BUSN Ch.15 Human Resource Management: Building a Top-Quality Workforce

Human Resource (HR) Management

Maximizing workforce effectiveness by recruiting talent, promoting career development, and boosting organizational effectiveness.

Wage Gap (CEO vs. Worker Pay)

The disparity between executive pay and average worker pay; averaged 303 times worker pay in the U.S. in 2014.

Older Worker Retention Challenges

Managing the massive retirement of baby boomers and retaining experienced talent through flexible schedules.

Younger Worker Characteristics

Millennials bring technological know-how and multitasking skills, often accompanied by high expectations and entitlement.

Women Workers and the Pay Gap

Women earn roughly $0.83 for every dollar men earn due to caregiving time off, occupational sorting, and discrimination.

Role of HR Management

To nurture human investment to yield the highest possible return through talent, development, and effectiveness.

HR Strategic Solution

Earning a seat at the executive table by understanding business goals and quantifying HR's financial impact.

Job Analysis

Examining specific tasks assigned to each position independent of who holds the job.

Job Description

An official explanation of the responsibilities for a specific position.

Job Specifications

The specific educational and experiential qualifications necessary to hold a particular position.

Internal Recruitment

Seeking employees currently within the firm to fill open positions.

External Recruitment

Seeking new employees from outside the firm using websites, ads, job fairs, and referrals.

Structured Interviews

Interviewing approach using a pre-developed list of identical behavioral questions for all candidates.

Probationary Period

A specific time frame (3-6 months) where a new hire proves their worth before becoming permanent.

Contingent Workers

Employees who do not expect regular full-time jobs, such as temporary workers and independent contractors.

Orientation

The first step in training, introducing new employees to company culture and administrative information.

Apprenticeships

Structured training where beginners assist fully trained workers before gaining full credentials.

Performance Appraisal

A formal feedback process comparing an employee's actual results to expected results.

Compensation

The combination of pay and benefits that employees receive in exchange for their work.

Wages vs. Salaries

Wages pay for hours worked with overtime eligibility; salaries cover a fixed period without overtime.

Cafeteria-Style Benefits

Giving employees a set dollar amount to spend on tailored benefits within broad limitations.

Flextime

A scheduling option allowing workers freedom in start and end times while completing required hours.

Compressed Workweek

A flextime version allowing employees to work full-time hours in fewer than five standard days.

Telecommuting

Working remotely, most often from home, and connecting to the office via broadband networks.

Job Sharing

An arrangement where two or more employees share a single full-time job.

Civil Rights Act of 1964 (Title VII)

Prohibits employment discrimination based on race, color, religion, sex, or national origin.

Equal Employment Opportunity Commission (EEOC)

Federal agency designed to regulate and enforce the provisions of Title VII.

Americans with Disabilities Act of 1990

Prohibits discrimination against people with disabilities and requires reasonable accommodations.

Family and Medical Leave Act of 1993

Requires firms with 50+ employees to provide 12 weeks of job-secure, unpaid leave for family reasons.

Affirmative Action

Policies meant to increase employment and educational opportunities for minority groups.

Sexual Harassment in the Workplace

Workplace discrimination based on gender, ranging from sexual favors to hostile environments.

Training Benefit: Innovation and Tech

Increases strategy innovation and ability to adopt new technologies.

Training Benefit: Productivity and Retention

Boosts productivity, increases employee motivation, and lowers employee turnover.

Appraisal Goof: Gotcha!

Using the performance appraisal to catch employees doing something wrong.

Appraisal Goof: The Once-a-Year Wonder

Giving feedback only once a year because annual reviews are mandated.

Variable Pay Option: Commission

Payment as a percentage of sales, usually paired with smaller base pay.

Variable Pay Option: Stock Options

Right to buy company stock at a future date for award-day price.

Fair Labor Standards Act of 1938

Established a minimum wage and overtime pay for working over 40 hours.

Occupational Safety and Health Act of 1970

Required safety equipment and established maximum exposure limits for hazardous substances.

Vestibule Training

Off-site training for workers using real equipment similar to actual job tools.

Job Simulation

Training that attempts to duplicate exact conditions faced on the job.

Variable Pay Option: Bonuses

Lump-sum payments, typically to reward strong performance from individual employees.

Variable Pay Option: Profit Sharing

Rewards employees with a share of company profits above and beyond predetermined goals.

Variable Pay Option: Pay for Knowledge

Awarding bonuses and pay increases in exchange for increases in knowledge such as earning an MBA.

Equal Pay Act of 1963

Mandated that men and women doing equal jobs receive equal pay.

Immigration Reform and Control Act of 1986

Required employers to verify employment eligibility for all new hires.

Compensation Factor: Competition

How much competing firms offer for similar positions.

Compensation Factor: Contribution

How much a specific person contributes to the bottom line.

Compensation Factor: Ability to Pay

How much the company can afford.

Compensation Factor: Cost of Living

What would be reasonable in light of the broader local economy.

Compensation Factor: Legislation

What the government mandates.

Management Development

Programs to help current and potential executives develop skills needed to move into leadership positions.

Reference and Background Checks

Vetting process used before job offers to uncover resume fraud and avoid negligent-hiring lawsuits.

Appraisal Goof: Straight from the Gut

Relying on personal gut feel during performance appraisals instead of relevant documentation.

Appraisal Goof: The Me Filter

Filtering performance appraisal comments through personal biases like leniency or the halo effect.

Frivolous Lawsuit Impact

Frivolous lawsuits cost American businesses over $865 billion per year in expenses and reputation damage.

Training Benefit: Decreased Liability

Training programs help decrease legal liabilities such as sexual harassment lawsuits.

Contingent Workers Drawbacks

Workers who can be less committed, potentially hurting productivity and facing higher poverty rates.

Noncash Benefits Value

Healthcare and other noncash benefits can be worth up to 30% of employee pay.

High Compensation Impact

Firms offering higher-than-average compensation generally outperform competitors in total return to shareholders.

Federal Minimum Wage (2017)

Set at a minimum of $7.25 per hour as of May 2017.

Overtime Pay Rate

Nonexempt wage earners must receive 50% more than standard wage for hours over 40 per week.

Competition

How much do competing firms offer for similar positions?

Contribution

How much does a specific person contribute to the bottom line?

Ability to Pay

How much can the company afford?

Cost of Living

What would be reasonable in light of the broader local economy?

Legislation

What does the government mandate?

On-the-Job Training

A training approach where employees simply begin their jobs and learn as they go, sometimes guided by more experienced workers.

Off-the-Job Training

Classroom training that happens away from the job setting, either on-site or off-site, to teach a wide variety of topics.

Computer-Based Training

Web-delivered training that supports interactive programs and flexibility, though it requires significant self-discipline.

Five Reasons for Training and Development

Innovation, technology adoption, efficiency and productivity, employee motivation and turnover reduction, and decreased liability.

Performance Pay Overview

Variable compensation systems that link employee pay to individual, group, or company performance.

Commission

Commission involves payment as a percentage of sales. Usually, larger commissions go with smaller base pay.

Bonuses

Bonuses are lump-sum payments, typically to reward strong performance from individual employees.

Profit Sharing

Profit-sharing plans reward employees with a share of company profits above and beyond predetermined goals.

Stock Options

Stock options are the right to buy shares of company stock at some future date for the price of the shares on the day that the company awarded the options.

Pay for Knowledge

This approach involves awarding bonuses and pay increases in exchange for increases in knowledge such as earning an MBA.

Positive Leniency

"I'm a nice guy, so I give everyone great scores."

Negative Leniency

"I have high expectations, so give everyone low scores."

Halo Effect

"I like this employee, so I'll give her top scores across the board."

Voluntary Separation

Employees leaving the firm voluntarily through resignation or retirement.

Involuntary Separation

Employees leaving the firm involuntarily due to layoffs, downsizing, or firing for cause.

Exit Interview

A meeting with departing employees to understand why they are leaving and gather feedback.

Severance Pay

Financial support given to employees upon involuntary separation to ease transition.

Downsizing

Planned reduction in company workforce to improve organizational efficiency and cut costs.

Core Areas of a Complete HR Plan

Recruitment, selection, training, evaluation, compensation, benefits, and separation.