© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 1

Taking Care of Taking Care of Employees:Employees:

Managing Human Managing Human ResourcesResources

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 2

Human Resource Human Resource ManagementManagement

• Acquiring

• Maintaining

• Developing

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 3

Functions of the Human Functions of the Human Resources DepartmentResources Department

• Planning for staffing needs

• Recruiting and hiring

• Training and development

• Appraising and retaining

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 4

Planning for Staffing Planning for Staffing NeedsNeeds

• Form business plan

• Estimate demand for employees

• Estimate supply of employees

• Perform job analysis

• Write job descriptions

• Write job specifications

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 5

Forecasting DemandForecasting Demand

• Predicted salesPredicted sales

• Expected turnover rateExpected turnover rate

• Workforce’s skill levelWorkforce’s skill level

• Impending strategic decisionsImpending strategic decisions

• Changes in technologyChanges in technology

• Company’s financial statusCompany’s financial status

• Status of key employeesStatus of key employees

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 6

Forecasting SupplyForecasting Supply

• Existing workersExisting workers

• Temporary workersTemporary workers

• OutsourcingOutsourcing

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 7

Evaluating Job Evaluating Job RequirementsRequirements

• Job analysis

• Job description

• Job specification

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 8

Recruiting EmployeesRecruiting Employees

• Internal searches• Newspaper ads• Internet ads• Employment agencies• Union halls• Colleges• Trade shows• Headhunters• Referrals

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 9

How Employers and Job-How Employers and Job-Seekers Approach Seekers Approach

RecruitingRecruiting• Look inside the company

• Networking and personal references

• Employment agency or search firm

• Unsolicited résumé

• Newspaper or Internet want ads

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 10

The Hiring ProcessThe Hiring Process

1. Select qualified candidates

2. Screen candidates

3. Conduct interviews

4. Evaluate final candidates

5. Check references

6. Select the best candidate

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 11

BackgroundBackground Checks Checks

• Employment verification

• Criminal records check

• Drug screen

• Reference checks

• Education verification

• Motor vehicle records

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 12

Hiring and the LawHiring and the Law

• Equal Employment Opportunity Commission

• Negligent Hiring

• Immigration Reform and Control Act

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 13

Preemployment TestingPreemployment Testing

• Job-skills tests

• Psychological tests

• Drug and alcohol tests

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 14

Training and Training and DevelopmentDevelopment

• Orientation

• Training

• Retraining

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 15

Appraising EmployeesAppraising Employees

• Periodic performance appraisals

• Regular written evaluations

• 360-degree reviews

• Electronic performance monitoring

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 16

Workplace Compensation Workplace Compensation

• Wages– Hourly workers

• Salaries– Corporate executives

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 17

Fair Labor Standards ActFair Labor Standards Act

• Administering wages and salaries– Overtime pay• Exempt employees• Nonexempt employees

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 18

Hot Compensation IssuesHot Compensation Issues

• Lower end of pay scale– Downward pressure on benefits– Downward pressure on wages

• Higher end of pay scale– Compensation gap between CEO and

employees– Disparity between results and

compensation

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 19

Incentive ProgramsIncentive Programs

• Bonuses

• Commissions

• Profit sharing

• Gain sharing

• Pay for performance

• Knowledge-based pay

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 20

Benefits and ServicesBenefits and Services

• Insurance

• Retirement plans

• Stock options

• Family benefits

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 21

Insurance BenefitsInsurance Benefits

• Life and health

• Dental and vision

• Disability

• Long-term care

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 22

Insurance ChallengesInsurance Challenges

• Rising premiums

• Level prices

• Flat wages

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 23

Creative Approaches to Creative Approaches to Skyrocketing Health-Care Skyrocketing Health-Care

CostsCosts• High deductibles• In house clinics• Employer driven quality

improvements• Health savings

accounts

• Sliding scale plans• Health insurance

buying groups• Insurance for the

uninsured• Wellness programs

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 24

Retirement BenefitsRetirement Benefits

• Employee pension plans

– Defined benefits

– Defined contributions

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 25

Stock Option PlansStock Option Plans

• Employer benefits

– Cost effective

– Long-term incentives

• Employee benefits

– Profit potential

– Vested interest

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 26

Family-Friendly BenefitsFamily-Friendly Benefits

• Unpaid leave

• Daycare

• Elder-care

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 27

Other Employee Other Employee BenefitsBenefits

• Vacations, holidays, and sick leaveVacations, holidays, and sick leave

• Professional developmentProfessional development

• Financial or legal counselingFinancial or legal counseling

• Wellness programsWellness programs

• Employee Assistance ProgramsEmployee Assistance Programs

• Corporate perksCorporate perks

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 28

Overseeing Changes in Overseeing Changes in Employment StatusEmployment Status

• Promotion

• Reassignment

• Termination

• Retirement

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 29

Promoting From WithinPromoting From Within

• Advantages–Maximizes workforce– Rewards employees– Boosts morale

• Disadvantages– Individual competence– Potential turnover– Training costs

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 30

Terminating EmployeesTerminating Employees

• Performance related– At-will employment–Wrongful discharge– Rank and yank

• Not performance related– Business downturns– Effects on employees– Outplacement efforts

© Prentice Hall, 2007 Excellence in Business, 3e Chapter 11 - 31

Retiring EmployeesRetiring Employees

• Hiring mature workers

• Balancing the workforce