Paper: 1

Human Resource Management

Module: 4
Human Resource Policy

Prof. S P Bansal
Principal Investigator Vice Chancellor
Maharaja Agrasen University, Baddi

Prof YoginderVerma
Co-Principal Investigator Pro–Vice Chancellor
Central University of Himachal Pradesh. Kangra. H.P.

Prof. Dr. Rajeev Jain

Paper Coordinator Department of Commerce and Management Studies
University of Kota, Kota

Prof. Dr. Rajeev Jain

Content Writer Department of Commerce and Management Studies
University of Kota, Kota

Items Description of Module

Subject Name Management
Paper Name Human Resource Management
Module Title Human Resource Policy
Module Id Module No.4
Pre- Requisites Knowledge of human resource management
Objectives To have a knowledge of human resource policy
Keywords Human resource policy, programs, procedures, principles

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 QUADRANT-I

Module 4: Human Resource Policy

1. Learning Outcome
2. Definition
3. Employee understanding on HR Policy
4. Benefits of policy
5. Specific Personal policies
6. Responsibility for policy making
7. Formulation of Human Resource Policy
8. Principles
9. Procedures
10. Programs
11. Summary

1. Learning Outcome:

After completing this module the students will be able to:

 Understand the meaning and definition of human resource policy.

 Having the knowledge of the benefits of human resource policy.
 Content and source of HR policy.
 Differentiation of policy, procedure, principles and programs.

Source:https://heathrconsulting.com.au/wp-content/uploads/2015/11/HR-Policies-Image.jpg

2. Definition

A policy is a plan of action. Organisations need to evolve HR policies as they ensure

consistency and uniformity in treating people. Policies become benchmarks to compare and
evaluate performance. They help motivate and build loyalty. A policy statement is very
specific and commits the management to a definite course of action.
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 Each company has a different set of circumstances and hence develops an individual set of
human resource policies.

HR policies provide an organisation with a mechanism to manage risk by staying up to date

with current trends in employment standards and legislation. The policies must be framed in
a manner that the company’s vision and HR department help the company to achieve it or
work towards it.

Source:https://image.slidesharecdn.com/whswk3powerpoint-131023232128-phpapp01/95/follow-policies-and-procedures-wk-
3-powerpoint-1-638.jpg?cb=1382570533

3. Employee understanding on HR Policy

HR Policy should be clear with employee on following points:

3.1. The nature of the organisation.

3.2. What they should expect from the organisation?

3.3. What the organisation expects of them?

3.4. How policies and procedures work?

3.5. What is acceptable and unacceptable behavior?

3.6. The consequences of unacceptable behavior.

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 Source:https://image.slidesharecdn.com/hr-141225230122-conversion-gate02/95/human-
resource-management-policies-of-tcs-and-pantaloons-3-638.jpg?cb=1419548747

The establishment of policies helps organizations in proving that they meet the requirements
for diversity, ethics and training as well as its commitments in relation to regulation and
corporate governance.

For example: In order to dismiss an employee in accordance with employment law

regulations, it will be necessary to meet provisions within employment contracts and
collective bargaining agreements. The establishment of an HR policy which sets out
obligations, standards of behavior and document disciplinary procedures, is now the
standard approach in meeting these obligations.

HR policies are also helpful in supporting and building the organisation culture.

For example: Recruitment and retention policies outline the way the organisation values
a flexible workforce, compensation policies might support this by offering a 48/52 pay
option where employees can take an extra four weeks holidays per year and receive less
pay across the year.

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 Source:https://image.slidesharecdn.com/google-hrpolicies-140502095703-phpapp02/95/google-hr-policies-7-
638.jpg?cb=1399024712

4. Benefits of policy

HR Policies have the following benefits.

4.1. While formulating the policies the management should give a deep thought to the
basic needs of both the organisation and the employees. The management must
give full consideration to the prevailing practices in other organizations.

4.2. Established policies ensure equal treatment of all employees throughout the
organisation. Favoritism and discrimination are minimized.

4.3. Policies promote stability. Though the Top management people change, retire and
resign. Even then the people maintain stability in application of policy.

4.4. The policies serve as a standard of performance. Actual performance can be

compared to the policies to determine how well the members of an organisation
are performing.

4.5. Sound and good policies help build the motivation and loyalty of employees. This
is especially true where the policies reflect the principles of fair play and justice
and where they help people grow within the organisation.

4.6. Sound policies help in clarifying interpersonal, intrapersonal and intergroup

conflicts.

For example: Policies and practices at LG electronics India

LG as a brand and market leader in India attracts customers and employees in

large numbers. LG has the ability to hire the best in the industry. Once these
candidates are hired they undergo an extensive induction program for duration of
14days in which each and every aspect of organisation is made familiar to the
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 candidates. A thorough integration with HR and business processes takes place
and the formulation of a KPI is done within 3days of taking the candidate on
board. Customer department/vendor department interaction also takes place.
Source: Personnel Management by Mamoria

Source:https://image.slidesharecdn.com/hrpolicies-111120023656-phpapp02/95/hr-policies-4-
728.jpg?cb=1321759138

5. Specific Personal policies

Few specific personnel policies are listed below:

5.1. Policy of hiring people

5.1.1. Sexual harassment policy

5.1.2. Probation policy

5.1.3. Equal employment opportunity policy

5.1.4. Recruitment policy

5.1.5. Employment category

5.1.6. Policy regarding training and development

5.2. Compensation and Benefits policy

5.2.1. Working time policy

5.2.2. Vacation policy

5.2.3. Holiday policy

5.2.4. Paternity leave policy

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 5.2.5. Maternity Leave policy

5.2.6. Loan policy

5.2.7. Sick Leave policy

5.2.8. Overtime policy

5.2.9. Leave policy

5.3. Policy regarding industrial relations

5.3.1. Communication policy

5.3.2. Problem resolution policy

5.3.3. Personal appearance policy

5.3.4. Conflicts of interest policy

5.3.5. Collective bargaining policy

5.3.6. Trade union policy

5.3.7. Grievance policy

5.4. Health and safety policy

5.4.1. Smoking policy

5.4.2. Visitor policy

5.4.3. Corporate security policy

5.4.4. Alcohol and drugs policy

6. Responsibility for policy making

The actual formulation of HR policies is the responsibility of the HR manager, but its actual
approval or any change in it comes from the top management. The decision depends on the
financial stability of the company, the obligations imposed upon it by legislation, the
agreement between employers and employees. The executive role is that of mediating,
persuading, convincing, and communicating the policy.

The HR policies should be made known to the employees through the supervisors at each
level. Superiors may be informed of the changed policies by any of the following methods:

6.1. Booklets or bulletins issued to new employees in which privileges, rights and
responsibilities are mentioned.

6.2. Verbal instructions from immediate supervisors.

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 6.3. Group meetings of new employees convened regularly.

6.4. Union contract.

6.5. Company papers giving details about company policies.

6.6. Conference conducted as a part of executive training program

7. Formulation of Human Resource Policy

Policy making is a complex process and it involves all levels of organization. The steps
necessary in making and implementing a policy are:

7.1. Initiating a policy.

7.2. Deliberations of facts by personnel department.

7.3. Recommending and taking feedback about policy from the top management.

7.4. Writing the policy.

7.5. Explaining and discussing the proposed policy with members of the organization.

7.6. Adopting and launching of the policy.

7.7. Communicating the policy to the employees at all levels.

7.8. Administering the policy, initiating the follow-up action and evaluating it.

7.9. Re-stating or re-formulating the policy.

Recommend Administer,
the policy to Adopting Communicate Follow-up
Initiating Uncovering Writing Policy and Reformulat
Top the Policy to and
a Policy of the facts Discussion Launching the Policy
Managemen Policy Employee Evaluation
t Policy of Policy

Figure 1: Steps in Formulating a Policy

8. Principles
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 Policies are guidelines for managerial decisions and actions. They vary from organisation to
organisation. Principles are the universal truths generally applicable to all organizations.
Principles guide managers in formulating policies, programs, procedures and practices.
Some of the Principles are as follows:

dignity
of contribut
labour labour ion to
manage national
ment. prosperit
y

fair
particip
remune
ation
ration
Principl
es

scientific commu
selection nication

Individua
l team
Develope spirit
ment
incentive

Figure2: Depicting Principles

8.1. Principle of individual development.

8.2. Principle of scientific selection.

8.3. Principle of fair remuneration.

8.4. Principle of labour management.

8.5. Principle of dignity of labour.

8.6. Principle of contribution to national prosperity.

8.7. Principle of participation.

8.8. Principle of communication.

8.9. Principle of team spirit.

8.10. Principle of incentive

9. Procedures

For the accomplishment of the HR policies specific procedures and programs are needed.
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 While a policy indicates What and Why, procedures indicate How, a policy is to be carried
out. It tells us the methods, procedures, movements, rules and regulations of carrying out
these policies and implementing them. It tells us where an action is to take place and at what
stage.

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VAYQaK5TuJyFvnv2CkE2H9IC38TGt9G2wQ

 They are set up by Top management and followed or carried out by low level
managers.

 They help in controlling the staff as they assign obligations on them for the
performance of various tasks.

 They are reviewed from time to time so that the areas of slackness and the
requisite changes can be done.

10. Programs

While the procedures tell us How the work is to be done. Programs tell What work is to be
done. It is a plan of action controlling employees at all levels. It is the end product of
philosophy, values, concepts, principles, policies and procedures. Practices and procedures
can be combined in a program. Some specific programs and procedures are:

10.1. Human resource forecasting and planning.

10.2. Training and development of employees.

10.3. Management development programs.

10.4. Wage and salary administration.

10.5. Employee benefits and services.

10.6. Employment and related facts.

10.7. Communication.
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 10.8. Labour relations.

11. Summary

Policies are guidelines that provide an organisation with a mechanism to manage risk by
staying up to date with current trends in employment standards and legislation. They vary
from organisation to organisation.

Sound policies help in clarifying interpersonal, intrapersonal and intergroup conflicts.

The actual formulation of HR policies is the responsibility of the HR manager, but its actual
approval or any change in it comes from the top management.

For the accomplishment of policies there are principles, programs, procedures and practices.
Principles guide managers in formulating policies, programs, procedures and practices.
Procedures tell us how the work is to be done. Programs are a stable plan of action that
continues over a longer period of time.

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