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Learn about HR responsibilities, laws, recruitment strategies, and training methods to develop a skilled workforce. Understand how diversity enhances business success.
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Human Resources Introduction to Business
Human Resource Management Human resource managers are responsible for the activities needed to recruit, hire, train, develop, and retain a workforce at the employee level. Hiring workers results from a process of job analysis, operational planning, and crafting of job descriptions at the organizational level.
Why is HR Important? HR departments strive to offer benefits that will appeal to workers, thus reducing the risk of losing corporate knowledge to employee turnover. HR promotes diversity and inclusion as well as using technology to advance employee engagement.
Human Resources and Laws Federal and state legislation has been enacted to prevent discrimination, set minimum wages, establish maximum work hours, and set standards for health and safety.
The Civil Rights Act of 1964 The Civil Rights Act of 1964 prohibits employment discrimination on the basis of race, color, religion, sex, or national origin. It also prohibits sexual harassment.
Other Anti-discrimination Laws • Age Discrimination in Employment Act (ADEA) of 1967 • Equal Pay Act (EPE) of 1963 • Americans with Disabilities Act (ADA) of 1990 • Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA)
Labor Legislation Important US labor legislation • National Labor Relations Act of 1935 • Fair Labor Standards Act of 1938 • Immigration Reform and Control Act of 1986 • Family and Medical Leave Act of 1993 • Occupational Safety and Health Act of 1970 (OSHA)
Recruitment and Hiring HR professionals manage the recruitment process in order to identify the pool of qualified applicants. Both internal and external candidates are selected based on job specifications, which are the result of an analysis of the job/position.
Internal Recruitment Internal recruitment is often the most cost-effective method of recruiting potential employees, as it uses existing company resources and talent pool to fill needs and therefore may not incur any extra costs. This is done in two principal ways: • Advertising job openings internally • Using networking: employee referrals, industry contacts and membership in professional organizations
External Recruitment The primary goal of external recruitment is to create diversity and expand the candidate pool. External recruitment can be done in a variety of ways: • Online recruitment • Traditional advertising • Job fairs and campus visits • Headhunters and recruitment services
How Does Diversity Help Business? The business case for diversity is driven by the view that diversity brings substantial potential benefits, such as better decision making, improved problem solving, and greater creativity and innovation, which lead to enhanced product development and more successful marketing to different types of customers.
Hiring • Each job description should be associated with a list of critical skills, behaviors, or attitudes that will make or break the job performance. • When screening potential employees, managers need to select based on cultural fit and attitude as well as on technical skills and competencies. • HR Managers use interviews, screening tests, and background checks for screening.
Practice Question While this advertisement is entertaining, it might create a legal problem. Why might an HR professional advise against using this ad?
Interviews The best interviews follow a structured framework in which each applicant is asked the same questions and is scored with a consistent rating process. • Behavioral interviews ask the applicant to reflect on his or her past experiences. • Situational interviews require the applicant to explain how he or she would handle a series of hypothetical situations.
Training, Development, and Rewards HR managers manage the process by which employees are trained and compensated, and also evaluate their performance. Performance evaluations involve • Setting goals • Completing a formal written evaluation • Communicating the results to the employee • Taking corrective action where needed • Overseeing employees’ professional development
Training Needs Assessment • Identify the need • Perform a gap analysis • Assess training options
Types of Training • On-the-job • Off-the-job - advantage of allowing people to get away from work and concentrate more thoroughly on the training itself.
Professional Development Professional development refers to skills and knowledge attained for both personal development and career advancement.
Performance Appraisals A performance appraisal (PA) or performance evaluation is a systematic and periodic process that assesses an individual employee’s job performance and productivity, in relation to certain pre-established criteria and organizational objectives.
Management by Objectives S.M.A.R.T Objectives for employees Specific Measurable Achievable Realistic Time-related Employee evaluations include: • An assessment of how well the employee is doing • Employee goals with deadlines • Feedback from coworkers and supervisors
Methods of Performance Appraisal • Graphic rating scales • Behavioral methods • 2+2
Compensation Employee compensation is the cost of acquiring human resources for running operations
Salary • Form of compensation paid periodically by an employer to an employee, the amount and frequency of which may be specified in an employment contract. • Employees work however many hours are necessary to accomplish organizational goals and objectives. • Calculated in terms of annual, monthly, or weekly earnings instead of hourly pay. • Employee stock options (ESO) sometimes part of employee compensation package.
Wage Systems Based on hours worked or some other measure of production including: • Time rate • Differential time rate • Payment by piecework
Hybrid Wage Systems Hybrid wages – most common in sales and management • Straight commission • Salary plus commission • Salary plus bonus
Common Benefits • Relocation assistance • Medical, prescription, vision, and dental • Retirement benefit • Group term life and long-term care insurance • Legal assistance • Child care benefits • Transportation benefits • Paid time off (PTO) in the form of vacation and sick pay • Fringe benefits or “perks”
Terminations Terminations can occur for a range of reasons, both voluntary and involuntary. Some states allow at-will employment, which means that an employeecan be dismissed by an employer without warning and for any reason—without the employer having to establish “just cause” for termination.
Types of Terminations • Firing • Layoff • Attrition • Mutual-agreement termination • Forced resignation
Challenges in HR Management An aging workforce, globalization, increased diversity, working from home, and advances in technology all create an environment that brings new challenges to human resources.
Turnover Turnover is the rate at which employees leave an organization. • Average cost of turnover is $15,000 per employee • Reasons employees leave jobs: downsizing, new opportunities, poor relationship with manager, better compensation/benefits
Quick Review • How does human resource management contribute to business success? • What key laws affect human resource management? • How do organizations effectively recruit and hire employees? • What approaches to training, developing, and rewarding employees are effective? • What are different HR management options for employee termination? • What challenges face today’s HR managers?
