Managing Human

Resources

Chapter 10

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 Learning Objectives
10-1 Define human resource management and explain its significance.

10-2 Summarize the processes of recruiting and selecting human resources

for a company.

10-3 Discuss how workers are trained and their performance appraised.

10-4 Identify the types of turnover companies may experience and explain
why turnover is an important issue.

10-5 Specify the various ways a worker may be compensated.

10-6 Discuss some of the issues associated with unionized employees,

including collective bargaining and dispute resolution.

10-7 Describe the importance of diversity in the workforce.

10-8 Assess an organization’s efforts to reduce its workforce size and

manage the resulting effects.

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 Chapter 9 Summary
IT truths
Vocab: HR, Motivation, HR Dept (HRM), Morale
Intrinsic vs Extrinsic Rewards
Equity and Expectancy
Hawthorne Studies
Maslow Hierarchy of Needs
Herzberg 2 Factors
Job Design (Rotation, Enlargement, Enrichment)
Minicase- 23 Ways the World is Improving

6.22.2020
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 Nature of Human Resource Management
Human Resource Management (HRM)
• All the activities involved in determining an
organization’s human resource needs
• Acquiring, training, and compensating people to fill
those needs
• Called personnel management in some companies
• Workforce increasingly more diverse
• Managers try maximizing employee satisfaction while
motivating them to productively meet objectives

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 All HR groups perform some common functions

Payroll (may be outsourced)

ER
Recruitment/hiring
Benefits
Maybe: training, job specs, Organizational Dev,
suggestion programs

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 Planning for Human Resource Needs
Determine the number of employees/skills needed
to satisfy overall plans
Forecast the number of qualified employees that
will need to be hired, or determine if layoffs are
required
Analyze the organization’s jobs
• Job analysis
• Job description
• Job specification

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 Recruiting and Selecting New Employees 1
Recruiting
• Forming a pool of qualified applicants from which
management can select employees
• Internal sources
• External sources

• Companies sometimes use headhunters to recruit for

managerial or professional positions

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 Recruiting and Selecting New Employees 2
Selection
• Process of collecting information about applicants and
using that information to make hiring decisions
• Includes:
• The application
• The interview
• Testing
• Reference checking

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 Table 10.1 Most Common Questions Asked during
the Interview
1. Tell me about yourself.
2. What are your biggest weaknesses?
3. What are your biggest strengths?
4. Where do you see yourself in 5 years?
5. Out of all of the other candidates, why should I hire you?
6. How did you learn about the opening?
7. Why do you want the job?
8. What do you consider your biggest professional achievement?
9. Tell me the last time a coworker or customer got angry with you. What
happened?
10.Describe your dream job.
Source: Jeff Haden, “27 Most Common Job Interview Questions and Answers,” Inc., 2017, https://www.inc.com/jeff-
haden/27- most-common-job-interview-questions-and-answers.html (accessed April 27, 2018).

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 Personality Tests

Personality tests such as Myers-Briggs are used to assess an applicant’s

potential for a certain kind of job. For instance, extroversion and a love of
people would be good qualities for a retail job.
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 Table 10.2 Top Ten Most Common Résumé Lies
1. College you graduated from
2. Foreign language fluency IMO: Never, Never, Never
3. Academic degree
4. College major
5. GPA
6. Former employment or work history
7. Awards or accomplishments
8. College minor
9. Projects or portfolio
10. Job title
Source: Mike Timmermann, “The #1 Resume Lie That Could Cost You a New Job,” Clark,
http://clark.com/employment-military/ worst-resume-lies/ (accessed April 26, 2018).

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 Anita is the chair of a hiring committee
POLLING QUESTION
searching for new talent. In your opinion,
which source of information should she place
the greatest value in during the interview
process?
A. Application
B. Interview
C. Employment Test
D. References

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 Legal Issues in Recruiting and Selecting 1
Title VII of the Civil Rights Act of 1964
• Prohibits specific discrimination in employment
• Created the Equal Employment Opportunity
Commission
• Dedicated to increasing job opportunities for women and
minorities
• Eliminates job discrimination based on race, religion,
color, sex, national origin, or handicap
• Outlaws use of discriminatory tests for applicants

• Applies to employers with >= 15 employees

• Remedies include reinstatement, backpay, damages.
• Does not apply to bona fide senority policies
What new laws now prevent discrimination?
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 Civil Rights Act of 1964
What significant (and surprising) USSC ruling was
made in June 2020 with this law at the logic?

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 Legal Issues in Recruiting and Selecting 2
Americans with Disabilities Act (ADA)
• Prevents discrimination against disabled persons
Age Discrimination in Employment Act
• Outlaws discrimination based on age; focus is on
people 40 years and older
Equal Pay Act
• Mandates that men and women who do equal work
receive the same wage
• Wage differences are acceptable if based on seniority,
performance, or qualifications

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 Legal Issues in Recruiting and Selecting 3

The Department of Labor has oversight over workplace safety, wages

and work hours, unemployment benefits, and more. It often files
lawsuits against firms that it believes are treating workers unfairly and
violating labor laws.
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 Which of the following laws makes it illegal to
POLLING QUESTION
discriminate against an individual based on
their sex, age, race, color, natural origin or
religion?
A. Title VII of the Civil Rights Act
B. Affirmative Action
C. Americans with Disabilities Act (ADA)
D. Sarbanes-Oxley Act (SOX)

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 Developing the Workforce 1
Orientation
• Familiarizes newly hired employees with fellow
workers, company procedures, and the physical
properties of the company
• Tour of the building
• Introductions to supervisors and co-workers
• Distribution of manuals and policies
• Socializing the new employee into the ethics and culture of the
company

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 Developing the Workforce 2
Training and Development
• Training
• On-the-job training
• Classroom training

• Mentoring
• Development

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 Developing the Workforce 3
Assessing Performance
• One of the most difficult tasks for managers
• Crucial activity because it:
• Gives employees feedback
• Provides a basis for determining compensation
• Generates information about the quality of the firm’s selection,
training, and development activities

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 Performance Appraisals

Performance appraisals are important because they provide

employees with feedback on how well they are doing as well as areas
for improvement.
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 Developing the Workforce 4
Assessing Performance (continued)
• Performance appraisals may be objective or
subjective
• Objective appraisals are quantifiable
• Popular subjective appraisal is the ranking system
• 360-degree feedback system
• Decrease negative employee feedback

• Vital for manager to discuss results with employee

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 Developing the Workforce 5
Turnover
• Occurs when employees quit or are fired and must be
replaced
Promotion
• Advancement to a higher-level job with increased
authority, responsibility, and pay
Transfer
• Move to another job within the company at the same
level and wage

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 Downsizing

Many companies in recent years are choosing to downsize by

eliminating jobs. Reasons for downsizing might be due to financial
constraints or the need to become more productive and competitive.
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 Developing the Workforce 6
Separations
• Occur when employees resign, retire, are terminated,
or laid off
• Traditionally, employees could be fired at-will
• Legislation now requires that companies fire employees fairly,
for just cause only
• Want to minimize losses due to separations
• Recruiting and training is expensive
• Exit interviews

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Table 10.3 Actions You Should and Shouldn’t Take
When You Are Terminated

1. Do not criticize your boss who terminated you.

2. Do not take files or property that is not yours.
3. Do try to get a reference letter.
4. Do not criticize your former employer during job
interviews.
5. Do look to the future and be positive about new
job opportunities.

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 Compensating the Workforce 1
Wage/Salary Survey
• Pay and benefits represent a substantial expense for
a firm
• Compensation for a specific job is typically determined
through a wage/salary survey
• Tells a company how much compensation comparable firms
are paying for specific jobs that the firms have in common

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 Compensating the Workforce 2
Financial Compensation
• Wages
• Commission
• Salary
• Bonuses
• Profit sharing

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 Compensating the Workforce 3
Benefits
• Nonfinancial forms of compensation provided to
employees
• According to the Bureau of Labor Statistics, employer
costs for compensation in the U.S. average $35.87
per hour worked
• Wages and salaries account for 63.8%
• Benefits account for 31.7%

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 Compensating the Workforce 4
Benefits continued
• Fringe benefits
• Soft benefits
• Cafeteria benefit plans

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 What Responsibility does the firm have to employees?

Fairness in treatment, promotions

Transparency (when possible)
Safe working conditions
Objective evaluations
Development
Help to succeed
Listen to Grievances and act when possible

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 Employees at Facebook can launder/dry clean
POLLING QUESTION
soiled clothing at work. This benefit is known
as a _____ benefit.
A. Soft
B. Fringe
C. Paid
D. Cafeteria

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 Managing Unionized Employees 1
Labor Unions
• Employee organizations formed to achieve better pay,
hours, and working conditions
• On average, union workers make about $200 more
than nonunion workers
• Union growth has slowed in recent years; prospects
for growth not good
• Significant aspects of HRM, particularly
compensation, are dictated by union contracts

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 Managing Unionized Employees 2
Collective Bargaining
• Negotiation process by management and unions to
reach an agreement about compensation, working
hours, and working conditions for the bargaining unit
Labor Contract
• Formal written document delineating the relationship
between the union and management for a specified
period of time, usually two or three years
• Cost-of-living escalator (COLA) clause
• Givebacks

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 Figure 10.1
The Collective
Bargaining
Process

Access the text alternative for these images.

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 Managing Unionized Employees 3
Resolving Disputes
• Labor tactics
• Picketing
• Strikes
• Boycotts

• Management tactics
• Lockout
• Strikebreakers

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 Managing Unionized Employees 4
Outside Resolution
• Conciliation
• Mediation
• Arbitration
• Compulsory arbitration

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 You are a tenured professor who chairs the
POLLING QUESTION
Faculty Council. The faculty is evenly divided
between those who support the formation of a
union and those who do not. You’ve convened
a meeting to discuss options. Which option do
you support?
A. Unionizing
B. Not unionizing
C. A neutral approach

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 The Importance of Workforce Diversity 1
Diversity
• The participation of different ages, genders, races,
ethnicities, nationalities, and abilities in the workplace
Characteristics of Diversity
• Primary characteristics
• Inborn and unchangeable

• Secondary characteristics
• Can be changed

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 Figure 10.2 Characteristics of Diversity

Source: Marilyn Loden and Judy B. Rosener, Workforce America! Managing Employee Diversity as a Vital Resource
(New York: McGraw- Hill, 1991), p. 20.
Access the text alternative for these images.
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 The Importance of Workforce Diversity 2
Why Is Diversity Important?
• U.S. workforce is becoming increasingly diverse
• Census Bureau predicts that by 2044 minorities will be
the majority in the U.S.
• Companies improving HRM programs to recruit,
develop, and retain more diverse employees to better
serve diverse customers
• Effectively managing diversity in the workforce
involves cultivating and valuing its benefits and
minimizing its problems

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 The Importance of Workforce Diversity 3
The Benefits of Workforce Diversity
1. More productive use of a company’s human resources.
2. Reduced conflict among employees of different ethnicities, races,
religions, and sexual orientations as they learn to respect each
other’s differences.
3. More productive working relationships among diverse employees
as they learn more about and accept each other.
4. Increased commitment to and sharing of organizational goals
among diverse employees at all organizational levels.
5. Increased innovation and creativity as diverse employees bring
new, unique perspectives to decision-making and problem-solving
tasks.
6. Increased ability to serve the needs of an increasingly diverse
customer base.

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 The Importance of Workforce Diversity 4
Affirmative Action
• Began in 1965
• Legally mandated programs
• Aim to increase job opportunities for minority groups
• Analyze current pool of workers
• Identify areas where women and minorities are
underrepresented
• Establish specific hiring and promotion goals with target dates
to resolve the discrepancy
• Reverse discrimination

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 Trends in Management of the Workforce
Advances in information technology, recessions
and financial crises have impacted employment
Nature of workplace changing; increase in
micropreneurs and small-scale businesses
The sharing economy (gig economy) is growing
Technology is blurring the lines between leisure
and work time
Legal issues regarding worker rights
Many successful firms find ways to balance costs
with employee well-being
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 Chapter 10 Summary

Major Functions in HR depts

Title VII of the Civil Rights Act of 1964
Impo of Diversity

Ecommerce MiniCase

6.6.2020

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 BO Instructions- Ecommerce

We will divide into 7 groups

Each group will be responsible for identifying and succinctly
reporting on the key data and information in their assigned
section

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 Solve the Dilemma
Morale among the Survivors 1

Medallion Corporation manufactures quality carpeting and

linoleum for homes throughout the United States
• Recession and subsequent downturn in home sales has sharply
cut the company’s sales
• Have to lay off hundreds of employees in the home office
(manufacturing facilities) and salespeople
• One additional month of work
• One month of severance pay
• Opportunity to sign up for classes to help with transition

• Several months after the cutback, morale was at an all-time low

for the company although productivity had improved

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 Solve the Dilemma
Morale among the Survivors 2

Consultant suggested:
• Leaner, flatter organizational structure would be
suitable for more team activities
• Set up task forces and teams to deal with employee
concerns
But diversity of the workforce led to conflict and
misunderstandings among team members

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 Solve the Dilemma
Morale among the Survivors 3

Critical Thinking Questions

1. What did Medallion’s HRM department do right in
dealing with the employees who were laid off?
2. What are some of the potential problems that must be
dealt with after an organization experiences a major
trauma such as massive layoffs?
3. What can Medallion do to make the team approach
work more smoothly? What role do you think diversity
training should play?

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