HRM OBJECTIVES

Hrm Objectives supporting functions

1Societal objectives legal compliance

benefits
union mgt relation

2org objectives HRP

Employee relations
selection
training & development
appraisal
placement & assessment
3functional objectives appraisal ,placement
assessment
Personal objectives T&D
appraisal
placement
compensation
assessment

Societal objectives -to be ethically & socially responsible to the

needs & challenges of the society .For eg failure of org to use
their resources for the societies benefit in ethical way may lead to
restriction.
Org objectives its nothing but the HRM dept exist to assist to serve
the rest of the depts. in an org which in turn will assist the org in
attaining its primary /common objective.
Functional objectives The HR depts level of service must be
tailored to fit the org it serves. Resources are wasted when HRM
is either more or less sophisticated to suite org’s demand. It has to
serve the function for which it has been formed.
Personal objectives – to assist the employee in achieving their
personal goals at least in so far as these goals enhance the
individual ‘s contribution to the org.
 Composition /structure of HR/Personnel Dept
owner/director

Mgr personnel Mgr administration Mgr HRD

Mgr IR

Appraisal T&
D

PR Canteen medical welfare transport legal

HRP Hiring Grievance handling compensation

Human Resource Planning (supply forecasting)

Wastage Analysis- Manpower wastage is an element of labor turn over. Tavis stock institute of
human relations ,UK, suggested, wastage analysis using a curve.

The curve identifies 3 different phases, Induction

phase marginal employees leave. Differential transit
an employee learns abt the org & identifies his role
in it. Settled connection an employees settles down
& plans to stay long. According to this analysis
wastage decreases with the increase of length of
service &it also decreases with the increased skill
exercise & age of employees.
 induction crisis

Levers differential transit

settled connection

weeks time months/years

 Employee Remuneration Theories/Wage Theories

Reinforcement and Expectancy Theory

-Reinforcement theory - states that high employee performance
followed by a monetary reward will make future employee
performance more likely. By the same token , a high performance
not followed by a reward will make its recurrence unlikely in future.
In short it shows the link between a particular behavior &
remuneration.

-Vrooms Expectancy Theory –There are 4 important elements

being explained in this theory

1 First level & second level outcome –Performance achieved as

a result of efforts is the first level outcome. Second level outcomes
are the rewards associated with performance
 2Expectency The belief that a particular level of effort will be
followed by a particular level of effort will be followed by a
particular level of performance.

 3Instrumentality relation btw the performance & rewards

 4Valence Individual [preference for a second level outcome

Valance range from negative to positive value.

 Adam’s Equity Theory- states an employee who perceives

inequity in his/her rewards seeks to restore equity. The theory
emphasises,equity in pay structure of employee remuneration.

 Agency Theory-Employees & employers are the two main

stakeholders in the org.Employers assume the role of principals &
employees play the role of agents .Wages paid to the employees
are considered as agency cost. The agency theory states that the
principal must choose a contracting scheme that helps align the
interest of agents with the principals own interest. These
contracts can be classified as either behavior oriented (merit
pay) and outcome oriented ( stock option scheme, Profit sharing
scheme & commissions)
Promotion
Promotion means an improvement in
Pay, prestige, position & responsibilities of an employee with in his/ her org
Purpose of promotion-
-to motivate
-to attract & retain the services of qualified & competent people
-increase the effectiveness of employees as well as the org
-to fill up higher vacancies frm within org
-To build loyalty, morale & a sense of belongingness in the employee
-to impress upon others that opportunities are available to them too
in the org if they perform well.
Principles of Promotion
-to fill up the position that is vacant- external/internal recruitment
generally higher position external recruitment
Lower position internal recruitment
-whether to go for merit based promotion or seniority based promotion
-Promotion based on seniority
Merits
• Easy to administer
• Less scope for subjectivity in fixing seniority
• Seniority & experience go hand in hand so it is right & proper to make
promotion on this basis
• Subordinates are more comfortable in working under a asenior boss rather
than a young one with less experience
• Loyalty is rewarded
Demerits
- Seniority is no indication of competence
- Young & competent people get frustrated & might leave the org
- In spite of judicial pronouncement , there is no single criterion for fixing the
seniority of an employee
Merit based promotion
Merits
-efficiency is encouraged , recognized & rewarded
-competent people are retained because better prospects are open to them
-productivity increases
Demerits
-discontentment amg senior employees
-scope for favoritism
-Loyalty & length of service not rewarded
-opposition from union leaders
To conclude , the promotion policy of merit or seniority promotion of a particular
org depends upon the presence of union to an extent & the type of org
 Promotion against vacancies & non vacancies
 A good promotion chart
 Avoid frequent promotion not good for both employer & employee.
 A promotion should be preceded by a job analysis & performance
appraisal
 Consultation with labour union
 If promotion based on merit adequate info regarding the post vacant
should be displayed at several places to enable interested parties to
apply for the same.
Types of Promotion

Horizontal Promotion- increase in responsibilities, pay & changes in

designation with in same job family largely Ii the form of job enlargement &
enrichment in for eg

Vertical Promotion- greater responsibilities, prestige ,pay with a significant

change in in the work content/ change in the nature of job.For eg

Dry Promotion- Under this promotion, the employee is moved to the

next higher level in the org hierarchy with greater responsibility
authority & status with out any increase in salary. The promotee may
be given one/two annual increments.
Transfers

Transfer- involves a change in the job (not necessarily)

accompanied by a change in the place with out any change
in position, pay responsibilities. Transfers are frequent but
not promotions
Reasons for transfer-
-transfers are mainly done for reducing the imbalance OF
OVERSTAFFING frm surplus dept to other dept with in the org or
frm the org to any of its sister concerns were there is a shortage
-TO REMOVE INCOMPATIBILITY BTW THE WORKER & THE BOOSS OR
BTW ONE Worker & OTHER WORKER
-correction of faulty initial placement of any employee
-a change has taken place in the interest 7 capacities of an
employee necessitating his/her transfer
-to overcome monotony
-may be due to employees ill health
-family related problems
Principles of Transfer
-the frequency of transfer & the minimum period between
transfer should be made kniow to all employees
- The authority which would handle transfer should be decided
upon
- -the criteria for entertaining transfer need to be laid down &
strictly adhered to
- The area of the org over which transfers can be made should
be defined
- The effect of transfer on the pay & seniority of the transferred
employee may be clearly evaluated
- Transfers should indicate wethre it’s a permenant or
temporary one
- The performance f employee evaluated b4 transfering him & a
jo analysis is to be carried out thoroughly
- -the interest of org should not be forgetten while framming
transfers.
Types of Transfer
Production Transfer- arises due to a surplus /shortage either with
in the org or with in different plants of the org due to changes in
production
Replacement transfer junior employee may be replaced by a
senior employee to avoid layoff of the latter. A replacement
transfer is used when all the operations are declining & is
designed to retain long service employee as long as possible.
Versatility transfer -are effected to make employee versatility &
competent in more than one skill .For eg clerical employees in the
bank.
Shift Transfer- transfer of employee from one shift to another
shift .It will be either by rotation basis /demanded by the
employee.
Remedial Transfer/Personal transfer -it is initiated by the
employer. transfer initiated to correct the wrong placements
Demotion

Demotion is the downward movement of an employee in the org hierarchy

with lower status pay. It is a down grading process where the employee
suffers considerable emotional & financial loss in the form of lower rank
,power & status, lower pay & poor working conditions.
Causes of Demotion
- When an employee is unable to meet the challenges posed by a new
job
-due to adverse business condition,org may decide to lay off some &
down grade others job.
-demotion may be used as a disciplinary tool.
Demotion policies
-specification of circumstances under which an employee will be
demoted
-Specification of authority who is authorized & responsible to initiate a demotion
-specification of lines/ladders of demotion
-Specification of basis of demotion like length of service ,merit or both
-It should provide for an open policy rather than an closed policy
-It should contain clear cut norm s for judging merit & length of service
-Specification pf provisions regarding placing demoted employees in their
original places if the normal conditions are restored
-Specification of nature of demotion whether it is permanent /temporary
Employee Turn Over/Labour Turn Over (External mobility)

Employee Turn over- Labor turnover is the rate of change in the working hands
of a particular organization during a given period. The rate of labor turn over is
expressed in terms of accession & separation rate. Accession is addition to the
workforce while separation is deletion from the work force , for any of the reasons
mentioned below .The external mobility is computed as follows:
Accession Rate - Total Accession per year * 100
Avg # of employees per year

Separation rate - Total separation per year * 100

Avg # of employees per year

Composite rate - (Total accession per year +total separation per year )/2 * 100
Avg # of employees for the year

Causes of Employee Turnover

Initiated by employer/org

 Lay off- A temporary separation from the org, it may be for a definite period on the
expiry of which the employee will be recalled by the employer.
Reasons for layoff
-scarcity of resources like coal ,raw material, power etc.
-accumulation of stock
-breakdown of machinery
For any other reasons
The employees are entitled for compensation for the period they
are laid off. The compensation must be equal to half the normal
wages the employee would have earned if the employee had not
been laid off.
Lay off could be based on merit or seniority
Recalling the employees
Seniority-the person with the longest service who had been laid off
should be called back first.
Merit- whose skill are very essential for the resumption of production
will be called back.
 Dismissal- When the termination of employment is initiated
by the employer, it is known as dismissal. The reasons for
dismissal are
-excessive absenteeism
-serious misconduct
-False statement of qualification at the time of employment
-Theft of companies properties

 Discharge
Retrenchment
It refers to termination of the services of employees because of replacement of labor
by machines, closure of dept due to continuing lack of demand for the products
manufactured in that particular dept of the org. Retrenchment entitles the
employees to compensation which in terms of sec 25(f0 of the industrial dispute
Act 1947 is equivalent to 15 days avg pay for every completed year of continuous
service.

Difference btw lay off - lay off employees will be recalled but in retrenchment
employer is sent home for good.
Difference btw dismissal due to misconduct of employee itself & only 2 or 3
suffers from this aspect but in case of retrenchment a whole lot of employees
suffer a job loss due to various reasons
Compulsory retirement- a specific age limit for
retirement especially those who are working in govt org
Suspension - due to misconduct of the employee the
employee will be suspended frm his job for a temporary time
period. & will be called back after that specific period of debarment
Initiated by employee/worker
Resignation- An employee resigns when employee
secures a better job elsewhere or due to personal reasons
like marriage, ill health or for other reasons.
 VRS/Golden hand shake plan handsome
compensation is paid to these who opt for this option.
-painless & time saving method of trimming staff strength.
-out unproductive older workers
-no objection from union since it is initiated voluntarily by
employee
To conclude the experience of companies is that org have lost
competent people while incompetent employees have not
opted for VRS
 Better opportunities existing in other similar org people
leave the org due to a better opportunity in the similar company
than the existing company is offering to the employee
 Lack of career growth in the existing org if the carrier growth
provided y the existing employer is not good for the employee he
may look on for a better opportunity.

 Other causes:
Death which is inevitable beyond the control of the employer &
employee
Solutions
-Redeployment when there is a problem of overstaffing the
company resort to lay off ,vrs etc to reduce the staff instead of going for
that the company can go for outplacement that is the redundant
employees could offered jobs in other sister concern branches of the
company were there is a a shortage of labor.

Transfer instead of cutting short the employees the company can go for
a suitable transfer policy like by transferring employees frm surplus dept
or pants to those were they are having shortage of employee

-Creation of adhoc projects-if there is over staff in the org assign

them with new projects and keep them engaged instead of leading to a
separation.

-some employees leave the org due to stressful wok timings & lack of other
qualities present with in an org so the employee should be provided with
good quality of work life.
-providing opportunities for self development
-maintaining sound industrial & human relation
-adopting effective technique of recruitment selection induction & placement,
(right man at the right place)
-providing challenging work
-Power to control by way of employee participation/empowerment
-mgt should adopt good forecasting system at those areas of external
mobility.
-providing counseling for employees is a good tactic for reduction in employee
turnover by understanding the various problems confronted by the
employees & the org can form suitable ways & means to deal with those
problems & thus reduce the turn over.
-A proper induction programme can reduce the employee turnover.
 Telecommuting
a work arrangements in which employees enjoy flexibility in
working location &hours
Potential Benefits
-a good opportuninity for mothers fathers with small children, the
disabled & people living in remote areas
-minimizes daily commuting
-this technique helps in providing increased services & an
international reach especially those working in different time
zones in different countries.
-it provides employee flexibility
- Increases employee productivity
- Reduces absenteeism
- Reduces traffic congestion
- Reduces pollution
Drawbacks
-distractions at home
-Fellow employees in the office some times resent home telecommuters
-there will e lack of loyalty
-lose space in their home even converting a room in to a office space
-The company face an increased risk of confidential data loss & risk to
data integrity resulting frm the increased geographical diversity of
their network & the loss of direct corporate control over the
telecommuters physical work environment
-drop in work productivity
-The feeling of alienation can be very difficult for the tele workers
-Expensive as far as technologies are concerned & the equipment
-telecommuters lack the social community with coworkers
-Training & development suitable for telecommuting work atmosphere
should be incorporated by the org.
-companies going for telecommuting should take in to consideration
specific local legal issues, union issues, and most important the
respective company rules & regulations of the company.
-Difficulty in performance appraisal since the telecommuter is not
present in the official location of work place the performance
evaluation won be that perfect as compared to the traditional
work performance
Employee welfare
The approaches to labor welfare refer to the beliefs & attitudes held by agencies
which provide welfare facilities. Some agencies provide welfare facilities
inspired by religious faith, others as a philanthropic duty & the like.
The various approaches to labor welfare
 The policing theory of labor welfare -the employers have enough chances
to exploit workers in an unfair manner. In short this approach gives the
state/legislation to act as a policeman & compels the mgr of industrial
establishments to provide welfare facilities & punishes the non complier
 The religion theory of labor welfare -consist of 2 aspects Investment
aspect fruits of to days deed will be reaped tomorrow whether good/bad is
therefore treated as an investment. Second aspect is atonement aspect-
present disabilities of a person are the result of the sins committed by him
previously. Employee should undertake to do good deeds now to
atone/compensate for the employees sins.
 The paternalistic theory of labor welfare- The employer hols
the total industial estates & the profits accruing from them in
trustMore or less employer act as a gurdian & the employees are like
minors & provide the required aminities to the employees.
 The placating theory of labor welfare By providng required
welfare measure by the employer to the employees peace can be
bought among the workers.
 The Public Relation theory of labor welfare- welfare activities
are provided to create a good impression on the minds of the
workers & the public particularly.
 The functional Theory of labor welfare
 The social theory of labor welfare The social theory implies that
a factory is morally bound to improve the conditions of the society
in addition to improving the conditions of its employees.
 The philanthropic Theory of labor welfare-it refers to the
provision of welfare provided by employer out of pity who wants to
remove the disabilities of the worker.
 Induction
Employee orientation /induction covers the following

Organizational issues

History of employer /company probationary

period
Organization of the company product line/service
provided
Name & title of key executive over view of production
process
Employee’s title & dept company policies & rules
Layout of physical facilities disciplinary regulations,
employee hand book
safety procedure &
enforcement.
 Employee Benefits
Pay scale & pay days insurance benefits
Vacations & holidays retirement program
Rest breaks employer provided
services to employees

Training & education benefits rehabilitation

programmes
counseling
Introduction
To supervisor to co worker
To trainers to employee counselor
 Job duties
Job location over view of job
Job tasks job objectives
Job safety requirements relationship to other
jobs
Different types of induction programmes

Formal & informal -formal one the mgt has a stuttered programme which
is executed when new employees join the org.Informal one were new hire
are directly put on to work & they rare expected to acclimatize themselves
with the work & the org.
Individual /collective-
Serial/disjunctive-when an experience employee inducts a new hire it is a
serial orientation. He act as tutor & model for the new hire. In case of
disjunctive it is likely to produce more inventive & creative employees
because the new hire is not burdened with tradition.
Investiture/Divestiture –Investiture orientation the characteristic feature
that a new hire have is not been modified he is been given the freedom to
apply his own potential to the job he is been entrusted with. Where as in
divestiture seeks to make minor modifications in the characteristic of new
hire to seek a better fit btw new member & the org, though he /she has
been selected based on his /her potential for performance.
 An Induction model
New Employee: Mr Niraj Mital MBA HRM
Job title: HR Executive
Dept: HRD
Reporting Date: 1st june 1999 8.00 am report to Ms Roopa ,HRD Chief
8.00am to 9.00 am:Miss Roopa will distribute brochures describing the
org’s history ,produts, philosophy,. Review the org’s overall structure,
authority structure with in HR Dept, review HRM Policies & practices
9.30am to 10.30 am :Mr rao will discuss company benefits, new employee
is require to fill out health ,tax & other relevant forms
10.30 m to 11.30 am:tour to main building & auxilary facilities with Miss
Roopa
11.30am to 12.30pm:lunch with HR mgr & Mis Roopa
12.30 pm to 3.00pm:Mr swaraj will provide
 *a detailed tour of production ,marketing dept
*Detailed discussion with chief executive HRM abt daily job routine
& dept policies & rules, explain job expectations, introduce to his
co workers
3.00pm to 5 .00 pm :new employee on his own to familiarize
himself with his new job.
 Steps in scientific selection
development basis for selection
Job analysis
Resume
HRP written examination
Preliminary interview
Recruitment business game
test

final interview
medical examination
reference check
line mgr’s decision
Assess the fit btw the job job offer

& the candidate employment

Business games
-case study
Role play
In basket method
Sensitivity
Simulations
Types of tests include
Aptitude test
-intelligence test
-EQ
-Skill test
-Mechanical aptitude
-Phychomotor test
-Clerical aptitude test
Achievement test

-job knowledge
-Work sample test
-Situational test
-GD
Personality test
Objective tests
Projective test
Interest test
Multi dimensional testing
Types of Interview
Preliminary interview

-informal ,unstructured
Core interview
-background information
-Core interview
-job& probing
-Stress interview
-Gd interview
-Formal & structured interview
-panel interview
-Depth interview
 Collective Bargaining in India
Evolution
 In India CB came to occupy the centre stage only after 1900
 In 1918 Gandhiji as the leader of Ahmedabad textile worker's advocated the
resolution of conflict through CB agreements
 For another 10 years CB did not gain popularity
 The legal steps take by govt after the second world war revived the interest in
subject again. The legislative measure initiated included negotiation, conciliation,&
arbitration
 Basic conflicting issues concerning wages & conditions of employment were solved
voluntarily
 After the independence with the spread of trade unionism CB have become popular
 In India the CB has taken place at 3 levels-plant level ,industry level & national level.
At plant level& industry level it is evident from Ahmedabad Textile
industry, which was carried out at 2 levels
-Agreement btw mill owners Association & Textile labour association
-btw individual mill owner & Textile labour association
At national level they are generally bipartite agreement btw mgt &
labour convened by govt of India. The Delhi Agreement 7 th feb
1951,The bonus Agreement for plantation workers 1956 are
examples for the same

Current scenario
When compared to other industrialized counties CB has not made much head
away in India this is due to the following reasons
-Employers reluctance
-Weak unions
-Inadequate interventions
-Politicization of unions
-Failure of both parties to devote adequate time
-Third party interventions
 JOB CHANGE
A JOB CHANGE to a worker CAN TAKE PLACE IN 3 FORMS
JOB ROTATION
A SYSTEMATIC MOVEMENT OF WORKERS FRM ONE JOB TO ANOTHER
JOB
JOB ENRICHMENT
Restructuring of a job to make it more interesting & stimulating this
concept developed by Herzberg.Job enrichment seeks to
improvement task efficiency & human satisfaction & to provide
greater scope for personal achievement & recognition, challenging
assignments & opportunities for individual advancement& growth.
JOB Enlargement is the horizontal regrouping of tasks & implies
mere addition of more functions & increase in the task variety.

Outsourcing HR Activities
Increasingly many large firms are getting their HR activities done by
outside suppliers & contractors. Employee hiring, T&D
,maintenance of statutory records are the usual functions
contracted out to outsiders
Advantages of outsourcing
-company can concentrate more on their core/strategic aspects
of the company
-to gain increased efficiency & better service in performance of
functions
-to get specialized expertise which is otherwise not available in
house
-it reduces the company’s risk exposure to changing technology
& /changing customer services
-company gets employees who will better match with the
company’s job profile with regard to recruitment outsourcing
-it can reduce cost, improve flexibility,
Disadvantages of outsourcing
-if the hr activities are outsourced to a third party then
what s the need /relevance of an HR dept in an org
-hr depts in an org are no more job givers as work is
assigned to a third person.
Two wings of outsourcing includes
BPO-if an external company develops software for the company, if
some one else does advertising for the company’s product, & if
some other firms administer benefits for the company’s
employees it is BPO

-
CALL CENTRES if some other company makes calls to the
companies customers/receives their calls, it is a call centre its a
part of BPO