reduce wage rate cutting by
management.

18
4. Rowan premium plan
Rowan premium plan is one of important incentive wage plan which was made by James
Rowan of David Rowan and Co. As per this plan, there is guarantee of minimum wage
with time rate. But worker has right to get bonus on the basis of his time saved.
5. Taylor’s differential piece rate system
Taylor's differential piece-rate system posits that the worker who exceeds the standard
output within the stipulated time must be paid a high rate for high production. On the
other hand, the worker is paid a low rate if he fails to reach the level of output within the
standard time
6. Taylor’s differential piece rate scheme
Taylor's differential piece-rate system posits that the worker who exceeds the standard
output within the stipulated time must be paid a high rate for high production. On the
other hand, the worker is paid a low rate if he fails to reach the level of output within the
standard time.
7. Budeaux multiple piece rate
Merrick's multiple piece rate is a modification of Taylor;s differential plan. In this method
three price rates are used to calculate the wages: 1.Standard piece rate up to 83% of the
standard output. 2.10% above the standard rate if output is between 83%-100% 3.20%
above the standard rate if output is more than 100%
8. Merricks Plan
The Merrick Differential Piece-Rate System is a modification of Taylor's differential
piece-rate system in which three piece-rates are used to distinguish between the
beginners, the average workers, and the superior workers, against two piece-rates in
Taylor's system.

9. Gantts task/bonus plan.

Under Gantt Task System, the standard time is fixed for the completion of a task based
on a careful time and motion study. If the worker completes the task within the standard
time, then his efficiency is 100% and in addition to the time wages, he is also paid a
bonus of 20% on the wages earned.
10. Group incentive programs
Group incentive programs are award programs that deliver lump–sum cash payments,
time–off awards, and/or informal recognition items to groups of employees who meet or
exceed pre–established levels of organizational performance.

19
FRINGE BENEFITS

The term fringe benefits refers to the extra benefits provided to employees in addition to
the normal compensation paid in the form of wage or salary. They are paid to all
employees (unlike incentives which are paid to specific employees whose work is above
standard) based on their membership in the organization.

The Bureau of Labor Statistics defines benefits as ―non-wage compensation provided to

employees.‖ Put succinctly, the benefit is provided in exchange for the services the
employee provides that isn‘t included in their salary or hourly compensation.

(a) Statutory benefits – The Employees Provident Fund Scheme, Gratuity or Pension
Schemes and Employees State Insurance Scheme.

(b) Non-statutory benefits – Payments towards Employees Provident Fund Scheme,

Gratuity and Pension Fund contribution, medical facilities, canteens, uniform and
recreational facilities.

OBJECTIVES OF FRINGE BENEFITS

 To create and improve sound industrial relations
 To boost up employee morale.
 To motivate the employees by identifying and satisfying their unsatisfied needs.
 To provide qualitative work environment and work life.

 To provide security to the employees against social risks like old age benefits and
maternity benefits.
 To protect the health of the employees and to provide safety to the employees against
accidents.
 To promote employee‘s welfare by providing welfare measures like recreation
facilities.
 To create a sense of belongingness among employees and to retain them. Hence,
fringe benefits are called golden hand-cuffs.
 To meet requirements of various legislations relating to fringe benefits

20
BENEFITS & CATEGORIES OF FRINGE BENEFITS:
 Paid leave (sick, holiday, personal and vacation days)
 Supplementary pay (overtime, shift differentials like weekend or holiday pay)

 Insurance (life, health, disability)

 Retirement plans (pension, 401(k) contributions)
 Legally required benefits (social security, taxes, workers‘ compensation).

TYPES OF FRINGE BENEFITS

 Employee Holidays
 Health & Life Insurance
 Canteen, Rest room & Welfare activity
 Education, Hospitality & Transport
 Old Age and Retirement Benefits
 Personnel Identification, Participation and Stimulation
 Retrenchment Compensation

 Lay-off Compensation
 Gym memberships & Wellness programs
 Personal use of company cars
 Free housing
 Cash awards
 Employee free meals/snacks
 Employee discounts
 Housing allowance
 Tuition Wavers
 Sick leave (for full time employees)

21
PERFORMANCE LINKED COMPENSATION

A performance-linked compensation (PLC) is a form of payment from an employer to an

employee, which is directly related to the performance output of an employee and which may be
specified in an employment contract.

It is a kind of payment mode based on excellence on the job. It is mainly depends on how ones
work on their task.

Example: The Salesmen compensation is purely depends on the amount of sales what he did, if
its high the incentive also increase ,if its low the incentive also decrease. It may be applicable

 Performance linked Compensation in Salary

 Performance linked Compensation in Wages
 Performance linked Compensation in Incentives
 Performance linked Compensation in Bonus
 Performance linked Compensation in Other financial Remuneration

QUESTION BANK

PART – A

1. Define the term wage.

2. State the meaning of Performance appraisal
3. List out the different types of incentives.
4. State the meaning of non- monetary incentives.
5. List out the methods of wage payment.
6. Identify job evaluation methods.
7. List out the limitations of performance appraisal.
8. Mention the objectives of wage and salary.
9. Define the term Bonus.

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 PART – B

1. Explain the principles of wage and salary

administration.
2. Discuss the factors influencing wage and salary
administration.
3. Describe the methods of job evaluation
4. Describe different wage incentives and its
advantages.
5. Construct an effective incentive scheme for a large
organization.
6. Explain merits and demerits of job evaluation.
7. Differentiate between piece rate and time rate
system
8. Describe the various methods of performance
appraisal
9. Discuss the pitfalls of performance appraisal. How
to overcome

REFERENCES

 Human Resource Management, Gary Dessler, 16th Edition. 2017

 Human Resource Management, Aswathappa. McGraw-Hill Education (India) Pvt Limited, 2010
 Principles of Human Resource management, Bohlender and snell,Cengage learning, 17 th
edition, 2016

23
 SCHOOL OF MANAGEMENT STUDIES

UNIT – V – Human Resource Management – SBAA1205

1
 MAINTAINENCE

Employee health and safety- employee welfare- social security- Employer-Employee relations-
Grievance handling and redressal- Industrial Disputes- causes and settlement machinery.

EMPLOYEE HEALTH & SAFETY

Employee health and safety is a cross-disciplinary area concerned with protecting the safety,
health and welfare of people engaged in work or employment. The goal of all occupational health
and safety programs is to foster a safe work environment

It is a must to provide required safety training programs for all employees who should
necessarily include emergency action plan training and how to treat you while injured and alone.
Make sure the employees are well efficient at the time of crisis by holding fire and emergency
drills from time to time.

Employment health & safety records are useful in determining:

• Employment history and occupational exposure records;
• Injuries and illnesses on the job; and
• Workers‘compensation records.

SAFETY PROCESS IN WORKPLACE

 Safety Policy:
It contains a declaration of the employer‘s intent towards the safety of employees and
means to realize it. It includes causes, extent and remedies for accidents at workplace.
The policy specifies the company‘s goals and responsibilities and caveats and sanctions
for failing to fulfill them.
 Provision of Physical Health Services:
Many organizations render periodical physical health check-up services to their
employees. Regular medical check-ups of employees help detect the signs and symptoms
of tension, stress, ulcers, depression and other diseases resulting from the exposure to
harmful gases or other irritants.

2
  Mental Health Services:
In order to reduce the risk of mental breakdowns because of tension, pressure and
depression and mental illness, a mental health service is provided to the employees in
different ways such as psychiatric counseling, co-operation and consultation with
specialists, educating employees about the importance of mental health and
establishment, development and maintenance of harmonious human relations at
workplace.
 Employee Assistance Programs:
These are specially designed to deal with stress-related problems of the employees and
help in diagnosis, treatment, screening and prevention of both work and non-work related
problems. These programs provide real help to professionals and do not carry any
negative implications.

 Fitness Programs:
These programs focus on overall health of employees and include both disease
identification as well as lifestyle modification. The most common programs carried out
by the organizations are hypertension identification, physical fitness, exercise, nutrition,
smoking and drinking cessation, diet control and personal and work-related stress
management.
 Awareness Programs:
Conducting the workshops about sexually transmitted diseases such as HIV AIDS help a
lot in raising the awareness of employees towards such dreadful diseases. Such programs
clear out the confusion and disruption in the workforce.

IMPORTANCE OF WORKPLACE HEALTH & SAFETY

• Keeping People Safe

Most employers would agree that preventing accidents and potential death to
employees is a natural priority. Most safety issues don't arise out of nefarious
intentions but come when businesses cut corners and don't take the time to train their
employees properly on safety protocols.

3
• Injuries Cost Time and Money
The Occupational Health and Safety Administration estimates that employers pay
nearly 1 million each week in workers' compensation costs. Employers are required to
have workers' compensation insurance policies, but injuries increase the basic costs.
Also, if an employer is underinsured, the gap of coverage is the responsibility of the
employer.
• Fewer Injuries Increase Productivity

Workplace injuries and unsafe working environments are bad for employee morale.
An employee who is concerned about being hurt isn't able to devote full attention to
daily work tasks. Employers who maintain a safe and healthy work environment and
conduct employee training on safety build a stronger relationship with employees.
Employees no longer feel like a means to an end but part of a team working together.
This creates loyalty and increases team morale, which has a direct correlation to
productivity.
• Increase Public Perception
A company that operates in an unsafe manner can turn away customers. A restaurant
that uses unsafe cooking practices isn't going to attract customers because they fear
illness. Similarly, customers don't want to walk into a cluttered store with potential
tripping hazards. Business owners must understand that safety goes well beyond their
employees. When thinking about productivity, positive team morale increases
positive customer interactions, which leads to customer retention and loyalty
• Minimizing Legal Liabilities
The Department of Labor oversees the Occupational Safety and Health Act. Simply
put, the act states that people have a right to feel and be safe at work. It sets forth
minimum standards for various industries and work environments. Current OSHA
posters must be posted in places where all employees can read and review them at
will. Should employers violate safety laws, legal and financial ramifications may
occur?
• Employee Motivation
Employees are getting motivation if the personal health and safety is ensured in their
organization. This will help the employees to give their best in all the task and
assignment in the business.

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• Continuous flow of work
Once the employees are getting fulfillment in all the criteria in terms of safety and
health, they can give their without any break and they could maintain the flow of
work in the long run.

TOOLS FOR EFFECTIVE HEALTH AND SAFETY PROGRAM

 Management training
 Workplace inspections
 Task analysis and procedures
 Accident/incident investigation
 Task observation
 Emergency preparedness
 Organizational rules
 Accident/incident analysis
 Employee training
 Personal protective equipment (PPE)
 Engineering controls
 Group meetings
 General promotion
 Off-the-job safety
 Evaluation and continuous improvement

EMPLOYEE WELFARE

Employee welfare defines as “efforts to make life worth living for workmen”. “Employee
welfare is a comprehensive term including various services, benefits and facilities offered
to employees & by the employers. Through such generous fringe benefits the employer
makes life worth living for employees”.

Employee welfare entails all those activities of employer which are directed towards
providing the employees with certain facilities and services in addition to wages or
salaries.

5
 The very logic behind providing welfare schemes is to create efficient, healthy, loyal and
satisfied labor force for the organization. The purpose of providing such facilities is to
make their work life better and also to raise their standard of living.

OBJECTIVES OF EMPLOYEE WELFARE

 To give expression to philanthropic and paternalistic feelings.

 To win over employee‘s loyalty and increase their morale.

 To combat trade unionism and socialist ideas.

 To build up stable labour force, to reduce labour turnover and absenteeism.

 To develop efficiency and productivity among workers.

 To save oneself from heavy taxes on surplus profits.

 To earn goodwill and enhance public image.

 To reduce the threat of further government intervention.

 To make recruitment more effective (because these benefits add to job appeal.

BENEFITS OF WELFARE MEASURES

 Employee welfare measures increase the productivity of organization and promote

healthy industrial relations thereby maintaining industrial peace.
 Facilities like housing schemes, medical benefits, and education and recreation
facilities for workers families help in raising their standards of living. This makes
workers to pay more attention towards work and thus increases their productivity.
 They provide better physical and mental health to workers and thus promote a healthy
work environment
 The social evils prevalent among the labors such as substance abuse, etc are reduced
to a greater extent by the welfare policies.
 Employers get stable labor force by providing welfare facilities. Workers take active
interest in their jobs and work with a feeling of involvement and participation.

6
IMPORTANCE OF EMPLOYEE WELFARE
 Improvement of Industrial Relations
 Creation of Permanent Labour Force
 Increase in General Efficiency and Income of Workers
 Enhancement of the Morale of Workers
 Development of the Sense of Belonging
 Change in Outlook of Employers
 Improvement of the Moral and Mental Health of Workers
 Benefit to the Society

SOCIAL SECURITY

Social security is a dynamic concept which is considered in all advanced countries of the
world as an indispensable chapter of the national programme. With the development of
the idea of the welfare state, it has been considered to be most essential for the industrial
workers, though it includes all sections of the society.

Social security is that security which the society furnishes through appropriate
organisation against certain risks or contingencies to which its members are exposed.
These risks are essentially contingencies against which the individual cannot afford by his
small means and by his ability or foresight alone.

CHARACTERISTICS OF SOCIAL SECURITY

 Social security is an instrument of ensuring social and economic justice.

 In a welfare state, social security is an essential part of public policy.

 Social security is not static; it is a dynamic concept which changes with the change in
social and economic conditions prevailing in a country at a particular point of time.
 The basic aim of social security is to provide protection to people of small means
against risks or contingencies.

 The contingencies which may impair a person‘s ability to support himself and his
family may include sickness, old age, invalidity, unemployment, death etc.

7
  Social security measures are generally guided by social legislations.

 Social security measures provide for cash payment to affected persons to partly
compensate them for the loss of income due to any of the contingencies mentioned in
point
 Social security is a must for the protection and stability of the labour force. Social
security is a wise investment made by the state which yields good social dividends in
the long run.

TYPES OF SOCIAL SECURITY SCHEMES

A) Social Insurance
A system of compulsory contribution to enable the provision of state assistance in sickness,
unemployment, etc

B) Social Assistance
• Medical care
Many employees in the public and private sector depend on medical benefits
to support their health and well-being, as well as that of their family members.
Employers big and small offer medical benefits in an effort to maintain a
healthy work environment. Medical benefits significantly reduce the costs
associated with common medical occurrences such as check-up and wellness
visits, pre-natal care or emergency care.
• Sickness benefit
Paid sick leave/sickness benefit provides wage and job security to workers
and it allows them to take the job and income-protected leave when they
are sick. Non-provision of paid sick leave, sickness benefit and injury benefit
amounts to work insecurity

• Old age or retirement benefit

It is a fund into which a sum of money is added during an employee's
employment years and from which payments are drawn to support the person's
retirement from work in the form of periodic payments. A pension may be a
"defined benefit plan", where a fixed sum is paid regularly to a person, or a
"defined contribution plan", under which a fixed sum is invested that then
becomes available at retirement age.

8
 • Employment injury benefit
Temporary incapacity for work resulting from such a condition, total or
partial loss of earning capacity, likely to be permanent, and. the loss of support
suffered by dependents as the result of the death of the breadwinner.
• Family benefit
The Family Benefit fund Scheme (FBF) was introduced with effect from
1st January 1974. In the case of death of a Government Servant while in
service, a sum of Rs.1,50,000/(Rupees One lakh and fifty only) shall be paid
to the nominee of the Government Servant. Children of employees are getting
preference in the jobs in most of the companies.
• Maternity benefit
A payment or other allowance made by the state or an employer to a woman
during pregnancy or after childbirth.
• Survivor’s benefit
Survivors' Benefits. Survivors' benefits are payments made to family members
when a worker dies. The payments are intended to help ease the financial
strain caused by the loss of the worker's income. When a wage earner dies, his
or her spouse and unmarried minor children are entitled to receive benefits

C) Public Service
Public service is a service intended to serve all members of a community. It is usually provided
by government to people living within its jurisdiction, either directly or by financing provision of
services.
EMPLOYER & EMPLOYEE RELATION

Employer-employee relations has become one of the most delicate and complex problems of
modern industrial society. Industrial progress is impossible without labour management
cooperation and industrial harmony. Therefore, it is in the interest of all to create and maintain
good relations between employers and employees.

Employer-employee relations mean the relationships between employers and employees in

industrial organisations. According to Dale Yoder, the term employer-employee relations refers
to the whole field of relationship among people, human relationship that exist because of the
necessary collaboration of men and women in the employment process of modern industry.

9
 NEED OF EMPLOYER-EMPLOYEE RELATION
1. Productivity

Strong employment relations create a pleasant atmosphere within the work environment;
it increases the employee motivation and can also be increased through improved
employee morale. Companies that have invested into employee relations programs have
experienced increases in the productivity, and therefore the increased productivity leads
to increases in profits for the business.

2. Employee Loyalty

Creating the productive and pleasant work environment has a drastic effect on an
employee‘s loyalty to the business, it encourages a loyal workforce. Having such a
workforce improves employee retention, in doing so the cost of recruitment, hiring and
training is cut drastically. For most businesses the high cost of employee turnover
outweighs the cost of the employee relations program that they have in place. Another
benefit is that when the employee turnover is low it ensures that the employer has a
trained and skilled set of employees.

3. Conflict Reduction
When a work environment is efficient and friendly the extent of conflict within the
workplace is reduced. Less conflict results in the employees being able to concentrate on
the tasks at hand and they are therefore more productive.
All the research and statistics lead to one conclusion, ‗A happy workforce is a productive
workforce‘. Creating a sound and efficient work environment with good management and
a strong employer- employee relation can be the vital key to any businesses success or
failure. Good luck.

4. Achieving Strong Employment Relations

The first implicating factor is good management. You may ask, why? Through research
and surveys it was found that an employee who respects their employer is more likely to
over-achieve in their designated duties, this creates a goal setting environment where the
productivity levels are high.

10
5. Motivating our employees
Encouragement can be achieved simply through applauding your workers every once in a
while, both publicly and privately. It is known throughout all levels of management that
happy employees make productive employees

6. Set Goals
Achieving strong employee relations is also providing your employees with the image of
ambition and success. A saying that should be considered is ‗Under-promise, Over-
deliver‘. This phrase is a great managerial mantra. Consider this; do you want to be the
person who has wildly optimistic goals that they never meet, or do you want to be the
person who sets measured goals and ends up exceeding them by leaps and bounds?
Although this is focused on image it also is focused on reputation, these are important
when seeking respect from your employees.

7. Delegate
Delegation of work/tasks throughout any business is important. Through delegation you
are taking an opportunity to teach and empower your employees. This also allows you
and the employees to acknowledge and understand their strengths and weaknesses. These
are a few points to consider when delegating tasks.

8. Communicate Effectively
When creating a work environment with an effective communication network there is one
key factor that is vital. It is to ‗Keep your door open‘. Regularly remind and reinforce
that your door is always open to any inquiries or concerns, and that you as a manager or
business owner are willing and ready to listen. Maintaining an open channel of
communication will make you aware of problems quickly, which is beneficial for quick
resolution.

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GRIEVANCES

Grievance is any discontent or dissatisfaction, whether expressed or not and whether valid or not
arising out of anything connected with the company that an employee thinks, believes or even
feels , is unfair, unjust or inequitable.

Employers are, often, bombarded with grievances of various kinds from workers almost on a
daily basis. The employer might be the target in most cases. At other times, workers may target
the supervisors and even their co-workers. Such grievances may be real or imaginary, valid, or
invalid, genuine or false. They might look silly and completely baseless at times.

DEFINITION:

Dale S. Beach defines grievance as “any dissatisfaction or feeling of injustice in connection with
one‘s employment situation that is brought to the attention of management”.

CAUSES OF GRIEVANCES

A. Resulting from working conditions

• Improper matching of the worker with the job
Normally, the qualification or experience of the employee may not sufficient
to handle the task in the higher post. It may create the grievances among the
employees in the company.
• Changes in schedules or procedures
There may be a changes in schedules or procedures in the working slots of
employee depends on the project and task where they are working.
• Inadequate tools, machines and equipments
Insufficient equipment may leads for delay in output or result in the business
process.
• Tight production standards
The level of standard and benchmark will make the employees to feel
complicated to do all the work.
• Bad working conditions
The bad working condition of working place will make the employees to de -
motivate and dis-courage in their work.

12
 • Failure to maintain proper discipline
Normally, the employees will follow the positive discipline in the company;
failing which they supposed to face more complications.
• Poor relationship with the supervisor
The negative and poor relationship with the supervisor will lead to grievances
and disputes among the employees and employer relationship.

B. Resulting from management policy

• Wage payment
Improper wage payment system will create the bias among the employees that
make them to feel negative in the work spot.

• Leave
Proper leave system should be followed in the organization, which helps the
employees to get relax and self-motivation.
• Overtime
Continuous overtime will lead for boredom among the employees that de-
motivate them in their work.
• Transfer
Unpredicted transfer will affect the employees to start and follow the work
easily in the company.
• Promotion, demotion and discharges
Promotion or demotion will create the high amount challenges in the working
process of organization
• Lack of career planning and development plan
The career planning is a base for development of employee in the company. If
there is no proper system of career planning, employees could not give their
full dedication in the work.
• Hostility towards a labour union
Influence of trade union will make the changes of employee‘s life personally
and officially. Most of the time the trade union will play the dual role in the
company .

13
OBJECTIVES OF THE GRIEVANCE HANDLING

• To enable the employee to air their grievance

• To clarify the nature of the grievance

• To investigate the reasons for dissatisfaction

• To obtain, where possible, a speedy resolution to the problem

• To take appropriate actions and ensure that promises are kept

• To inform the employee of their right to take the grievance to the next stage of the
procedure, in the event of an unsuccessful resolution

BENEFITS OF GRIEVANCE HANDLING PROCEDURE

• It encourages employees to raise concerns without fear of reprisal.

• It provides a fair and speedy means of dealing with complaints.

• It prevents minor disagreements developing into more serious disputes.

• It serves as an outlet for employee frustrations and discontents.

• It saves employer‘s time and money as solutions are found for workplace problems. It
helps to build an organizational climate based on openness and trust.

EFFECTS (OR) RESULT OF GRIEVANCE

A) On the Basis of production
• Low quality of production

• Low productivity

• Increase in the wastage of material, spoilage/leakage of machinery

• Increase in the cost of production per unit

B) On the Basis of employees

• Increase in the rate of absenteeism and turnover

• Reduction in the level of commitment, sincerity and punctuality

• Increase in the incidence of accidents

• Reduction in the level of employee morale

14
 C) On the Basis of managers
• Strained superior-subordinate relations
• Increase in the degree of supervision and control
• Increase in indiscipline cases
• Increase in unrest and thereby machinery to maintain industrial

STEPS TO OVERCOME GRIEVANCE

1. Acknowledge dissatisfaction
2. Define the problem
3. Get the facts
4. Analyze and decide
5. Follow up

INDUSTRIAL DISPUTES

An industrial dispute can be viewed as friction or disagreement between two or more parties
involved, due to the difference in their perceptions, opinions, mindsets, attitudes and values.

It may occur due to the misunderstanding of

• Employer and employee;
• Employee and employee or;
• Employer and employer.
• On a massive level, conflicts can even arise between the government and the public.
Industrial disputes are sometimes observed as a result of poor industrial relations in the
organization.

OUTCOMES OF INDUSTRIAL DISPUTES

I) Strikes
 a) Primary
 Gherao
 Boycott
 Stay away Strike
 Pen Down Strike
 Token Strike

15
  Lightening Strike
 Go slow
 Work to rule
 b) Secondary
• Sympathy Strike
c) Others
 General Strike
 Political Strike
 Particular Strike
 Bandh

II) Lockouts
 Gherao
Gherao, meaning "encirclement", is a word which denotes a tactic used by labour
activists and union leaders in India, it is similar to picketing. Usually, a group of people
would surround a politician or a government building until their demands are met, or
answers given
 Boycott
A boycott is an act of voluntary and intentional abstention from using, buying, or dealing
with a person, organization, or country as an expression of protest, usually for moral,
social, political, or environmental reasons.
 Stay away Strike
A stay away, also known as a stay-away or stay-away, is a form of protest where people
are told to "stay away" from work, similar to a general strike.

 Pen Down Strike

A labor action in which employees come to work but do not do any work. The term
connotes that this takes place in an office setting as opposed to an industrial setting. A
pen-down strike is analogous to a slow down.
 Token Strike
A situation in which a group of workers refuses to work, but only for a short period: They
called a 24 hour token strike

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 Lightning Strike
A strike by workers after little or no warning, especially without official union backing

 Go slow
A deliberate slackening of the rate of production by organized labour as a tactic in
industrial conflict. They will do the work very slowly.
 Work to rule

Work-to-rule is a job action in which employees do no more than the minimum required
by the rules of their contract, and precisely follow all safety or other regulations, which
may cause a slowdown or decrease in productivity, as they are no longer working during
breaks or during unpaid extended hours and weekends.

 Sympathy strike

A sympathy strike is when one union strikes in support for another involved in a dispute,
even though the first union has no disagreement with the employer A refusal to work by
one worker or group of workers to support the efforts of another group of strikers is a
sympathy strike.

 General Strike
General strike action, also called labor strike, labour strike, or simply strike, is a work
stoppage, caused by the mass refusal of employees to work. A strike usually takes place
in response to employee grievances. Strikes became common during the Industrial
Revolution, when mass labor became important in factories and mines.

TYPES OF INDUSTRIAL DISPUTES

• Interest Disputes or rights disputes
• Grievance disputes
• Recognition disputes
• Unfair labour practices disputes
CAUSES OF INDUSTRIAL DISPUTES

• Economic Causes
• Managerial Causes
• Government Machinery

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 • Joint Management Councils (JMC)
• Wage Boards
• Voluntary Arbitration
• Other Causes

1. Economic Causes
(a) Wages:
The demand for wage increase is the prime-most cause of the industrial disputes. A large
number of strikes are being organised to raise a voice against the rise in prices and cost of
living.
(b) Dearness Allowance and Bonus:
Increase in cost of living was the main cause of the demand of dearness allowance by the
workers to equate their wages with the rise in prices. Bonus also plays an important role
as a cause of industrial dispute. It is interesting to note that in 1966, 49 percent of the
disputes were related to wages and bonus.
(c) Working Condition and Working Hours:
The working conditions in Indian industries are not hygienic. There is not ample
provision of water, heating, lighting, safety etc. Working hours are also greater. The
demand of palatable working conditions and shorter hours of work are also responsible
for labour disputes.
(d) Modernisation and Automation of Plant and Machinery:
The attempt at modernisation and introduction of automatic machinery to replace labour
has been the major cause of disputes in India. Workers go on strike, off and on, to resist
rationalisation and automation.

(e) High Industrial Profits:

During and after the world wars, prices of the commodities went up and the industrialists
earned huge profits. In order to get share in the prosperity of the industry, it naturally led
to the resentment on their part. The increased profits also led to the demands of higher
wages and bonus.

(f) Demand for Other Facilities:

Demand for other facilities for meeting out their basic needs such as medical, education,
housing, etc., encourage the workers to resort to direct action because such facilities were
denied by the employers.

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2. Managerial Causes
(a) Denial of Recognition to Trade Unions:
Failure on the part of the employer to recognise the trade unions or to recognise the rival
union for representation, insult of trade union leaders by the employers are some of the
examples of autocratic managerial attitude worth mentioning as the causes of industrial
disputes. The attitude of employers towards the labour associations had never been
sympathetic.
(b) Defective Recruitment Policies:
The recruitment practices in Indian industries are defective. Recruitment is generally
made by the contractors who exploit the workers and suppress their individuality. The
defective promotion, demotion, transfer and placement policies encourage dissatisfaction
among workers.
(c) Irregular Lay-Off and Retrenchment:
Lay-off and retrenchment are reasons to be mentioned for encouraging industrial
disputes. Indian employers follow the policy of ‗Hire and Fire‘. As a matter of practice,
workers are not made permanent for a pretty long time to deprive them of their legitimate
rights.
(d) Defiance of Agreements and Codes:
The employers regularly defy the provisions of collective bargaining agreements and
code of conduct and code of discipline with a view to harass or exploit the employees and
just encourage strife.
(e) Defective Leadership:
Inefficient leadership is also one of the causes of disputes. Leadership from the
management and from the workers is quite incompetent to induce the workers to get them
worked. The employers‘representatives are not delegated sufficient authority to negotiate
with the workers.

3. Government Machinery
(i) Enactments are Ineffective:
(a) The irrelevancy in the context of the challenges of present industrial climate/culture,
as many has not been convinced of their utility satisfactorily;

19
 (b) Improper and inadequate implementation by many employers;
(c) Incapability of understanding and answering imperatives of development.
(ii) Little Confidence over Settlement Machinery:
Both employers and employees have little confidence over the Conciliation Machinery as
it could succeed in settling a very negligible number of disputes so far. Both employers
and employees are litigation-minded.
4. Joint Management Councils (JMC)
Just to make a start labour participation in management, the Government in its Industrial
Resolution 1956, decided to set up Joint Management Councils. This step also remained
ineffective and not much headway is made in this direction. Currently, there are hardly 80
JMCs and even out of them a good number are not effective.
5. Wage Boards
Wages and allowances is the main issue in industrial disputes. The Government of India
set up wage boards for various industries. The main function of wage boards is to fix the
fair wage in various industries.
6. Voluntary Arbitration
The object of the Act is to require employers to diffuse with sufficient precision, the
conditions of employment in the establishments- under him and to let the workers know.
Such conditions include conditions of recruitment, discharge, disciplinary action, holiday,
leave etc., of the workers
7. Other Causes
.(a) Multiplicity of trade unions in the same industry/unit and rivalry among the workers
has destroyed the solidarity of the working class.

(b) In some undertakings, there is no union at all recognised or unrecognised.

(c) The workers generally are uncertain with the activities except wages.

SETTLEMENT MACHINERY OF DISPUTES

Arbitration:
Arbitration is defined as a method of resolving a dispute with the professional help of a
neutral third party who specializes in resolving labor-management, collective or
individual conflicts and delivering a final legal decision.

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 Aggrieved employee:
An aggrieved employee shall meet the officer designated by the Management for the
purpose of handling grievances or the alternate officer designated to handle the grievance
in his absence and present to him his grievance in writing in the prescribed Grievance
Record Form

Front line manager:

Front-line management is the level of management that oversees a company's primary
production activities. Front-line managers have critical value to a company's success
because they must motivate employees who perform those critical production duties.
They also must generate efficient productivity and control costs.

Union representative:
Trade union representative is an employee who will represent and defend the rights of
workers. Representatives are entitled to raise any concerns with management on behalf of
union members

Middle level management:

Middle management is at the center of a hierarchical organization, subordinate to the
senior management but above the lowest levels of operational staff.

Middle level union leader:

They are the middle agent of trade unions who connecting the employees and the
employees for mutual communication.

Top management:
Top-level management are your executives such as a CEO, CFO, President and Vice
President. These top managers are responsible for setting the overall direction of a
company and making sure that major organizational objectives are achieved.

Top Union Leaders:

They are the head of trade union , who control and lead the entire union. Normally, they
will participate in the extreme case , where the union members could not solve the issues.

21
 Figure 1

QUESTION BANK

PART - A

1. What are the causes of poor industrial relations?

2. State the need for harmony in industrial relations.

3. State the features of collective bargaining.

4. Write the pre-requisites for collective bargaining.

5. Define trade union.

6. Define suggestion scheme.
7. Why do employees join in trade union?
8. Write short note on craft union.
9. What are causes of indiscipline in an organization?
10. Define lockout.

22
 PART – B
1. Explain the origin and growth of trade union in India.
2. Describe the concept of industrial relations and its role.

3. Explain the role of state in the settlement of industrial

disputes.
4 Summarize the process of collective bargaining to settle
industrial disputes.
5. Recommend the measures to be taken by HR manager in
promoting industrial relations.
6. Analyze the different ways to make suggestion scheme
more effective.
7. Explain the procedure of grievance redressal scheme.
8. Develop the important strategies for measuring the
performance of HRA.
9. Explain two important functions of HR and explain how
audit is done.

REFERENCES

 Human Resource Management, Gary Dessler, 16th Edition. 2017

 Human Resource Management, Aswathappa. McGraw-Hill Education (India) Pvt Limited,
2010
 Principles of Human Resource management, Bohlender and snell,Cengage learning, 17 th
edition, 2016

23
Personnel management is a little old and a more traditional way of handling employees at a
workplace. Personnel management is the seed and root for Human resources management.
HRM is a more modern and a more specific approach to managing human resources in an
organization

Personnel management.
 Employees were not given high priority in decision making process
 Weren't much allowed to interact with management.
 Personal manager was to see that everything was in compliance with the labour laws or
not but not much emphasis made on the morale of employees.
 Employees were just treated as tools, obligation to the organisation but not as the asset of
the organisation,
 they were seen as cost & expenditure to company rather than capital and investment.
 Personnel officers mostly used be disciplinary oriented instead of flexible and interactive
with employees.
 Nurturing of employees was not priority by the personnel managers
 employees perspective was ignored which means personnel managers rather than
understanding situation they used to be punitive if any error was committed by employee.

Human Resource Planning (HRP)

Meaning
The process by which a management determines how an organisation should move from its
current manpower position to its desired manpower position. Through planning, a management
strives to have the right number and the right kind of people at the right places, at the rights time,
to do things which results in both the organisation and the individual receiving the maxium long-
range benefits.

Definition
Ibid., P.157, HRP includes the estimation of how many qualified people are necessary to
carryout the assigned activities, how many people will be available, and what if anything, must
be done to ensure that personnel supply equals personnel demand at the appropriate point in the
future.

24
According to Jeisler, "Manpower planning is the process including forecasting, developing and
controlling— by which a firm ensures, it has the right number of people and the right kind of
people and at the right places at the right time doing things for which they are economically most
useful"

According to Dale S. Beach, "Human resource planning is a process of determining and

assuring that the organisation will have an adequate number of qualified persons,
available at the proper times, performing jobs which meet the needs of the enterprise
and which provide satisfaction for the individuals involved."
According to Wickstron,
"Human resource planning consists of a series of activities viz.:

Forecasting future manpower requirement either in term of mathematical projection of trends in

the economic environment and development in industry or in term of judgmental estimates based
upon the specific future plans of a company.

Making an inventory of present manpower resources and assessing the extent to which these
resources are employed optimally.

Anticipating manpower problems by projecting present resources into the future and comparing
them with the forecast of requirements to determine their adequacy, both quantitatively and
qualitatively

Planning the necessary programs of recruitment, selection, training, development, transfer,

promotion, motivation and compensation to ensure that future manpower requirements are
properly met.

25
Objectives of Manpower planning
1. To ensure optimum use of HR currently employed
2. To determine future recruitment level
3. To provide control measures to ensure that necessary resources are available as and when
required
4. To anticipate redundancies and avoid unnecessary dismissals.
5. To forecast future skill requirements to serve as a basis for training and developemnt
programmes
6. To assess future housing needs of employees
7. To cost the manpower component in new projects
8. To decide whether any of the enterprise activities

Importance of HRP
1. Future personnel needs
2. Coping with change
3. Creating highly talented personnel
4. Protection of weaker sections
5. International strategies
6. Foundation for personnel functions
7. Increasing investment in HR
8. Resistance of change and move
9. Other benefits

The main problems in the process of HRP are as follows:

a) Inaccuracy: Human Resource Planning is entirely dependent on the HR forecasting and
supply, which cannot be a cent per cent accurate process.

b) Employee resistance: Employees and their unions feel that by Human Resource Planning,
their workload increases so they resist the process.

26
c) Uncertainties: Labour absenteeism, labour turnover, seasonal employment, technological
changes and market fluctuations are the uncertainties which Human Resource Planning process
might have to face.

d) Inefficient information system: In Indian industries, HRIS is not much strong. In the absence
of reliable data it is not possible to develop effective Human Resource Planning.

e) Time and expense: Human Resource Planning is time consuming and expensive exercise, so
industries avoid.

Factors affecting HRP

1. Strategy and type of organisation
2. Organisational growth cycles and planning
3. Environmental uncertainties
4. Time horizons
5. Type and quality of forecasting information
6. Nature of jobs being filled
7. Off-loading the work

Manpower Planning Process or HRP

27
Meaning of HRP
The process of forecasting an organisation‘s future demand for and supply of, the right
type of people in the right number. It is only after this, that the HRM department, can initiate the
recruitment and selection process. HRP is a sub-systems in the total organisational planning.
Steps in Procurement of Personnel
1. Determination of the kind or quality of personnel needed:
a. Job Analysis
b. Job Description
c. Job Satisfaction
2. Determination of the quantity of personnel requried
a. Manpower planning
3. Recruitment, selecion and induction
Job Analysis
It is the process by means of which a description is developed of the present method and
procedure of doing a job, physical conditions in which the job is done, relations of the job to
other jobs and other conditions of employment.

Various point on which information may be gathered for Job Analysis are as follows:
1. Job Title
2. Alternative Title
3. Work performed
4. Equipment used, Tools and Materials used
5. Reports and records made
6. Relation of the job to other jobs
7. Education
8. Experience
9. Physical and mental efforts required
10. Visual attention required
11. Responsibility
12. Discomforts and hazards
13. Supervision given and received

28
How to obtain data for Job Analysis?
1. Questionnaire
2. Checklist
3. Interview
4. Observation
5. Participation
6. Techincal conference
7. Self – recording or diary
8. Critical incident
Uses of Job Analysis
1. It provides a complete knowledge about jobs
2. It is the first step in selection process and it is the best means of discovering the essential
traits
3. A satisfactory evaluation of job is not possible without a comprehensive job analysis
4. Job analysis uncover many organisational ills
5. It help to rearrange the work flow and revise existing procedure
6. Reveal the required skills and knowledge for doing a job and determines the training
needs
7. When considering for promotion, Job analysis may facilitate comparison of his current
responsibilities with those of the post for which he is being considered
8. It helps in developing appropriate design of job for improved efficiency and productivity.

29
Job Description
It lists job titles, duties, machines and equipment involved working conditions,
surrounding a job, etc
Definition
It defines the scope of job activities, major responsibility, and positioning the job in the
organization. It provides the worker, analyst, and supervisor with a clear idea of what the worker
must to do meet the demand of the job. It also provides both organizational information and
functional information.
Content / Components of Job Description
1. Job Identification or organizational position
2. Job summary
3. Job duties and responsibilities
4. Relation to other jobs
5. Supervision (Received and Given)
6. Machine, tools and equipments used
7. Working conditions
8. Hazards

30
Job Specifications
Job specifications list the human qualities and qualifications necessary to do the job.
Definition
Job specifications defines the human traits and experience are necessary to do the job. It
portrays what kind of person to recruit and for what qualifies that person should be tested.
Content of Job specification
I. Physical characteristics
a. Health, age, strength
b. Size, height, weight, voice
c. Eye, hand and foot co-ordination
II. Psychological characteristics
a. Judgment
b. Resourcefulness
c. Analytical
d. Mental concentration and alertness
III. Personal characteristics
a. Emotional stability
b. Appearance
c. Good and pleasing manner
d. Leadership and initiative
e. Smell, hearing and adaptability
IV. Responsibility
V. Other features of a demographic nature
Recruitment
Meaning
It is the process of searching for and obtaining applicants for jobs, from among whom the
right people can be selected.
Definition
Prof. William B.Werther and Keith Davis – HR and PM ―It is the process of finding and
attracting capable applicants for employment. The process begins when new recruits are starts

31
and ends when their applications are submitted. The results is a pool of applicants from which
new employees are selected.
Purpose and importance of recruitment
1. Determine the present and future requirements of the organization with its human
resource planning and job analysis
2. Increase the pool of job applicants at minimum cost.
3. Help to increase the success rate of the selection process, by reducing the number of
visibly under qualified and over qualified applications
4. Help to reduce the probability of the job applicants, will leave the organization after a
short period of time.
5. Begin identifying and preparing potential job applicants
6. Increase organizational and individual effectiveness in the short term and long term
7. Evaluate the effectiveness of various recruiting techniques and source for all types of job
applicants.
Factors influencing Recruitment:
The following diagram represents the various factors or determinants of the effectiveness
of the recruitment process done by the organisation;

32
Sources of Recruitment
The sources of recruitment can broadly be classified into two; internal and external.
I. Internal Sources
An internal source refers to the present working force of a company. In the event of a
vacancy, some one already on the payroll is promoted. Thus, at the Tata Engineering and
Locomotive Company and at Hindustan Unilever Ltd., outside recruitment is resorted to only
when requirements cannot be met from internal promotions.
Filling a vacancy form internal sources by promotion people has the advantages of
increasing the general level of morale of existing employees and of providing to the company a
more reliable information about the candidate‘s suitability who has already worked with the
company on a lower post.
The major weakness of this source are that it results into inbreeding depriving the
organization of a fresh outlook, originality and initiative and offers limited choice.

Advantages of Internal Sources of Recruitment

1. Familiarity with the organisation and employees
2. Better use of talent
3. Economical and less time consuming
4. It will help to improve the morale, loyalty and belongingness of an employee
5. It will motivate the employees
Disadvantages of Internal Sources of Recruitment
1. Limited choice
2. Discourage competition
3. Creates conflicts
II. External Sources
The more commonly used external sources are the following;
1. Advertisement in the newspapers
Senior posts are largely filled by this method. This method is however, followed by
companies in 3 different ways:
First, there are some companies which do not do their own advertising. On the other
hand, they send their requisitions to certain specialized agencies which advertise positions in

33
leading newspapers without divulging the name of the client company. The applications received
from the candidates by the agencies are duplicated and mailed to the clients.
Second, there are some companies which although do their own advertising but give only
box numbers. Box number advertisements generally do not draw good candidates who feel that it
is not worthwhile to apply without knowing employer‘s name. Both first and second types are
called blind advertisements.
Third, there are some companies which divulge their names in their advertisements.
2. Employment Exchange
An employment exchange is an office set up by the government for bringing together as
quickly as possible those men who are in search of employment and those employers who are
looking for men. Employment exchange register unemployed people and maintain records of
their names, qualifications, etc. the employers on their part intimate the exchange about the
vacancies which occur in their factories and types of employees they required for from among
the employment seekers already registered with it and forwards their names to the employers for
consideration.

3. Field Trips
An interviewing team makes trip to towns and cities which are known to contain the
kinds of employees required. Arrival dates and time and venue of interview are advertised in
advance.
4. Educational Institutions
Sometimes recruiters are sent to educational institutions where they meet the members of
the faculty and persons in charge of placement services who recommend suitable candidates.
Some companies send representatives of professional meetings and convention to recruit people.
5. Labour Contracts
In many industries workers are recruited through contractors who are themselves the
employees of these organizations.
6. Employee Referrals
Some industries with a record of good personnel relations encourage their employees to
bring suitable candidates for various openings in the organization. Companies offer rich rewards

34
also to employees whose recommendations are accepted. The disadvantage of the method is that
cliques of relations and friends may be formed within the enterprise.
7. Unsolicited Applicants
These are persons who gather at the factory gates to serve as casual workers or who send
in their applications without any invitation from the factory. Sometimes already employed
person may seek additional jobs. This is called moon-lighting. The number of unsolicited
applicants at any point of time depends on economic condition, the image of the company and
the job-seekers perception of the type of jobs that might by available.
8. Labour Unions
Organisations with ‗closed shop‘ agreements with their unions are required to recruit
union members only.
Advantages of External Sources of Recruitment
1. A better process of selection
2. Availability new and talented candidates
3. Opportunity to select the best candidates with innovative or creative thoughts
4. Provides healthy competition among the employees
Disadvantages of External Sources of Recruitment
1. Expensive and time consuming
2. Unfamiliarity with the organisation
3. Lack of mutual relations
4. Chances of faulty selection

SELECTION

Meaning:
Selection is the process of picking individuals (out of the pool of job applicants) with requisite
qualifications and competence to fill jobs in the organisation. The objective of selection process
is to determine whether an applicant meets the qualifications for a specific job and to choose the
applicant who is most likely to perform well in that job.

35
Definition:
According to Prof. Thomas H. Stone defined selection as, ―It is the process of differentiating
between applicants in order to identify (& hire) those with a greater likelihood of success in a
job‖.
Selection Process:
Selection is a long process, commencing from the preliminary interview of the applicants and
ending with the contract of employment.
In practice, the process differs among organisation between two different jobs within the
same organisation. Selection procedure for Senior Manager will be long-drawn and rigorous,
but it is simple and short while hiring shop-floor workers.

Environmental Factors Affecting Selection

Selection is influenced by several factors. More prominent among them are supply and
demand of specific skills in the labour market, unemployment rate, labour-market conditions,
legal and political considerations, company‘s image, company‘s policy, HRP, and cost of hiring.
The last three constitute the internal environment and the remaining form the external
environment of the selection process.

Preliminary Interview:
It helps to reject misfit for reasons, which did not appear in the applications forms.
Besides, preliminary interview, often called ‘courtesy interview’ is a good public relations
exercise.

Kinds of Interview:
1.Direct Planned Interview:
This interview is a straight forward, face-to-face, question and answer situation intended
to measure the candidate‘s knowledge and background. Although it also provides an opportunity
for observing the candidate‘s personal characteristics and nothing his attitudes and motivations
but the presentation is usually superficial. The interviewer, however, does some advance
planning.
2 Indirect Non-directives Interview:

36
 In this type of interview the interviewer refrains from asking direct and specific questions
but creates an atmosphere in which the interviewer feels free to talk and go into any subject he
considers important.
In such atmosphere the information obtained by the interviewer is more likely to be an
accurate representation of what the individual believes than if the employee is asked specific
questions. The interviewer, therefore, plays mainly a listening role.

3. Patterned Interview:

In this interview a series of questions which can illuminate the strategic parts of the
applicant‘s background are standardized in advance and validated against the record of
employees who have succeed or failed on the jobs. Answers to these questions are compared
with a critical score and used in determining who is to be selected.

4. Stress Interview:

In this interview the interviewer deliberately creates stress to see how an applicant
operates under it. To induce the stress, the interviewer responds to the applicants‘ answer with
anger, silence, criticism or a flurry of incisive follow-up questions. Events such as noise,
interruptions, or change of schedules are introduced to see how determined and inventive an
applicant can be. The interviewer can add realism by acting uncooperatively and by raising
objections.

5. Systematic Depth Interview:

In this interview, the interviewer has a plan of areas he wishes to cover. Ordinarily, the
interviewer exhausts one are before launching into the next so that he can be more certain of
complete coverage. Each answer must be interpreted in the context of many other interrelated
circumstances. So the interviewer must weigh the meaning of various answers.

6. Panel or Board Interview:

In the board interview, more than one person interviews an applicant at the same time.
Areas of questioning are allowed to each interviewer before the interview starts. One possible

37
disadvantage of this method is that on being stimulated by each other‘s questioning, interviewer
may start competing with one another and thus create conditions of stress for the candidate.

7. Group Interview:

In this interview 5 or 6 applicants are placed together in a situation in which they must
interact. The situation may be structured or unstructured. It is usual for the selector to remain
silent throughout the discussion and make notes of the applicant‘s interactions unobtrusively.
The applicant who verbalizes better and who has a better personality is likely to be selected
under such circumstances.

8. Walk-in-Interview:

In this interview candidates are not required to apply for the post beforehand.
They are asked to approach the employer for interview on the advertised date, time and place
with their bio-data and a copy of their passport size photograph.

Procedure for an Interview

1. Reviewing Background Information:

Pertinent information about the candidate should be collected and noted beforehand.
This preparation saves time and mental effort during the interview.
2. Preparing a question Plan:
Every interview should have a question plan. It is useful for inexperienced interviewers
to have this written down in front of them so that questions can be ticked off as they are dealt
with.
3. Creating a Helpful Setting:
Most interviews have overtones of emotional stress for the applicant. Success in
interviewing depends on reducing this stress. This can be achieved if the following conditions
are present at the place of interview. Privacy and comfort, atmosphere of leisure, freedom from
interruptions, authentic feeling for an interest in the candidate.

38
 4. Conducting the Interview:
Interviewing is much like fishing, where it is often necessary to change depth, lure and
location order to get a bite. It is, therefore, necessary to use a number of different approaches
during the course of an interview.
5. Concluding the Interview:
In this final movement the interviewer guides the interview to a close. After the
candidate leaves, the interviewer looks over his notes, recalls his impressions, collates his
observations and makes a provisional before seeing the next candidate. He fills up the
interviewer‘s Rating Sheet meant for this purpose.

Advantages and Limitations of Interviewing:

Advantages:
a) It can fill information gaps and can correct questionable response
b) It can effectively bring out the behavioral characteristics of the applicants.
Disadvantages:
a) Interview is an unreliable tool of selection because it has the maximum element of
subjectivity.
b) Same candidate may be rated differently by different interviewers. He may be rated as
‗fit‘ by one interviewer and as ‗unfit‘ by another.
Tests
Another important device used in selection is psychological test. A psychological test is
designed to measure such skills and abilities in a worker as are found by job analysis to be
essential for successful job performance.
a) Knowledge Test:
Tests measuring knowledge or information are the easiest to develop and most
appropriate to use for jobs that require knowledge of certain things. Such knowledge tests
become necessary when academic qualifications are not good indications of the capacity and
knowledge of a candidate.
b) Ability or Proficiency Tests:
Ability or proficiency tests are those which measure the skills and abilities already
present in the testee at the time of testing. These tests check an applicant‘s claim that he

39
possesses those abilities which are believed to be critical in the performance of his job. Ability
tests are appropriate for lower levels jobs where ability is quantifiable.
c) Aptitude Tests:
Aptitude tests are those which measure skills and ability that have potentiality for later
development in the testee. These tests measure whether or not an individual has the capacity or
latent ability to learn a given job quickly and efficiently.
d) Personality Tests:
These tests, which are generally used in the selection of executives, measures the
personality traits (such as honesty, Cheerfulness, Persistence, dominance, Cooperatives) of
individuals.
e) Simulations Exercise:
Simulation exercise is a test which duplicates many of the operations and problems confronting
the work on the job. Thus testing punch press operators by means of a miniature and hazardless
facsimile of the actual machine or managers by means of the role-playing is a simulation test.

Reference:
Requesting reference is a widespread practice with substantial doubt as to its validity.
References are usually obtained from the candidates‘ friends or from his previous employer.
Some organisation have found that by assuring the referee of absolute confidentiality and by
informing him that one adverse vote in three does not disqualify, frank, reliable and valid
references have been obtained.
Selection Decision:
The final decision has to be made from the pool of individuals who pass the tests, interviews and
reference checks. The view of the line manager will be generally considered in the final
selection because it is he/she who is responsible for the performance of the new employee. The
HR manager plays a crucial role in the final selection.
Physical Examination:
It reveals whether or not a candidate possesses the required stamina, strength and
tolerance of hard working conditions. The basic purpose of a physical examination is to place
selected candidates on jobs which they can handle without injury or damage to their health.

40
Job Offer:
The next step in the selection process is job offer to those applicants who have crossed all
the previous hurdles. Job offer is made through a letter of appointment such a letter generally
contains a date by which the appointee must report on duty.
Contract of Employment:
After the candidates accept the offer, certain documents need to be executed by the
employer and the candidate. One such document is the attestation form. This form contains
certain vital details about the candidate which are authenticated and attested by him/her.
Attestation form will be a valid record for future reference.
Conducting the Selection Process:
There is another step- a more sensitive one – reassuring those candidates who have not
been selected. Such candidates must be told that they were not selected, not because of any
serious deficiency but because their profile did not match the requirements of the organisation.
They must be told that those selected purely on merit.
Evaluation of Selection Program:
The broad test of the effectiveness of the selection process is the quality of the personnel
hired. An Organisation must have competent and committed personnel. How to evaluate the
effectiveness of a selection program? A periodic audit is the answer. Audit must be conducted
by people who work independent of the HR department.

PLACEMENT
Meaning :-
Placement is a process in which the new employee is allocated the job he is hired for and it is
assignment of a new employee to the job.
The job assigned to him may be;
i) Independent
ii) Sequential
iii) Or may be in the pool where he works with other to complete the assigned work.

41
Orientation / Induction:
Meaning:
Orientation is one component of the new employee socialization process. It is the
ongoing process of instilling in all new employees prevailing attitudes, standards, values,
patterns of behavior that are expected by the organisation and its departments.
Definition of Orientation:
Orientation defined by Prof.Robert .L.Mathis and John H.Jackson as, ―It is a process
of planned introduction of employees to their jobs, their co-workers and the organisation‖.

Problems of Orientation

1. Supervisor not trained and is too busy

2. Overwhelmed with too much information in a short time.
3. Overload with forms to complete
4. Employee asked to perform task where there are high chances of failure that could
needlessly discourage the employee.
5. Employee is forced to fill in the gaps between a broad orientation by the HR department
and a narrow orientation at the department level.
6. Employee thrown into action too soon
7. Employee mistake can damage the company
8. Employee may develop wrong perception because of short period spent on each job

PROMOTION
Meaning:
Promotions means an improvement high pay, prestige, position and responsibility of an
employee within his/her organisation. The new job is a promotion for the employee only when it
carries increased responsibilities and enhanced pay.
Definition:
According to Scotl and Clothier, ―A promotion is the transfer of an employee to a job
which pays money or one that carries some preferred status‖.

42
Purpose of Promotion:
To motivate employees to higher productivity.
To attract and retain the service of qualified and competent people.
To recognize and reward the efficiency of an employee.
To increase the effectiveness of the employee and of the organization.
To fill up higher vacancies from within the organisation.
To build loyalty, morale and a sense of belongingness in the employee.
To impress upon other that opportunities are available to them.

Requirements of a Sound Promotion Policy:

It must provide for a uniform distribution of promotional opportunities throughout the
organisation.
It must tell employee in advance what avenues advancement exist.
There should be some definite criteria for the selection of employees who are to be promoted.
All promotions should be finally sanctioned by concerned line heads.
There must be suitable systems of follow-up, counseling and review.
Advantages of Promotion Policy:
1. It provides an opportunity for
greater personal satisfaction and prestige
2. It ensures uniformity and
consistency in the treatment of employees.
3. It offers opportunities to
management to provide recognition and incentives to the better employees.
4. It serves as an orderly, logical
and prompt source of recruitment for management to fill vacancies.

Types of Promotion:
1. Horizontal Promotion:
This type of promotion involves an increase in responsibilities and pay, and a change in
designation. But the employee concerned does not transgress the job classification. For

43
example; a lower division clerk is promoted as an upper division clerk. This type of promotion
is referred to as upgrading the position of an employee.

2. Vertical Promotion
This type of promotion involves a greater increase responsibility, prestige and pay, together
with a change in the nature of the job. A promotion is vertical when a canteen employee is
promoted to an unskilled job; the concerned employee naturally transgresses the job
classification.

3. Dry Promotions:
Dry promotions are sometimes gives in time of increases in remuneration. Designation is
different but no change in responsibility. This promotion may be given one or two annual
increments.

TRAINING AND DEVELOPMENT

Meaning:
Training is a process of learning a sequence of programmed behavior. It is an application
of knowledge. It gives people an awareness of the rules and procedures to guide their behavior.
It attempts to improve their performance on the current job or prepare them for an intended job.
In simple terms, training and development refer to the imparting of specific skills,
abilities and knowledge to an employee.
Definition:
According to Prof. Randall S.Schuler has defined training as, ―It is any attempt to
improve current or future employee performance by increasing an employee‘s ability to perform
through learning, usually by changing the employee‘s attitude or increasing his or her skills and
knowledge . The need for Training and Development is determined by the employee‘s
performance deficiency, computed as follows:
Training & Development Need = Standard Performance – Actual Performance.

44
Difference between Training & Education:
Training Education

1. Application Theoretical orientation

2. Job Experience Class room learning
3. Specific Tasks General Concepts

4. Narrow Prospective Broad Prospective.

Difference between Training & Development
Training & Development differ in four ways;
i) What is learned?
ii) Who is learning?
iii) Why such learning takes place ? &
iv) When learning occurs?

Inputs in Training and Development

1. Skills :
Training is imparting skills to employees. A worker needs skills to operate machines, and use
other equipment with least damage and scrap. This is a basic skill without which the operator
will not be able to function. Training should also provide other skills like motor skills and
interpersonal skills.
2. Education:
The purpose of education is to teach theoretical concepts and develop a sense of reasoning and
judgment. That any training and development program must contain an element of education is
well understood by HR specialist.
3. Development:
Another component of Training & Development program is development which is less skill-
oriented but stresses on knowledge. Knowledge about business environment management
principles and techniques, human relations, specific industry analysis, and the like is useful for
better management of a company.

4. Ethics:

45
There is need for imparting greater ethical orientation to a training and development program.
Unethical practices abound in marketing, finance and production functions in an organization. If
these personnel indulge in unethical practices the fault rests on the HR Manager. It is his/her
duty to enlighten all the employees in the organization about the need for ethics.
5. Attitudinal change:
Attitudes represent feelings and beliefs of individuals towards others. Attitudes affect
motivation, satisfaction and job commitment. Negative attitudes need to be converted into
positive attitudes. Nevertheless, attitudes must be change so that employees feel committed to
the organization are motivated for better performance, and derive satisfaction from their jobs and
the work environment.
6. Decision Making & Problem Solving :
Learning related to decision making and problem solving skills seeks to improve trainees‘
abilities to define and structure problems, collect and analyse information, generate alternative
solutions and make an optional decision among alternatives. Training of this type is typically
provided for potential managers, supervisors and professionals.
Need for / Basic Purpose of Training:
1. To improve productive
2. To improve quality
3. To help a company fulfils its future personnel needs
4. To improve organizational climate
5. To improve health and safety
6. Obsolescence prevention
7. Personal Growth.
Objectives of Training and Development:-
1. To familiarize the employee with the company‘s culture.
2. To enable the employee to do new jobs and prevent his skills from becoming
obsolete.
3. To increase the employees‘ quantity and quality of output.
4. To improve the employees‘ performance for promotion to higher jobs (or) to prepare
the employees‘ quality for promotion to higher jobs.
5. To reduce supervision, wastage and accidents.
6. To teach the employee how to adjust better with different members of his role set.

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Training Process

Organisational Objectives & Strategies

Assessment of Training Needs

Establishment of Training Goals

Devising Training Programme

Implementation of Training Programme

Evaluation of Results

1. Organizational Objectives & Strategies:

The first step in the training process in an organization is the assessment of its objectives and
strategies. What business are we in? At what levels of quality do we wish to provide this product
or service? Where do we want to be in the future?
2. Assessment of Training Needs:
Needs assessment diagnoses present problems and future challenges to be met through
training and development organization that implement training programs without conducting
needs assessment may be making errors.

Various sources from which evidence of training needs may be gathered:

1. Informal observation
2. Performance appraisal
3. Suggestion system
4. Group discussion
5. Questionnaire to trainees and supervisors
6. Accident rates and scrap

47
 7. Morale survey
8. Test and Interview
9. Analysis Reports
10. Employee Counseling
3. Training & Development Objectives:
Without clear set goals, it is not possible to design a training and development
programme and after it has been implemented there will be no way of measuring its
effectiveness. Goals must be tangible, verifiable and measurable.
4. Designing Training & Development programme:

Every Training & Development programme must address certain vital issues like;

Who are the Who are the trainers? What Methods & Techniques

What should be the level of What principles of learning? Where to conduct the

Steps in Training Program

i. Deciding the location and organizing training and other facilities
ii. Scheduling the training program
iii. Conducting the training program
iv. Monitoring the training progress of trainees.

5. Implementation of the Training program:

Once the training program has been designed, it needs to be implemented. Program
implementation involves action on the following lines:
6. Evaluation of the program:
The last stage in the Training and Development process is the evaluation of results. Since
huge sum of money are spent on training and development how far the program has been useful

48
must be judged/determined to make it effective in the future. And it helps to determine the
results of the Training and Development program.

Methods / Techniques of Training:-

I. Training Methods for Operative
II. Training Methods for Executive

I. Training Methods for Operative:

Skills needs, size and tradition of the company, abilities of trainees, time and money,
experience of the company about the training activities that have been carried on in the past all
will affect the type of training.

1. Training on the Job:

This is an important type of training. It helps to learn to master the operations involved
on the actual job situation under the supervision of the immediate boss.
Advantages:
1. It can be learned in a relatively short period of time say, a week or two.
2. No elaborate program is necessary
3. No line-staff conflict because his own supervisor
4. Highly economical
5. Not located in an artificial situation, either physically or psychologically
Therefore, eliminates the possible problem of transfer to learning.
a. Job Rotation: It involves the employee being sent through different jobs, thereby
providing him a wider exposure.
b. Internship Training: It refers to a joint program of training in which schools and
business Co- operates to enable the students to gain a good balance between theory and
practice.
c. Apprenticeship: It is used in those trade, craft and technical fields in which proficiency
can be acquired after a relatively long period of time in direct association with the work
and under the direct supervision of experts.

49
 d. Vestibule School: A portions of this training is taken away from the line and assigned to
staff through a vestibule school. The responsibility to operate a vestibule school
generally rests with the personnel department. This training gets its name from the
resemblance of the school to a vestibule through which one passes before entering the
main room of a house.
2. General Education Programme:
Beyond the training of employees for specific job skills by offering programme of
General Education content, such as, courses in economic, arts and science and so on.
3.Simulators and Training Aids:
Simulators are used to provide trainees with physical equipment that resembles to same
degree the equipment that is to be used on the job.

PERFORMANCE APPRAISAL (PA)

Meaning:
Performance Appraisal refers to all the formal procedures used in working organizations
to evaluate the personalities and contribution of group members.
Definition: (Prof.Randall S.Schuler)
―PA is a formal, structured system of measuring and evaluating an employee‘s job related
behavior and outcomes to discover how and why the employee is presently performing on the
job and how the employee can perform more effectively in the future so that the employee,
organization and society all benefit‖.

Objectives / Purpose of PA
1. Basis for job change and promotion
2. Training and development program
3. Feedback to the employee
4. Incentive to all the employees
5. Provide the rational foundation for the payment of price, rate , wages, bonus etc.,
6. Evaluating the effectiveness of devices used for the selection and classification of workers.

Factor affecting PA

50
 1. Environmental constraints
2. Organizational leadership
3. Interdependence of sub-systems
4. Organisational structure

Who can be the appraiser?

1. Immediate Manager
2. Higher Level manager
3. Employee‘s Peer
4. Employee‘s subordinates., etc.,
I. Traditional PA Methods
1. Ranking Method:
The oldest and simplest method of performance appraisal is to compare one man with all other
men and place him in a simple rank order. In this way, ordering is done from best to worst of all
individuals comprising the group.

2. Rating – Scale Method:

As the very name implies these methods provide some kind of a scale for measuring absolute
difference between individuals. The scales used are generally of two types;
i. Discrete ii. Continuous

3. Check List Method

This consists of a member of statements about the worker and his behavior. Each statement on
this list is assigned a value depending upon its importance. Both statements and their values are
derived from preliminary research in which the pooled judgments of persons familiar with the
job are used.

4. Forced-Choice Method:
It consists of a number of statements which describe an individual being rated. These
statements are grouped into two, three or four. Sometimes all groups of the form are made of
favorable statements. Sometimes all have unfavourable statements only and sometimes they have
both statements. Nevertheless, the rater is compelled to check a ‘most’ and a ‘least’ in each
group-hence the term ‘forced choice’.

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 5. Field Review

The personnel officer meets small groups of raters from each supervisory unit and goes over
each employee‘s rating with them to

a) Identify areas of inter-related disagreement

b) Help the group arrive at a consensus

c) Determine that each rater conceives of the standards similarly.

6. Critical Incident Technique :

In this method the first step to draw up for each job a list of critical job requirements, that
is, those requirements which are vital for success or failure on the job.

7. Confidential Report:
A confidential report by the immediate supervisor is still a major determinant of the
subordinate‘s promotion or transfer. The format and pattern of this report varies with each
organization.

Limitations of Traditional PA Methods:

1. Emphasis on Human Performance without regard for Human Values
2. Halo Effect
3. Hyper Critical or “Horns‖ Effect
4. Central Tendency and leniency
5. Reluctance to ‘play God’
6. Defensiveness of Employees.

WAGE AND SALARY ADMINISTRATION

Definition:
The establishment of an implementation of sound policies and practices of employee
compensation. It includes such areas as job evaluation, development and maintenance of wage
structures, wage changes, wage surveys and related issues.

52
Wages:
Payment made usually at the end of the day‘s work. The term further denotes payment
made to workers doing physical work.

Salary:
Payment made to employees at the end of every month usually it refers to payment made
to those who are doing white-collar job.

Compensation of wages:

i. Basic pay- for the skill

ii. Increment- for continued learning of the skill year after year.
iii. Incentive- for efficiency
iv. Dearness allowances-for cost of living.
v. Overtime- for clearing extra workload which cannot be done during normal
hours.
vi. H.R.A. - allowance for rent.
vii. C.C.A. - to meet additional cost of living in metros.
viii. Social Security Schemes- like ESI and PF and pension.
ix. Welfare-fringe benefits-perquisites (all other allowances and loan) like transport,
medical facilities, housing, schooling, etc. - not related to efficiency or skill.
These are given to enhance quality of work life-also called QWL.
x. Bonus: sharing the profit.

Important Principles Of Wage And Salary Administration:

 The jobs that call for equal effort/skill/knowledge should be classified into one
cadre.
 Find out the total no. of jobs and total positions as per MPP.
 The financial worth of each and every job should be ascertained based on job
evaluation. After the financial worth of all the jobs is ascertained it should b4e
fitted into the cadres. This is the starting point of pay scales.
 Fix the actual pay scales.
 Fix the increments, should the incremental slab be 15 or 10.
 Should there be fixed increments or flexible increments. Should there be an
efficiency bar what should be the actual quantum of the increment?
 What should be the pay differentials (means the gap between two cadres or gap
between one pay scale and the other?
 For each job the highest point in career should be fixed- what is the highest cadre
for each job? For example, a medical officer of a manufacturing organization
cannot become the CEO, whatever is his salary.
 There should be a balance between reporting relationships and pay as far as
possible-means the bosses generally should get more pay than the subordinates.
 The pay scale should be adequate in number to provide for promotional avenues.
 Any policy on compensation should be in tune with the overall company policies
and the HR policies.

53
  The organization should have a clear policy on overtime and incentives.

Guiding principles of wages:

 Payment of remuneration determined in accordance of each job.
 The pay policy of the organization shall protect the interest of both the employer
and the employee.
 The wages rate for similar job in similar organization shall be taken into
consideration.
 The pay policy of the organization shall recognize individual differences, those
employees contributing more.
 The employees and their union shall be informed of the procedure adopted to
determine the wages raise.
 The pay structure shall be made flexible. So that any adjustment required can be
made easily.
 There shall be a prompt payment of the amount due to the employees.
 The pay given to the employee shall assure him and his family a reasonable
standard of living.
 There shall exist a forum too redress employees‘ grievances over pay
inequalities.
 Wage policy of the organization shall be reviewed periodically in true with
changing needs.

Basic kinds of wage plans

I. Time wage

 Oldest and most common method of fixing wages

 Workers are paid according to the work done during a certain period of time at the rate of
per hour, per week, per tonight, or per month
 The essential point is that the production of a worker is not taken into consideration in
fixing the wages
Merits of time wage system

1. it is simple, wage can be easily calculated

2. as there is no time limit for execution workers pay attention to the quality of their
work
3. same wages are paid to same kind of job, avoids jealousy among workers
4. slow and study pace of the worker, there is no rough handling of machinery
5. this is a profitable system where output cannot be measured
6. it ensures a stable income to workers
7. it requires less administrative attention than others because the very basic of the
time wage contract is good faith and mutual confidence between the parties

Demerits of time wage plan

1. all the persons are paid equally without considering ability differences

54
 2. labour changes for a particular job do not remain constant, hence quoting rates for a
particular piece of work becomes difficult
3. as there is no specific demand for the period of time of work there is possibility of
systematic evasion.
4. the employees does not know the amount of work done by each other, so total
expenditure on wages cannot be adequately assessed
5. as no record of workers output is maintained, it becomes difficult for the employees to
determine the efficiency for the purpose of promotion.

II. Piece wage plan – [wage=no. of output*wage per output] [as output increases, wage
increases]
 under this plan, workers are paid according to the amount of work done or the number of
units completed, the rate at which each unit being settled in advance, irrespective of the
time taken to do the work
 there is indirect implication that worker should not more than the average time, if he is
not abiding to it he is at the risk of losing job.
 The worker is paid in direct proportion to output produced
 This is generally adopted in jobs of repetitive nature.
 Out its application be difficult where different shifts are employed on the same work or
where a great Varity of different grades of workers are employed and immeasurable in
services
 Formula
WE = NR
WE =workers earnings
N= no. of pieces produced
R= rate per piece

Merits of piece wage system

1. pay is according to the workers efficiency as reflected in the amount of work.

2. Efficiency of the workers is adequately rewarded which gives him a direct stimulus to
increased his production
3. supervision is less required since wage depends upon the amount of work done or output
shown by the worker
4. for the continuity of the work breakdown is prevented by the worker which in turn
reduces the maintenance charges
5. direct labour cost per unit of production remain constant hence calculation of cost for
filling tenders becomes easy
6. not only as output increase wage increase, the method of production also increases

Demerits of piece wage plan

1. rate per piece or output ids not done on scientific basis

2. rate is done by rule of thumb method

55
 3. workers wish to perform there work at speed, may consume more power and result in
high cost of production
4. excessive speeding of work may result in wear and tear
5. trade union often appose to this system and might lead to labour disputes

Minimum Wages

The minimum wages is that wage which is sufficient to meet the worker's bare necessities.The
minimum wages takes in the factor of the prevailing cost of essential commodities whenever
such minimum wage is to be fixed.
State Governments have the power to fix different minimum rates of wages for different
scheduled employments different class of work in the same scheduled employments adults,
adolescents, children and apprenticies and different localities.

Features of a good wage plan

 It should be linked to employee performance

 It should be communicated to employees
 Employee suggestions should be valued
 It should have monetary as well as non-monetary aspect
 It should be easily understandable.
 It should be capable of easy computation
 It should be capable of effectively motivating the employees
 It should provide for remuneration to employees as soon as possible after the effort has
been made.
 It should be relatively stable rather than frequently varying.

Minimum Wages Act (1948)

 Objective: Fixing minimum rates of wages in certain employments

 Applicable to whole of India

 Central and State Government empowered to fix minimum wages

 Did not define ―minimum wages‖. Definition given by Fair Wages Committee

 Minimum Wages to be paid in Cash

 Defined normal working hours , one day rest in every period of 7 days

56
  Overtime fixed on a specific time unit

Incentive Scheme
―Wage incentives are extra financial motivation. They are designed to stimulate human effort by
rewarding the person, over and above the time rated remuneration, for improvements in the
present or targeted results‖
-NATIONAL COMMISSION ON LABOUR.

Objectives of wage incentive scheme:

1.To improve the profit of a firm through a reduction in the unit cost of labor and materials.
1. To avoid or minimize additional capital investment for the expansion of production.
2. To increase a worker‘s earnings without dragging the firm into a higher wage.
3. To use it as a tool for securing and better utilization of human resource.

Merits of incentives scheme:

1) Strengthens productivity
2) Advantages for both workers and employers.
3) Reduces supervision.
4) Low absenteeism.
5) Healthy industrial relations and reduces chances of dispute.
6) Better scheme for developing human resource.
7) Develops the feeling of co-operation among workers.

Demerits of incentive schemes:

1) There is possibility of reducing productivity.

2) Difficult to consider and achieve psychological and social dimensions.
3) Employment is uncertain.
4) Difficult to measure proportionate value of the extra work done.

Various types of incentive wage plans:

A. Individual incentive wage palns:

1. Halsey premium plan

 Combination of time –speed basis of payment.
 Standard time is fixed for each job, if the worker finishes the job before this
standard fixed time, be gets bonus for the time saved by him.
 Bonus rate ranges from 30% to 50% of time saved.

MERITS:

57
 a. Slow workers are guaranteed of fixed wages.
b. Efficient workers get extra wages.
c. Easy and simple device to increase efficiency.
DEMERITS:
a. Decreased quality of work.
b. More wastage.
c. No scientific method of wage fixing.
d. Standards are fixed based on past performance.

2. Rowan premium plan:

 Widely used in England
 Introduced by James Rowan, David Rowan and Sons, Glassgow in 1901.
 It is modification of Halsey plan.
 Premium is calculated on a percentage of wages for the time worked and
not for the time saved.
 Bonus= time saved*time taken/standard time*hourly rate.

MERITS:
a. There is no possibility of over speeding since bonus earned is not based on time
saved.
b. Less cost of supervision.
c. This plan is good for beginners and learners.
d. No rush through the work.

DEMERITS:
a. No difference is made between efficient and inefficient worker.
b. Difficult for the workers to understand.
c. As the time saved is increased, the bonus will be decreased proportionately.

3. Taylor’s differential piece rate system:

 Provides greater incentives to efficient workers.
 A standard task is established by techniques of time and motion study and
two piece rates are set up for each job.
 High piece rate is allowed to those who can make higher than standard
performance.
 Lower piece rate for those who cannot reach the standard.
 This method penalizes slow and lazy workers and pays incentive to
efficient workers.
MERITS:
a. Efficient and inefficient workers are distinguished.
b. Rates are fixed based on scientific method.
c. Helps in spotting and eliminating inefficient workers.

DEMERITS:
a. More mechanical and less humane.
b. Leads to discontentment among workers.

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 c. No guaranteed minimum wages.

4. Time rate system (Refer the above notes )

5. Piece rate system ( Refer the above notes)

Profit sharing is an incentivized compensation program that awards employees a percentage of

the company's profits. The amount awarded is based on the company's earnings over a set period
of time, usually once a year. Unlike employee bonuses, profit sharing is only applied when the
company sees a profit.

Profit sharing may be defined as an agreement freely entered into, by which the employees
receive a share, fixed in advance, of the profits. This compensation is in addition to the regular
wages and bears a definite percentage relationship to company profits. This definition would
exclude bonuses based on profits which are not assured on a continuing basis.

Objectives of Profit Sharing:

 To promote worker‘s efficiency.

 To raise productivity.

 To make workers feel that their interests are identical with those of the employer.

 To make workers behave in a more responsible manner.

 To improve employee morale.

 To bring workers and management closer so that many problems can be sorted out due to
already developed better mutual understanding and cooperative spirit.

Profits can be distributed to employees in a number of ways, such as:

 In the form of cash money.

 In the form of company shares.

Profits under the profit sharing scheme can be paid to employees on the basis of:
their years of service with the company. A fixed percentage of their total wages during a
stipulated period, Merit rating of the employees., Their attendance., Their good performance
record.,Their good general record, etc.

Advantages of Profit Sharing:

i) Employees and employers develop better mutual understanding and cooperation.

59
(ii) Industrial disputes tend to reduce.

(iii) Productivity increases.

iv) Worker‘s morale and motivation improves.

Payment of Bonus Act (1965)-Features

Objective: Share profit earned by organization with employees. Applies to every factory or
establishing employing not less than 20 people. Employee drawing salary not beyond ₹
10,000, per month, who has worked for not less than 30 days in an accounting year is eligible
for bonus of minimum 8.33% of salary/wages and maximum of 20% of salary/wages.
Applicable to whole of India, where 10 or more workers are working

Calculation: includes Wages + DA.Paid in Cash within 8 month of closing of accounting

year..Payment Of Bonus (Amendment) Act, 2015

Amendment of Eligibility Limit

By amending Section 2(13) of the Principal Act, the Amendment Act has now widened the
scope of employees eligible for payment of bonus from those drawing salary of INR 10,000
per month, to INR 21,000 per month. The Principal Act provided that the bonus payable to
an employee shall be in proportion to his/her salary. However, where an employee's salary was
over INR 3,500 per month, for the purposes of calculating bonus, the salary was to be assumed
to be INR 3,500 per month. With a view to maximise bonus earnings, the Amendment Act has
increased the wage ceiling for calculation to INR 7,000 and has also factored in possibilities
where the minimum wage payable to such employees may be over INR 7,000, thereby giving
employees the flexibility to draw a higher amount as bonus.

Productivity:

Productivity describes various measures of the efficiency of production. Often, a productivity

measure is expressed as the ratio of an aggregate output to a single input or an aggregate
input used in a production process, i.e. output per unit of input, typically over a specific
period of time. One of the most widely used measures of productivity is Gross Domestic
Product (GDP) per hour worked. This measure captures the use of labour inputs better than
just output per employee.
Productivity in construction Industry:

Many terms are used to describe productivity in the construction industry:

 Performance factor,

 Production rate,

60
  Unit person-hour (p-h) rate and others.

Traditionally, productivity has been defined as the ratio of input/output, i.e., the ratio of the
input of an associated resource to real output (in creating economic value).To restate this
definition for use in the construction industry- Labour productivity is the physical progress
achieved per p-h, e.g., p-hs per linear metre of conduit laid

Factors affecting productivity of labor :

a) Internal Factors:
1. Working hours
2. Place of carrying out the job (office, factory ,….)
3. Tools
4. Technology
5. Machines
6 Feeling of interest
7. Motivation
8. Satisfaction (salary , insurance, ……)
9. Development and training
10. Career vision (upgrading , dedication ,….)

b) External factors
1-country rules and economic situation
2-traffic
3- family
4- distance between workplace and house
5-weather
6- culture
7- health care
8- population (may affect positive or negative )

The two most important measures of labour productivity are:

• the effectiveness with which labour is used in the construction process;

• the relative efficiency of labour doing what it is required to do at a given time and place.

Field rating

Field rating can be used to estimate crudely the level of activity of a construction operation.
The method simply categorizes the observed worker as either "working" or "nonworking"
and uses the "working" fraction as a measure of effectiveness. To collect a random sample,
an observer on site observes the workers. Once a sample has been collected, the field rating is
calculated as total observations in the "working" category divided by the total number of
observations, plus 10% to account for foreman and supervisory activity as follows:

61
Field rating = total observations of working/ total number of observations+ 10%
The number should be roughly over 60% for a job to be satisfactory.

Work sampling

Work sampling is based on statistical sampling theory and is a slightly more sophisticated
method than field rating. The basic objective is to observe an operation for a limited time and
from the observations infer how productive the operation is. Work sampling estimates the
percentage of time a labourer is productive relative to the total time the person is involved in
the operation.

To accomplish this, the following approach can be adopted:

1. Classify the worker's activity as one of three modes of activity: productive, semi-
productive (involved in supporting the main activity), and non-productive.
2.Develop a data collection form that will facilitate tallying the observations on site
3. Take random observations of workers involved in a given operation in the field. The
observation should indicate the workers' activity mode, i.e., productive, non-productive, or
semi-productive. Random, for all practical purposes, means without any bias as to who is
being observed and that each worker will have the same chance of being observed as any
other worker.
4. Record all observations on the form. Enter a checkmark under the appropriate mode of
activity observed.
5. Add up all the checkmarks under each mode and calculate the percentage of activity. In the
example (Figure 2.1 ), the 'percent productive' is calculated as 4/9 (= 45%), the 'percent non-
productive' is 3/9 (= 33%), and the balance of 22%, semi-productive.

Five-minute rating

The five-minute rating technique, unlike work sampling, is not based on statistical sampling
theory. The method relies on simply observing an operation for a short time. The observation
does not result in a large enough sample to support work sampling. The method does,
however, provide some insight as to the effectiveness of the crew and can identify areas
where more observation is required:

1. Identify the members of the crew to be observed and structure a form with the crew to be
observed noted in the column headings and the time of observation listed in the rows of the
first column.
2. Observe the crews as they are working. For the observation interval -equals 5 minutes,
determine whether the crew member has been active for over half the interval. If so, mark the
observation cell with an "x"; if not, leave the cell empty.
3. Add the "x" observations for the entire table and divide the sum by the total number of
observations. In the example of Table 2.3, 22 observations were positive out of a total of 32;
therefore, the effectiveness is 22/32 or 68%.

Total observations= 32 Effectiveness = 22/32 Observed effective = 22

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 5-Minute Rating = 68%

Field Surveys

The work sampling methods covered in Section 2.2 measure efficiencies in the site operation,
but do not go far enough in identifying the leading cause for the inefficiency. For example,
work sampling might indicate that a craftsman spent 25% of the time being delayed because
the required material was not available. The method cannot, however, pinpoint the real cause
of the delay or what can be done to reduce it. Field surveys and questionnaires are organized
ways of involving the foreman or craftsman in the site evaluation and productivity
improvement process. Craftsmen are probably the persons most familiar with their work
activity. They can easily identify sources of delay and obstacles in their progress. Likewise, a
foreman is the person most familiar with the crew and the problems that restrict improvement
in their productivity.

1 Foreman delay survey

Foreman Delay Survey (FDS) relies on a questionnaire which is to be filled out by the job
foreman at the end of a working day according to a particular survey schedule, e.g., one work
week in each month. The questionnaire is primarily meant to identify the number of hours of
a day lost due to delays. Most FDSs are divided into rework and delay categories. Once a
form has been filled out, the information is extracted in the form of percentages and action
taken to ensure that sources of delays are properly dealt with.

A typical FDS form is given below:

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The results of the survey are converted from p-hs into equivalent percentages and reported on
a form . The information on the report sheet will identify concerns that the foremen have
with the operation. The example reveals that too much time is being spent on redoing work
due to design error - 2.3% of the time - and waiting for construction equipment - 1.1% of the
time.
The FDS is a relatively low-cost method for analyzing the sources of delay during
construction. It can be easily stylized and implemented.

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Craftsman questionnaire :

Craftsman questionnaire (CQ) is a questionnaire-oriented technique attempting to address issues

and concerns that relate to a craftsman's productivity and motivation.
The basic idea is to distribute a simple questionnaire, to craftsmen on a job site to complete.
The aim is to identify major factors that inhibit the productivity of craftsmen and estimate the p-
hs lost per craftsman per week due to specific causes.

The questionnaire can comprise 50 short questions addressing such areas of concern as material
availability and site layout, equipment and tool availability, rework items and causes of rework,
management interference and inspection, and suggestions for improving the process.
In addition, the questionnaire asks for the hours lost per week per craftsman on each area of
concern listed. This is often supplemented with personal interviews with some of the craftsmen
to validate the responses and test the level of seriousness.

Employee relations and communications are some of the main factors that influence employee
satisfaction and engagement. Therefore, many companies today invest more resources to

43
improve employee relations and keep their workplaces healthy. The main goal of every
employee relations strategy is to improve relationships and collaboration in the workplace.

Employer- Employee Relation refer to the relationship shared among the employees in an
organization. It is an art which effectively monitors and manages the relation between
individuals either of the same team or from different teams.
―Employer and Employees‖ are the two wheels of the engine of the organization, a good and
healthy relationship between these two wheels will only take the organization forward.‖

Improves Productivity: Strong employment relations create a pleasant atmosphere within the
work environment; it increases the employee motivation and can also be increased through
improved employee morale.
Increase Employee Loyalty: Creating the productive and pleasant work environment has a
drastic effect on an employee‘s loyalty to the business, it encourages a loyal workforce. Having
such a workforce improves employee retention, in doing so the cost of recruitment, hiring and
training is cut drastically.
Reduces Conflicts: When a work environment is efficient and friendly the extent of conflict
within the workplace is reduced. Less conflict results in the employees being able to concentrate
on the tasks at hand and they are therefore more productive.
Increased Morale: One feels secure and confident and thus delivers his best. It is okay if you
share your secrets with your colleagues but you should know where to draw the line. A sense of
trust is important.
Easy Delegation: This also allows you and the employees to acknowledge and understand their
strengths and weaknesses.

Characteristics of Groups

44
Size: To form a group, it must be having at least two members. Practically, the number of group
members ranges from 15 to 20. The more the members in the group, the more complex it is to
manage.
Goals: Every group has certain goals, that are the reasons for its existence.
Norms: A group has certain rules, for interacting with the group members.
Structure: It has a structure, based on the roles and positions held by the members.
Roles: Every member of a group has certain roles and responsibilities, which are assigned, by
the group leader.
Interaction: The interaction between the group members can occur in several ways, i.e. face to
face, telephonic, in writing or in any other manner.
Collective Identity: A group is an aggregation of individuals, which are separately called as
members, and collectively called as a group.

A group climate is an emotional setting of the group, that relies on participative spirit,
coordination, trust and bonding among the members, open communication and other similar
factors.

Formal Groups:
Groups that are formed consciously by the management, with an aim of serving an
organizational objective

These are further classified as:

Self-directed teams: The group of employees which are so authorised to make decisions, on their
own, as it is independent and self-governing in nature.

45
Quality Circles: A number of employees classed together belonging to the same field, who meet
every week for an hour, to talk about their problems, identify the causes and find out solutions, to
take necessary steps in this regard.

Committees: An association of people created by the management for different matters to

identify and discuss the issues of the company and arrive at a conclusion. It can be:
-Standing Committee
-Advisory Committee
-Audit Committee
-Grievance Committee
-Adhoc Committee

Task force: It is a temporary committee, wherein people belonging to different fields are grouped
together for the performance of the task.

Communication:

It is a process of exchanging –
 Information
 Ideas
 Thoughts
 Feelings
 Emotions
 Through –
 Speech
 Signals
 Writing
 Behavior

Communication is a Latin word which means ‗to share‘. It is the sharing of information between
different individuals. It includes the sharing of ideas, concepts, imaginations, behaviours and
written content. Communication is simply defined as the transfer of information from one place
to another. This transfer of information can be conducted in different ways.

46
People communicate with each other in a number of ways that depend upon the message and its
context in which it is being sent.

Types of communication based on the communication channels used are –

 Verbal Communication
 Nonverbal Communication

Verbal

It refers to the form of communication in which message is transmitted verbally.

Communication is done by word of mouth and a piece of writing.
In verbal communication it should be - short and simple.

Verbal Communication is divided into:

 Oral Communication
 Written Communication

In oral communication, Spoken words are used.

It includes face-to-face conversations, speech, telephonic conversation, video, radio, television,
voice over internet. Communication is influenced by pitch, volume, speed and clarity of
speaking.

Advantages –
It brings quick feedback. In a face-to-face conversation, by reading facial expression and body
language one can guess whether he/she should trust what‘s being said or not.

Disadvantages –
In face-to-face discussion, user is unable to deeply think about what he is delivering, so this can
be counted as a fault.
In written communication, written signs or symbols are used to communicate.

47
In written communication message can be transmitted via email, letter, report, memo etc.
Written Communication is most common form of communication being used in business.

Advantages –
Messages can be edited and revised
Written communication provide record and backup. A written message enables receiver to fully
understand it and send appropriate feedback.

Disadvantages –
Written communication doesn‘t bring instant feedback. It take more time in composing a written
message as compared to word-of-mouth and number of people struggles for writing ability.
Nonverbal communication is the sending or receiving of wordless messages. Such
as gesture, body language, posture, tone of voice or facial expressions, is called nonverbal
communication.
Nonverbal communication is all about the body language of speaker.
Nonverbal communication have the following three elements –
Appearance of Speaker – clothing, hairstyle, neatness, use of cosmetics
Surrounding – room size, lighting, decorations, furnishings
Body Language- facial expressions, gestures, postures
Sounds- Voice Tone, Volume, Speech rate

Communication in construction industry

48
JOB EVALUATION:

Meaning:
Finding the financial value or worth of assigned task or work, by using this method a
company can easily fix the wages to their employees

Methods of job evaluation:

Ranking:
Throughout the organization, the relative worth of each job is measured and given a rank. Very
subjective method. Not good.

Grading method:
Classify the jobs according to categories like skilled, highly skilled, semiskilled etc. Not
a comprehensive method. However, it can be used along with other methods.

Point rating method:

This system uses internationally standardized manuals. The important factors of each
standard job and marks for them are furnished in the manual. In other words, the manual gives
the detailed breakdown factors of standard jobs and their marks. Against these data, the
employer should break down each job in his organization into important factors and design
marks or weight ages. The next step is to convert these marks into financial values.

Factor comparison method:

The manuals may not offer accurate weight age in the case in many jobs. Particularly
specialized organizations. Therefore, under this method, the employer develops indigenous
standards instead of relying on international manuals. Here the employer assembles a group of
experts who will choose the key jobs within the organization, break them into factors and assign
weight age- compare all other jobs against these key jobs, factor by factor and give relative
weight age. Then convert them into financial values.

Difficultlies with job evaulation:

 Heavy time and cost factors.

 Union problems.
 Job Evaluation methods should be constantly updated with
technology changes. However, this is rarely done.
 There are practical problems like difference of opinion between
experts in assigning weight age in the comparative norms, etc.
 Job Evaluation tends to curb creativity. It lads to inflexibility. People
stick to the job as done at present. It discourages exceptional
workers.
 The greatest defect OF Job Evaluation it has no way of measuring
actual performance on the job.

49
Merits of job evaluation:

 It is the only logical and systematic way of doing wage and salary administration.
 An exercise is job evaluation stabilizes internal norms and standards. Otherwise, there
would be chaos in measuring what each job is expected to do.
 It removes wage inequalities because it links the job worth to the wages.
 It ensures proper wage cadres and classifications – also wage differentials.
 Jobs are properly classified as unskilled, semiskilled, etc.
 Helpful for recruitment.
 For promotions.
 For job rotation and training.
 It is the basis for resolving job anomalies, wage anomalies (high job paid low, low job
paid high) and such other complaints.
 It forms the basis for any collective bargaining or union management negotiations.

How to proceed with job evaluation? Steps in job evaluation.

 Clear objectives
 Publicize the job evaluation scheme proposals and gain acceptance of all parties.
 Choose the key jobs carefully.
 Adopt a proper technique of job evaluation.
 Develop proper norms and standards for comparison.
 Constitute a proper term to carryout job evaluation-HR representative, technical reps,
industrial engineering. Reps, and workers reps.
 Review the job evaluation periodically and make corrections.

Whether job evaluation alone can fix wages? Or factors other than job evaluation which
influences wages:

 Capacity of the unit to pay.

 Prevailing wages rates in competitor‘s units.
 Demand and supply factors.
 Ability of the employees to bargain.
 Cost of living.
 Employee‘s job experience(sometimes you have to pay more than the job evaluation rates
to get an experienced person)
 Employee‘s actual performance on the job.
 Legal factors. (Like min. wages act, PF, gratuity, leave benefits, medical benefits, etc.)
 Social factors (like the employer has to pay enough salary for the minimum subsistence
of the workmen‘s family)—normally this is bound to be more than the job evaluation
rates.

50
Wage agreement:

Most organization have periodic agreements between unions and management (say once
in 4 to 5 years) to revise wages and salaries of all the HR in the organization (collective
bargaining notes).

Incentive schemes:

i. Simple piece rate.

ii. Taylor‘s differential piece rate scheme.
iii. Halsey
iv. Rowan
v. Budeaux multiple piece rate
vi. Merricks
vii. Gantts task/bonus plan.
viii. Group incentive scheme.

Motivation is the process that initiates, guides, and maintains goal-oriented behaviors. It is what
causes you to act, whether it is getting a glass of water to reduce thirst or reading a book to gain
knowledge.
Motivation
The processes that account for an individual‘s intensity, direction, and persistence of effort
toward attaining a goal.
Motivation involves the biological, emotional, social, and cognitive forces that activate behavior.
Motivation is an internal process.
Whether we define it as a drive or a need, motivation is a condition inside us that desires a
change, either in the self or the environment
MOTIVATION METHODS

Empowerment
Giving employees more responsibility and decision-making authority increases their realm of
control over the tasks for which they are held responsible and better equips them to carry out
those tasks.

Creativity and Innovation

The power to create motivates employees and benefits the organization in having
a more flexible work force, using more wisely the experience of its employees, and
increasing the exchange of ideas and information among employees and departments

Learning
Companies can motivate employees to achieve more by committing to perpetual enhancement of
employee skills. Accreditation and licensing programs for employees are an increasingly popular
and effective way to bring about growth in employee knowledge and motivation.

51
Quality of life

Programs incorporating flex-time, condensed workweeks, or job sharing, for example, have been
successful in focusing overwhelmed employees toward the work to be done and away from the
demands of their private lives.

Monetary Incentive

The sharing of a company's profits gives incentive to employees to produce a quality product,
perform a quality service, or improve the quality of a process within the company.

What benefits the company directly benefits the employee.

Motivation

Types of Motivation

Different types of motivation are frequently described as being extrinsic or intrinsic:

Extrinsic motivations are those that arise from outside of the individual and often involve
rewards such as trophies, money, social recognition, or praise.
Intrinsic motivations are those that arise from within the individual, such as doing a complicated
crossword puzzle purely for the personal gratification of solving a problem

ABRAHAM MASLOW--Theory of Human Motivation

INTRODUCTION:

The basis of Maslow's theory is that human beings are motivated by unsatisfied needs, and that
certain lower needs need to be satisfied before higher needs can be satisfied.

According to Maslow, there are general types of needs (physiological, safety, love, and esteem)
that must be satisfied before a person can act unselfishly. He called these needs "deficiency
needs.

" As long as we are motivated to satisfy these cravings, we are moving towards growth, toward
self-actualization. Satisfying needs is healthy, while preventing gratification makes us sick or act
evilly.

Maslow’s Need Hierarchy

Maslow‘s theory assumes that a person attempts to satisfy the more basic needs before directing
behavior toward satisfying upper-level needs.

52
Lower-order needs must be satisfied before a higher-order need begins to control a person‘s
behavior.

A satisfied need ceases to motivate.

Physiological needs are those required to sustain life, such as:

 Air
 Water
 Food
 Sleep

Once physiological needs are met, one's attention turns to safety and security in order to be free
from the threat of physical and emotional harm. Such needs might be fulfilled by:
Living in a safe area
Medical insurance
Job security
Financial reserves

Once a person has met the lower level physiological and safety needs, higher level needs
awaken. The first level of higher level needs are social needs.

53
Social needs are those related to interaction with others and may include:
Friendship
Belonging to a group
Giving and receiving love

Once a person feels a sense of "belonging", the need to feel important arises. Esteem needs may
be classified as internal or external.
Internal esteem needs are those related to self-esteem such as self respect and achievement
External esteem needs are those such as social status and recognition. Some esteem needs are:
 Self-respect
 Achievement
 Attention
 Recognition
 Reputation

Self-actualization is the summit of Maslow's hierarchy of needs. It is the quest of reaching one's
full potential as a person. Self-actualized people tend to have needs such as:
 Truth
 Justice
 Wisdom
 Meaning

54
 SCHOOL OF BUILDING AND ENVIRONMENT
DEPARTMENT OF ARCHITECTURE

UNIT – I – Human Resources and Materials Management – SAR5201

1
HUMAN RESOURCE DEVELOPMENT
Introduction
HRM is the most happening function as of now. This is so because people offer competitive
advantage to a firm and managing people is the domain of HRM. An organization enjoys
competitive advantage when it is the only one which can offer a product at a price and at
quality while its competitor‟s cannot do so.
How do people lend competitive advantage? There are several ways. First, people offer skills,
capabilities, systems, practices, speed, language, bonding and behaviours, which help execute
firm‟s strategies successfully. Strategy implementation cannot be done by physical resources
such as technology, buildings, machines and materials. It is the people who can craft
strategies and execute them effectively.
Secondly, by aligning HR plans to business plan, HR managers are becoming strategic
partners. HR professionals work with line managers to identify HR practices that help
accomplish business strategy. The outcome of identifying HR planning with business
planning is a frame work for integrating HR practices into business decisions to ensure
results. On integration line managers and HR professionals work as partners to ensure that an
integrated HR planning process occurs.
Third, innovation is the key to competitive advantage. Fortunes of several companies have
been revised thanks to innovation. Fourth, HR function seeks to convert an adverse situation
into an opportunity. HR often gets trapped in a policy role, mediating employee grievances,
monitoring compliance with employment laws and enforcing codes of conduct. What is more,
the function often has seen its mission as one of helping workers over-come deficiencies and
obstacles that hinder their performances. Without ignoring these tasks, the new HR
concentrates on the positive. How firms can enhances its revenue by doing more for its
employees? Instead of trying to „fix‟ a chronic employee weakness, how can the firm tailor a
role that matches and capitalizes on strengths? For instance, after performance review rather
than dwell on a talented marketing executive‟s creative talents in a broader marketing role –
one that helps the company expand in key overseas markets.
Fifth, organizational designs do not remain static over a period of time. Environmental
changes compel organizations redesign their structures. Along with changes in designs,
organizations adopt uncertainty avoidance mechanisms, differentiation mechanisms and
integrating mechanisms to cope with the compulsions of environmental changes. These
changes in organizational designs need to be reinforced by innovative HRM strategies.
Finally, HR executive is becoming an effective change agent. Change management is critical
to the success of any firm and marks a difference between winners and losers. While winners
anticipate and prepare themselves to adapt and assimilate the change, losers are overtaken by
events, ruminate over the events and are left behind. Business adopts three general response
types to face change: initiatives, processes, and cultural adaptations.

HUMAN RESOURCE :

2
Behind production of every product or service there is an human mind, effort and man hours
(working hours).
No product or service can be produced without help of human being.
Human being is fundamental resource for making or construction of anything.
Every organisation desire is to have skilled and competent people to make their organisation
competent and best.
Among the five Ms of management-
men,
money,
machines,
materials
methods
HRM deals about the first M, which is men.
It is believed that in the five Ms, "men" is not so easy to manage. "every man is different
from other"
Why do we call it as Human Resource Management?
Human: refers to the skilled workforce in an organization.
Resource: refers to limited availability or scarce.
Management: refers how to optimize and make best use of such limited or scarce resource
so as to meet the organization goals and objectives.
You must treat your employees with respect and dignity because in the most automated
factory in the world, you need the power of human mind. That is what brings in innovation. If
you want high quality minds to work for you, then you must protect the respect and dignity. "
---Mr N.R. Narayana Murthy, Chairman Emeritus, Infosys Ltd
.
“Our progress as a nation can be no swifter than our progress in education. The human mind
is our fundamental resource.”
- John F. Kennedy (35th President of the United States).

Meaning
HRM refers to the application of management principles to management of people in an
organization. In order words, HRM consists of people-related functions as hiring, training
and development, performance review, compensation, safety and health, welfare, industrial
relations and the like. These are typically the functions of „personnel Management‟ and are

3
administrative and supportive in nature. Appropriately called „doables‟, these activities are
highly reutilized and have been often outsourced.
Definition
According to Prof. Edwin Flippo, HRM is the process of planning, organizing, controlling
and directing of the procurement, development, compensation, maintenance, integration and
separation of the HR to the end that organizational individual and social objectives are
accomplished.
The National Institute of Personal Management (NIPM) of India has defined human
resources – personal management as “that part of management which is concerned with
people at work and with their relationship within an enterprise. Its aim is to bring together
and develop into an effective organization of the men and women who make up enterprise
and having regard for the well – being of the individuals and of working groups, to enable
them to make their best contribution to its success”.
According to Decenzo and Robbins,
“Human Resource Management is concerned with the people dimension” in management.
Since every organization is made up of people, acquiring their services, developing their
skills, motivating them to higher levels of performance and ensuring that they continue to
maintain their commitment to the organization is essential to achieve organsational
objectives. This is true, regardless of the type of organization – government, business,
education, health or social action”.
Pigors and Myers –
“It is basically a method of developing potentialities of employees so that they feel
maximum satisfaction of their work and give their best efforts to the organization”.
Ivancevich and Glueck –
“Human resource management is the function performed in organizations‟ that facilitate the
most effective use of people (employees) to achieve organizational and individual goals”.
EVOLUTION OF HRM:
Robert Owen , an industrialist was regarded as creator and originator for introducing reforms
for workers in his own Lanark cotton mills. Initially he structured 10 hrs work / day
He created a principle of 8 hours day work, 8 hours recreation and 8 hours rest. Owen
identified the importance of better working conditions at workplace and its impact on the
productivity and efficiency of the workers. Owen after implementation of better working
conditions at workplace, he observed change in the productivity of his workers as their
efficiency increased.
He in those olden days implemented many social and welfare practices for his workers and
saw his workers got happy, motivated and worked better. Therefore he was referred as father
of Personnel management.

4
Nature of HRM
1. HRM necessitates alignment of HR policies and practices with the organisation‟s
strategies – both corporate as well as functional. By meshing HR practices and policies with
the strategies, the HR executive helps formulate and implement business strategies.
2. As stated above, HRM involves the application of management principles and functions to
doables and deliverables of people management.
3. HRM assumes that it is the people who make the difference. They alone are capable of
generating value and adding to the competitive advantage to organizations.
4. HR activities, both doables and deliverables, are not the sole responsibility of the HR
specialists. Line managers are equally responsible for carrying out the activities
5. HR functions are not confined to business establishments only. They are applicable to non-
business organizations too, such as education, health care, recreation and the like.
Objectives of HRM
The primary objective of HRM is to ensure that availability of a competent and willing work
force to an organization. Beyond this, there are other objectives, too. Specifically, HRM
objectives are four fold-societal, organizational, functional and personal.
1. Societal Objectives:

To be ethically and socially responsible to the needs and challenges of the society while
minimizing the negative impact of such demands upon the organization. The failure of
organizations to use their resources for the society‟s benefit in ethical ways may lead to
restrictions.
2. Organisational Objectives:

To recognize the role of HRM in bringing about organizational effectiveness. HRM is not an
end in itself. It is only a means to assist the organization with its primary objectives. Simply
stated, the department exists to serve the rest of the organization.
3. Functional Objectives:

To maintain the department‟s contribution at a level appropriate to the organization‟s needs.

Resources are wasted when HRM is either more or less sophisticated to suit the
organization‟s demands. The department‟s level of service is must be tailored to fit the
organization it serves.
4. Personal Objectives:

To assist employees in achieving their personal goals, at least insofar as these goals enhance
the indiviudal‟s contribution to the organization. Personal objectives of employees must be
met if workers are to be maintained, retained and motivated. Otherwise, employee
performance and satisfaction may decline and employee may leave the organization.

5
Functions of HRM
HRM objectives Supportive
functions
1. Societal Objectives 1. Legal
Compliance
2. Benefits
3. Union-
management relations
2. Organizational Objectives 1. Human
resource planning
2. employee
relations
3. selection
4. training and
development
5. appraisal
6. placement
7. assessment
3. Functional Objectives 1. Appraisal
2. Placement
3. Assessment
4. Personal Objectives 1. Training
and development
2. Appraisal
3. Placement
4.
Compensation
5. Assessment

6
General Functions of HR
Planning:
Preparing forecasts of future HR needs in the light of an organization‟s environment, mission
and objectives, strategies, and internal strengths and weaknesses, including its structure,
culture, technology and leadership.
Staffing:
Obtaining people with the appropriate skills, abilities, knowledge and experience to fill jobs
in the work organization. Key practices are human resource planning, job analysis,
recruitment and selection.
Developing:
Analyzing learning requirements to ensure that employees possess the knowledge and skills
to perform satisfactorily in their jobs or to advance in the organization. Performance appraisal
can identify employee‟s key skills and „competencies‟.
Monitoring:
The design and administration of reward systems. HR practices include job evaluation,
performance appraisal, pay and benefits.
Maintaining:
The administration and monitoring of workplace safety, health and welfare policies to retain a
competent workforce and comply with statutory standards and regulations.
Managing relationships:
Encompasses a range of employee involvement/participation schemes in non-union or union
work place. In a union environment this includes negotiating contracts and administering the
collective agreement.
Managing change:
This involves helping others to envision the future, communicating this vision, setting clear
expectations for performance and developing the capacity to reorganize people and reallocate
other resources.
Evaluating:
Designing the procedures and processes that measure, evaluate and communicate the value-
added component of HR practices and the entire HR system to the organization.

7
The ten "Cs" of human resources management are:
• cost effectiveness

• competitive

• coherence

• credibility

• communication

• creativity

• competitive advantage

• competence

• Change

• commitment.

The ten "Cs" framework was developed by Alan Price in his book "Human Resource
Management in a Business Context".
Primary responsibilities of the Human resource manager:
• To develop a thorough knowledge of corporate culture, plans and policies.

• To act as an internal change agent and consultant.

• To initiate change and act as an expert and facilitator.

• To actively involve himself in company‟s strategy formulation.

• To keep communication lines open between the HRD function and individuals and groups
both within and outside the organisation.
• To identify and evolve HRD strategies in consonance with overall business strategy.

• To facilitate the development of various organisational teams and their working relationship
with other teams and individuals.
• To try and relate people and work so that the organisation objectives are achieved effectively
and efficiently.
• To diagnose problems and to determine appropriate solution particularly in the human
resources areas.
• To provide co-ordination and support services for the delivery of HRD programmes and
services.
• To evaluate the impact of an HRD intervention or to conduct research so as to identify,
develop or test how HRD in general has improved individual or organisational performance.

8
Role of HR Manager:
1. Personal Role:
• Advising

• Training and development

• Manpower planning, selection, recruitment, etc

• Measurement and assessment of individual and organizational behaviour

2. Welfare and Counselor Role

• Maintenance of services

• Group dynamics, group behaviour, motivation and leadership

• Research of personal and organizational problems

3. Administrative Role
• Salary and wage

• Maintenance of records

• Human engineering and Man-machine relations

• Effective utilization of HR

4. Fire fighting and legal Role

• Grievance handling

• Settlement of dispute

• Handling discipline and legal matters

• Joint consulataion

Functional areas of HRM

1.Organizational planning, development and task specialization
2.Staffing and employment
3. Training and development

4. Compensation, wage and salary administratio

5.Employees services and benefits

6.Employees services and benefits
7.Employees record
8.Labour and industrial relations and
9.Personnel research and personnel audit

9
Qualities of Good HR Manager
Some desirable personality traits of an effective HR manager are as under;
1. Insight in Human Nature
He must be able to understand various kinds of people and to get along with them at all
levels. He should possess immense tact, practical mind, amiable disposition and sober
temperament. He should be trained in behavioural sciences. The three disciplines comprising
the core of behavioural science are anthropology, psychology and sociology.
2. Freedom from bias
He should be neither pro-management nor pro-labour. He should be pro-profession and
should judge and advise on issues without fear or favour on the merits of the matter under
consideration. He should be known for his honesty, integrity, strength of characteristic
balance, justice and fair play.
3. Passion for Anonymity
He should be a credit-passer and not a credit-grabber. Since the personnel manager mostly
plays a staff role, he can achieve his results only through line managers. These calls for a
willingness to let credit for success go to them. He is best when people barely know that he
exists.
4. Communication skill
A HR manager has not only to „sell‟ his ideas to line people above him but alos he is required
to address several oral and written communications to people below him. The two groups
which are different in culture, status, education and knowledge differ in their communication
requirements also. Workers with poor education may not understand literary expressions of
difficult language. They will prefer communication in their own colloquial language.
Therefore, a HR manager must possess linguistic facility.
5. Leadership and organizational skills
A HR manager must also be a good leader and good organizer to be able to motivate the
workers. He must possess emotional stability, adaptability and decisiveness.

Future role of HR Manager:

Future role of a HR manager will undergo dramatic changes as described below. He would
end up getting marginalized if he does not change his old tools of the trade.
• Greater involvement in development planning

• Change in manpower planning and personnel policie

10
• Retaining of workers

• Greater emphasis on quality of work life

• Greater emphasis on productivity

• Greater attention to the human problem of adjustment to new work ethics

• Better performance appraisal devices

• Cultural change

• Check on rising money wages

• New quality standards

Future HR Manager
From the several changes sweeping through the corporate world, one can expect that the
future role of a HR manager will undergo dramatic changes as described below. He would
end up getting marginalized if he does not change his old tools of the trade.
1.Greater involvement in development planning
2.Change in manpower planning and personnel policies
3.Retaining of workers
4.Greater emphasis on quality of work life
5.Greater emphasis on productivity
6.Greater attention to the human problem of adjustment to new work ethics
7.Better performance appraisal devices
8. Cultural change

9. Check on rising money wages

10.New quality standards

Personnel management is a little old and a more traditional way of handling employees at a
workplace. Personnel management is the seed and root for Human resources management.
HRM is a more modern and a more specific approach to managing human resources in an
organization
Difference between personal management and HR management
Personal management
1. It is a routine maintenance oriented administration function

11
2. Personal management is mainly reactive and response to the demand of an organization
wherever they arise.
3. Personal takes a narrow of its scope and objectives concentrate mainly on improving
efficiency of the personal, without emphasing the relevant of efficiency in the organizational
context.
4. Clear rule and procedure.

5.Monitoring
6.Corporate plan is marginal
7.Speed of decision is slow.
8.Standardization is high
9.Pay is based on job evaluation.
10.Division of labour.
11.Labour management focus of collective bargaining.
12.Indirect communication.
13.Transactional leadership
14.Labour is treated as a tool.
15. Interests of organization are uppermost.

HRM place emphasis on the continuous development of people at work place. HRM is
proactive function concern with future needs and act accordingly.HRM undertakes system
view in which attempt is made and only to make people efficient but, to create organizational
cultural to utilize the efficiency.

 Business needs.
 Nurturing.
 Corporate plan is central.
 Speed of decision is high.
 Standardization is low.
 Pay is based on job performance
 Division of work is a team work.
 Labour management focus on individual control.
 Direct communication.
 Transformational leadership.
 People are treated as assets.
 Mutuality of interest.

12
Personnel management.
- Employees were not given high priority in decision making process
- weren't much allowed to interact with management.
- Personal manager was to see that everything was in compliance with the labour laws
or not but not much emphasis made on the morale of employees.
- Employees were just treated as tools, obligation to the organisation but not as the
asset of the organisation,
- they were seen as cost & expenditure to company rather than capital and investment.
- Personnel officers mostly used be disciplinary oriented instead of flexible and
interactive with employees.
- Nurturing of employees was not priority by the personnel managers
- employees perspective was ignored which means personnel managers rather than
understanding situation they used to be punitive if any error was committed by
employee.
Human resource management
• employees are seen from the perspective as a most valuable resources for the organisation

• they consider their employees as assets and capital for their organisation.

• Motivating employees is a basic feature of human resource management in contrast with

personal management.
• Main principle of the Human resource management is to see what should be given to an
employee for extracting the desired work.
• HR Managers always encourage participation of employees in decision making and their
suggestions are most valued.
• Flexibility in work, welfare and Work life balance to employees is high priority for Hr
managers and they show much more concern towards employee issues.
• Adoption of new policies and optimisation methods by the Hr manager are well encouraged
and swift.
• The finest difference between Personnel management and Human resource management is
integration and augmentation of Information Technologies in the human resources
management process and functions for enhanced productivity and time savings as time is
money.

13
Types of Groups
From an organizational point of view, there are basically two types of groups. These are
formal groups and informal groups.
A group is formal when it is purposely designed to accomplish an organizational objective or
task. It is created via formal authority for some defined purpose.
A formal group can be a command group or a functional group that is relatively permanent is
composed of managers and their subordinates who meet regularly to discuss general and
specific ideas to improve product or service.
The formal groups usually work under a single supervisor, even though the structure of these
groups may vary.
Informal Groups
Whereas formal groups are established by organizations to achieve some specific objectives,
informal groups are formed by the members of such groups by themselves. They emerge
naturally, in response to the common interests of organizational members. They are formed
spontaneously, without any formal designation, and with common interests such as self-
defense, work assistance, and social interaction. They exist outside the formal authority
system and without any set rigid rules. Though officially unrecognized, they exist in the
shadow of the formal structure as a network of personal and social relations that must be
understood and respected by the management. They exist outside the formal authority system
and without any set rigid rules. Though officially unrecognized, they exist in the shadow of
the formal structure as a network of personal and social relations that must be understood and
respected by the management.
Informal work groups are based upon socio-psychological support and reasoning and depend
upon the member‟s interaction, communication, personal likings, and dislikings and social
contacts within as well as outside the organization. Informal groups may have their own
leaders and followers, group goals, social roles, and working patterns.
The leadership of the informal groups develops from within rather than a formal election.
An individual, who is working in a group for a long time and has a good rapport with other
members, may emerge as a leader due to his technical expertise and his seniority.For any
problem within the group, either technical or social, the members would go to this leader
rather than the formally assigned supervisor.
Some Other Aspects of Informal Groups are as follows:
Group Norms
Groups Roles
Group Goals
Leadership
Group Cohesiveness..

14
SCHOOL OF BUILDING AND ENVIRONMENT

DEPARTMENT OF ARCHITECTURE

1
 MATERIAL MANAGEMENT

“Material management is the planning, directing, controlling and co-ordination of all those
activities concerned with material and inventory requirements, from the point of their inception
to their introduction into manufacturing process.” - L.J. De Rose

“Material management is the integrated functioning of the various sections of an organization

dealing with the supply of materials and allied activities in order to achieve maximum co-
ordination.” - N.K. Nair

Definition :

Material management is defined as planning, identification, procuring, storage, receiving and

distribution of materials. The purpose of material management is to assure that the right
materials are in the right place, in the right quantise when needed. It is the responsibility of
material management department for the flow of materials from the time the materials are
ordered, received, and stored until they are used in the basis of material management.

AIM OF MATERIAL MANAGEMENT

1. The Right quality

2. Right quantity of supplies

3. At the Right time

2
 4. At the Right place

5. For the Right cost

PURPOSE OF MATERIAL MANAGEMENT

 To gain economy in purchasing

 To satisfy the demand during period of replenishment
 To carry reserve stock to avoid stock out
 To stabilize fluctuations in consumption
 To provide reasonable level of client services
 Objectives and Functions of Materials Management
Primary objectives can be classified as:
 Efficient materials planning
 Buying or Purchasing
 Procuring and receiving
 Storing and inventory control
 Supply and distribution of materials
 Quality assurance
 Secondary Objectives of Materials Management :
Efficient production scheduling
 Prepare specifications and standization of materials
 To assist in product design and development
 Forecasting demand and quantity of materials requirements
 Quality control of materials purchased
 Material handling
 Use of value analysis and value engineering
 Developing skills of workers in materials management
 Smooth flow of materials in and out of the organization

Components of Material Management:

 Material estimation, budgeting, planning and programming.

3
  Scheduling , purchasing and procurement
 Receiving and inspection.
 Inventory control, storage and warehousing
 Material handling and transport
 Waste management
 Process of Construction Material Management

Material Planning

Materials planning include measuring, ordering and scheduling. It is emphasized that planning is
a very important process to increase the productivity, profit, and assisting the time to complete
the construction projects.

The productivity of the construction project will be hanged if the material planning process is not
implemented properly.

The most commonly used basis for planning things out for the project is the BOQ prepared by
the client.

Companies may have two major levels in planning- micro and macro level.

Time, cost, material and labour are the four major types of planning undertaken on sites.

The planning should be revised as frequently as possible in order to monitor whether work is
progressing as planned.

2. Purchasing

For examples, a detailed material list and co-ordination of the purchasing and order of material
are significant to assuring the material will available on construction site.

Step 1 – Material Indent

Step 2 – Enquiry to Vendors

Step 3 – Vendor Comparison

Step 4 – Vendor Selection and Negotiations

Step 5 – Purchase Order

Step 6 – Vendor Evaluation

4
3.Inventory control department:

The duties of the inventory control department is to decide about the types of ordering
system, fixing the safety stock limits, fixing up the reorder level & maximum / minimum stock
level.

4.Receiving, inspection and despatching department

The responsibility of Receiving, inspection and despatching department is to receive the

materials when delivered by the suppliers. After receiving it, the quantity and quality must be
checked. Production parts and materials are checked against blueprints and specifications. Non-
production items are also reviewed. When once it is as per the specifications given, the goods
will be accepted.

Receiving

The receipt system can be divided into:

1. Receipt from outside suppliers

2.Receipts from internal divisions.

System of receipt starts even before the material reaches the site.

The three documents that should be dispatched are copy of purchase order, supplier‟s advice
document and the consignment note. This enables the Stores manager to organize and plan for
clearances of materials.

For receipt from internal divisions, usually transfer notes and return to stores documents are
used. Inspection can happen in two ways

Pre- dispatch inspection

Inspection on site

It is the responsibility of the inspector to inspect all materials

delivered to the site prior to their being used in the work.

It is desirable to perform inspection of materials or fabricated products prior to their delivery at

site. E.g.: precast members.

The inspector shall have rights to reject faulty material and have it removed from site.With
respect to manufactured goods, the quality requirements should be specified in the purchase
order.

Methods of Inspection.

5
There are three methods of inspection:

-Visual

-Tactile

-Statistical

Storing and Stacking

Types of physical storage system on site vary according to the space availability and company
practices. Industrial guidelines are also taken into consideration for the stacking and storage of
particular materials. Materials are most often classified as per the comfort level of working of
the workers. Basic categories followed are civil, electrical, plumbing, finishes, construction
chemicals, miscellaneous.

The materials are also often stacked as per the specification of the vendor or manufacturer.

Relevant IS Codes (IS: 4082: recommendations on stacking and storage of construction

materials at site) specifications are also followed. E.g. : As per IS : 4082,

The materials should not be affected by impurities or atmospheric agencies.

Materials like cement must be stored in covered sheds and stacked on timber raised platforms.

Reinforcing bars should be stacked yards away from moisture to prevent rusting and also away
from oil and lubricants. Bars of different classification, sizes and lengths should be stored
separately to facilitate issues.

 Issue of material
 Issues can be divided into

6
  Issues to consuming departments

2. Issues to outside suppliers for processing or conversion.

 Issuing on site does not happen in the case of all construction materials.
 In the case of sand or aggregate, the materials are consumed as and when required
corresponding to the progress of the project.
 For other materials, issues are based on production programmes.

Based on this and the bill of materials, work orders are printed, listing for each material,
quantity to be issued against each component requiring that material. This automatically controls
consumption.

5. The Value Analysis and Standardization

The Value Analysis and Standardization offer greatest scope, in reducing the materials cost. It
also reduce the number of varieties and also helps in finding the substitute for the materials at
lesser cost. Value engineering identifies the areas of excessive or unnecessary expenses and
attempts to improve the value of the product.

6. Logistics

Logistics is a concept that stresses movement of the materials and it involve planning,
implementing, and controlling the movement and storage of all things from raw materials to the
finished the product to meet client requirements. During construction project, routing of the
materials will affect the cost and time to complete the construction projects.

7. Disposal of Scrap and Surplus, Material Preservation

Stock control can categorize as a technique planned to be the cover and to ensure all materials or
equipment are available when needed.

Stock control include raw materials, processed materials, assembly components, consumable
stores, general stores, maintenance materials and spares, work in progress and finished products.

At the same time, construction activities will generate big amount of the waste and it will cause
difficulty to the construction industry.

However, with the planning of the material management which is effective will help to reduce
the waste of material and increase the profit of the companies.

Importance of Materials Management

7
  Lower prices for material and equipment.
 Faster inventory turnover.
 Continuity of supply
 Reduced lead time
 Reduced transportation cost.
 Less duplication of efforts.
 Elimination of bulk- passing.
 Reduced materials obsolescence.
 Improved supplier relationship and better records and information.
 Better inter-department cooperation & Personnel development

Advantages of Materials Management

 The better accountability part of the material, as well as other departments and no one can
blame others.
 As materials management by a single authority, which can lead to better coordination,
because it became the central point of any substance-related problems.
 Materials management departments to ensure a better quality materials provide a request
in a timely fashion department. This can lead to a better performance of the organization.

CODING AND CLASSIFICATION OF MATERIALS

Classification and codification:

The storekeeper keeps the material in the store.

The duties of storekeeper include accepting, identifying, classifying, and placing of materials.

Classification and codification of materials is necessary for keeping the material in store.

All items in the stores department are properly classified and codified to prevent mixing of one
type of materials with the other and minimise the cost of retrieval.

Materials are classified according to nature in appropriate categories,

e.g., Materials related with engineering are classified as bronze, copper, steel, and mild steel etc.,
and each category is further classified suitably.

To save time in handling of materials, a written document known as material manual, is prepared
in which description and code number to each store item is given.

8
Efficient storage requires the consideration of the following :

Checking of material

He should verify the materials received with consignment note, inspection report and materials
received report.

He should send the copy of materials received report received by him, after due verification to
the Accounts Department for payment purposes.

Following are the methods of coding of materials:

Alphabetical method

Numerical method

Alphabetical-cum-Numerical method

Alphabetical method

In this method first alphabet letters are used for codification of each category of materials.

For example, steel wire is coded as SW or steam coal is coded as SC etc.

Numerical method:

This method is used where materials accounting is to be mechanised by use of punched cards or
computers.

For numerical coding a list is prepared for various departments and allotting to each of them a
suitable number.

The first two digits of the code number represent the department for which the materials are
meant and other two digits state the name of material as mentioned in the standard list or
materials manual. For example, if code is

2341 it means Material No.41 [copper wire] is to be used in Department No.23.

Alphabetical-cum-Numerical method

In this method, a combination of these two methods is used for coding of materials.

For example, a steel wire of gauge 4mm quality A stored in rack/ bin No.22, is given the code
number SW4A/22.

Such a method gives exact information than any of the above two methods.

9
Codification of materials helps in two ways:

In absence of coding the title of an account may have to be written a number of times. This
results in unavoidable clerical work, particularly in case of lengthy account titles. Secrecy about
the exact nature of the transaction from the office employees is maintained.

Procurement System

Objectives of procurement system

 Acquire needed supplies as inexpensively as possible

 Obtain high quality supplies
 Assure prompt & dependable delivery
 Distribute the procurement workload to avoid period of idleness & overwork
 Optimize inventory management through scientific procurement procedures

Inventory control
It means stocking adequate number and kind of stores, so that the materials are available
whenever required and wherever required.

Scientific inventory control results in optimal balance.

Functions of inventory control

 To provide maximum supply service, consistent with maximum efficiency & optimum
investment.
 To provide cushion between forecasted & actual demand for a material
 Inventory Control for Quantitative Analysis

Definition:

Inventory control can be defined as, “which ensures the supply of required quantity and quality
of inventory at the required time and at the same time prevent unnecessary investment in
inventories”

Objectives of Inventory Control

 To ensure that the supply of raw material & finished goods will remain continuous so that
production process is not halted and demands of customers are duly met.
 To minimise carrying cost of inventory.
 To keep investment in inventory at optimum level.
 To reduce the losses of theft, obsolescence & wastage etc.

10
  To make arrangement for sale of slow moving items.
 To minimise inventory ordering cost.

Re-order level

It is the point at which if material in store is reached, the order of further supply of material must
be placed. This point is fixed between maximum level and minimum level. This point
automatically initiates the process of placing a fresh order.

11
Average stock level

This level indicates the average stock held by the firm. It is calculated with the help of following

Basic Inventory Models (Economic Order

Quantity / EOQ Models)

Economic Order Quantity (EOQ) models are the most basic models of inventory management.

The approach in EOQ models is essentially to trade-off various relevant costs and derive an
order quantity and time for placing an order such, that the total costs are minimized.

Economic order quantity

The economic order quantity (EOQ) is the size of the purchase order which gives maximum
economy in purchasing material. It is also termed as standard order quantity.

It is fixed after taking into consideration the following points:

- Ordering cost

- Carrying cost

EOQ =

Where,

A = Annual consumption

B = Buying / Ordering cost per order

C = Carrying cost per unit per annum

12
EOQ = Economic order Quantity

Ordering cost

Cost of placing a order refers to the cost incurred for acquiring materials. It depends upon
number of orders placed and the number of items ordered.

If the order size is larger in quantity, orders placing cost per unit is lower and if order size is
smaller in quantity, order placing cost per unit is higher: It includes cost of preparing and
placing an order, cost of transportation, cost of receiving and inspecting the materials.

Carrying cost

It is the cost that is incurred in maintaining a given level of stock. It includes cost of handling
materials, insurance premium, cost of storage space, obsolescence losses etc., larger size of
stock, higher the stock carrying cost per unit per annum and vice versa

EOQ = Average Monthly Consumption X Lead Time [in months] + Buffer Stock – Stock on
hand

1.ABC Analysis

The ABC (Always Better Control) inventory control technique is based on the principle that a
small portion of the items may typically represent the bulk of money value of the total inventory
in construction process, while a relatively large number of items may form a small part of the
money value of stores. The money value is ascertained by multiplying the quantity of material of
each item by its unit price.

The ABC Analysis is a business term used to define an inventory categorization technique
often used in material management. It is also known as Selective Inventory Control.

Policies based on ABC analysis:

A ITEMS: very tight control and accurate records.

13
B ITEMS: less tightly controlled and good records.

C ITEMS: simplest controls possible and minimal records.

„A‟ items – 20% of the items accounts for 70% of the annual consumption value of the items.

„B‟ items - 30% of the items accounts for 25% of the annual consumption value of the items.

„C‟ items - 50% of the items accounts for 5% of the annual consumption value of the items.

Procedure for ABC Analysis

Make the list of all items of inventory.

Determine the annual volume of usage & money value of each item.

Multiply each item‟s annual volume by its rupee value.

Compute each item‟s percentage of the total inventory in terms of annual usage in rupees

“A” Category – 5% to 10% of the items represent 70% to 75% of the money value.

“B” Category – 15% to 20% of the items represent 15% to 20% of the money.

“C” Category – The remaining number of the items represent 5% to 10% of the money value.

The relative position of these items show that items of category A should be under the maximum
control, items of category B may not be given that much attention and item C may be under a
loose control.

ABC ANALYSIS

(ABC = Always Better Control)

This is based on cost criteria.

It helps to exercise selective control when confronted with large number of items it rationalizes
the number of orders, number of items & reduce the inventory.

About 10 % of materials consume 70 % of resources

About 20 % of materials consume 20 % of resources

About 70 % of materials consume 10 % of resources

„A‟ ITEMS

Small in number, but consume large amount of resources,Must have:,Tight control,Rigid

estimate of requirements,Strict & closer watch,Low safety stocks, Managed by top management

14
 „B‟ ITEM

Intermediate,Must have Moderate control,Purchase based on rigid requirements,Reasonably

strict watch & control,Moderate safety stocks,Managed by middle level management

„C‟ ITEMS

Larger in number, but consume lesser amount of resources,Must have:Ordinary control

measures, Purchase based on usage estimates, High safety stocks ,ABC analysis does not stress
on items those are less costly but may be vital.

Technologies in construction Material Management

The tools used in the construction industry change constantly with the continuous changes of
technology. Researchers are finding ways to apply those changes in technology to construction in
order to improve production and lower the cost of the operations.

Material Referencing:

Bar Codes Applications to Material Management

RFID-Radio Frequency Identification

1. Bar Codes Applications to Material Management

Bar code applications in construction are mostly intended to provide accuracy in data collection,
to improve productivity and to save time in the data collection process.

Typically, bar codes are used for materials and inventory management. The scope of bar codes
extends beyond materials management.

Bar codes provide the advantage of relatively error free data collection, which improves
productivity and avoid errors.

Some construction firms that use bar codes claim that it saves time, money and labor while
improving the accuracy of inventory.

The major applications of bar code to material management identified in previous research can
be identified as follows

Field material control

Warehouse maintenance and control

15
Inventory control applications and tool and consumable material issue

Purchasing and accounting

RFID-Radio Frequency Identification

A Radio Frequency Identification (RFID) system is an automated data collection system similar
to bar code.

RFID is the use of wireless signals to transfer data between microchips. The chips can be
inserted in tags, cards, or even living beings.

RFID systems consist of a reader or interrogator, which is a two-way radio transmitter that emits
a signal to labels or tags.

The tags contain a microchip to store and process information and an antenna that receives and
transmits a signal to the reader.

An ADC (Automated Data Collection) technology that:

16
  uses radiofrequency waves to transfer data between a reader and a movable item to
identify, categorize, track..
 Is fast and does not require physical sight or contact between reader/scanner and the
tagged item.
 Performs the operation using low cost components.
 Attempts to provide unique identification and backend integration that allows for wide
range of applications.

RFID applications in construction are mostly intended to provide accuracy in data collection, to
improve productivity and to save time in the data collection process. Radio frequency
identification (RFID) technology is increasingly being used on construction projects to increase
efficiencies, manage assets, and reduce theft. .Throughout the past several years, a number of
applications have been developed for use in the construction industry. As the cost of RFID
systems continue to drop, their use in construction has continued to grow.

There are a variety of ways in which construction companies are taking advantage of RFID.In
passive systems when the reader emits electromagnetic waves, it powers the tag, which transmits
the data back to the reader. The simplest tags are labeled passive tags and need to be extremely
close to a scanner to be read.

Passive RFID Tag

17
Generally, passive tags have shorter read ranges of a few inches to 30 feet, but have a long life
than active tags.

The passive RFID tags consist of a microchip attached to an antenna and can be packaged in a
different way such as mounted on a substrate to create a tag, sandwiched between an adhesive
layer and a paper label to create a printable RFID label (or smart label), embedded in a plastic
card, a key fob, the wall of a plastic container, and special packaging (to resist heat, cold or harsh
cleaning chemicals.

Active RFID Tags

Active RFID tags have their own internal power supply and are rewritable.

The features of the active tags are much larger and heavier, and more expensive, but have a
better noise protection than passive tags.

However, they have a shorter battery life of up to 10 years, with read range of 60 feet to 300 feet
(20 metres to 100 metres).

Active tags are more reliable in environments such as water (including human/cattle, which are
mostly water), metal (shipping containers, vehicles), or at longer distances for generating strong
responses from weak requests.

They also have larger memories than passive tags and the ability to store additional information
sent by the transceiver

Uses of RFID:
RFID had been used for material tracking and material receipt in the construction industry.

18
Material Tracking: Material as the move in the jobsite since direct contact is not required for data
collection. This can avoid theft and lost since managers can notice when materials are not where
they are supposed to be.

Materials Receipt: Materials can be easily verified as they arrive to the site. The type of materials
received can be known easily and verify if the right quantities were received.

Material Management using RFID

RFID advantages over barcodes

 No line of sight required for reading

 Multiple items can be read with a single scan
 Each tag can carry a lot of data (read/write)
 Individual items identified and not just the category
 Passive tags have a virtually unlimited lifetime
 Active tags can be read from great distances
 Can be combined with barcode technology

Different methods are in use concerning the pricing of materials issued from the store. They are
as follows:

 First-in, First-out [FIFO]

 Last-in, First out [LIFO]

First-in, First-out [FIFO]

19
It is based on the assumption that the materials purchased and received first are issued first to the
job.

A FIFO warehouse system is an inventory management system in which the first or oldest stock
is used first and the stock or inventory that has most recently been produced or received is only
used or shipped out until all inventory in the warehouse or store before it has been used or
shipped out.

This ensures that the oldest stock is used first and reduces the costs of obsolete inventory. It is
also considered the ideal stock rotation system.

This inventory system is common used in many industries and is sometimes combined with
other warehouse, inventory management models and inventory systems such as the EOQ
modelor any other multiple order inventory model.

A good system of stock management requires that the oldest units are issued first and stock
consists of the latest purchases. This system is found in the FIFO method of pricing the issues.
No profit or loss occurs merely on the use of this method.

Last-in, First out [LIFO]

It is based on the assumption that the material purchased and received last are issued first to the
job. The cost of last lot of materials received is used to price the materials issued until the stock
of that lot is exhausted. Thereafter the next lot for pricing is used, and so on through successive
lots. The stock is priced a the oldest cost.

PURCHASING POLICY AND PROCEDURES :

Purchasing Policy : Every organization sets the purchasing policy. In order to accomplish the
aims and objectives of the organization, the directives and instructions issued to purchase the

20
materials are called the policy of purchasing. Policy means the set of principles, purposes and
rules of action framed written or otherwise applied to fulfill the goals of organization.

The purchasing policy provides the guidelines and direction in the following categories. It
defines:

 Rules of purchasing
 Conduct of purchasing personnel
 Social and minority business objectives
 Operational issues

The Selection of the supplier:

The process of selection of supplier involves two basic aspects: searching for all possible sources
and short listing out of the identified sources.

The complete information about the supplier is available from various sources, such as, trade
directories, advertisement in trade journals, direct mailing by the suppliers, interview with
suppliers, salesmen, suggestions from business associates, visit to trade fair, participation in
industries convention, etc.

Identification of more and more sources helps in selecting better and economical supplier.

It should be noted that the low bidder is not always the best bidder. When everything except
price is equal, the low bidder will be selected. The important considerations in the selection are
the price, ability to supply the required quantity, maintenance of quality standards, financial
standing etc. It should be noted that it is not necessary to go for this process for all types of
purchases.

For the repetitive orders and for the purchases of low-value, small lot items, generally the
previous suppliers with good records are preferred.

Placing the order:

 Once the supplier is selected the next step is to place the purchase order.
 Purchase order is a letter sent to the supplier asking to supply the said material.
 At least six copies of purchase order are prepared by the purchase section and each copy
is separately signed by the purchase officer.
 Out these copies, one copy each is sent to store-keeper, supplier, accounts section,
inspection department and to the department placing the requisition and one copy is
retained by the purchase department for record

A purchase order is a contract between the buyer and the seller and it gives specific information
like product or services to be delivered, delivery date, and any other terms and conditions

21
including the price. The purchase order is also called as „PO‟.Below are details that usually
forms part of purchase order:

 Products that are ordered

 Quantities i.e., (kg, meters, numbers etc.,)
 Price at which it is ordered
 Name of the vendor to whom the purchase order is being sent
 Shipment address or delivery location where the goods are required
 Billing address of the company
 Terms and conditions of payment.
 Due date of delivery/consignment

Purchase order vs purchase invoice

22
The following table highlights the key difference between purchase order and purchase invoice

Purchase order Invoice

Purchase order is a contract or confirmation of Purchase invoice is a bill issued after fulling
that the order for such a material is placed the delivery and request for the payment

Buyer initiates and sends to the supplier Supplier initiates and sends it to the buyer

It is issued before receiving the goods It is issued after or along with the delivery of
goods by the supplier.

Follow-up of the order:

Follow-up procedure should be employed wherever the costs and risks resulting from the
delayed deliveries of materials are greater than the cost of follow-up procedure, the follow-up
procedure tries to see that the purchase order is confirmed by the supplier and the delivery is
promised.

It is also necessary to review the outstanding orders at regular intervals and to communicate with
the supplier in case of need.

Generally, a routine urge is made to the supplier by sending a printed post card or a circular letter
asking him to confirm that the delivery is on the way or will be made as per agreement.

In absence of any reply or unsatisfactory reply, the supplier may be contact through personal
letter, phone, telegram and/or even personal visit.

Receiving and inspection of the materials:

The receiving department receives the materials supplied by the vendor.

The quantity are verified and tallied with the purchase order.

The receipt of the materials is recorded on the specially designed receiving slips or forms which
also specify the name of the vendor and the purchase order number.

23
It also records any discrepancy, damaged condition of the consignment or inferiority of the
materials. The purchase department is informed immediately about the receipt of the materials.

Usually a copy of the receiving slip is sent to the purchase department.

Payment of the invoice:

When the goods are received in satisfactory condition, the invoice is checked before it is
approved for the payment.

The invoice is checked to see that the goods were duly authorised to purchase, they were
properly ordered, they are priced as per the agreed terms, the quantity and quality confirm to the
order, the calculations are arithmetically correct etc.

24
SCHOOL OF BUILDING AND ENVIRONMENT

DEPARTMENT OF ARCHITECTURE

1
LABOUR LEGISLATIONS
The term 'Labour Legislation' is - used to cover all the laws which have been enacted to deal
with
 " employment and non-employment" wages,
 working conditions,
industrial relations,

social security and welfare of persons employed in industries.

• Thus 'Labour Legislation' refers to all laws of the government to provide social and
economic security to the workers.
• These acts are aimed at reduction of production losses due to industrial disputes and to
ensure timely payment wages and other minimum amenities to workers.
• In India, labour legislation is treated as an arm of the State for the regulation of
working and living conditions of workers.

“To secure to each labourer the whole product of his labour, or as nearly as possible, is a
worthy object of any good Government” said Abraham Lincoln.
WHY LABOUR LAWS??????
The need for labour legislation may be summarized as under:
 Necessary for the health, safety, and welfare of workers;
 Necessary to protect workers against oppressive terms as individual worker is
economically weak and has little bargaining power;
 To encourage and facilitate the workers in the organization;
 To deal with industrial disputes;
 To enforce social insurance and labour welfare schemes.

The Need of Labor Legislation becomes important because of following reasons :

a) Weak Labor Organizations :

Individual worker is economically very weak and is unable to bargain his terms with the
employers. Even, Labor organizations are relatively weak and in most cases, they depend merely
on the mercy employers. Now as the payment of wages, lay off, dismissal, retrenchments etc, are
all governed by the legislations, economic insecurity of workers is removed to great extent.

b) Occupational Insecurity :

The workers in many organizations, did not get the amount in case of accidents, deaths etc. As
a result, the workers faced occupational insecurity. Now, benefits such as Occupational Act,
Employees State Insurance Act, etc have been statutorily given to the employees.

2
 c) Hazardous Working Conditions:

Workers health and safety is always in danger due to harmful working condition in some
factories.The Factories Act, contains a numbere of provisions relating to health, safety and
welfare of workers.

d) Law And Order :

Labor legislation is also necessary in order to maintain law and order situation and national
security of the country.The idea of welfare state is emboided in the directive principles of the
constitution and for that reason various labor laws have been enacted to protect the sections of
the society.
e) Achieving Socio –economic Progress :

Labor legislation is one of the most progressive and dynamic instruments for achieving socio
– economic progress.

Objectives of Labor Legislation :

 To protect the workers from profit seeking exploiters.
 To ensure that the service conditions should be clearly spelt out by the employer to the
employee.
 To improve and regulate the working conditions of workers employed in different
factories and establishments.
 To make statutory provision for the regular trainings of a certain number of apprentices in
different trades.

INDUSTRIAL RELATIONS

Meaning:

Industrial relations denote the collective relationship between management, employees and
government in any industrial or non-industrial organisation.

Definition:

Industry is not a machine it is a complex form of human association. The true understanding of
industry is to understand the thoughts of those engaged in it.

Prof. Oliver Sheldon.

Significance / Importance of IR

1. To help in the economic progress of a country.

2. To help in establishing and maintaining the industrial democracy

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3. To help management both in the formulation of informal labour relations and policies.

4. To encourage collective bargaining.

5. To help government in making laws

6. To boost the discipline & morale of workers.

Conditions of Good Industrial Relations.

1. History of Industrial Relations.

No enterprise can escape its good and bad history of Industrial Relations. A good history
is marked by harmonious relationship between management and workers. A bad history by
contrast is characterized by militant strikes and lockouts. Both of history has a tendency to
perpetrate themselves

2. Economic Satisfaction of workers:

Much of man‟s conduct is dominated by the needs. Man works because he wants to survive.
This is all the more for under developed countries. Hence, economic satisfaction of workers are
another important prerequisite for good IR.

3. Social & Psychological Satisfaction:

Indentify the social and psychological urges of workers is a very important step in the
direction of building good IR. As has been revealed by the Hawthorne experiments a man does
not live by bread alone. He has several other needs besides his physical needs which should also
be given due attention by the employer.

4. Off-the job conditions:

A person‟s home life is not totally separable from his work life, and his emotional
condition is not separate from his physical condition. Each affects the other. Hence for good
Industrial Relation it is not enough that the worker‟s factory life alone should be taken care of .
His oof – the – job conditions should also be improved.

5. Enlightened Labour Unions:

The most important single condition necessary for good IR is a strong & enlightened
labour movement which may help to promote the status of labour without jeopardizing the
interests of management. Many enlightened unions, however, usually do focus on employee
contribution & responsibility and they have gained both social and economic rewards by this
approach.

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6. Negotiating Skills & Attitudes of Management and Workers:

Both management and workers representatives in the area of IR come from a great
variety of backgrounds in terms of training, education, experience ant attitudes. These varying
backgrounds play a major role in shaping the characteristic of IR.

7. Public Policy & Legislation:

When government regulates employee relations, it become a third major force determining IR –
the first two being the employer and the union. Governments in all countries intervene in
management union relationships by enforcing labour laws and by insisting that the goals of the
whole society shall take precedence over those of either of the parties.

8. Better Education:

With rising skills and education, workers‟ expectations in respect of rewards increase. Better
workers‟ education can be a solution to mislead by outside TU leaders who have their own axe to
grind. This alone can provide workers with a proper sense of responsibility which they owe to
the organisation in particular and to the community in general.

Causes of poor IR

1. Uninteresting Nature of work:

The problem of poor IR is essentially a product of large-scale production which has made man
subordinate to the machine. Owing to extensive specialization, a worker in a factory performs
only a minor operation in the whole process of production. This made him lose his sense of
pleasure, pride and satisfaction from work which he used to get earlier by producing the whole
product. This lead the shop floor worker culminates into big strikes and lockouts.

2. Political Nature of Unions

Another major irritant to good IR is the politicization of labour union by outside political
leaders. This leads to multiple unions on the one hand and inter-union rivalry on the other. It
depresses both a union membership and its finance.

3. Poor Wages:

Too much tight or complicated wage and incentive and payment systems are also a cause
of poor IR. Wage and salary differentials between occupations also create feelings of inequity
and mar poor IR.

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4. Occupational Instability:

It makes workers feel secure on their jobs. It produces an enervating effect on them.

5. Poor Behavioural Climate:

The behavioural climate of an enterprise which is made up of its culture, traditions and methods
of action may be wither favourable or unfavourable . That unfavourable climate is one which
prevents him from meeting his various types of needs and produces in his mind a poor image of
the enterprise. This becomes a cause of poor IR.

EFFECTS OF POOR IR:

1. Multiplier Effect:

Modern industry and for that matter modern economy are inter-dependent. Hence, due to
industrial conflict in any one plant may not be very great, the total cost loss caused due to its
multiplier effect on the total economy is always very great.

2. Fall in Normal Tempo:

Disputes adversely affect the normal tempo of work so that plants work for below the optimum
level. Costs build-up. Absenteeism and labour turnover increase. Plant discipline breaks down
and both the quantity and quality of production suffer.

3. Resistance to Change:

Dynamic industrial situations calls for change more or less continuously . Each of these tasks
involves a whole chain of changes and this is resisted bitterly if there is industrial conflict.

4. Frustration and Social Cost:

Every man comes to the work place not only to earn a living. He wants to satisfy his social and
egoistic needs also. When he finds difficulty in satisfying the needs he feels frustrated. They
reduce cordiality and aggravate social tension.

SUGGESTIONS TO IMPROVE IR:

1. Both Management and Union should develop constructive attitudes towards each other.

2. All basic policies and procedures relating to IR should be clear to every body in the
organisation to the union leaders.

3. The personnel manager should remove any distrust by convincing the union of the
company‟s integrity and his own sincerity and honesty.

4. Management should encourage right kind of union leadership

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5. After the settlement is reached the agreement should be properly administered.

COLLECTIVE BARGAINING

Meaning:

Collective Bargaining is the process in which conditions of employment are determined by

agreement between representatives of the union, on the other hand and those of the employer on
the other.

Benefits of Collective Bargaining:

• It provides a method for a regulation of conditions of employment

• It helps to know about the industry conditions and problem

• It helps for better understanding

• It helps to aware of the economic & technical factors involved in Industrial Management

• It provides a code defining the rights and obligations of each party

• It leads to better implementation of decisions.

Essential Conditions For Successful Collective Bargaining:

1. A favorable political climate

2. Stability of workers organizations

3. Recognition of Trade Union

4. Freedom of Association

5. Willingness to give and take

6. Avoidance of unfair labour practice.

Types of Activities in Collective bargaining

1. Distributive bargaining

2. Integrative bargaining

3. Attitudinal bargaining

4. Intra Organizational bargaining

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1. Distributive bargaining – Economic issues like wages, bonus, salaries are discussed.
However one parties gain is another party‟s loss.

2. Integrative bargaining – Here Issues where no party losses are discussed like better
training programme, better job evaluation system etc.

3. Attitudinal bargaining – Attitudes of both the parties are shaped and re shaped like trust
or distrust, friendliness or hostility between labour and management.

4. Intra Organizational bargaining – Type of maneuvering to achieve consensus with the

workers and management.

Prerequisite for successful Collective bargaining:

I. Mutual Recognition

Trade Union must be recognized. Since Collective bargaining is a two way process it is
necessary for both to shed their suspicion.

II. Mutual Accommodation

Collective bargaining is a process for continuous joint consideration and

adjustment of problems. The approach must be mutual “Give and Take policy”

III. Single Strong Union

A stable Union is essential.

IV. Efficient Bargaining Mechnism

Availability of full information, selection of proper representative is crucial.

V. Bargainer must have authority

VI. Political climate must be positive.

Points to be remembered in the Negotiation Process:

1) Composition of Negotiation Team:

Members must possess analytical mind, problem solving ability and finding out the
relevant parameter. They should have the full decision making power.

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2) Ready Availability of relevant Material:

Necessary data should be collected and tabulated as needed.

3) Continuity of talks:

The important thing is never to reach an end but to keep talking continuingly. As the field
of agreement is widened and the field of disagreement is narrowed down, small gaps can be
bridged easily later.

4) Problem solving attitude:

Important factor is to replace opinions and impression of facts and figures and to assess
these facts objectively and analytically.

5) It should have a good beginning

TRADE UNION

Meaning:

Trade Union is an association of workers in one or more professions – an association carried on

mainly for the purpose of protecting and advancing the members‟ economic interests in
connection with their daily wage.

Definition:

According to Trade Union Act, 1926, Sec-2 (h), to defines “it means any combination, whether
temporary or permanent, formal .

1. Primarily for the purpose of regulating the relations;

a. Between workmen and workmen or

b. Between workmen and employer or

c. Between employer and employer

2. For imposing restrictive conditions on the conduct of any trade or business.

Why do workers join Trade Union?

1. To attain economic security

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2. To improve their bargaining power

3. Workers like to resist or sustain the management irrational, illogical and discriminatory
actions.

4. To ventilate the workers‟ grievances to the management

5. To inform workers‟ views, aims, ideas and dissatisfaction, frustration to the management.

6. To secure protection from unexpected economic needs like illness, accidents, injury , etc.,

7. To satisfy their social needs

8. To secure power.

Registration of Trade Union

1. Application for Registration

2. Rules and a statement of the following particulars

a. The names, occupations and address of the members making the application

b. The name and address of the Trade Union and Head Office

c. The title name, age, address and occupation of the officers of the Trade Union.

3. Registration

4. Certificate of Registration

Rights & Privileges of a Registered Trade Union:

1. Body Corporate

2. Separate fund for political purpose

3. Right to inspect books of Trade Union

4. Enforceability of Agreements

5. Rights of minors to be a member

6. Change of name

7. Amalgamation of Trade Union

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Trade Union Federation:

I. National:

AITUC – All India Trade Union Congress

INTUC – Indian National Trade Union Congress

II. Central

BMS – Bharathiya MazdoorSangh

HMS – Hindu Mazdoor Sabha

CITU – Centre of Indian Trade Union

Types & Structure of Trade Union:

I. Reformist Unions:

Aims at the preservation of the capitalist economy and the maintenance of competitive
production based Industrial Relation.

a. Business Union: Protect workers interest by participating in CB with the employer.

b. Friendly or Uplift Unions: Aspire to elevate the moral, intellectual and social life of
workers, like education, health, insurance and other benefits.

II. Revolutionary Unions:

This union aims at replacing the present system with the new and different institutions based on
the ideas that are regarded as preferable. Destroying the capitalistic system and abolish private
property and installing socialist or communistic system.

III. Craft Union / Horizontal Union

If the workers of the same craft, or category of the job form into an union, that union is
called craft union. Example: Drivers‟ Association, Lawyers Associations etc.,

IV. General Unions:

If the worker of any industry , any region and of any job or occupation form into one union in
order to protect the overall interest of the workers, such unions are called general union.

V. Industrial Unions / Vertical Union:

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Different categories form into a union that union is called Industrial union. The logic behind this
is , workers of the same industry have the common bend and they are governed by same rules
and regulations and are administered by same management.

Functions of Trade Union:

1. Achieving higher wages

2. Better working conditions and living conditions

3. Acquiring control of the industry by workers

4. Minimizing the helplessness of the Individual workers by making them stand collectively

5. Increasing their resistance power

6. Protecting members against victimization and injustice of employer

7. Raising status of the workers

8. Providing self-confidence

9. Taking up welfare measures for improving the morale of workers.

10. To enlarge the opportunities for promotion and training

11. To provide for educational, cultural and recreational facilities

12. To offer responsive co-operation in improving levels of production and productivity and
discipline.

New Activities which unions can undertake in future area as follows:

a. Communication

b. Counseling

c. Education and Training

d. Welfare

e. Family and vocational guidance

f. Research

g. Team building

h. Employee ownership

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i. New work force

j. HRD

L A B O U R L AW S & E M P L O Y M E N T LA W S

The final goal of labour law is to bring both the employer and the employee on the same
level, thereby mitigating the differences between the two ever-warring groups.

Labour Laws are different from employment laws which deal only with employment contracts
and issues regarding employment and workplace discrimination and other private law issues.

Employment Law is a broad area including all areas of the employer/employee relationship
except the negotiation process covered by labour law and collective bargaining. Many
employment laws (e.g., minimum wage regulations, employment discrimination) were
enacted as protective labour legislation. Other employment laws take the form of public
insurance, such as unemployment compensation

LABOUR LAWS deals . . .

 Employment Contract
 Minimum wage
 Working time
 Health and safety
 Anti-discrimination
 Unfair dismissal
 Child labour

EMPLOYMENT CONTRACT
The basic feature of labour law in almost every country is that the rights and obligations of
the worker and the employer between one another are mediated through the contract of
employment between the two.

The CONTRACT aims to allow the employee to know concretely what to expect and is
expected; in terms of wages, holiday rights, notice in the event of dismissal, job
description and so on.

An employer may not legally offer a contract in which the employer pays the worker less than a
minimum wage. An employee may not for instance agree to a contract which allows an employer
to dismiss them unfairly.

MINIMUM WA G E

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  There may be law stating the minimum amount that a worker can be paid per hour. Many
countries across the world have laws of this kind.
 The minimum wage is usually different from the lowest wage determined by the forces of
supply and demand in a free market.
 Each country sets its own minimum wage laws and regulations, and while a majority of
industrialised countries has a minimum wage, many developing countries have not.
 Minimum wage laws were first introduced nationally in the United States in 1938,India
in 1948, France in 1950, and in the United Kingdom in 1999.

WORKING TIME

 Before the Industrial Revolution, the workday varied between 11 and 14 hours. With
the growth of industrialism and the introduction of machinery, longer hours became far
more common.
 14-15 hours being the norm, and 16 not at all uncommon. Use of child labour was
commonplace, often in factories.
 In England and Scotland in 1788, about two-thirds of persons working in the new water-
powered textile factories were children.
 The eight-hour movement's struggle finally led to the first law on the length of a
working day, passed in 1833 in England, limiting miners to 12 hours, and children to 8
hours. The 10-hour day was established in 1848, and shorter hours with the same pay
were gradually accepted thereafter.

H E A LT H A N D S A F E T Y

 The passage of the Health Insurance Act, which entitled workers to health insurance; the
worker paid two-thirds, and the employer one-third, of the premiums.
 Accident insurance was provided in 1884, while old age pensions and disability
insurance were established in 1889. Other laws restricted the employment of women and
children.
 Compensation for injuries suffered by a workman in the course of and arising out of his
employment according to the nature of injuries suffered and disability incurred.
A N T I - D IS C R I M I N AT I O N

 This clause means that discrimination against employees is morally unacceptable and
illegal, on a variety of grounds, in particular racial discrimination or sexist
discrimination. Anti-discrimination law refers to the law on people's right to be treated
equally.

14
  Most developed countries mandate that in employment, in consumer transactions and in
political participation people may be dealt with on an equal basis regardless of
 sex, race, ethnicity, nationality, sexuality and sometimes religion political views.

Examples of anti-discrimination law include,

Age Discrimination Act of 1975
Racial Discrimination Act 1975
Disability discrimination act
Anti-Discrimination Act 1977

CHILD LABOUR
 Child labour is the employment of children under an age determined by law or
custom.
 This practice is considered exploitative by many countries and international
organisations.
 Child labour was not seen as a problem throughout most of history, only becoming a
disputed issue with the beginning of universal schooling and the concepts of
labourers' and children's rights.

 Child labour can be factory work, mining or quarrying, agriculture, helping in the
parents' business, having one's own small business (for example selling food), or
doing odd jobs.

Protective Labor Legislations :

The legislations whose primary purpose is to protect minimum labor standards and improve
working conditions are protective labor legislations. Legislations laying down the minimum
labor standards in the areas of work, safety, employment of children and women and also the
manner of wage payment come under this category. The Indian labor laws under this category
are :
1) The Factories Act, 1948,
2) The Mines Act, 1952,
3) The Plantation Labor Act, 1951,
4) The Motor Transport Workers Act, 1961,
5) The Shops and Establishment Act passed by various states,
6) The Payment of Wages Act, 1936,
7) The Minimum Wages Act, 1948,
8) The Child Labor (Prohibition and regulation) Act, 1986 and
9) Contract Labor (Regulation and Abolition) Act, 1970.

II )Regulative Legislations :

The legislations whose primary purpose is to regulate the relations between employers and
employees and to provide for methods and manners for settling industrial disputes are Regulative
Legislations. This laws also regulate the relationships between workers and trade unions, the
rights and obligations of the organizations of employers and workers, as well as their mutual
relationships. The laws under this category are as follows :

15
 1) The Trade Unions Act, 1926,
2) The Industrial Disputes Act, 1947, and
3) The Industrial Employment (Standing Orders) Act, 1946

III) Social Security Legislations :

The Legislations which intend to provide social security benefits to the workmen during certain
contingencies of life are Social Security Legislations. Though this legislations may cover other
classes of citizens also, their primary goal has been to protect the workers. The laws under this
category are as follows:

1) The Workmen's Compensation Act, 1923,

2) The Employees State Insurance Act, 1948,
3) The Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948,
4) The Employees Provident Funds and Miscellaneous Provisions Act, 1952
5) The Maternity Benefit Act, 1961, and
The Payment of Gratuity Act, 1972.

IV) Welfare Legislations:

The legislations which aim at promoting the general welfare of the workers and improve their
living conditions are Welfare legislations. Such laws carry the term “Welfare” in their titles. The
Laws under this category are as follows :
1) Mica Mines Labor Welfare Fund Act, 1946,
2) Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines labor Welfare Fund Act,
1976 and
3) Beedi Workers Welfare Fund Act, 1976.

All of these laws provide for the funds which is spent on improving the general welfare of
workers including housing, medical, educational and recreational facilities.

The legislations can be categorized as follows:

 Labour laws enacted by the Central Government, where the Central Government
has the sole responsibility for enforcement.

 Labour laws enacted by Central Government and enforced both by Central and
State Governments.

 Labour laws enacted by Central Government and enforced by the State

Governments.

 Labour laws enacted and enforced by the various State Governments which apply
to respective States.

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Labour Laws may be classified under the following heads:

 Laws related to Industrial Relations

 Laws related to Wages

 Laws related to Working Hours, Conditions of Service and Employment

 Laws related to Equality and Empowerment of Women

 Laws related to Deprived and Disadvantaged Sections of the Society

 Laws related to Social Security

Laws related to Industrial Relations such as:

 Trade Unions Act, 1926

 Industrial Employment Standing Order Act, 1946.
 Industrial Disputes Act, 1947.

WAGES

Payment of Wages Act, 1936 (amended 12 times in 1937

twice,1940,1951.1957,1960,1964,1971,1974,1976,1977,1982)
Minimum Wages Act,1948 (amended 8 times in 1950,1951,1954,1957,1961,1970,1986)
Employee‟s Provident Fund and Miscellaneous Provisions Act, 1952 (amended 14 times)
Payment of Bonus Act,1965 (amended 3times in 1976,1980,1995)
Payment of Gratuity Act,1972 amended 5times in 1984 twice,1987,1994,1999)
Equal Remuneration Act, 1976 (Amended once in 1987)

HEALTH & SAFETY

Factories Act ,1948
Mines Act, 1952
Personal Injuries (Compensation Insurance ) Act ,1970
Fatal accidents Act, 1855
Employees State Insurance Act,1948 (amended 6times in
1951,1966,1970,1975,1984,1989)
Child Labour (Prohibition and regulation)Act, 1996
Workmen‟s compensation Act, 1923(amended 4times in 1933,1959, 1962, 1995)
Maternity Benefit Act, 1961 (amended 6 times in 1970,1972,1973,1976,1988,1995)
Children Pledging of Labour Act,1933

EMPLOYMENT

17
 Contract Labour(Regulation and Abolition) Act, 1970 (amended once in 1986)
Interstate Migrant Workmen (Regulation of employment and conditions of Service) Act,
1979
Employment Exchanges( Compulsory Notification of Vacancies) Act,1959 ,(amended
once in1986)
Trade Union Act, 1926
Bonded Labour System (abolition) Act,1976 (amended once in 1985)
Apprentices Act ,1961 (amended 4 times in 1964,1968,1973,1986)
Employers Liability Act,1938 (amended 3times,in 1951 twice and 1970)
Weekly holidays Act 1942 (amended 2 times in 1970, 1986)
Industrial Disputes Act, 1947
Building and other construction worker‟s (Regulation of Employment and conditions of
service ) Act,1996
Building and other Construction Worker‟s Welfare Cess Act, 1996

Laws related to Equality and Empowerment of Women such as:

Maternity Benefit Act, 1961

Equal Remuneration Act, 1976.

Laws related to Deprived and Disadvantaged Sections of the Society such as:

Bonded Labour System (Abolition) Act, 1976

Child Labour (Prohibition & Regulation) Act, 1986
Children (Pledging of Labour) Act, 1933

Laws related to Working Hours, Conditions of Service and Employment such as:

Factories Act, 1948.

Plantation Labour Act, 1951.
Mines Act, 1952.
Working Journalists and other Newspaper Employees‟ (Conditions of Service and Misc.
Provisions) Act, 1955.
Merchant Shipping Act, 1958.
Motor Transport Workers Act, 1961.

Beedi & Cigar Workers (Conditions of Employment) Act, 1966.

Contract Labour (Regulation & Abolition) Act, 1970.
Sales Promotion Employees Act, 1976.
Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service)
Act, 1979.
Dock Workers (Safety, Health & Welfare) Act, 1986.
Building & Other Construction Workers (Regulation of Employment & Conditions of
Service) Act, 1996.
Building and Other Construction Workers Welfare Cess Act, 1996Cine-Workers
and Cinema Theatre Workers (Regulation of Employment) Act, 1981

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 Dangerous Machines (Regulation) Act, 1983
Dock Workers (Regulation of Employment) Act, 1948
Dock Workers (Regulation of Employment) (Inapplicability to Major Ports) Act, 1997
Employment of Manual Scavengers and Construction of Dry Latrines (Prohibition) Act,
1993
Industrial Employment (Standing Orders) Act, 1946
Mines and Mineral (Development and Regulation Act, 1957
Plantation Labour Act, 1951
Private Security Agencies (Regulation) Act, 2005

Laws related to Social Security such as:

Workmen‟s Compensation Act, 1923.

Employees‟ State Insurance Act, 1948.
Employees‟ Provident Fund & Miscellaneous Provisions Act, 1952.
Payment of Gratuity Act, 1972.
Employers‟ Liability Act, 1938
Beedi Workers Welfare Cess Act, 1976
Beedi Workers Welfare Fund Act, 1976
Cine workers Welfare Cess Act, 1981
Cine Workers Welfare Fund Act, 1981
Fatal Accidents Act, 1855
Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines Labour Welfare Cess
Act, 1976
Iron Ore Mines, Manganese Ore Mines and Chrome Ore Mines Labour Welfare Fund
Act, 1976
Limestone and Dolomite Mines Labour Welfare Fund Act, 1972
Mica Mines Labour Welfare Fund Act, 1946

Personal Injuries (Compensation Insurance) Act, 1963

Personal Injuries (Emergency Provisions) Act, 1962
Unorganised Workers‟ Social Security Act, 2008

Workmen Compensation Act, 1923

Sec. 1(3) All workers irrespective of their status or salaries either directly or through
contractor or a person recruited to work abroad.
Sec. 3 Employers Liability to pay compensation to a workmen: On death or personal
injury resulting into total or partial disablement or occupational disease caused to a
workmen arising out of and during the course of the employment.
Amount of compensation
- An amount equal to fifty per cent
of the monthly wages of the deceased workman multiplied by the relevant factor on an
amount of eighty thousand rupees, whichever is more.

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 - An amount equal to sixty
per cent of the monthly wages of the injured workman multiplied by the relevant factor or
an amount of ninety thousand rupees, whichever is more

Higher the age – Lower the compensation

Payment of Wages Act, 1936

Coverage of Employees
Drawing average wage upto Rs.6500 pm as amended w.e.f. 06.09.05.

Time of payment of wages

The wages of every person employed be paid.
When less than 1000 persons are employed shall be paid before the expiry of the 7th day
of the following month.
When more than 1000 workers, before the expiry of the 10th day of the following month.
Deduction made from wages
Deductions such as, fine, deduction for amenities and services supplied by the employer,
advances paid, over payment of wages, loan, granted for house-building or other purposes,
income tax payable, in pursuance of the order of the Court, PF contributions, cooperative
societies, premium for Life Insurance, contribution to any fund constituted by employer or a
trade union, recovery of losses, ESI contributions etc.

Building and Other Constructions Workers (Regulation of Employment and

Conditions of Service) Act, 1996
The Government of India enacted the Building and Other Constructions Workers (Regulation of
Employment and Conditions of Service) Act, 1996
The BOCW Act is a social welfare legislation that aims to benefit workers engaged in
building and construction activities across the country.

"An act to regulate the employment and conditions of service of building and other construction
workers and to provide for their safety, health and welfare measures and for other matters
connected therewith or incidental thereto."

The BOCW Act stipulates health, safety and welfare measures applicable to building workers.
Building worker is defined in Section 2(e) of the BOCW Act as "a person who is employed to do
any skilled, semi-skilled or unskilled, manual, supervisory, technical or clerical work for hire or
reward, whether the terms of employment be expressed or implied, in connection with any
building or other construction work."

SPECIAL PROVISIONS
. Responsibility of employers:
-An employer shall be responsible for providing constant and adequate supervision of
any building or other construction work in his establishment as to ensure compliance with
the provisions of this Act relating to safety and for taking all practical steps necessary to
prevent accidents.

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 Responsibility for payment of wages and compensation:-
An employer shall be responsible for payment of wages to each building worker
employed by him and such wages shall be paid on or before such date as may be
prescribed.

(2) In case the contractor fails to make payment of compensation in respect of a building
worker where he is liable to make such payment when due, or makes short payment
thereof, then, in the case of death or disablement of the building worker, the employer
shall be liable to make payment of that compensation in full or the unpaid balance due in
accordance with the provisions of the Workman„s
Compensation Act, 1923 (8 of 1923), and recover the amount so paid from the contractor either
by deduction from any amount payable to the contractor under any contract or as a debt payable
to the contractor.

Factories Act, 1948

Applicability of the Act

Any premises whereon 10 or more persons with the aid of power or 20 or more workers are/were
without aid of power working on any day preceding 12 months, wherein Manufacturing process
is being carried on. Sec.2(ii)

Employer to ensure health of workers pertaining to

s and effluents

Safety Measures

prohibition of young persons on dangerous machines.

-acting machines.

-openers.

Welfare Measures

-aid appliances – one first aid box not less than one for every 150 workers.

lunch rooms when there are 150 or more workers.

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 Working Hours, Spread Over & Overtime of Adults
Weekly hours not more than 48. Daily hours, not more than 9 hours. Intervals for rest at least ½
hour on working for 5 hours.:: Spreadover not more than 10½ hours. Overlapping shifts
prohibited. Extra wages for overtime double than normal rate of wages. Restrictions on
employment of women before 6AM and beyond 7 PM. Secs. 51, 54 to 56, 59 & 60

The Maternity Benefits Act, 1961

Objective
Maternity Leave and benefit
To protect the dignity of Motherhood by providing complete & healthy care to
women and her child when she is unable to perform her duty due to health condition.

Maternity Act 1961 : Gives her the assurance that her rights will be looked after while
she is at home to care for her child.

Applicability:

The Act extends to whole to India.

Every factory, mine or plantation (including those belonging to Government) and to every shop
or establishment wherein 10 or more persons are employed on any day preceding 12 months.

Eligible for Maternity Benefit?

Must work in the establishment for 80 days in 12 months before her date of Delivery.

Women earning less than 15,000 may be offered ESI scheme by her employer and will not be
eligible for maternity benefit and but will receive the maternity benefit under ESI scheme

Duties of Employee for Maternity Benefit:

o Ten weeks before the expected delivery date she may ask employer to give her
light work.[Produce certificate of pregnancy]

o Should intimate the employer Seven Weeks before her delivery date about the
leave period.

 Name the person to whom the payment will be made in case she cannot take herself.

Non Cash Benefits

Light work for 10 weeks (6 weeks plus 1 month) before delivery.
2 Nursing breaks of 15 Minutes until the child is 15 months old.
No discharge or dismissal while on maternity leave.

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 No charge to her disadvantage in any conditions of her employment while on maternity
leave.
Pregnant women discharged or dismissed may still claim maternity benefit from employer.

Cash Benefits

84 Days Leave with pay before/after delivery.

A medical bonus of Rs. 1,000/-
Take the pay for 6 weeks after/before child birth within 48 hrs of request
An additional leave with pay up to one month
[Proof of illness]
In case of miscarriage Six weeks leave with average pay.

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal)

Act, 2013 is a legislative act in India that seeks to protect women from sexual
harassment at their place of work.

The Act defines sexual harassment at the work place and creates a mechanism for
redressal of complaints. It also provides safeguards against false or malicious charges.
The definition of "aggrieved woman", who will get protection under the Act is extremely
wide to cover all women, irrespective of her age or employment status, whether in the
organised or unorganised sectors, public or private and covers clients, customers and
domestic workers as well.

Every employer is required to constitute an Internal Complaints Committee at each office or

branch with 10 or more employees. The District Officer is required to constitute a Local
Complaints Committee at each district, and if required at the block level.

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