Professional Documents
Culture Documents
Chapter 5 - Supplementary Employee Maintenance & Separation
Chapter 5 - Supplementary Employee Maintenance & Separation
Employee Maintenance
Employee transfer - refers to the company assigning an employee to a position in a
different area of the company. Transfers do not necessarily increase job
responsibilities or compensation.
Transfers are usually lateral moves, that is, moves to a job with a similar level of
responsibility.
It may involve relocation to another branch of the company in another part of the
country or even to another country.
Employee Maintenance
Read from proclamation No. 1156/2019 part five the whole section
about :
▪Annual leave
▪Special leave
▪Sick leave
Employee Separation
An employee separation occurs when an employee ceases to be a
member of an organization.
The turnover rate is a measure of the rate at which employees leave the
firm.
TYPES OF SEPARATION
▪ The employee’s level of dissatisfaction with the job. The employee can be
dissatisfied with the job itself, the job environment, or both.
▪ Economic necessity or
Involuntary separations are the result of very serious and painful decisions
that can have a profound effect on the entire organization and especially
on the employee who loses his or her job.
INVOLUNTARY SEPARATIONS
The costs can be categorized as recruitment costs, selection costs, training costs, and
separation costs.
RECRUITMENT COSTS - the costs associated with recruiting a replacement may include
advertising the job vacancy and using a professional recruiter to travel to various
locations (including college campuses). I.e., recruitment costs include costs such as
advertising , campus visits, recruiter time, search firm fees, etc.
THE COSTS OF EMPLOYEE SEPARATIONS
SELECTION COSTS: selection costs are associated with selecting, hiring, and placing a
new employee in a job.
Interviewing the job applicant includes the costs associated with travel to the interview
site and the productivity lost in organizing the interviews and arranging meetings to
make selection decisions.
That is, selection costs include costs such as interviewing, testing, reference checks, and
relocation.
THE COSTS OF EMPLOYEE SEPARATIONS
TRAINING COSTS: most new employees need some specific training to do their job.
Training costs also include the costs associated with an orientation to the company’s
values and culture. Also important are direct training costs-specifically, the cost of
instruction, books, and materials for training courses.
Finally, while new employees are being trained they are not performing at the level of
fully trained employees, thus, some productivity is lost.
Training cost include; orientation, direct training costs, trainer’s time and lost productivity
during training.
THE COSTS OF EMPLOYEE SEPARATIONS
SEPARATION COSTS: a company incurs separation costs for all employees who leave,
whether or not they will be replaced.
The largest separation cost is compensation in terms of pay and benefits. Most
companies provide severance pay (also called separation pay) for laid-off employees.
Severance pay may add up to several months’ salary for an experienced employee.
Although length of service is the main factor in determining the amount of severance
pay, many companies also use formula that take into account factors such as salary,
grade level, and title.
THE COSTS OF EMPLOYEE SEPARATIONS
Other separation costs are associated with the administration of the separation itself.
Administration often includes an exit interview.
Exit interview
An employee’s final interview following separation.
The purpose of the interview is to find out the reasons why the employee is leaving (if
the separation is voluntary) or to provide counseling and/or assistance in finding a new
job (if the separation is due to layoff).
THE BENEFITS OF EMPLOYEE SEPARATIONS
REDUCED LABOR COSTS:
An organization can reduce its total labor costs by reducing the size of its workforce.
Although separation costs in a layoff can be considerable, the salary savings resulting
from the elimination of some jobs can easily outweigh the separation pay and other
expenditures associated with the layoff.
THE BENEFITS OF EMPLOYEE SEPARATIONS
SEPERATION GIVES OPPORTUNITY FOR REPLACING OF POOR PERFORMERS
If an employee does not respond well to interventions that aim to improve his/her
performance, it may be best to terminate him /her so that a new and presumably more
skilled employee can be brought in.
THE BENEFITS OF EMPLOYEE SEPARATIONS
INCREASED INNOVATION:
They also open up entry-level positions as employees are promoted from within.
An important source of innovation in companies is new people hired from the outside
who can offer a fresh perspective.
THE BENEFITS OF EMPLOYEE SEPARATIONS