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A policy is predetermined course of action established to guide the performance of work

towards accepted objective

Human resource policies are the formal rules and guidelines that businesses put in place to hire,
train, assess, and reward the members of their work force.

Human resource policies are systems of codified decisions, established by an organization, to

support administrative personnel functions, performance management, employee relations and
resource planning.
Each company has a different set of circumstances, and so develops an individual set of human
resource policies. Sound human resource policy is a necessity in the growth of any business or

A policy is a guide for making decisions. If a decision provides help for decisions in other
situations, it is said to be a policy decision, because it sets an example and provides some guide
for decision making in future.
Personnel policies guide action. They offer the general standards based on which decisions are
reached. The HR policies serve as a road map for managers on various issues such as
recruitment, selection (on merits), promotion (performance parameter shall be the key) and

Purpose of hr policies :-

HR policies allow an organization to be clear with employees on:

• The nature of the organization

• What they should expect from the company
• What the company expects of them
• How policies and procedures work at your company
• What is acceptable and unacceptable behavior
• The consequences of unacceptable behavior


The personnel policies can be classified into following depending upon their sources i.e.
Originated, Appealed, Imposed, General or Specific, Written or Implied.

• ORIGINATED POLICIES- originated policies are generally given by top management

to guide departmental heads at various levels.

• APPEALED POLICIES- such policies are the policies which were earlier not
formulated to cover or to meet the requirements. Such request usually comes from
subordinates who fail to handle the cases based on existing policies.
• These policies are formulated on request of subordinates who wants to know how to
handle some situations. The needs for such policy arise because the particular case is not
covered by earlier policy.

• IMPOSED POLICIES- these are formed under pressure from external agencies such as
government, trade union etc. for ex. The policy that no body below age 14 will be
employed in the co.

• GENERAL POLICIES- it represents the basic philosophy and priorities of the top
management in formulating the broad plan. do not relate to any specific issue in
particular. For ex. Encouraging worker to participate in decision making is a general

• SPECIFIC POLICIES-these policies cover specific issues such as hiring, rewarding and

• WRITTEN OR IMPLIED POLICIES-implied policies are inferred from the behavior

of the members such as dress code, politeness etc. Written policies on the other hand
provide proper direction and explanation so that there is very little room for


Personnel policy reflects the needs and aspirations of employees. If the values which policy
generates are short of employees expectations it will be difficult to bring such policy in practice.
Therefore, the top management should take the advice of personnel or HRM Head to develop
policies on all matters relating to personnel activities. The personnel head devising Personnel
policies must have knowledge about the organization and its manpower. Policy formulation and
implementation involves following steps:-

1. FACT FINDING: - In formulating policies, the first step is to specify the areas needing
policies. Initially important areas of personnel management (recruitment, selection,
training, compensation, bargaining etc.) must have a policy formulation which is clearly
spelt out.

2. COLLECTING DATA:- Once priority areas are listed steps should be taken to collect
facts before formulating a policy .a committee or a specialist may be assign the task of
collecting the requirement information from inside and outside the org. Various sources
could be tapped for this purpose, such as company’s records , past practices, survey of
industries, experience of personnel, top management philosophy, organizational culture,
employees aspirations and changing economic , social and legislative environment etc.
3. SPECIFYING ALTERNATIVES: - The third stage in policy formulation deals with
examination of alternative, policies in the light of their contribution to the organizational
goals. Policy alternatives should emerge only after collecting from various sources. It is
always better to involve people at various levels especially those who are to work with
such policies.

4. APPROVAL BY TOP MANAGEMENT: - When the policy is found appropriate and

when everything is above board, the policy should be written down and put up before top
management for approval. It should also be ensured that prepared policy do meet the
organizational priorities.

5. Communicating the policy: - the approved policy needs to be communicated through out
the org. policy manual, house journal meetings and other methods may be employed for
this purpose.

6. Evaluating the policy: - the policy should be evaluated in terms of experience of those
who use it and who are affected by it. Environmental changes should also be considered.


There are several advantages of personnel policies which are explained below:-

1. DELEGATION – it helps managers functioning at various levels to act with confidence

without the need for consulting superiors.

2. UNIFORMITY- taking decisions in issues by people at different levels become uniform

and therefore the actions of people become more consistent in a given situation.

3. BETTER CONTROL- the personnel policies specify the relationship shared between
employees and management as such they allow members towards achievement of
organizational objectives. Therefore, little friction and very less conflict and thus better
control automatically pave way for smooth functioning.

4. STANDARDS OF EFFICIENCY- policies also serve the purpose to know the

standards in execution of policies at work. It provides opportunity to management to see
whether their policies have been translated in action by various groups in view of the
level of performance the existing policies can be modified, if required.
5. CONFIDENCE- traveling through actions in terms of policies makes the employee to
understand their position as to where they stand. Their success through performance
brings confidence in them which also avoids misinterpretation and friction

6. SPEEDY DECISIONS-policies after execution can speed up decisions.

7. COORDINATING DEVICES- personnel policies help in achieving coordination with

other departments if they are practicing the same policy. They can predict more
accurately the actions and decisions of others.

Coverage of human resource policies:-

Policies are established regarding various function of HRM which are as follows:-
1. EMPLOYMENT :include all policies concerning recruitment, selection, and separation
of employee