Lesson 5

PERFORMANCE EVALUATION AND CONTROL PROCESS

TOPICS
1. Method of Performance Evaluation
2. Feedback
3. Promotion
4. Transfer
5. Separation
6. Implication of Job Change
7. Control Process
8. Grievances

LEARNING OUTCOMES
At the end of the lesson, you should be able to:
1. learn and discuss the method of performance evaluation, feedback,
promotion and transfer in the field of human resource management
and planning.
2. Determine and explain the separation process, implication of job
change, control process and grievances.

TOPIC 1: METHOD OF PERFORMANCE EVALUATION

Performance Evaluation Systems

A performance evaluation system is a systematic way to examine how well an employee
is performing in his or her job. If you notice, the word systematic implies the
performance evaluation process should be a planned system that allows feedback to be
given in a formal—as opposed to informal—sense. Performance evaluations can also be
called performance appraisals, performance assessments, or employee appraisals.
There are four reasons why a systematic performance evaluation system should be
implemented. First, the evaluation process should encourage positive performance and
behavior. Second, it is a way to satisfy employee curiosity as to how well they are
performing in their job. It can also be used as a tool to develop employees. Lastly, it can
provide a basis for pay raises, promotions, and legal disciplinary actions.
Designing a Performance Appraisal System
There are a number of things to consider before designing or revising an existing
performance appraisal system. Some researchers suggest that the performance
appraisal system is perhaps one of the most important parts of the organization, while
others suggest that performance appraisal systems are ultimately flawed, making them
worthless. For the purpose of this chapter, let‘s assume we can create a performance
appraisal system that will provide value to the organization and the employee. When
designing this process, we should recognize that any process has its limitations, but if we
plan it correctly, we can minimize some of these.

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The first step in the process is to determine how often performance appraisals should
be given. Please keep in mind that managers should constantly be giving feedback to
employees, and this process is a more formal way of doing so. Some organizations
choose to give performance evaluations once per year, while others give them twice per
year, or more. The advantage to giving an evaluation twice per year, of course, is more
feedback and opportunity for employee development. The downside is the time it takes
for the manager to write the evaluation and discuss it with the employee. If done well, it
could take several hours for just one employee. Depending on your organization‘s
structure, you may choose one or the other. For example, if most of your managers
have five or ten people to manage (this is called span of control), it might be worthwhile
to give performance evaluations more than once per year, since the time cost isn‘t high.
If most of your managers have twenty or more employees, it may not be feasible to
perform this process more than once per year. To determine costs of your performance
evaluations, see "Estimating the Costs of Performance Evaluations". Asking for feedback
from managers and employees is also a good way to determine how often performance
evaluations should be given.
Estimating the Costs of Performance Evaluations
Narrow Span of Control
Average span of control 8
Average time to complete one written review 1 hour
Average time to discuss with employee 1 hour
Administrative time to set up meetings with employees1/2 hour
8 employees × 2 hours per employee + 1/2-hour administrative time to set up times to
meet with employees = 16.5 hours of time for one manager to complete all
performance reviews
Wider Span of Control 133
Average span of control 25
Wider Span of Control
Average time to complete one written review 1 hour
Average time to discuss with employee 1 hour
Administrative time to set up meetings with employees1 hour
25 employees × 2 hours per employee + 1-hour administrative time to set up times to
meet with employees = 51 hours
Once you have the number of hours it takes, you can multiply that by your manager‘s
hourly pay to get an estimated cost to the organization
16 hours × $50 per hour = $850 51 hours × $50 per hour = $2550
Should pay increases be tied to performance evaluations? This might be the second
consideration before development of a performance evaluation process. There is
research that shows employees have a greater acceptance of performance reviews if
the review is linked to rewards.
The third consideration should include goal setting. In other words, what goals does the
organization hope to achieve with the performance appraisal process?
Once the frequency, rewards, and goals have been determined, it is time to begin to
formalize the process. First, we will need to develop the actual forms that will be used
to evaluate each job within the organization. Every performance evaluation should be
directly tied with that employee‘s job description.

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Determining who should evaluate the performance of the employee is the next decision.
It could be their direct manager (most common method), subordinates, customers or
clients, self, and/or peers. "Advantages and Disadvantages of Each Source for
Performance Evaluations" shows some of the advantages and disadvantages for each
source of information for performance evaluations. Ultimately, using a variety of
sources might garner the best results.
A 360-degree performance appraisal method is a way to appraise performance by using
several sources to measure the employee‘s effectiveness. Organizations must be careful
when using peer-reviewed information. For example, in the Mathewson v. Aloha Airlines
case, peer evaluations were found to be retaliatory against a pilot who had crossed
picket lines during the pilot‘s union strike against a different airline.
Management of this process can be time-consuming for the HR professional. That‘s why
there are many software programs available to help administer and assess 360 review
feedback. Halogen 360, for example, is used by Princess Cruises and media companies
such as MSNBC. This type of software allows the HR professional to set criteria and
easily send links to customers, peers, or managers, who provide the information
requested. Then the data are gathered and a report is automatically generated, which
an employee can use for quick feedback. Other similar types of software include
Carbon360 and Argos.
Performance Appraisal System Errors
Before we begin to develop our performance review process, it is important to note
some of the errors that can occur during this process. First, halo effects can occur when
the source or the rater feels one aspect of the performance is high and therefore rates
all areas high. A mistake in rating can also occur when we compare one employee to
another, as opposed to the job description‘s standards. Sometimes halo effects will
occur because the rate is uncomfortable rating someone low on a performance
assessment item. Of course, when this occurs, it makes the performance evaluation less
valuable for employee development. Proper training on how to manage a performance
appraisal interview is a good way to avoid this. We discuss this in Validity issues are the
extent to which the tool measures the relevant aspects of performance. The aspects of
performance should be based on the key skills and responsibilities of the job, and these
should be reviewed often to make sure they are still applicable to the job analysis and
description.
Reliability refers to how consistent the same measuring tool works throughout the
organization (or job title). When we look at reliability in performance appraisals, we ask
ourselves if two raters were to rate an employee, how close would the ratings be? If the
ratings would be far apart from one another, the method may have reliability issues. To
prevent this kind of issue, we can make sure that performance standards are written in a
way that will make them measurable. For example, instead of ―increase sales as a
performance standard, we may want to say, ―increase sales by 10 percent from last
year. This performance standard is easily measured and allows us to ensure the
accuracy of our performance methods.
Acceptability refers to how well members of the organization, manager and employees,
accept the performance evaluation tool as a valid measure of performance. For
example, let‘s assume the current measurement tools of Blewett Gravel, Inc. are in
place and show validity for each job function. However, managers don‘t think the tool is
useful because they take too much time. As a result, they spend minimal time on the
evaluation. This could mean the current process is flawed because of acceptability error.
Another consideration is the specificity, which tells employees the job expectations and
how they can be met. If they are not specific enough, the tool is not useful to the

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employee for development or to the manager to ensure the employee is meeting
expectations. Finally, after we have developed our process, we need to create a time
line and educate managers and employees on the process. This can be done through
formal training and communicated through company blogs or e-mails. According to
Robert Kent, teaching people how to receive benefit from the feedback they receive can
be an important part of the process as well.
Performance Appraisal Legal Considerations
The legality of performance appraisals was questioned in 1973 in Brito v. Zia, in which an
employee was terminated based on a subjective performance evaluation. Following this
important case, employers began to rethink their performance evaluation system and
the legality of it.
The Civil Service Reform Act of 1978 set new standards for performance evaluation.
Although these standards related only to public sector employees, the Reform Act
began an important trend toward making certain performance evaluations were legal.
The Reform Act created the following criteria for performance appraisals in government
agencies:
 All agencies were required to create performance review systems.
 Appraisal systems would encourage employee participation in establishing the
performance standards they will be rated against.
 The critical elements of the job must be in writing.
 Employees must be advised of the critical elements when hired.
 The system must be based exclusively on the actual performance and critical
elements of the job. They cannot be based on a curve, for example.
 They must be conducted and recorded at least once per year.
 Training must be offered for all persons giving performance evaluations.
 The appraisals must provide information that can be used for decision making,
such as pay decisions and promotion decisions.
Early performance appraisal research can provide us a good example as to why we
should be concerned with the legality of the performance appraisal process. Holley and
Field] analyzed sixty-six legal cases that involved discrimination and performance
evaluation. Of the cases, defendants 135 won thirty-five of the cases. The authors of the
study determined that the cases that were won by the defendant had similar
characteristics:
 Appraisers were given written instructions on how to complete the appraisal for
employees.
 Job analysis was used to develop the performance measures of the evaluation.
 The focus of the appraisal was actual behaviors instead of personality traits.
 Upper management reviewed the ratings before the performance appraisal
interview was conducted.
This tells us that the following considerations should be met when developing our
performance appraisal process:
 Performance standards should be developed using the job analysis and should
change as the job changes.
 Provide the employees with a copy of the evaluation when they begin working
for the organization, and even consider having the employees sign off, saying
they have received it.
 All raters and appraisers should be trained.
 When rating, examples of observable behavior (rather than personality
characteristics) should be given.
 A formal process should be developed in the event an employee disagrees with a
performance review.

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Now that we have discussed some of the pitfalls of performance appraisals, we can
begin to discuss how to develop the process of performance evaluations.
Table 3. Advantages and Disadvantages of Each Source for Performance Evaluations
Source Advantages Disadvantages
Usually has extensive
knowledge of the
Manager/Supervisor employee’s performance Bias
and abilities

Favoritism
Self-analysis can help with In the employee’s interest
Self employee growth to inflate his or her own
ratings
Works well when the
supervisor doesn’t always
directly observe the Relationships can create
employee bias in the review

Peer Can bring a different If evaluations are tied to

perspective, since peers pay, this can put both the
know the job well employee and the peer in
an awkward situation
If confidential, may create
mistrust within the
organization
Customers often have the
best view of employee Can be expensive to obtain
behavior this feedback
Customer/Client
Can enhance long-term
relationships with the Possible bias
customer by asking for
feedback
Data garnered can include
how well the manager
treats employees

Can determine if
employees feel there is
favoritism within their Possible retaliation if
department results are not favorable

Subordinates may not Rating inflation

Subordinate understand the “big
picture” and rate low as a If confidential, may create
result mistrust within the
organization
Can be used as a self-
development tool for
managers

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 If nothing changes despite
the evaluation, could
create motivational issues
among employees

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. What is performance? What are its determinants?
2. What environmental factors may affect performance?
3. What steps are undertaken in appraising performance?
4. What are the steps in developing a performance appraisal?
5. What are the most common errors in performance appraisal?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 2: FEEDBACK

Feedback
Performance Feedback:
Most employees want feedback about their performance. Performance feedback is the
ongoing process between employee and the manager where information is exchanged
concerning the performance expected and the performance exhibited. Effective
performance feedback skills are extremely important for managers. Employees need to
be able to constructive feedback regarding both positive and negative aspects of their
performance.
Features of Performance Feedback:
 It is specific rather than general.
 It is focused on behavior rather than on the person.
 It takes into account the needs of the receiver of the feedback.
 It involves sharing of Information rather than giving advice.
Types of Performance Feedback:
 Formal feedback
 Informal Feedback
 Positive Feedback

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  Negative Feedback
Process of Performance Feedback:
 Scheduling performance feedback
 Preparing for a feedback session
 Conducting the Feedback session

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. Explain the importance of performance feedback in the workplace.
2. What are the main features of performance feedback?
3. For you, what is the most common type of feedback? Explain.
4. Discuss the process of performance feedback.
5. What are the best practices for providing constructive feedback in the
workplace?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 3: PROMOTION

Promotion
Definitions of Promotion
Some definitions given by authorities on the subject are listed below:
According to Scott and Clothier, ―A promotion is the transfer of an employee to a job
which pays more money or one that carries some preferred status.
According to Prof Mamoria, ―Promotion is a term which covers a change and calls for
greater responsibilities, and usually involves higher pay and better terms and conditions
of service and, therefore, a higher status or rank.
According to Arun Monappa and Saiyadain, ―Promotion is the upward reassignment
of an individual in an organization‘s hierarchy, accompanied by increased
responsibilities, enhanced status, and usually with increased income, though not always
so.

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From the above definitions, we can say that promotion usually implies several things to
the person concerned—higher status, both at work and in the community outside, more
pay and fringe benefits, perhaps greater job security and a more senior position from
which a person renders better service to his organization. Employees expect to be
informed about ladders of promotion, how they can prepare themselves for
advancement and what will be expected of them from the higher rated jobs.

Types of Promotion
The different types of promotions are:
(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‘s
pay. 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.
Basis of Promotion
 Promotion Based on Seniority
 Promotion Based on Merit
 Merit cum seniority promotion
 Promotion by Selection
 Time Bound Promotion
 Temporary Promotion
Demotion is a process by which the employee is downgraded and sent to a lower
position from the one he is holding at present. When an employee is moved to a job
with less responsibility, status or compensation he is said to be demoted. Demotion is
the reverse of promotion. It is more a punishment for inefficiency or incompetence.
According to D.S Beach, Demotion is ―the assignment of an individual to a job of lower
rank and pay usually involving lower level of difficulty and responsibility‖. According to
Arum Moapa and Saiyadain Demotion ―is a downward assignment in the organization‘s
hierarchy to a lower level job which has less responsibility, pay and status. Because of
this hierarchical repositioning it has a negative connotation and may lead to employee
dissatisfaction‖. Demotions, being a serious penalty, must be handled tactfully. The
usefulness of demotion as a punitive measure is questioned on many grounds. A
demoted employee will be disgruntled and his dissatisfaction may spread to co-workers
which will adversely affect morale, productivity and discipline of the workforce.

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Causes of Demotion
 Demotion may be used as a disciplinary weapon.
 Demotion may be resorted to when employees, because of ill health or personal
reasons, cannot do their job properly.
 If a company curtails some of its activities, employees are often required to
accept lower-level position until normally is restored.
 If an employee finds it difficult to meet job requirement standards, following his
promotion he may be reverted to his old position.

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. What is meant by promotion in HRM?
2. How do promotions motivate employees?
3. Explain the need to establish a policy on promotion.
4. If you were a manager, what will be your basis in promoting an employee?
Explain your answer.
5. When can management initiate demotion?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 4: TRANSFER

Transfer
A transfer is a change in job assignment. It does not involve a change in responsibility
and status. A movement of an employee between equivalent positions at periodical
intervals is called ― transfer. A transfer therefore does not involve a change of
responsibility or compensation. Transfers are normally made to place employees in
positions where they are likely to be more effective or where they are likely to get
greater job satisfaction. Transfers may be either organization-initiated or employee-
initiated. An organization may initiate a transfer to place employees in positions where
they are likely to be more effective or where they are better able to meet work
schedules of the organization. Employee initiated transfers also known as ―personnel
transfers may be initiated for several reasons. These could range from wanting a change
of boss or a change of location or to avoid interpersonal conflicts with their present
colleagues or to join their friends and relatives.

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Types of Transfers
There are different types of transfers depending on the purpose for which the transfers
are made.
Judging from the view-point of purpose, there are nine type of transfers.
(a) General (b) Production
(c) Replacement (d) Shift
(e) Remedial (f) Versatility
(g) Punishment or Penal (h) Request or Personal
(i) Mutual
(a)General
General transfers are normally affected during a particular period of the year wherein all
employees having completed a given period of service in a post or at a place are
involved. Definite rules and regulations are to be followed in affecting such transfers.
Such transfers are followed in big organizations, quasi-governmental organizations and
government departments.
(b) Production
Production transfers are normally made from one department to another where the
need for the employee is more. This type of transfer is made to avoid lay-off of efficient
and trained employees by providing them with alternative positions in the same
organization. These changes help to stabilize employment in an organization and
therefore require centralized control. Although it is called production transfer, similar
situations can exist in non- manufacturing enterprises or divisions too where an
employee is transferred from one department to another for similar reasons
(c) Replacement
These are transfers of long-service employees to similar jobs in other departments
where they replace or bump employees with shorter service. Replacement transfers are
affected to replace persons leaving the organization, due to resignations, retirements,
dismissal or death. Quite often such transfers are affected to change a new employee
who has proved to be ineffective in the organization. Even though the objective of these
transfers is to retain the efficient and trained employees in this process some short-
service employees may lose their jobs.
d) Shift
Shift transfers are transfers of workers from one shift to another on the same type of
work. Workers generally dislike second or third shift as it affects their participation in
community life. To minimize this, shift transfers are affected. Shift transfers also help
workers to be out of routine fatigue.
(e) Remedial
Remedial transfers are transfers made to remedy some situation primarily concerned
with employee on the job. Remedial transfers provide management with a procedure
whereby an unsatisfactory placement can be corrected. Initial placement might be
faulty or the type of job might not suit his health in such cases the worker would benefit
by transfer to a different kind of work.
(f) Versatility
The objective of these transfers is to increase the versatility of the employee by shifting
him from one job to another. In this way, the employee is provided a varied and broad
job experience. This transfer is like a rotation transfers. Versatility transfers, besides
resulting in greater satisfaction of the workers through job enlargement, also creates a
work force which can be conveniently shifted to other jobs in time of necessity.
(g) Punishment or Penal

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This transfer is made as punishments to erring employees. Quite often the employees
are transferred from one place be another so that they are made to work in a situation
of risks and hazards. Employees are posted to such places as a matter of punishment for
the errors and omissions they have committed.
Sometimes, transfer is used as a concealed penalty. A trouble-maker may be transferred
to a remote branch where he cannot continue his activities.
(h) Request Transfers
This type of transfer is done on the request of the employee. It is normally done on
humanitarian grounds to help the employee to look after his family and personal
problems.

(i) Mutual Transfers

When transfers turn out to be mutual between two employees they are referred to as
mutual transfers. Usually the organization concedes to request of employees for
transfer if another employee is willing to go to the other place.

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. When does transfer take place?
2. Explain the purpose of transfers made by the organisations?
3. Distinguish the personal transfer from organisation Initiated transfer.
4. Discuss the advantages and disadvantages of employee transfer?
5. Explain why every organization should have a fair and impartial transfer policy?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 5: SEPARATION

Separation
Separation means cessation of service of agreement with the organization. Separation
can be the result of:
(a) Resignation (b) Discharge (c) Dismissal (d) Retrenchment
(e) Lay-off (f) Golden handshake (g) Retirement

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(a) Resignation
A resignation is a voluntary separation. When a termination is initiated by the employee
himself, it is termed a resignation. Resignations may be put in voluntarily by the
employees on grounds of marriage especially in case of young girls, health, physical
disability, better opportunities elsewhere, or maladjustment with company policy and
affairs. The personnel department should investigate the real reasons behind such
resignations. A study of exit interviews over a period of time may disclose a fiscal
pattern suggesting improvements in the personnel management functions.
Resignation may also be compulsory when an employee is asked to put in his papers if
he wants to avoid termination of services on the ground of gross negligence of duty or
some serious charge against him.

(b) Discharge
A discharge involves permanent separation of an employee from the organization
because of poor performance, violation of rules or poor code of conduct. A discharge
becomes necessary when
 The business volume is reduced thereby reducing the employment opportunities
in the organization,
 The employee fails to work according to the requirements of the job, or
 The employee forfeits his right to a job.
Discharges are generally made in accordance with the standing orders. The action taken
should be bonafide and nor a punitive measure or a case of victimization.
(c) Dismissal
When the termination is initiated by the organization, it is termed as dismissal. A
dismissal is the termination of the services of an employee by way of punishment for
some misconduct, or for prolonged absence from duty. A dismissal is a drastic step.
Therefore, it must be supported with a just and sufficient cause. It is generally done as a
last resort after all attempts at reconciliation have failed. Before an employee‘s services
are terminated, he should be given an opportunity to explain his conduct and show
cause why he should not be dismissed. The principle of natural justice should be
followed to ensure that the punishment is in proportion to the offence. As a safeguard,
responsibility for dismissal should not rest on the immediate supervisor. The approval of
the next higher authority should generally be taken and the personnel manager should
be consulted. Dismissals can be on the ground of unsatisfactory performance,
misconduct, or want of qualifications for the job, or excessive absenteeism.
(d) Retrenchment
Retrenchment is termination of service due to redundancy. It is a permanent
termination of the services of an employee for economic reasons in a going concern. It
must be noted that termination of services as a punishment given by way of disciplinary
action or superannuation or continued ill health does not constitute retrenchment. The
term retrenchment is applied to continuing operations where a part of the workforce is
found to be superfluous. Retrenchment has many un-stabilising effects. It influences the
attitudes and contributions of other employees who become disturbed by rumors,
gossips, resentment and a sense of insecurity about their own fate. The principle in the
procedure of retrenchment is that the last person employed in each category must be
the first person to be retrenched. For this purpose, the employer prepares a list of all
the workers in the category where retrenchment is contemplated, arranged according
to the seniority of service of the employees in that category. When vacancies arise after
retrenchment, the organization gives an opportunity to the retrenched workers to offer
themselves for re-employment; and they are given preference.

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(e) Layoff
According to Section 2 (KKK) of the Industrial Disputes Act, a layoff is ―the failure,
refusal or inability of an employer, on account of shortage of coal power or raw
materials, or the accumulations of stocks or breakdown of machinery for any reason, to
give employment to a workman whose name is borne on the muster roll of his individual
establishment and who has not been retrenched‖. According to this definition, a lay off
refers to an indefinite separation of the employee from the pay roll due to factors
beyond the control of the employer. The employee is expected to be called back in the
foreseeable future. The laid-off employee is not a discharged employee and is still
carried on the roll as an employee. Lay- off is resorted to by the employer for factors
beyond his control. Such factors could be:
 Fluctuations in the market resulting in loss of sales.
 Shortage of raw materials or power.
 Accumulation of stock.
 Breakdown of machinery.
 Production delays.
Golden Handshake
It is a method of retrenchment wherein the employees with a certain minimum service
can opt for voluntary retirement and get a fat lumpsum in return. Golden handshake is
usually offered by the Government to reduce the size of the bureaucracy and close
down chronically loss-making public sector enterprises. Many thinkers on the subject
are of the opinion that golden handshake is the fallout of the new economic policy
followed by the Government of India. In the 1992–93 Union Budget, the Government
had provided Rs. 450 crores for the Voluntary Retirement Scheme (VRS) for its
employees.
(g) Retirement
In India, the retirement age is 58 or 60 years. Some employers may extend the age
upward or downward from this base. For those employees who retire, it is a significant
milestone. Regardless of the age at which retirement occurs, workers may need
preparation through counselling. They should be informed about pension choices and
insurance benefits after retirement. Employees at retiring age often feel they could
continue to work effectively and there is a strong resistance from many to give up
employment. For an organization, in times of staff shortage, retired employees are of
great help.

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. What is separation in HRM?
2. When can you say that termination or dismissal of an employee is legal?
3. What steps can an organization take to protect itself from liability for wrongful
discharge?
4. What do you think the reasons for separation of employees?
5. What are the cost and benefits of employee separation?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Content Demonstrate a thoughtful 8
understanding of the writing

122
 prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 6: IMPLICATION OF JOB CHANGE

Implication of Job Change Effects of Promotion:

A Promotion results in an employee taking on responsibility for managing or overseeing
the work of other employees.
A Promotion is viewed as desirable by employees because of the impact a promotion
has on pay, authority, responsibility, and the ability to influence broader organizational
decision making. It is a form of recognition for Employees who make significant and
effective work contributions. An individual who receives a promotion normally receives
additional financial rewards and the ego boost associated with achievement and
accomplishment.
A promotion is a powerful communication tool about what is valued within an
organization.
Effects of Demotion:
 Demotion sends a strong signal to the employee that his behavior is not
acceptable to the organization.
 It can also have a demoralizing effect on other employees who happen to work
with the demoted employee.
 Demotion will have a serious impact on need fulfilment.
 If demotion is chosen over termination, efforts must be made to preserve the
self-esteem of the individual. A positive image of the worker‘s value to the
company should be projected.

Causes of Demotion:
 Demotion may be used as a disciplinary weapon.
 Demotion may be resorted to when employees, because of ill health or personal
reasons, cannot do their job properly.
 If a company curtails some of its activities, employees are often required to
accept lower-level position until normally is restored.
 If an employee finds it difficult to meet job requirement standards, following his
promotion he may be reverted to his old position.

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. What are the implications of change in HRM?
2. In your own understanding, how you will define job change in HRM?
3. Why job change emerge?
4. As an HR professional, how you will handle job change in your workplace?

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 5. Explain briefly the effects and causes of demotion.

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 7: CONTROL PROCESS

THE EVALUATION AND CONTROL PROCESS
Ensure that a company is achieving what it set out to accomplish. It compares
performance with desired result and provides the feedback necessary for management
to evaluate results and take corrective action, as needed.
A Five Step Feedback Model:
Determine what to measure: Top managers and operational managers need to specify
what implementation process and results must be capable of being measured in a
reasonably objective and consistent manner. The focus should be on the most
significant element in a process the ones that account for highest proportion of expense
or the greatest number of problems. Measurement must be found for all important
areas, regardless of difficulty.
Establish standards of performance: Standards used to performance are detailed
expressions of strategic objectives they are measure of acceptable performance results.
Each standard usually includes a tolerance range that defines acceptable deviation.
Standards can be set not only for final output but also for intermediate stages of
production output.
Measure performance: measurement must be made at predetermined times.

Compare actual performance with the standard: if actual performance results are
within the desired tolerance range. The measurement process stop here.
Take corrective action: if actual results fall outside the desired tolerance range action
must be taken to correct the deviation, the following questions must be answered:
 Is the deviation only a chance fluctuation?
 Are the process being carried out incorrectly?
 Are the process appropriate to the achievement of the desired standard? Action
must be taken will not only correct the deviation but also prevent it is happening
again.
 Who is the best person to take corrective action?
Measuring performance
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The end result of activity. Which measures to select assess performance depends on the
organizational unit to be appraised and the objective to be achieved. The objectives that
were established earlier in the strategy formulation part of strategic management
process (dealing with profitability, market share, and cost reduction, among others)
should certainly be used to measure corporate performance once the strategies have
been implemented.

Task/Activity

ESSAY. Answer the questions in a clean sheet of paper.

1. What is control process in HRM?
2. Describe the five step feedback model control approach.
3. Explain briefly the costs and benefits of organizational controls.
4. Identify some features of controlling.
5. Why Is Performance Measurement Important?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

TOPIC 8: GRIEVANCES

GRIEVANCE:
It may be any genuine or imaginary feeling of dissatisfaction or injustice which an
employee experiences about his job and it‘s nature, about the management policies and
procedures. It must be expressed by the employee and brought to the notice of the
management and the organization. Grievances take the form of collective disputes
when they are not resolved. Also, they will then lower the morale and efficiency of the
employees. Unattended grievances result in frustration, dissatisfaction, low productivity,
lack of interest in work, absenteeism, etc. In short, grievance arises when employees‘
expectations are not fulfilled from the organization as a result of which a feeling of
discontentment and dissatisfaction arises. This dissatisfaction must crop up from
employment issues and not from personal issues.
Grievance may result from the following factors-
 Improper working conditions such as strict production standards, unsafe
workplace, bad relation with managers, etc.
 Irrational management policies such as overtime, transfers, demotions,
inappropriate salary structure, etc.

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  Violation of organizational rules and practices
The manager should immediately identify all grievances and must take appropriate
steps to eliminate the causes of such grievances so that the employees remain loyal and
committed to their work. Effective grievance management is an essential part of
personnel management. The managers should adopt the following approach to manage
grievance effectively:
Quick action- As soon as the grievance arises, it should be identified and resolved.
Training must be given to the managers to effectively and timely manage a grievance.
This will lower the detrimental effects of grievance on the employees and their
performance.
Acknowledging grievance- The manager must acknowledge the grievance put forward
by the employee as manifestation of true and real feelings of the employees.
Acknowledgement by the manager implies that the manager is eager to look into the
complaint impartially and without any bias. This will create a conducive work
environment with instances of grievance reduced.
Gathering facts- The managers should gather appropriate and sufficient facts explaining
the grievance‘s nature. A record of such facts must be maintained so that these can be
used in later stage of grievance redressal.
Examining the causes of grievance- The actual cause of grievance should be identified.
Accordingly remedial actions should be taken to prevent repetition of the grievance.
Decisioning- After identifying the causes of grievance, alternative course of actions
should be thought of to manage the grievance. The effect of each course of action on
the existing and future management policies and procedure should be analyzed and
accordingly decision should be taken by the manager.
Execution and review- The manager should execute the decision quickly, ignoring the
fact, that it may or may not hurt the employees concerned. After implementing the
decision, a follow-up must be there to ensure that the grievance has been resolved
completely and adequately.
An effective grievance procedure ensures an amiable work environment because it
redresses the grievance to mutual satisfaction of both the employees and the managers.
It also helps the management to frame policies and procedures acceptable to the
employees. It becomes an effective medium for the employees to express t feelings,
discontent and dissatisfaction openly and formally.
Objectives of Grievance Handling Procedure:
Objectives of the grievance handling procedure are as follows:
 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:
 Benefits that accrue to both the employer and employees are as follows:
 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.
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  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.
Details of a grievance procedure/machinery may vary from organization to organization.
The four stages of the machinery are briefly discussed here:
1. Initial level at which grievance occurs:
The greatest opportunity to redress a grievance is to resolve it at the initial level at
which it occurs. A worker‘s grievance should be resolved by their immediate boss, the
first-line supervisor. The first stage of the procedure usually involves three persons—the
aggrieved employee, his immediate boss and the union representative.
It is possible to involve the union in laying down the framework of the grievance
procedure and thereafter restrain union involvement in the actual process, at least in
the first two stages. Supervisory role needs to be strengthened, with appropriate
training in problem-solving skills, grievance handling, and counselling.
2. Intermediate stage:
If the dispute is not redressed at the initial state at supervisor‘s level, it is usually
referred to the head of the concerned department. It is important that the management
assumes prime responsibility for the settlement of a grievance. At the intermediate
level, grievance can be settled with or without union involvement.
3. Organization level:
If a grievance is not settled at the intermediate level also, it can be referred to the top
management. Usually, a person of a level not less than the general manager designated
for the purpose directly handles the issue. At this level, it is very difficult to reconcile the
conflicting interests.
4. Third-party mediation:
If the grievance has not been settled bilaterally within the organization, it goes to a third
party for mediation. Arbitration or adjudication or the matter may even be referred to a
labor court. At this stage, the parties concerned lose control over the way the grievance
is settled.
In case of mediation (conciliation or arbitration), the mediator has no authority to
decide, but in case of the labor court or an adjudicator, the decision will be binding on
the parties, subject to statutory provisions for appeal to higher courts.
At any stage of the grievance machinery, the dispute must be handled by some
members of the management. In grievance redressal, responsibility lies largely with the
management. And, as already discussed, grievances should be settled promptly at the
first stage itself.
Methods of Identifying Grievances
The following methods can help the employer to identify the grievances:
1. Directive observation:
Knowledge of human behavior is requisite quality of every good manager. From the
changed behavior of employees, he should be able to snuff the causes of grievances.
This he can do without its knowledge to the employee. This method will give general
pattern of grievances. In addition to normal routine, periodic interviews with the
employees, group meetings and collective bargaining are the specific occasions where
direct observation can help in unfolding the grievances.
2. Grip boxes:

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The boxes (like suggestion boxes) are placed at easily accessible spots to most
employees in the organization. The employees can file anonymous complaints about
their dissatisfaction in these boxes. Due to anonymity, the fear of managerial action is
avoided. Moreover management‘s interest is also limited to the free and fair views of
employees.
3. Open door policy:
Most democratic by nature, the policy is preached most but practiced very rarely in
Indian organizations. But this method will be more useful in absence of an effective
grievance procedure, otherwise the organization will do well to have a grievance
procedure. Open door policy demands that the employees, even at the lowest rank,
should have easy access to the chief executive to get his grievances redressed.
4. Exit interview:
Higher employee turnover is a problem of every organization. Employees leave the
organization either due to dissatisfaction or for better prospects. Exit interviews may be
conducted to know the reasons for leaving the job. Properly conducted exit interviews
can provide significant information about the strengths and weaknesses of the
organization and can pave way for further improving the management policies for its
labor force.

The following steps provide a measure of guidance to the manager dealing with
grievances:
1. Acknowledge dissatisfaction:
Managerial/supervisory attitude to grievances is important. They should focus attention
on grievances, and not turn away from them. Ignorance is not bliss; it is the bane of
industrial conflict. Arrogant attitude on the part of supervisors and managers aggravates
the problem.
2. Define the problem:
Instead of trying to deal with a vague feeling of discontent, the problem should be
defined properly. Sometime the wrong complaint is given. By effective listening, one can
make sure that a true complaint is voiced.
3. Get the facts:
Facts should be separated from fiction. Although grievances result in hurt feelings, the
effort should be to get the facts behind the feelings. There is need for a proper record of
each grievance.
4. Analyze and decide:
Decisions on each grievance will have a precedent effect. While no time should be lost in
dealing with them, it is no excuse to be slipshod about it. Grievance settlements provide
opportunities for managements to correct themselves, and thereby come closer to the
employees. Horse-trading in grievance redressal due to union pressures may
temporarily bring union leadership closer to the management, but it will surely alienate
the workforce away from the management.
5. Follow up:
Decisions taken must be followed up earnestly. They should be promptly communicated
to the concerned employee. If a decision is favorable to the employee, their immediate
boss should have the privilege of communicating the same.

Task/Activity
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ESSAY. Answer the questions in a clean sheet of paper.
1. Give examples of managerial action that might reduce the number of
employee quits.
2. What steps can an organization take to protect itself from liability for wrongful
discharge?
3. Why do organizations need both grievance and disciplinary procedures? What
is the purpose of each?
4. What are the typical grievance procedures found in unionized and non-
unionized firms?
5. What is the role played by the supervisor in handling grievances?
6. Discuss some of the causes of grievances?
7. Explain the condition when arbitration is required.
8. Describe how the various labor laws affected the balance of power between
labor and management.
9. Explain how a supervisor can ensure fairness in discharging employees.
10. Discuss the differences between the positive and negative approaches to
discipline.

ASSESSMENT: LESSON 5
Name: ________________________________________________ Score:
___________
Part I. Identification. Read each statement carefully and fill in the blanks with the
correct answer. Answers may be more than one word.
_______________1. Employee's dissatisfaction with company's work policy and
conditions because of an alleged violation of law.
_______________2. It is an indefinite separation of the employee from the pay roll due
to factors beyond the control of the employer.

_______________3. It is a termination of service due to redundancy.

_______________4. Termination of service of agreement with the organization.
_______________5. Type of transfer wherein it normally affected during a particular
period of the year wherein all employees having completed a given period of service in a
post or at a place are involved.
_______________6. This transfer is like a rotation transfer.
_______________7. It is normally done on humanitarian grounds to help the employee
to look after his family and personal problems.
_______________8. Basis of promotion wherein the rule is to promote the employee
having the longest length of service.
_______________9. It is the movement of an employee to a more capable job within
the same occupational unit and with a corresponding increment in pay.

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_______________10. The reassignment of a higher-level job to an internal employee
with delegation of responsibilities and authority required to perform that higher job and
normally with higher pay.
_______________11. It happens when the source or the rater feels one aspect of the
performance is high and therefore rates all areas high.
_______________12. It refers to how consistent the same measuring tool works all
through the organization.
_______________13. Tells employees the job expectations and how they can be met.
_______________14. The ongoing process between employee and the manager where
information is exchanged concerning the performance expected and the performance
exhibited.
_______________15. It also known as impromptu feedback, and it can happen in the
spur of the moment and in casual settings.

Part II. Case Study.

Case Study #1
The Strict Evaluator
Samuel Icasiano is upset about his recent
performance review. Samuel has worked for Reyes Enterprises for 12 years. For the first nine
years, Samuel’s job performance was consistently rated outstanding. However, for the past
three years, Samuel’s performance has been rated only a little above average. According to
Samuel, his performance review scores have been low during the past three years because his
supervisor gives unreasonably low ratings. Marissa Andres was assigned as Samuel’s supervisor
three years ago.
Marissa says that she tries to evaluate her subordinates objectively and she refuses to a change
Samuel’s ratings. Samuel claims that any other supervisor would have evaluated him at least 10
points higher. He feels very disappointed about his low evaluation because he knows it will mean
a minimal pay increase and that it will hurt his chances for promotion.

Questions
1. Why do most people expect higher evaluations than they receive?
2. What is wrong with this performance evaluation process and what can be done
to improve it?
3. If Samuel and Marissa were members of different religious groups, how the
problems with performance appraisal process could be separated from
allegations of discrimination.

Case Study #2
Unfair Promotion at the Food Chain
Joel Reyes, the newly hired HR officer at the Food Chain, Inc. was jolted by the
conversation he just had with Ria Tolentino, an employee at the counter. Ria complained that
female employees were being passed over for promotions in favor of male employees who had
less experience and seniority. She explained that she had been passed over for promotion twice
since she started working at the Food Chain.

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After Ria left his office, Joel began to immediately investigate her complaints, only to find out
that for the past two or three years, more than 90% of the employees who were promoted are
male. Further investigations revealed that the supervisor made promotion recommendations
and decisions. The company felt that the supervisor was in the best position to judge whether or
not an employee was promotable. There was no system for employees to apply for promotions.
Written performance evaluations were limited to office employees and store managers.
Promotions were limited to persons recommended by the store managers.

Questions
1. If you were Joel, how will you handle the complaint presented by Ria?
2. As the newly hired HR Officer of the Food Chain, how will you avoid problems
similar to this in the future?
3. What should Joel do now?

Case Study
Betting on Ending, A Form of Gambling
The Company Rules and Regulations at Javier’s Enterprises prohibit taking part
in gambling or game of chance on company time and/or premises. Today, while working at the
Sales Division, Jonathan, one of the drivers, complained that Tony, another employee, reneged
on his P50 bet on the Purefoods-Ginebra basketball game. As he was talking, in came Samuel, a
supervisor from another department and says, “Pare, tiba ka, panalo and Purefoods. Eto ang
P4,000 mo.” Just as Samuel was handling the P4,000 to Jonathan, in came Jun, Jonathan’s
supervisor. Upon learning of the betting and paying, Jun summoned Jonathan to his room. Later,
was sent home because he was suspended for two weeks for gambling inside the company
premises. Jonathan filed a grievance against Jun saying that what they were doing is just for fun
and not gambling.

Questions
1. If you were Jun, how will you handle the grievance filed by Jonathan?
2. Is betting on “ending” a form of gambling? Explain your answer.
3. Can Jun also file charges against Tony and Samuel who are both employees of
the company but are not under the supervision of Jun?

Rubric for grading:

PERFORMANCE
CRITERIA POINTS
INDICATORS
Demonstrate a thoughtful
Content understanding of the writing 8
prompt and the subject matter.
Used correct grammar,
Grammar punctuation, spelling, and 1
Capitalization
Expressed the points in clear
Organization of
and logical arrangement of ideas 1
ideas
in the paragraph

131
 REFERENCES
DeCenzo, David A., et al (2005). Fundamentals of Human Resource Management - 8 th
Edition. Hoboken, New Jersey: John Wiley & Sons, Inc.

Noe, Raymond A. (2007). Fundamentals of Human Resource Management – 2 nd Edition.

New York: McGraw-Hill/Irwin.

Payos, Ranulfo, (2010). Human Resource Management. Manila, Philippines: Rex Book
Store, Inc.

Corpuz, Crispina R. (2006). Human Resource Management. Manila, Philippines: Rex Book
Store, Inc.

Medina, Roberto G. (2006). Personnel and Human Resources Management. Manila,

Philippines: Rex Book Store, Inc.

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