2.1 Human Resource Planning

1. 2.1 Human Resource Planning Unit 2 – Human Resources YR12 IB BUS MGT

2. What is HRM? Human resource management refers to the management function of using and developing people within a business in order to meet the objectives of the organisation.

3. Human resource planning Also known as ‘workforce planning’ This is the management process of anticipating an organisation’s current and future staffing needs. It includes the number of employees required and the type of worker sought.

4. What factors would the following businesses have to consider with their workforce planning?

5. Anticipating the human resource needs Historical data and trends. Such as the change in size of the workforce over the past few years. Sales and income levels. Employers will require more workers if the level of customer demand is rising. Labour turnover. This measures the number of employees who leave a firm as a percentage of its workforce per year. The higher the staff turnover the more people the firm will need to recruit. Demographic changes. E.g. Data showing changes in the number of female workers or the number of graduates can help forecast HR needs. Technological changes. Advances in technology, such as e-commerce, can bring both opportunities and threats. E.g. people can work from home, however, capital intensive firms may not require as many workers in the future. What about external influences?

6. Supply of Labour & Demographic changes The net birth rate: the difference between the number of births and deaths per period of time. Countries with a high birth rate will have a larger supply of human resources. The net migration rate: the difference between the number of immigrants to emigrants. The retirement age: the legal age where people can stop working and claim money from their pension. Countries with an increasing number of elderly people may increase the retirement age. In Hong Kong there is no retirement age.

7. Supply of Labour & Demographic changes • The flexibility of the workforce: businesses with multi-skilled people tend to have a more flexible workforce. Businesses that employ a large proportion of part-time workers use their workforces flexibility to quickly change according to the needs of the business. • The level of unemployment: (economic factor) high unemployment means a high labour supply. • Women: A more positive attitude to female workers boosts the supply of human resources. • Mobility of labour: This refers to the extent to which labour can move to different locations or job roles

8. Further factors affecting the supply of human resources The internal workforce: if the current workforce can adapt to change, then it may not have to hire externally Competition: existing and potential workers will consider the packages on offer from rival firms. Cost of living: cost of housing etc. may deter people from locating in certain areas. Cost and availability of transport: Businesses located within good transport networks will attract a larger supply of workers. Unemployment: highin an area means a business will be able to pay a low wage rate.

9. Demographic changes • At times, there may be surplus Human resources. During off-peak for example, many temporary or part time workers are not required. This increase the available labour supply. If there is excess labour supply the business has two real choices: • Redundancy – their services are no longer required so their job disappears • Redeploy – relocate workers to other departments or to parts of the organisation in need of extra staffing

10. Ageing population One demographic change in modern society is the longevity of the population which has led to an ageing populations. E.g. the average age of the population increases. The effects include: Increased dependent population – this includes those who are below the national working age and those above retirement age. Reduced labour mobility – labour immobility reduces the flexibility of a countrys workforce making it less internationally competitive

11. Ageing population Changes in consumption practices – different age groups have different spending patterns. Therefore an ageing population can create opportunities to cater for more mature groups. Changes in employment patterns – with more people going to university than ever before the average age of people entering the workforce has also risen. Coupled with ageing population this means that firms are more likely to retain staff beyond their retirement age due to labour supply shortages. If domestic supply falls too short business may consider international relocation?

12. Recruitment & Selection • Labour is arguably the most important of the four factors of production. Therefore effective recruitment and selection is essential to a business. • The recruitment and selection process is both time consuming and expensive. • A vacancy can arise because of the following: • Expansion of the business • Replace staff who have left

13. Summary of the recruitment process • Job analysis • Job description and person specification • Advertise the vacant post • Short-list • Interview • Aptitude test • Check references • Offer job • Sign contract of employment • Carry out induction training

14. Job advertisement • The aim of this is to get as many people as possible to apply for the post. • Advertisements are often placed in trade journals, local and national newspapers.

15. Job description • This outlines the details of a particular job. • It will include the job title and the roles and duties to be undertaken. • A good job description will leave scope for an employee to be flexible (link to organisational change)

16. Person Specification • This document gives the profile of a perfect candidate. • It will include qualifications, skills and experience. • Some jobs state physical attributes. • Both the person specification and job description are used to establish training needs.

17. Job advertisement • This will often include • Hours worked • Rate of pay • Fringe benefits (non-monetary rewards) • Contact name and address • Deadline • Often advertised internally and externally

18. 5 TRAPS • A good job advertisement should be: - • Truthful • Relevant • Accurate • Positive • Short • Why do job advertisements differ from country to country?

19. The application process • Application form • CV • Covering letter • Why might a firm ask for an application form to be completed rather than a CV? • It is common today for firms to use an online application form.

20. The selection process • Once the application forms or CVs have been received the HR manager will short-list the candidates, using the job description and person specification. • The next stage is to invite short-listed candidates to interview

21. Recap • What is the 10 stages to the recruitment process? • What is the purpose of a job description? • What is the purpose of a person specification?

22. Testing • What are the limitations of interviews? • Because of the limitations of interviews testing is often used. • Psychometric tests are an assessment of a person’s personality. It measures an applicants personality • Aptitude tests these test the skills of an applicant, for example typing speed • Intelligence tests these test the mental ability of a candidate, such as numeracy and literacy. • Trade tests these examine a candidates skill level which cannot be determined from an interview, for example news readers will have a voice test.

23. References • These are written statements about an applicant from an independent source, such as a previous employer. • Referees will be asked to confirm the strengths and weakness of a candidate. • This check confirms the information on the CV is correct.

24. The contract of employment • Job title • Job role and job specification • Date the job starts and ends • Hours and days of work • Rate and method of pay • Holiday and sick pay entitlements • Pension scheme arrangements • Outline of disciplinary procedures • Period of notice that must be given when employment is terminated by either party • Names and signatures of both parties

25. Interviews • 2 way process • Gives the employer a chance to meet the candidate face to face (in person or video conferencing) • A suitable environment must be selected • Can range from one interviewer or a panel • Time consuming • Can you think of any limitations to interviews?

27. Types of questions • Behaviour-based questions are used to assess an applicant’s behavioural pattern and initiative. E.g. “explain an example of when you…” • Situation-based questions are used to assess an applicants judgemental ability. E.g. “If one of your team-members were constantly late what would you do?”

28. 10 common interview questions • Why do you want the job? • What do you know about the organisation? • What makes you think you will fit into the organisation? • What are your key interests and how might these help you in this job? • What are your key strengths? • What are your main weaknesses and what have you done about them? • What was the most difficult person you worked with and how did you manage this? • What leader/person do you admire the most and why? • Describe your key responsibilities in your last job • Why did you leave your last job?

29. Interview do’s and don’ts • Do’s • Prepare- research the organisation and its industry; plan how to get to the venue on time! Read your letter and CV. Prepare questions • Dress appropriately- First impressions count • Practise interview skills • Don’ts • Be Late! • Be critical

30. Task • In pairs write model answers to the 10 common questions • Extension work- come up with 3 of your own interview questions

31. Employment rights (HL) In November 2000, Coca-Cola was made to pay out $192.5 million in lawsuit allegations that they treated black workers unfairly.

32. Ant-discrimination legislation • These laws make it illegal to show prejudice against individuals because of their gender, race, religion, disability, marital status or age. • The laws should help to provide equal opportunities to everyone in society. • Sex discrimination laws: in 2001 1.6 million female workers alleged that men were favoured over women for promotion and pay. • Racial discrimination laws: mean it is illegal to discriminate employees because of their nationality, ethnic background or the colour of their skin. • Disability discrimination laws: mean it is unlawful for employers to mistreat a person because him or her has a disability.

33. Positive discrimination • Modelling agencies can recruit only women • Chinese restaurants can only employ Chinese people • An all girls school can employ a female PE teacher. Something to think about! Positive Discrimination in the Police Force

34. Equal pay legislation • This means it is illegal to pay people differently if they are doing the same job. • It is possible to pay people more if they have higher qualifications and greater experience. • Geographical considerations are also possible, why?

35. Health and Safety at Work • Health and Safety at Work Acts (HASAWA) cover the provision of safe and adequate working conditions. • Adequate facilities such as washrooms and lighting. • Training must be provided so that workers know how to operate equipment and machinery in a safe manner. • Costs of implementing HASAWA is high, however the company should benefit long term from lower absenteeism and less claims for accidents at work.

36. Statutory benefits • Statutory Sick Pay- Payment to a worker who is off sick. Firms may request a doctors note. • Statutory Maternity Pay- Payment made to female workers who are expecting a baby. They are also guaranteed their position on their return to work. • Statutory Paternity Pay- Payment made to male workers whose partner is expecting a baby. However, they receive a shorter time. • Adoption leave- As above • Statutory Holiday Pay- Payment made to employees during statutory holidays such as Christmas and New Year. • Retirement Pension Scheme- Contribution made by employees for when they retire also known as superannuation.

37. National Minimum Wage (NMW) • As of Jan 2010 • UK= £5.73 per hour for workers aged 22 years and older • A development rate of £4.77 per hour for workers aged 18-21 inclusive • £3.53 per hour for all workers under the age of 18, who are no longer of compulsory school age • NMW means that all businesses must pay no less than this rate of pay. • NMW is normally stated per hour.

38. Wal-Mart Case Study • 1) What employment rights became issues for Wal-Mart? • Race Relations Act • Sex Discrimination Act • Equal Pay Act • National Minimum Wage • Statutory Benefits

39. Wal-Mart Case Study • 2) Justify why employers such as Wal-Mart need to be aware of employment legislation? • Public Relations Image – Consumers will stay loyal to the company if they see the company being loyal to their employees rights • Investors – Shareholders and possible future investors may want to see the company adhering to the law before they invest

40. Wal-Mart Case Study • 2) Justify why employers such as Wal-Mart need to be aware of employment legislation? • Staff Motivation – current and future staff will not be very productive if their rights are being violated • Overall, based on the huge settlements Wal-Mart has had to pay out to employees in the past, it is extremely important Wal-Mart becomes aware of the employment legislation, mainly to improve the overall image of the company for staff, customers and shareholders

41. Starters • http://www.businessstudiesonline.co.uk/GcseBusiness/Activities/Module2/ObtainingWorkers/RecruitmentProcess/The%20Recruitment%20Process.html • http://www.businessstudiesonline.co.uk/GcseBusiness/Activities/Module2/ObtainingWorkers/JobOrPerson/Job%20or%20Person.html • http://www.businessstudiesonline.co.uk/GcseBusiness/Activities/Module2/ObtainingWorkers/RecruitmentLawsDragDrop/frame.htm

42. Focus Questions • 1. What is internal and external recruitment?2. What are some methods of appraisal?3. How does training effect a company?4. What are the employment trends?

43. Internal Recruitment - Advantages • Cost Effective • Less down-time • Less Risk • Motivational

44. Internal Recruitment - Disadvantages • Fewer Applicants • Time Consuming • Dead Wood • Internal Politics

45. External Recruitment Methods • Newspaper Adverts • Specialist trade Publications • Internet Advertising • Employment Agencies • Job Centres • Headhunting • University Visits • Direct Contacts

46. External Recruitment - Advantages • New Blood • Wider Range of Experiences • Larger Pool of Applicants

47. External Recruitment - Disadvantages • Time Consuming • Expensive • Greater Degree of Uncertainty

48. Internal and external recruitment

49. External Recruitment

50. Appraisals Is a form of assessment What does it Assess? An employee’s performance Usually carried out on an annual bases Why do we even appraise?!?!