Human Resource Management: by Prof. Jayalakshmi

Human Resource Management
By Prof. Jayalakshmi
Promotions & Transfers
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Meaning of Promotion
• According to E.B. flippo “promotion involves a
change from one job to another that is better
in the terms of status and responsibilities.”
• According to Scott and Spreigal: “A Promotion

is the transfer an employee to a job that pays
more money or that enjoys some preferred
status.”
www.learnito.com HRM 2
Purpose of Promotions
1. Recognize and reward employee’s good/superior performance and
commitment.
2. Promote a feeling of content with the existing conditions of the
company and a sense of belongingness.
3. Build loyalty and to boost morale and job satisfaction.
4. Retain skilled and talented employees and reduce discontent and
unrest.
5. Promotions acts as a tool for reducing labour turnover.
6. Increase interest in acquiring higher qualifications, training and self
development with a view to meet the requirements of promotion.
7. Reduce/Eliminate problems created by the leader of workers’
unions by promoting them to the officer’ levels where they are
less effective in creating problems.
8. Ultimately it improves organizational health.
Basis for Promotions
Seniority Merit
1. Seniority means length of
recognized service in an 1. Merit means ability to work.
organization.
2. It denotes an individual employee’s
2. Seniority means the calculation of skill, knowledge, ability, efficiency and
time from when an employee has
joined the company and served for aptitude as measured from
how many years in the company. educational, training and past record
3. The senior most person in the 3. If the merit is adopted as basis of

lower grade shall be promoted as
and when there is an opening in promotion then the person in the lower
the higher position grade ,no matter his junior most in the
company, shall be promoted.
4. Seniority is suggested as the criteria
for promotion on the plea that
there is a positive correlation 4. It encourage all employee to improve
between length of the service and their efficiency
talent
Advantages of Seniority and Merit Based
Promotions
Seniority Based Merit Based
1. Easy to measure the length 1. Difficult to judge merit.
of service
2. Implies the knowledge, skills and
2. Trade unions generally emphasis on
seniority. performance record of an employee.
3. Security and certainty. 3. Motivates competent employees to

work hard and acquire new skills.
4. Minimize the scope of grievances
and conflicts. 4. Maintains the efficiency of the
organization by recognizing talent
5. Reduce labour turnover and performance
6. Sense of satisfaction to senior 5. Attracts and retains young and

employees and is in line with the promising employees in the
Indian Culture of respecting organization
seniority in all walks of life.
Disadvantages of Seniority and Merit
Based Promotions
Seniority Based Merit Based
1. Length of Service is not directly 1. Measuring Merit is not easy.

proportional to talent. Subjective judgement may be
involved.
1. Performance and potential of an
individual is not recognized.
2. Many, particularly trade unions
2. Demotivates and demoralizes distrust the management’s integrity
the young employees who are in judging merit.
talented.
3. When younger employees are
3. Kills the zeal and interest for self promoted over the older one, the
development older employees may feel insecure
or leave.
4. Fails to attract young and
hardworking employees
Seniority cum Merit as a Basis for
Promotion
As both seniority and merit as basis suffer from certain
limitations, a sound promotion policy should be based on a
combination of both seniority and merit.
A proper balance between the two can be maintained by

differentiating the way minimum length of service is
prescribed.
Relative weightage may be assigned to seniority and merit and

employees with a minimum performance record and
qualifications are treated eligible for promotion. Seniority is
used to choose from the eligible candidates
Transfers
Meaning of Transfer
• A transfer is a horizontal or lateral movement of an
employee from one job, section, department, shift plant or
position to another at some other place where salary, status
and responsibility are usually the same.
• Transfer is defined as “a lateral shift causing movement of

individuals from one position to another usually without
involving any kind of change in duties, responsibilities, skills
needed or compensation”.
Types of Transfers
1. Production Transfer: Such transfers are resorted to when there is a need
of manpower in one department and surplus manpower in another
department. Such transfers are made to meet the company
requirements.
2. Replacement Transfers: Replace an existing employee who has been in

the organization for a long time with a new employee and thereby giving
some relief to an old employee from the heavy pressure of work.
3. Remedial Transfers: As the name suggest, these transfers are made to

rectify the situation caused by faulty selection and placement
procedures. Such transfers are made to rectify mistakes in placement
and recruitments.
4. Versatility Transfer: Such transfers are made to increase versatility of the

employees in more than one job and department. This type of transfer,
also referred to as ‘Job Rotation’ is a tool to train employees.
Types of Transfers, contd.,
5. 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.
6. Selection Transfers: they are made within the department or

section. It is to be train the workers and prepare them to handle
different types of operations within the department.
7. Departmental Transfers: transferring from one department to

another department within the plants.
8. Inter-Plant transfers: if there is more than one plant under the

control of same management transfer may be made from one plant
to another for varied reasons. Such transfers are called inter- plant
transfers.
Benefits of Transfer
1. Increase in productivity and effectiveness of the
organization.
2. Greater job satisfaction to employees.
3. Stabilize fluctuating job needs.
4. Improve employee skills.
5. Remedy for wrong placement.
6. Improve labour relationships.
7. Develop employees for future promotions.
8. Avoid monotony and boredom.
Reasons for Transfer
1. Meet the organizational requirements and also personal requirements of employees.
2. Satisfy employee’s needs.
3. Utilize employees’ skill, knowledge etc., where they are more suitable or badly
needed.
4. Correct inter-personal conflicts.
5. Avoid favoritism and nepotism.
6. Creates transparency among the employees and their work
7. Maintain healthy relationship among staff in order to ensure harmonious

environment and to avoid unnecessary disputes.
8. Limits the ability of an employee to take advantage and sole control over the seat or
section.
Right Sizing the Workforce
• The process of reorganizing or restructuring a business by
cost-cutting, reduction of workforce or reorganizing upper-
level management. The goal is to get the company molded
properly to achieve maximum profit. The term rightsizing is
often used by companies instead of downsizing because it
sounds less drastic.
• It is proactive and needs to be a constant part of the process

of managing an organization. To do rightsizing of an
organization, the leaders first look at market needs and
trends, technologies, alternative approaches, and new ideas.
Need for Right Sizing
1. Ensures that the required functions are properly
maintained.
2. Cost-control and to Maximize Profits
3. Avoid formation of trade unions
4. Enhance employee performance and
productivity
5. Improve employee collaboration
6. Create a sense of belongingness within the
employees.
Demotion
Demotion has been defined as the assignment
of an individual to a job of lower rank and pay
usually involving lower level of difficulty and
responsibility.
Demotions serves as a useful purpose in the

sense that they keep the employees alert and
alive to their responsibilities and duties.
Separation
Separation means cessation of service from the organisation
for one or more reasons.
The employee may be separated from HR payroll due to:

• Resignation
• Discharge and dismissal
• Suspension and retrenchment
• Lay off
References
Books
Human Resources Management by Aswathappa
Human Resources Management by Shashi. K. Gupta and Rosy Joshi
Web References
Reference for Business
http://www.referenceforbusiness.com/management/De-Ele/Downsizing-and-
Rightsizing.html#ixzz3iOSzC3ou
CiteMan
http://www.citeman.com/949-bases-of-promotion-of-employees-in-
organization.html
Learnito Study Series for Business Students
Find notes, curated videos, MCQs, case studies and solved

university papers at www.learnito.com

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Human Resource Management

Promotions & Transfers

Learnito Study Series for Business Students

• According to Scott and Spreigal: “A Promotion

3. The senior most person in the 3. If the merit is adopted as basis of

3. Security and certainty. 3. Motivates competent employees to

6. Sense of satisfaction to senior 5. Attracts and retains young and

1. Length of Service is not directly 1. Measuring Merit is not easy.

A proper balance between the two can be maintained by

Relative weightage may be assigned to seniority and merit and

• Transfer is defined as “a lateral shift causing movement of

2. Replacement Transfers: Replace an existing employee who has been in

3. Remedial Transfers: As the name suggest, these transfers are made to

4. Versatility Transfer: Such transfers are made to increase versatility of the

6. Selection Transfers: they are made within the department or

7. Departmental Transfers: transferring from one department to

8. Inter-Plant transfers: if there is more than one plant under the

2. Satisfy employee’s needs.

4. Correct inter-personal conflicts.

5. Avoid favoritism and nepotism.

6. Creates transparency among the employees and their work

7. Maintain healthy relationship among staff in order to ensure harmonious

• It is proactive and needs to be a constant part of the process

Demotions serves as a useful purpose in the

The employee may be separated from HR payroll due to:

Find notes, curated videos, MCQs, case studies and solved

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