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Executive summary
Human resource management has become a buzzword in the era of present competitive world. In
an increasing rate, it is becoming the basic function of the management. Human resource
management covers the employment planning, recruitment, selection, training and development,
motivating, promoting, degrading and termination of employees for the organisations. Human
resource management serves the various interests of the organisations and contributes to the
firms success through proper management of employees. Human resource management ensures
a proper job analysis, job description and also ensures that right employees to be recruited and
selected to the right posts. It ensures the proper nourishment of current and new employees
through proper training and development programs. Moreover, it facilitates the firm to make the
employees satisfied through better compensation plan and reward system and non-financial
rewards. Satisfied employees can give their maximum effort to contribute a lot the organisations
success. Moreover, it also provides effective tools for measuring the employees performance
and monitoring their works within the firm so that firm can evaluate that employees are working
as per their employment terms and job requirements. That means it tries to ensure as everything
is going as per the planning. Various legal and regulatory frameworks are also considered by
HRM to make sure that organisation is working up to the legal requirements and various
regulations. Labour relations and various employee and employment rights also considered by
HRM. Finally, HRM sets the termination policies for proper employment cessation management.
Table of Contents
Executive summary.........................................................................................................................1
Introduction......................................................................................................................................4
Task1................................................................................................................................................4
P1.Does the Human Resource Management Just another Term For personnel Management.....4
P2. Benefits of HRM....................................................................................................................6
P3. Legal and regulatory impacts on Human resource management...........................................7
Task2................................................................................................................................................8
P1. Importance Of human resource planning and its stages........................................................8
P2. Effectiveness of Recruitment and Selection process...........................................................10
Task 3.............................................................................................................................................13
P1. How the agency can determine an effective reward system................................................13
P2. Techniques for monitoring performance with their relevant advantages and disadvantages
....................................................................................................................................................16
Task 4.............................................................................................................................................17
P1. Various reasons for termination of employment..................................................................17
P2. Employment Exit procedures...............................................................................................18
P3: How the legal and regulatory framework could affect employment cessation arrangements
....................................................................................................................................................19
Conclusion.....................................................................................................................................20
References......................................................................................................................................21
Introduction
Human resource management is considered as the managing of human capital within the
organizations. HRM recognizes humans as the most important resources within the organization.
This report covers the various aspects of human resources management. In the first part it covers
the discussion regarding the differences between HRM and personnel management. Besides, this
part contains the benefits of HRM and impact of various legal and regulatory frameworks on the
human resources management.
In the second part of the report, the importance of human resource planning and stages of the
HRM planning are discussed. Moreover, the recruitment and selection process for organisations
are discussed in details in the second part.
In the third part, the report makes a detailed discussion on the ways of determining effective
reward system. Various motivation theories also discussed in relation with the reward system.
Moreover, the monitoring techniques are also discussed with their related benefits and problems.
In the final part, the various reasons for terminating the organisations employees are stated. The
report also includes employment exit procedures and the impact of legal and regulatory
framework on the employment cessation arrangements.
Task1
P1.Does the Human Resource Management Just another Term
For personnel Management
Human resource management has become a critical aspect for an organizational the todays
business context. It is related with the proper nourishment and management of the employees
within the organisation (Odden, 2011). Many professionals conclude that there are a few
differences between human resource management and personnel management and believe human
resource management as the new version of personnel management (Robbins, 2005). They found
little and rare defences between HRM and Personnel Management. However, there are some
conspicuous differences between HRM and Personnel Management in the following areas and
matters.
Personnel management is considered as the traditional approach of managing people in
the organisation where human resource management is considered as the modern concept
of properly managing the people and their strengths in the organisation.
The main focus of personnel management is on the personnel administration, employee
welfare and labour relation whereas the main focus of human resource management is on
acquisition, development, motivation and maintenance of human resources in the
organisation (Noe, 2006).
Personnel management states the personnel function as undertaken for employees
satisfaction and human resource management recognizes administrative function as
undertaken for goal achievement.
Job design is done on the basis of division of labour under personnel management. On the
other hand job design function is done on the basis of group work or team work in case of
HRM.
Personnel management focuses on the centralized decisions and it recognizes that
decisions are made by the top management as per the rules and regulations of the
organisations (Odden, 2011). On the contrary, decisions are made collectively after
ensuring employees participation, authority, decentralization, competitive participation.
These are the theoretical differences that have been drawn between Personnel Management and
Human Resource management. These two concepts can be differentiated in terms of business
examples as well.
For example, Smith practices personnel management in an organisation. Smith involves with the
proper planning and job analysis to determine his organisations Current and future labour needs.
Employees with the proper knowledge, skills and abilities are the key people he tries to recruit.
Smith and his co-workers will also focus on developing their current employees through
employee appraisal and training and will further try to ensure a safe and healthy workplace.
John works in human resource management in an organisation. John always seeks to extent to
which his organisation is appropriately staffed by proper job analysis, planning, recruitment and
selection. He and his team members develop training and development programs. Proper
compensation plan plans are also developed by them. Smith engages in developing policies to
comply with various employment and labour laws, employee relations and continuous
improvement.
P3.
Legal
and
regulatory
impacts
on
Human
resource
management
In the todays business context, every firm has to be governed by some specific and effective
institutional regulatory framework that influences not only human resource management but also
overall activities of business organisation (Milkovich, 2012). As HRM is very critical aspect for
any organisation, there will be a lot of legal legislations imposed by the EU as the UK is part of
the EU. HRM has to be concerned about the following laws and legislations.
Sex discrimination act 1995/97, races relations act 1992, equal pay act 1970, disability
discrimination acts 1995 and 2005, employment act 2002, and data protection act 1998.
Besides these legislations HRM must put a considerable thought on various ethical issues such as
asking the candidates the same questions, no biasness by the interviewers for a particular
candidate, gender and ethnic balance on panels. Moreover, they need to focus on the following
regulatory frameworks
European Working time directive (All the counties within EU follow and implement the
same working time for their employees. EU suggested a standard of 48 hours a week by
an act. It also determines restrictions on the maximum length of nightshifts, rest periods
and annual leave of four weeks.)
National minimum wage: is set by the government as recommended by low pay
commissions.
Employee safety and health (maintain safe and clean environment)
Sexual harassment (sexual favours, other inappropriate verbal and physical conduct and
hostile conditions)
Labour relations (procedures for labour unions and indicates what parties can and cant
do)
Employee Privacy (using of surveillance for monitoring with limited context, but cant be
used against employees unless there is strong suspicion of inappropriate actions).
Task2
P1. Importance Of human resource planning and its stages
Human resource planning serves many important goals and responsibilities for business. HR
planning provides an aid to the managers to recruit talented staff, management of payroll and
benefits, administration over employee policies and employee training programs (Robbins,
2005). HR plans not only covers the tactical needs but also the strategic needs. Tactical planning
focuses on day to day staffing issues and compliance with government regulations are managed.
Strategic planning facilitates a firm by ensuring establishing updated recruitment and training
programs and provides a path for establishing benchmark through which firms can evaluate its
employees performances. HRM resource planning focuses on assessment of the manpower
recruitment for future period of time. HRM Planning involves the following steps
Supply forecasting is engaged with the estimation of supply of manpower on the basis of current
availability and future availability of human resources in the organisation. Future sources of of
HR are likely to be estimated by this forecasting.
Matching Demand and Supply
Matching demand and supply is to match the supply and demand of the employees by bringing
demand and supply in an equilibrium position so that shortage and over staffing position will be
solved (Kreitner and Kinicky, 2014). Shortage requires additional employees and overstaffing
demands reducing the level of existing employment.
Action Plan
The last stage of human resource planning is concerned with surplus and shortages of human
resources. Under this plan, different HR activities are executed such as recruitment, selection,
placement, training and development, socialization. Finally this step is followed by control and
evaluation of performance.
Recruitment and selection is often seen as an integrated approach for many organisations. But it
may vary from organisation to organisation. Recruitment process for two organisations are
shown in below with brief discussion
Task 3
P1. How the agency can determine an effective reward system
The task of determining the reward system often creates a dilemma for the HR mangers. HR
managers have to consider many options to determine the effective reward system. These
consideration set may include an effective compensation system or pay, profit sharing, gain
sharing, commissions, bonuses, stock options etc.
Compensation system
A compensation system is often used to determine the amount of pay to be given to the
employees within the organisation for their contribution to the organisations operations,
effectiveness and efficiency (Maccarthy, 2014). The basic components of compensation system
are
Pay structure
Pay level
Pay form
Pay may change from year to year because of seniority and longevity, cost of living,
performance/merit, changes in job scope and increase in individual qualifications. Employees
within the organisation may be satisfied with the pay or dissatisfied with it. Pay satisfaction
depends on two major factors. They are
Pay adequacy is the degree to which an individuals pay level satisfies his or her financial
needs.
Pay Equity refers to the extent to which an individual perceives his or her pay level as
equitable or fair in comparison to the others.
Pay equity can often be judged in terms of the equity theory of satisfaction and motivation that is
often based on the premise that individuals search for achieving a balance between the ratio of
their contribution to rewards to the ratio of contributions and rewards of others (Robbins, 2005).
Commissions
Commissions are more popular for sales position where sales people are provided with
commission based payment with a fixed amount for their extra effort or performance.
Incentive plans
These system based on the premise that individuals will be paid on his or her measured
productivity. This includes price rate (number of units produced), standard hour plans (extra
payment for overtime works).
Bonuses
Bonuses are generally considered as the lump sum payments awarded for the accomplishment of
specific objectives. Three types of bonuses are individual, team/group/departmental and
organisational (Hunt, 2013).
Profit sharing
Profit sharing is considered as the system in which individuals receive an annual bonus based on
the overall profitability of the organisation.
Gain sharing
Gain sharing are provided on the monthly, quarterly or annual bonuses basis for the employee
productivity generally measured by a formula comparing labour costs to value of products
produced (Liao, 2012).
Stock options: Employees are provided with the opportunity to purchase shares of the company
at a specific predetermined price as an alternative to bonuses.
Motivational potential: Individuals believe that working efficiently and effectively will increase
the profitability and thus increase the stock value of firm.
Task 4
P1. Various reasons for termination of employment
Human resource management not only involves the finding, selecting, training and developing
the employees but also it involves the termination of employees as well (Robbins, 2005). HR
managers sometimes take decision regarding termination of their employees for several reasons.
Those reasons are shown in below:
Inadequate Job Performance
If the employee within the firm cant perform up to the organisations requirement and fulfil his
tasks properly, then the manager can preliminary provides feedback to him and counsels as well
(Tony, 2012). If employee provides little concern and passion to his job even after counselling,
then the manager can terminate him.
Business Conditions
Sometimes, managers have to take the decision of layoff because of economic reasons as
opposed to poor performance. Layoff can be both permanent and temporary.
Unacceptable behaviour
Some unacceptable behaviour like breaching the firms code of ethics, stealing the firms
property, engaging in sexual harassment or verbally or physically terminating another employee
may drive the manager to terminate the employee from the firm.
Absenteeism
An employee who misses work frequently or reaches the office late habitually may affect the
organisations performance and may place unfair burden on firms other employees and thats
why manger can terminate them from the organisation (John, 2011).
recommendation for HR. Finally they collect the firms belongings from the resigned employee
that were given to him during his employment (Tescocorp, 2015).
organisation not only has to comply with its own standards but also it has to focus on the other
legal and regulatory framework within which it is operated (Graham and Benet, 2012). If an
employee is terminated on the basis of sex discrimination then the sex discrimination act will
protect the employee from being terminated. Moreover, if an employee is terminated on the basis
of racial segregation then races relation act will protect the employee being terminated. Besides
that, data protection act will support the organisation in case of data stealing and supplying by an
employee to other organisation and allow the firm to terminate the employee. Regulatory
framework will allow the employer to terminate the employee if he violates the code of conduct
of organisation and make sexual harassment within the organisation (Graham and Bennet, 2012).
This legal and regulatory frameworks are established to benefit both the employee and employer
and make an equal playing field for both parties. Sometimes, labour unions prohibit or impede
the firm to terminate the employee from the organisation. Organisations need to be concerned
about these things.
Conclusion
From the above discussions, people can come to know the degree of importance of HRM to an
organisation. In the present context, it is quite difficult to properly run the organisation without
the help of skilled and knowledgeable employees. But, these employees cant be managed in an
easy way. HRM provided the organisations with the ability to better manage the workforce
within the organisation. It ensures the employee empowerment, workforce diversity, workforce
engineering and continuous improvement within the organisation to make it efficient and
effective in case of business planning and operation. Thats why it takes no hesitation to term
HRM as the part and parcel of organisations management.
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