HRM523- human resource management final exam

final exam

What is orientation?

A procedure for providing new employees with basic background information about the firm and the job

What are the benefits of orientation? (5 points)

1. part of ongoing socialization process
2. helps reduce first day jitters and reality shock
3. foundation for ongoing performance management
4. improved productivity
5. improved retention levels and reduced recruitment costs

Reality shock (cognitive dissonance)

the state that results from the discrepancy between what the new employee expected from his or her new job and the realities of it

What should the characteristics of a compensation plan be?

1. The compensation plan should first advance the firm's strategic aims—management should produce an aligned reward strategy.

2. This means creating a compensation package (including wages, incentives, and benefits) that produces the employee behaviours the firm needs to achieve its competitive strategy.

What does employee compensation include?

includes all forms of pay going to employees and arising from their employment

What are the 2 types of financial payments?

direct and indirect

What are direct payments?

wages, salaries, incentives, commissions, and bonuses

What are indirect payments?

financial benefits like employer-paid insurance and vacations

What are the basic considerations in determining pay rates?

1.legal considerations in compensation

2.union influences

3. compensation policies

4. equity and its impact on pay rates

What are the 3 steps in establishing pay rates?

Stage 1: Job evaluation

Stage 2: Conduct wage/salary survey

Stage 3: Combine job evaluation and salary survey to determine pay

What is job evaluation?

A systematic comparison to determine relative worth of jobs within a firm.

What is a benchmark job?

critical to operations or commonly found in other organizations

What are compensable factors?

fundamental, compensable element of a job such as skill, effort, responsibility and working conditions

What is Classification/Grading Method?

1. categorizes jobs into groups

2. grade/group description: outlines level of compensable factors required by each job

What is Point Method?

1. identify compensable factors (e.g., skills, effort, responsibilities, working conditions)

2. determine the degree to which each factor is present in each job

What is a wage/salary survey? (3 components)

aimed at determining prevailing wage rates:

1. determine rates for benchmark jobs

2. determine market rates for jobs

3. collect data on benefits, recognition programs, etc.

What is wage curve?

a graphic description of the relationship between the value of the job and the average wage paid for this job

What are Pay ranges?

a series of steps or levels within a pay grade, usually based on years of service

What is Broadbanding?

Reducing the number of salary grades and ranges into just a few wide levels or "bands," each of which contains a relatively wide range of jobs and salary levels

What are the types of incentive plans? (4)

organization-wide

operations employees

senior managers and executives

salespeople

What are the 2 types of organization wide incentives?

Merit pay - the idea that your salary increases incrementally

Profit sharing - employees get a percentage of the profits

What is a piecework plan?

earnings are directly tied to what the worker produces

What are the advantages of Piecework plan?

Simple, appears equitable, directly tied to performance

What are the disadvantages of piecework plans?

Some employers arbitrarily raise standards, resistance to revising the standard

What are the common incentives for executives?

Annual bonuses, long-term incentives (e.g. stocks)

disadvantages of commission?

Focus on sales, not on customer relationship

Variance in income for employees

Sales people may neglect other duties

Advantages of commission?

Greatest incentive, attracts high performers

Sales costs proportion to sales

Easy to understand

What are the considerations in developing effective incentive plans?

performance pay cannot replace good management

firms get what they pay for - incentives based on production levels may result in rushed production

pay is not a motivator - employees value opportunities and psychological success

rewards rupture relationships - employees may feel more inclined to pursue financial rewards for themselves

rewards may undermine responsiveness - harder to achieve goals with distractions

How to effectively implement incentive plans? (7 points)

Pay for performance

Link incentives to activities that engage employees

Link incentives to measurable, valuable competencies

Match incentives to organizational culture

Keep group incentives clear and simple

Over-communicate

The greatest incentive is the work itself

Common employee recognitions? (Examples)

Certificates, cash, company merchandise, gift cards

What are the 5 components of total rewards?

1.Compensation

2.Incentives

3.Benefits

4.Work-life programs

5.Performance and recognition

6.Development and career opportunities

What are benefits?

indirect financial payments given to employees. They may include supplementary health and life insurance, vacation, pension plans, education plans and discounts on company products

Why are benefits important?

Helps with recruitment of people who share the values of the business

A good way to retain employees

Makes employees more motivated

Why don't organizations offer the value of their benefit in dollars?

Lack of control

Cheaper to offer things at retail value

Employees might not spend the full value of their benefits

What are the government mandated benefits? (examples)

Employment Insurance (EI)

Pay on Termination of Employment

Reasonable notice

Canada/Quebec Pension Plan (C/QPP)

Vacation and Holidays

Paid Breaks

What is employment insurance?

a federal program that provides income benefits if a person is unable to work through no fault of his or her own

eligibility: employees who were terminated without just cause, restricted to persons who have paid into the account

benefit period: up to 45 weeks

Funding: contributions from eligible employees, employers

Pay on Termination of Employment - conditions

does not apply to those on short-term contract or fired for just cause

amount of payment varies according to jurisdiction and circumstances:
pay in lieu of reasonable notice

A lump-sum equal to an employee's pay for the notice period provided to employees who cease working immediately

severance pay (Ontario and federal jurisdiction only)

Additional payout, subject to eligibility
pay for mass layoffs (some jurisdictions)

Additional pay, since larger layoffs result in longer time to re-employment

Leaves of Absence - characteristics

unpaid time off

employer must guarantee same or similar job when employee returns

common types:
- maternity/parental leave
- parental/adoption leave
- bereavement leave
- compassionate care leave

Worker's Compensation - characteristics

"no fault" insurance plan (regardless of weather the employee was at fault)

income and medical benefits to victims of work-related accidents or illnesses, regardless of fault

funded collectively by employers

administered by jurisdictional workers' compensation boards

What are the 3 types of paid time off?

Vacation
- minimum amount of paid vacation must be
- provided to employees
- typically two week requirement, usually three weeks

Holidays
- varies by jurisdiction
- minimum 5 days, maximum 9 days

Paid Breaks
- uninterrupted break within a work day
e.g. 30 minute break on a shift over 5 hours

What are the Voluntary Employer-Sponsored Benefits? (6)

life insurance

supplementary healthcare/medical insurance

short-term disability and sick leave plans

long-term disability

sabbaticals

retirement benefits

List and define retirement benefits

Defined Benefit Pension Plan
benefits formula based on earnings and years of service

Defined Contribution Pension Plan
benefits based on amount of contribution and value of fund

Group RRSP
employer sets up RRSP fund for employees
a way to defer taxes on some of your income

Deferred profit sharing plan (DPSP)
portion of profits is put into fund by the employer

Why would organizations want employees to retire?

Clears the way for new talent entering the workforce

Employees make significantly more towards the end of their careers than at the beginning

List different types of flexible work schedules

Flextime (work around core hours, flexible start and end times)

Telecommuting (working from home or somewhere else)

Compressed workweeks (longer work days, shorter week)

Job sharing (sharing a position with multiple people to work less)

Work sharing (work for a combination of wages and some EI)

ListTelecommuting is the most popular

List job-related services

subsidized childcare

eldercare

subsidized employee transportation

food services

educational subsidies

family-friendly benefits

List personal serivces

credit unions: members can deposit savings that accrue interest and/or take loans

counselling services: financial, family, career, legal, etc.

employee assistance programs (EAPs)
Provides employees with confidential counselling for problems like mental health issues, family problems, stress, substance abuse, etc.

other personal services (social and recreational)

List executive perks

management loans
salary guarantees (golden parachutes)
financial counselling
relocation benefits
outplacement assistance
company cars, chauffeured limousines
concierge service

what are Flexible Benefits Programs?

individualized benefit plans to accommodate employee needs and preferences

Constraints:
employer must limit total cost for each benefits package
benefit plan must include certain items that are not optional (government mandated benefits)

How can employers prevent workplace accidents?

filing government accident reports
maintaining records
ensuring that safety rules are enforced
posting safety notices and legislative information

What is WHMIS?

Workplace Hazardous Materials Information System

WHIMS legislation is based on what 3 elements?

1. labels designed to alert the worker that the container contains a potentially hazardous product

2. material safety data sheets (MSDSs) outlining a product's potentially hazardous ingredient(s) and procedures for safe handling of the product

3. employee training

what are employees responsibilities in preventing work accidents?

take reasonable care to protect their own health and safety, and that of co-workers

includes wearing protective clothing and equipment, and reporting contravention of the law

What are employees safety rights?

to know about workplace safety hazards

to participate in the OHS process

to refuse unsafe work

what are Joint Health and Safety Committees?

non-adversarial atmosphere where management and labour can work together to ensure a safe and healthy workplace

usually consists of between 2 and 12 members, at least half of whom represent workers

in small workplaces, one health and safety representative may be required

What causes accidents? (3)

Chance occurrences
Beyond management control

Unsafe conditions
Equipment, procedures, storage, illumination, ventilation,
Job itself, work schedule, psychological climate

Unsafe acts
carrying/lifting, operating speed, avoiding safety devices/equipment, horseplay, quarrelling, etc.

How to prevent accidents?

Reduce unsafe conditions:
1. Job design, remove physical hazards
2. Ensure safety precautions are taken

Reduce unsafe acts
1. Selection testing - can help screen out accident prone individuals
2. Leadership commitment - emphasizing safety at work
3. Training and education - especially appropriate for new employees
4.Positive reinforcement - praise workers for good safety performance

What are the OHS Challenges in Canada?

substance abuse
job-related stress
repetitive strain injuries
workplace toxins
workplace smoking
viral pandemic
violence at work

What is a union?

A group of workers recognized by law who collectively bargain terms and conditions of employment with their employer

A union is an organization, external to an independent from the company

What is a bargaining unit?

a group of employees that have been recognized by the employer as appropriate for collective bargaining purposes

What is a collective agreement?

A written document outlining the terms and conditions of employment in a unionized workplace

What Industries are Unionized?

Government employees, trade workers, police, firefighters, teachers

What Do Unions Do?

Wages

Benefits

Improved working Conditions

Security

Dispute resolution

Employee Voice

Promote broader social justice (social unionism)

Unions seek to adjust the power imbalance between employees and their employer

Union advantages?

Employees get greater benefits and are more loyal (low turnover)

Better working conditions

Employees have greater power

Union disadvantages?

Hard to fire employees

Employers may have to comply to employee demands

Negatively impacts other people (e.g. students, consumers)

Why are unions declining?

Unions seem irrelevant

In good times - high cost

In bad times - can't protect employees

Unions are perceived as bureaucratic (i.e. slow, inefficient)

Workers views are changing

Employee for life vs. entrepreneurship

Workers are turning to government for protection

What are the steps in the labour relations process?

1. Employees decide to seek collective representation

2. The union organizing campaign begins

3. The union receives official recognition

4. Union and management negotiate a collective agreement

5. Day-to-Day contract administration begins

Describe steps in collective bargaining

Preparation for negotiations
Face to face negotiations
Bargaining Zone
Collective bergaining

Why people join unions?

dissonance-based reasons
- unpleasant work environment, low pay

utility-based reasons
- cost/benefit analysis

political/ideological reasons
- desire to work for collective versus individual purposes

What is grievance?

allegation of a contract violation, filed by individual, the union, or management

Describe grievance process

Step 1:
Employee prepares written grievance with union steward
Brings grievance to supervisor

step 2
Grievance is brought to HR representative
Discussion with grievor and union steward

step 3
If not resolved, brought to more senior management

step 4
Grievance is submitted to arbitration (imposition of settlement by third party)

In collective bargaining what the parties can do if they cannot reach the deal? (union, management and third party)

Union Rights:
strike, picket, boycott

Management Rights:
lockout

Arbitration:
imposition of settlement by third party

what is employment contract?

formal agreement between employer and employee

employee cannot be prematurely dismissed without just cause if a term is specified

What is implied contract?

indefinite period of time, may be terminated by either party with reasonable notice

more common

What is voluntary turnover?

Quit
Retirement
Resignation

What is involuntary turnover?

Dismissal
layoff

What are the reasons for involuntary turnover?

Just cause (termination)

Restructuring/change in org. direction (downsizing)

Financial pressures/cost cutting (layoffs)

What is downsizing?

Downsizing: "activities undertaken to improve organizational efficiency, productivity, and/or competitiveness that affect the size of the firm's workforce, its costs, and its work processes

Why do organizations downsize?

Declining profits

Business downturn

Increased pressure from competitors

Organizational merger

New technology

Reduce operating costs

Decrease levels of management

Getting rid of employee "deadwood"

What are the consequences of downsizing?

Displaced Employees

'Survivors'

Costs

What are the direct costs of turnover?

separation costs
separation interview, administration, separation or severance pay

vacancy costs
temporary workers, overtime, loss of sales due to vacancy

replacement costs
recruiting/hiring replacement

training costs
for replacement

What are the indirect costs of turnover?

Employee moral

Productivity

What are the 5 steps in progressive discipline?

1. Verbal warning
2. Written warning
3. Second written warning
4. Suspension
5. Termination

What is required when dismissing an employee without cause?

reasonable notice

What is dismissal for just cause?

termination based on poor behaviour

no severance or additional notice period required

insubordination
disregard or disobedience of authority
often provides grounds for just cause

What is wrongful dismissal?

an employee dismissal that does not comply with the law or does not comply with a written or implied contractual arrangement.

What are bad faith damages?

reserved for extreme circumstances in which the employer was untruthful, misleading or unduly insensitive to the employee in the course of dismissal

what are punitive damages?

reserved for malicious or outrageous cases in which an employer engages in harsh and vindictive treatment of an employee, or if the employee suffered undue distress from not being given adequate notice of termination

What is constructive dismissal?

employer makes unilateral changes in the employment contract that are unacceptable to the employee

Examples:
demotion
reduction in pay and benefits
forced resignation

creates hostile work environment so employee wants to leave

How can wrongful dismissal suits be avoided?

Use termination clause and probationary period in employment contracts

Document all disciplinary action

Do not allege just cause for dismissal unless it can be proven

Time the termination so that it does not conflict with special occasions

Clearly state a settlement offer in writing

Schedule the termination interview in a private location at a discreet time of day

Include two managers in the termination meeting

List the steps in training process (5)

Step 1: Training Needs Analysis
Step 2: Instructional Design
Step 3: Validation
Step 4: Implementation
Step 5: Evaluation of Training

What is task analysis?

Task Analysis (new employees)
break down job into tasks and skills
determine where each each task and skill is best learned

What is performance analysis?

Performance Analysis (current employees)
verify any performance deficiencies and determine whether they are best resolved through training or other means
can't do vs won't do
Performance gap - what people should be doing vs what they are actually doing

What is instructional design?

prepare curriculum
ensure that training materials support learning objectives
ensure the quality and effectiveness of program elements

List traditional training techniques

Classroom training - e.g. CPR training involves a classroom component
on-the-job training - e.g. co-op and apprenticeships
job instruction training - step by step instructions, e.g. how to make a sub
Simulated training - computerized programs, e.g. for pilots
E-learning - gaining popularity, e.g. Athabasca University in Alberta

graphic rating scale

a scale that lists a number of traits and a range of performance for each
the employee is given a rating that best describes the level of performance for each trait

alternation ranking

rank employees against other employees, based on performance

paired comparison

for each trait, list all possible pairs of employees
for each pair, indicate "+" for the higher ranked employee, "-" for the lower ranked
rank employees by trait based on number of "+" scores

forced distribution

predetermined percentages of ratees are placed in various performance categories
example:
15 percent high performers - promotion
20 percent high-average performers
30 percent average performers
20 percent low-average performers

list Performance Appraisal Problems

Unclear performance standards
An appraisal scale that is too open to interpretation of traits and standards

Halo effect
In performance appraisal, the problem that occurs when a supervisor's rating of an employee on one trait biases the rating of that person on other traits

Central tendency
A tendency to rate all employees in the middle of scale

Strictness/leniency
The problem that occurs when a supervisor has a tendency to rate all employees either low or high

Appraisal bias
The tendency to allow individual differences (e.g., age, race, sex) to affect the appraisal ratings that these employees receive

how to give feedback?

Be direct and specific
use objective work data
Do not get personal
compare against standard
Encourage the person to talk
use open-ended questions, listen
Develop an action plan
agree on future steps