Human resources

Role of human resources management

 Is the process of managing the staff within the business and focusing on the
employee, employer relationship
 Most valuable assets Is the staff
 Strategic role of human resources
o Is the approach taken to ensure the business can meet the needs of their
employees and at the same time the business’s goals
o Areas between the employee and the employer include:
 Recruitment
 Training and development
 Work incentives
 Firing
o By the HRM being proactive and thinking long term, it would improve the
diverse range of human resource issues
o Benefits of a strategic role is:
 Allows for employee recognition
 Allows for a system in place to deal with workplace conflict and issue
 Gives the business the correct employment for now and future
 Is a competitive advantage
 Interdependence with other key business functions
o Human resources and Operations
 Operations works closely to ensure the correct type of workers with
relevant skills and experience are employed for the business to
succeed
 HR will monitor the performance of employees in all sections
including production of goods to training development
o HR and Marketing
 Staff will need to be motivated and skilled to develop products which
cater for both the needs and wants of the customers
 Through marketing the business is able to determine which skills are
required for the employees to produce the desired products
o HR and Finance
 A key goal is for the business to employ high motivated and skill staff
which would benefit the business and its profits
 Budgets are establish to allocate funding for training and
development and education
 Outsourcing
o Human resource functions
 Reasons for:
 Provides ability for specialised staff access
 Allows the managers to focus on the core of the business
o Production and needs of customers
 If outsourced it can save costs
 Issues concerning:
  If outsourced the other company might lack the understanding
of the key aspects which can include:
o Business culture
o Existing workplace issues
 The relationship between employees and HR could become
undeveloped
o Using contractors
 Domestic
 The employment contract in Australia is between employee
and employer
 Many conditions of the contract are outlined and controlled by
various state and federal laws which apply to all workplaces
 Contractors have unique contracts with their employers
o Due to their employment by one employer is not
ongoing and an agreed fee is paid for the service
provided
o Contractors services include:
 Buildings, lawyers, plumbers
o This is different from contract of service. Exists were an
employee offers his or her services to an organisation
on a regular basis and is subject to the lawful control
and authority of the employer
 Global
 This allows for Australian business to access foreign countries
where they don’t consider Australian law such as minimum
labour requirements, health and safety laws, etc.
Key Influences
 Stakeholders
o Employers
 An employer is an individual or organisation which pays others to
work for their business
 Employers are often the business owners and takes reasonability to
hire the appropriate staff to achieve the business goals
 In large businesses, they can appoint mangers to become
employers
 Large businesses would have a HR department to focus on employee-
related issues in the workplace
 Which allows for the managers to focus on the core of the
business
 HR departments:
 Would work with other KBF to employee right staff
 Ensure the working conditions and benefits comply with both
federal and state laws
 Implement a range of different training and development
which cater for the business needs
  Develop rewards for the employees to express how they are
valued for the business
o Employees
 An employee is an individual who provides their skills in return for a
regular source of income
 The employee responsibility is to complete the lawful tasks provided
by the employer
 Employees with the assistance of trade unions have encouraged
employers to introduce initiatives aimed at developing family friendly
practices such as:
 Part time work
 Paid maturity leave
 Provision of child care centres
 Some business allows for flexibility in working times due to family, or
others allow for casual clothes to wear to work
 Advancing technology has allowed employees to work from home
o Employer associations
 These associations aim to promote the interests of the employer in
the business environment
 Lobby governments aims to develop polices which aim to enhance the
relationship between employee-employer
 They also consult with governments on key policy issues
 Examples in Australia:
 Employers first
 The Business Council of Australia
 The National Farmers’ Federation
 Employer associations assist and give advice to their members about:
 Employment opportunity
 Dismissal wage negotiation
 Legislative changes
o Trade Unions
 Trade unions are an NGO which is aimed at protecting and promoting
the rights of the employee in the workplace
 Unions assist employees with disputes and act as a bargaining agent
in wage negotiations
 Trade unions also advise their members about rights, wage levels,
occupational health and safety issues
 Examples:
 Shop, Distributive and Allied Employees’ Association
 Retail and fast food workers unions
 The ACTU (Australian council of trade unions) and federal labor
government works together to improve wage and living standards and
have targeted:
 Reduce income tax rates
 Childcare subsidies
 Compulsory employer-funded superannuation contributions
 Union membership is on a decline due to:
  more jobs moving to the private sector
 cost of union membership being high
 The union representation is called shop steward
 This representation is the first point of contact between the
union and its members in the workplace
o Government organisation
 The government is the most influential stakeholders is the
employment relationship process
 The federal government establishes the legal framework which the
employees, employers, trade unions and employee associations
operate within
 Key term:
 Award
o Is the legal documents which specifics the specifies the
minimum working conditions which apply to all people
in the common industry
o It covers:
 Wages
 Holidays
 Sick leave
 Overtime
 Working conditions
o Is the non-wage feature of the employees’ workplace
contract which includes:
 Hours of work
 Rostering issues
 Promotional policies
 Certified agreements are subjected to the
better off overall test
 Better Off Overall Test
o Used by the Fair Work Commission to examine if any
employees’ will become worse off if they sign a new
agreement rather than being employed under an
award
 Industrial disputes
o Is the problem which arises from the employer to the
employees at the workplace
o Problems include:
 Wage rates
 Working conditions
 Unfair dismal
 Occupational health and safety issues
 Conciliation
o Not all disputes are solved through negation
o Conciliation is by Fair Work Commission
o These recommendations are not legally binding
  Arbitration
o When dispute isn’t solved through conciliation, the Fair
Work Commission can decide to arbitrate
o It involves a commissioner and both parties putting
forward their cases and making a decision
o The decision is legally binding
 Fair Work Commission
 Fair Work Act 2009 (cth)
 The function of the commission is to:
o Encourage the prevention and settlement of disputes
between employees and employers through the
process of conciliation and arbitration
o Determine minimum wages through national wage
case hearings
o Arbitrate on unfair dismissal claims
o Apply Better Off Over All test to certain wage
agreements
 Federal court of Australia
 The federal court is the appeal for decisions made by the Fair
Work Commission
 It can apply penalties to parties who breach the legally binding
decisions from the Fair Work Commission
 Other agencies organisations
 United Nations conventions which seek to protect the basic
rights of all employees
 Human Rights and Equal Opportunity Commission was
established in 1996 to enforce federal government legislation
on discrimination in the workplace.
 Equal Opportunity for Women in the Workplace Agency
(EOWA) promotes and enforces the Equal Opportunity for
Women in the Workplace Act 1999 (Cth)
o Society
 It is becoming more accepted that the workplace practises are
reflective of behaviours that are upheld within society
 Issues such as:
 Perceived discrimination
 Harassment
 Unfair working conditions
 Legal – current legal framework
o Over the years the government has established the legal framework to
encourage employees and employers to co-exist
o Employment contract
 Is between the employer and employee
 Many conditions are controlled by both state and federal laws
 The law regards the employee to be the person of subject in the
service as the employer is able to tell them what and how to do the
service
 The employment contract is based off the employee offering their
services on regular basis
 The position of employment is ongoing and won’t be terminated once
finished service
 The rights and responsivities are created by the employment contract
for both the employee and employer which are enforceable by law
such as:
 A safe workplace
 Minimum wage entitlement
 Anti-discrimination and equal opportunity initiatives
 Duty of employers:
 Duty of care
 Duty to pay the agreed wage
 Duty to provide the work
 Duty of employees:
 Duty to obey lawful instructions and commands
 Duty to work with skill
 Duty to disclose relevant information
 Regulation in employment
 Minimum wage rates
o A specialist minimum wage panel from the Fair Work
Commission
o Wage rates differs between adults and children
o Current federal minimum wage (before tax) is $17.70
per hour or $672.60 for a 38-hour week
 Agreements
o 1991, the government encourage workplaces to
develop their own wage agreements
 Type of employment:
 Part time
o An employee working on a fixed set of hours but less
than full time
o Entitled to all benefits of full time staff (sick leave,
annual leave, holiday loading, meals and uniform
allowance)
 Full time
o Is a person providing continuous employment within
the business
o Works 35 hours plus
o Entitled to minimum 4 weeks holidays per year and
receive 1.1 weeks of long service leave for each year
 Casual
o Employed for a short period of time
 o Must work a minimum of 1 shift (depends on employer
demands)
o Not entitled to sick or annual leave
o Not obligated to give ongoing work
o Entitled to paid 1.5 times the normal wage employees
doing the same work
 Fixed-term (contract work)
o A business which requires labour for a specific period
of time
o Involves an agreement between two parties
o If the employer wishes to terminate the contract the
employee is able to seek court action to recover the
lost funds (vice versa)
o Work health and safety and workers compensation
 Work and safety act
 Work and Safety Act 2011 (NSW), Establishes the right and
responsibilities of employees and employers in regard to
safety
 Employers must provide a safe working environment for
employees
 Businesses with over 20 employees must have an OH&S
committee
 Workers compensation
 Workers Compensation Act 1987 (NSW) and Workplace Injury
Management and Workers Compensation (1998) (NSW)
governs the employees process of financial injuries which
occur at work and their process of returning to work
 The Acts maintain the individual’s income and establishes
rehabilitation for the employee to return to work
o Anti-discrimination and equal employment opportunity
 Anti-discrimination
 Various anti-discrimination laws prohibit discrimination in the
workplace based on:
o Gender
o Ethnicity
o Sexual preference
o Religion
o Disability
 Legislation includes:
o Sex Discrimination Act 1984 (cth)
o Racial Discrimination Act 1975 (cth)
o Human Rights and Equal Opportunity Commission Act
1986 (cth)
o Disability Discrimination Act 1992 (cth)
 Economic
o The economic cycle
  Businesses drives production, price changes, employment and the
standard of living
 The level of economics in society depends on the consumers and the
business spenditure
within a period of time
 The level of
consumption and
investment changes over
a period of time
 The fluctuations in
consumer and business
spending is the
economic cycle
o Inflation
 The general increase in
prices fall and rise when
purchasing money
 As the price rises the cost of living rises
 Which leads to employees seeking higher wages
 Also leads to an increase cost in production
 Which then leads to a reduction in the workforce as the
business wants to save costs
o Globalisation
 Over the years, Australian businesses are facing increased
competition globally
 The Australian government has encouraged foreign businesses to
establish their operation in Australia to provide more choice and
lower costs
 When a business can’t complete with increased competition the
business their employees are retrenches (cut) due to their services
being no longer needed
 In HR, it is critical that the business follows correct procedures
for staff to be able to reach all of their entitlements
 Multicultural workforces have multiple challenges:
 Recognition of foreign qualifications
 Development of cultural tolerance
 Developing anti-discrimination and harassment polices
o Technological
 Technology seeks to improve production and quality of products
 Positive impacts of technology in HR include:
 Develops more efficient techniques
 Upskills employees
 Encourages the employer to deliver the product in new and
improved ways
 Allows for continuous learning
 Reduces repetition
 Allows for greater teamwork
  Negative impacts of technology in HR include:
 Loss of employment
 Employee resisting to change
 Reduce employee moral as the staff feel less valued
 Lower level of employee empowerment and decision making
 Employment in manufacturing has declined due to technology
o Social
 Social influences include:
 Ethnicity
 Cultural background
 Participation of women
 Work life balance
 Changing work patterns
 More woman are working in the workforce, but are
underrepresented in board of directors of Australia’s leading
businesses
 Growth of part time work
 Decline in manufacture sector
 Traditional 9-5pm working days are disappearing
 Living patterns
 Education influences an individual’s occupation
 Less educated people are employed in lower rate industries
o Results in emerging inequality between living
standards
o Ethics and corporate social responsibilities
 The World Business Council for Sustainable Development defines
corporate social responsibility (CSR) as:
 The continuing commitment by companies to behave ethically
and to contribute to economic development, while improving
the quality of life of the workforce and their families, as well as
the local community and society at large
 Being a good corporate citizen is about a company making lasting
contributions to the community
 This encourages businesses to consider its social, economic
and environmental concerns in its operations and decision
making
 Businesses should consider the interests of people who are
affected:
o Employees
o Customers
o Suppliers
o Community organisations
o Local communities
 Successful CSR is:
 Investing in community projects
 Supporting research initiatives
  Introducing occupational health and safety measures
 Adopting environmentally friendly practices
 Drafting and applying a code of ethics to company operations
 An effective CSR program will enhance the reputation and standing
the business within the community and may be used to promote
recruitment of staff.
 Strategies to promote CSR are:
 Promoting effective affirmative action and anti-discrimination
programs
 Developing initiatives that reduce the business’ impact upon
the environment
 Engaging in the strategies that promote work-life balance and
enhance workplace flexibility
 Encouraging staff to volunteer their time to participate in
community-building activities
Processes of human resources management
 Acquisition
o In order for the business to become effective they need to:
 Identify the skills and number of employees required for the future
 Analyse the existing workforce, strengths and weaknesses
 Compare the future staff with current staff to analysis the needs of
the business
o Acquisition involves:
 Identifying the staffing needs
 When existing staff isn’t being efficient or productive or just
doesn’t have the right skill set, the business should identify
and analyse the specifics needed for that job
 The job description should describe and layout the:
o Duties, tasks and responsibilities of the job
 After a job description is complete a job specification should
be developed which identifies the:
o Key skills, experiences and qualification needed
 After this the business needs to establish the remuneration to:
o Figure out how much the job is worth
 Recruitment
 The business can fill vacancy by recruiting applicants:
o Internally – From existing staff
 Advantages
 Promotes performance and reward for
hard work
 The existing staff member knows the
business culture
 Disadvantages
 Might not have the full set of skills
required and needs training
o Externally - From outside the business
  Advantages
 Has an array of skills to successfully
complete the job description
 Disadvantages
 Doesn’t know the business culture
 Methods to recruit externally:
o Outsource the recruitment function
o Interviews
o Trainee positions (cadetships)
o Online careers (job seek.com)
o Advertising
o Poach from another job
 Applicants can apply for the advertised job by a specific date
and provide their information in there resume such as:
o Employment history
o Skills
o Qualifications
 Selection
 All job applications should be reviewed, and the most
appropriate applicant should be chosen
 The selection process involves:
o Application forms
o Interviews
o Assessment centres
o Written tests
o Computing interviews
o Handwritten assessment
o The above selection should be chosen according to
available costs
 Screening process
o Each business has its own unique business culture and
therefore must teach the new recruitment
 An introduction procedure allows the new
employee to become familiar with the business
environment
 Training
 Orientation or induction of new staff involve a few days of
training and explaining the job description:
o Staff requirements
o Codes of conduct
o Rostering
o Grievance procedures
o Positions
o Work systems
o Techniques
o Computers
  Training includes any activity to improve the employee for the
future and there performance
o Upgrading skills and knowledge to better meet the
needs of the business
 Training methods include:
o On the job training
 Advisers, traineeships, apprenticeships
o Off the job training
 TAFE and university courses and seminars
 Development
o Involves preparing employees for future responsibilities with the business to
prepare the employees for future changing or future growth
o Performance appraisals can be a carried out which provides an assessment of
well an individual is performing and can allow for arrangements of future pay
rises, promotion and further development
o Training
 Is any activity which aims to improve an employee’s current skill
o Development
 Is preparing employees for the future
 Maintenance
o Maintenance of databases
 A data based is used to maintain the records of a business including
its employee information
 A skill inventory is a database that contains on the skill, expertise and
qualifications of the current staff
 Advantage is that the information is always at the central source
 Database can also include personal information such as phone
number, home address
o Maintenance of human resource staff
 Maintenance is providing the working conditions and working
conditions which motivate and increase productivity which gives the
employees a feel-good factor
 The creation of a feel-good factor will increase:
 Productivity
 Levels of moral
 Improved communication
 Reduce level of absenteeism
 A higher staff turnover can indicate staff dissatisfaction and low moral
o Monetary benefits
 Minimum wage rates and minimum working conditions are set out in
an award
 The award is influenced by factor which include:
 Age
 Education and qualifications
 Job location and risk
 Days/hours worked
  Wage
 Hourly rate of pay
 Includes overtime payments
 Salary
 An annual rate, divided into equal pay periods
 Professionals on a salary are expected to work extra until the task is
completed
 Additional monetary benefits can be paid:
 According to sales
 Based on an individual’s output
 Bonuses
 Through a shared income scheme
 Fringe benefits
o Non-monetary
 Includes greater job variety, flexible working hours, increased status
or community and intrinsic rewards
 Intrinsic rewards in terms of employment is the satisfaction
that comes with completing a task well
 Non-monetary benefits are aimed to motivate staff
 Benefits include:
 Employees are entitled to a period of annual leave which is 4
weeks per year
o Australian workers are entitled to 17.5% annual leave
loadings
 Long service leave after working at the same firm for at least
10 years which = 8 weeks holidays
 Employees are entitled to have up to 12% of their annual wage
or salary paid into their superannuation
 Firms cost’s when employing staff:
 Workers compensation
 Sick leave
 Fringe benefits
 Superannuation
 Payroll tax to the government
 Separation
o Is the ending of the employment relationship:
 Voluntary:
 Retirement
o Employee has decided to stop full or part time work
o People retire due to:
 Ill health
 Lack of motivation to continue working
 Leisure activity plans
o Many retires become consultants due to their
experience and knowledge in their field of work
 Resignation
 o Is for the employee to leave their job
 Reasons include:
 Losing interest in the job, family, etc
o Employee needs to give the employer notice of their
intention to leave their job
o Length of notice depends on the employment contract
 Average 1 – 4 weeks’ notice
 Voluntary redundancy
o Employees can nominate themselves for redundancy
when their existing job is no longer required by the
firm
o Redundancy happens due to:
 Changes in technology
 A merger – joining of two businesses
 A takeover – one business buys an controlling
interest in another business
 Involuntary
 Involuntary redundancy / retrenchment
o Redundancy is the termination of employment due to
the position being no longer available
o This usually happens in either a merger or a takeover
o The Employment Protection Act 1982 (NSW) provides a
minimum scale for the payment required for all the
employees who worked with an employer for over 15
years
o The process leads to an insecure workforce
 Instant or summary dismissal
o Occurs when the employer terminates the employee’s
contract due to unacceptable behaviour or code of
conduct
o Instant or summary dismissal happens when:
 Theft occurs from the firm
 Gross negligence
 Absenteeism
 Drunkenness
 Misconduct by an employee
 Dismissal after warning
o Happens due to:
 Continuous lateness
 Failing to perform the duties required
o Employees can appeal the employer’s decision at
tribunals like Australians Industrial’s Relation
Commission
o Business should have a written and clear policy about
the procedures in place in case of discipline, dismissal
or retrenchment
Strategies in human resources
 Leadership style
o Leadership style is the manner and approach of which the leader interacts
with the employees:
 Includes providing staff with directions and instructions
 Implementing plans and organising staff
 Motivating staff in a manner that promotes effective workplace
environments
o Authoritarian (autocratic leadership)
 This is the type of leadership is which the mangers take the
responsibilities to tell the employees what to do and how to complete
the task
o Participate
 for the business to become successful they need to:
 Identity staffing needs for the future and compare the current
staffing needs
 Analyse its existing workforce
 Acquisition requires:
 Identifying staffing needs
 Recruitment
 Selection
o Delegative
 In order for business to effective they need to:
 Identity staffing needs for the future and compare the current
staffing needs
 Analyse its existing workforce
 Acquisition requires:
 Identifying staffing needs
 Recruitment
 Selection
o An effective leader makes use of all three leadership styles and the
appropriate choice depends on:
 Knowledge and expertise of staff
 Extent of decisions being made
 Time available
 The relationship between staff and leaders
 Job design
o Is when the mangers develop and specify the work for the business
employees
o It involves taking the process of determining the type of tasks of which the
employees will complete
o The objective of job design is to meet the needs of the business
o Job satisfaction
 Refers to the extent of how the employees are satisfied with their
current position in the workforce
o Job enrichment
  Seeks to use the employee’s abilities and talents effectively
o Job rotation
 the system of which the employees are moved through a variety of
different tasks to increase individual skills and reduce boredom
o General tasks
 Advantages of having general tasks is that it reduces boredom by
having the employee engaged in a variety of tasks
 Moving from tasks to task to help avoid health and safety issues
o Specific tasks
 Advantages of specific tasks leading to specialisation is that it
increases performance due to the employees becoming more skilled
at that specific task and also it increases quality
 Disadvantage is the task could become boring and routine
 Recruitment
o Is a strategy used by the management team to employee an individual for the
vacancy
o General skills
 These are transferable from job to job – basic skills
o Specific skills
 Are skills acquired through specialist training at TAFE, UNI, etc

  Training and development

o Training
 Is educating an employee in the skills and processes of the job they
currently hold
o Formal education
 Involves the employees, taking educational information about the
skill and how to apply themselves and are later assessed like a student
o Informal education
 Is when the employee is coached to do the correct skill, or learnt by
working on the job
o Development
 Involves selecting employee for educational programs which allow
development for the future
 Performance management
o Is the process of recognising the efforts and contributions of the employee
o Involves the ongoing process of constant communication between the
employee and supervisor based on the achievement of the business goals
and the individual goals
o Communication process includes:
 Clarification of expectations
 Setting of workplace objectives
 Providing feedback
  Evaluating employee performance
o Benefits include:
 Employee having an improved understanding how their role
contributes to the role of the business success
 The employer identifying the problems early and assist the employee
with improving their performance
 Performance review and improvement is ongoing and allows for the
employee to be aware of the business goals
o Performance management cycle
 Stage 1 – planning
 Focused on goal setting
 Expectations are developed between employee’s and
employer to understand what task need to be completed
 These goals should be realist and achievable
 Stage 2 – checking in
 Employer should regularly check on the employee process and
provide feedback
 Management have a key responsibility to recognise and
reward strong achievement and encourage improvement
when needed:
o Communication should be developed
o Employee motivation increases through recognition
o The employee is assisted to achieve performance
objectives
 Stage 3 – assessment
 Process of measuring the employee’s performance against the
objectives established in the planning stage
o Check results against business and industry
benchmarks
o Reasons for achievement or non-achievement
o Employee accomplishments, positions and possible
areas for improvement are discussed
o New goals are developed
 Rewards
o Financial
 Most common type of rewards used in the workforce
 Financial rewards are additional monetary payments which are given
to the employees and beyond the minimum standard
o Non-financial
 Not all employees are motivated to gain financial rewards, and
therefore some employees are benefited by the benefits associated
with the job itself
 Non-financial rewards include:
 Fringe benefits
 Status-related benefits
 Intrinsic rewards
 o Individual or group
 Teams or groups share similar job descriptions
 Rewarding based on group efforts benefits include:
 A greater sense of teamwork
 Employees will become motivated as they aren’t not only
working for themselves but others as well
 Improves communication between staff
 Disadvantages include:
 Not all employees will put in equal effort
 Employees might have different personal goals which don’t
become recognised through teamwork
 Conflict can occur through the group, restricting the ability to
continue work
o Performance pay
 Is the process of linking part of the employee income to their
performance during work
 As the employee reaches the targets set they are rewarded through
increased pay
 Advantages:
 Performance of employees can improve as they are
encouraged due to increased pay
 It encourages unmotivated employees to improve their
performance
 Disadvantages:
 Conflict may emerge due to measures of different
performances
 Some employees might not enjoy the idea of completing with
other employees for more pay
 Global
o Costs
 Labour costs vary from country to country depending on the size of
the workforce and the skill available
 Labour costs also vary on the demand for workers in the particular
industry
o Skills
 India has become the preferred source for global labour due to their
levels in English and technique skills
 South Korea has developed technique skills, but not in the general
level for English
 China is also a preferred source
o Supply
 The labour force is declining in advance industries such as japan and
Europe but the workforce is increasing in Africa, Asia, Latin America
and North America
 Asia’s share of the global market will rise to 65% by 2025
 Workplace disputes
o Disputes resolution processes
 Grievance – is a dispute between parties
 Grievance procedure:
 The rules and procedures which both employees, unions and
employers must follow
 Firms develop grievance procedures to:
o Provide a clear outline of issues which are regarded as
part of grievance
o Illustrates the correct and appropriate when raising a
complaint
o Provides a mechanism which can be used to achieve
quick resolutions
 Negotiation
 Involves both parties in an attempt to resolve a dispute
 Collective bargaining is the common term used to describe
negotiation
 Mediation
 Occurs where the an independent party with no ties to either
stakeholder is asked to assist in the conflict to help reach
settlement
 Conciliation
 The fair work commission will be notified and be required to
assist with a resolution
 Conciliation is like mediation but the mediator is from Fair
Work Commission
 Each party is legally obligated to attend the conciliation
meeting
 The agreement is not legally binding
 Arbitration
 The final stage of the dispute resolution
 In arbitration, it is clear that there is some hostility
 During this process, lawyers are present and represent both
parties to the Fair Work Commission
 The resolution is legally binding to all parties