CHAPTER 12

Human Resource
Management

Prepared by Dr. C. McLarney, Dalhousie University

© 2022 McGraw Hill Limited

 Learning Objectives
1. Explain the importance of human resource management
as a strategic contributor to organizational success, and
summarize the five steps in human resource planning.
2. Describe methods that companies use to recruit new
employees, and explain some of the issues that make
recruitment challenging.
3. Outline the six steps in selecting employees, and illustrate
the use of various types of employee training and
development methods.

© 2022 McGraw Hill Limited 2

 Learning Objectives, Pt. 2
4. Trace the six steps in appraising employee performance, and
summarize the objectives of employee compensation
programs.
5. Demonstrate how managers use scheduling plans to adapt to
workers’ needs. Consider the ways in which employees can
also move through the company.
6. Illustrate the effects of legislation on human resource
management.

© 2022 McGraw Hill Limited 3

Human Resource Management (HRM)
HRM is the process of determining human resources
needs and then:
• recruiting,
• selecting,
• developing,
• motivating,
• evaluating,
• compensating,
• and scheduling employees to achieve
organizational goals.
© 2022 McGraw Hill Limited 4
Human Resource Management (HRM), Pt. 2
• As the figure on the next slide shows, HRM is more
than hiring and firing personnel.
• All activities are designed to achieve organizational
goals within the laws that affect human resource
management.

© 2022 McGraw Hill Limited 5

Human Resource Management (HRM), Pt. 3

© 2022 McGraw Hill Limited 6

 Developing the Ultimate Resource
• One reason why human resource management is
receiving increased attention is the major shift from
traditional manufacturing industries to service and
high-tech manufacturing industries that require highly
technical job skills.
• This shift means that many workers must be retrained
for new, more challenging jobs.

© 2022 McGraw Hill Limited 7

 Human Resource Challenges, Pt. 2
• In the coming decade, half of all jobs will be disrupted by technology and
automation. Uncertainty in global politics and increased attention on hiring
immigrants.
• A multigenerational workforce where older Millennials and Gen Xers hold
management positions, while Gen Zers are entering the workforce and
many Baby Boomers are delaying retirement.
• Shortages of trained workers in growth areas such as computer technology,
biotechnology, robotics, green technology, and the sciences.
• Large numbers of skilled and unskilled workers from declining industries,
such as steel and automobile, who are unemployed or underemployed and
need retraining.
• A growing percentage of new workers who are undereducated and
unprepared for jobs in the contemporary business environment.

© 2022 McGraw Hill Limited 8

Human Resource Challenges, Pt. 3
• A shortage of workers in skilled trades due to the retirement of
experienced, aging Baby Boomers.
• The Baby Boomer brain drain means that with yearly
retirements, employers in all fields must plan for and manage
how to transfer their knowledge to younger workers.
• An increasing number of both single-parent and two-income
families, resulting in a demand for job sharing, maternity and
parental leave, and special career advancement programs for
women.
• A shift in employee attitudes toward work. Leisure time has
become a much higher priority, as have flex time, working from
home, and a shorter workweek.

© 2022 McGraw Hill Limited 9

 Human Resource Challenges, Pt. 4
• An increased demand for temporary and part-time workers.
• A challenge from overseas labour pools whose employees work for
lower wages and are subject to fewer laws and regulations than
Canadian workers. This results in many jobs still being offshored.
• An increased demand for benefits tailored to the individual yet cost-
effective to the company.
• Growing concerns over health care, elder care, child care, opportunities
for people with disabilities, and workplace violence and harassment.
• A decreased sense of employee loyalty, which increases employee
turnover and the cost of replacing lost workers.
• Implementing human resource information systems (e.g., technology
that helps manage HR activities such as payroll, benefits, training,
recruiting, and so forth).

© 2022 McGraw Hill Limited 10

 The Hiring Process
• Recruit • Train/Develop
• Select  Orientation
1. Application Form  OJT
2. Interview  Apprenticeship
3. Test  Off-the-Job Training
4. Investigate  Online Training
5. Probation  Vestibule Training
 Job Simulation

© 2022 McGraw Hill Limited 11

Determining HR Needs Five Steps
1. Prepare HR Inventory
2. Prepare Job Analysis
a. Description
b. Specification
3. Assess Demand
4. Assess Supply
5. Establish Strategic Plan

© 2022 McGraw Hill Limited 12

Determining HR Needs Five Steps – Step 1
1. Preparing a human resources inventory of the
organization’s employees.
This inventory should include ages, names,
education (e.g., languages spoken), capabilities,
training, specialized skills, and other information
pertinent to the specific organization.

© 2022 McGraw Hill Limited 13

 Determining HR Needs Five Steps – Step 2
2. Preparing a job analysis.
A job analysis is a study of what is done by employees
who hold various job titles.
Such analyses are necessary to recruit and train
employees with the necessary skills to do the job.

© 2022 McGraw Hill Limited 14

 Determining HR Needs Five Steps – Step 3
3. Assessing future human resources demand.
Because technology changes rapidly, training
programs must be started long before the need is
apparent.

© 2022 McGraw Hill Limited 15

 Determining HR Needs Five Steps – Step 4
4. Assessing future human resources supply.
The labour force is constantly shifting: getting older,
becoming more technically oriented, etc.

© 2022 McGraw Hill Limited 16

Determining HR Needs Five Steps – Step 5
5. Establishing a strategic plan.
The plan must address recruitment, selection, training
and development, evaluation, compensation,
scheduling, and career management for the labour
force.

© 2022 McGraw Hill Limited 17

 Job Analysis
• A job analysis yields two important statements:
• job descriptions
• job specifications
• See figure on the next slide for a job description and
job specifications for a sales representative.

© 2022 McGraw Hill Limited 18

 Job Analysis, Pt. 2
Job Analysis

Observe current sales representatives doing the job.

Discuss job with sales managers.
Have current sales representatives keep a diary of their activities.

Job Description Job Specifications

(about the job) (about the person)
Primary objective is to sell the company’s products Characteristics of the ideal person qualifying for
to stores in Territory D. Duties include servicing this job include:
accounts and maintaining positive relationships • bilingual
with clients. Responsibilities include: • self-motivated
• introducing the new products to store • positive attitude
managers in the area • strong written and communication skills
• helping the store managers estimate the • have a valid driver’s licence
volume to order • two years of sales experience
• negotiating prime shelf space • a diploma or degree in Business
• explaining sales promotion activities to store
managers
• stocking and maintaining shelves in stores that
wish such service

© 2022 McGraw Hill Limited 19

Recruiting Employees From a Diverse
Population
• Recruitment is the set of activities used to obtain a sufficient
number of the right people at the right time.
• The end result is to have a pool of qualified applicants.

© 2022 McGraw Hill Limited 20

 Recruiting Employees From a
Diverse Population, Pt. 2
Recruiting has become very difficult for several reasons:
• Some organizations have policies that demand
promotion from within, operate under union
contracts, or offer low wages, which makes recruiting
and keeping employees difficult.

© 2022 McGraw Hill Limited 21

 Recruiting Employees From a Diverse
Population, Pt. 3
• The emphasis on corporate culture, teamwork, and
participative management makes it important to hire
people who are not only skilled but also fit in with the
culture and leadership style of the
organization.
• Sometimes people with the necessary skills are not
available.
• In this case, workers must be hired and then trained
internally.

© 2022 McGraw Hill Limited 22

Employee Resources

© 2022 McGraw Hill Limited 23

Selecting Employees Who Will Be
Productive
• Selection is the process of gathering information and
deciding who should be hired, under legal guidelines, for
the best interests of the individual and the organization.
• Selecting and training employees has become extremely
expensive processes in some firms.

© 2022 McGraw Hill Limited 24

 Selecting Employees
A typical selection process involves five steps:
1. Obtaining complete application forms.
2. Conducting initial and follow-up interviews.
3. Giving employment tests.
4. Conducting background investigations
5. Obtaining results from physical exams
6. Establishing trial (probationary) periods.

© 2022 McGraw Hill Limited 25

 Hiring Contingent Workers
• When more workers are needed in a company, human
resources managers may want to consider finding
creative staffing alternatives rather than simply hiring
new full-time employees.
• Contingent workers are defined as workers who do
not have regular, full-time employment.
• A varying need for employees is the most common
reason for hiring contingent workers.

© 2022 McGraw Hill Limited 26

Training and Developing Employees
for Optimal Performance
• Training and development include all attempts to
improve productivity by increasing an employee’s
ability to perform.
• Training focuses on short-term skills, whereas
development focuses on long-term abilities.

© 2022 McGraw Hill Limited 27

 Training and Developing Employees for
Optimal Performance, Pt. 2
Both training and development programs include three
steps:
1. Assessing the needs of the organization and the
skills of the employees to determine training
needs;
2. Designing training activities to meet the identified
needs; and
3. Evaluating the effectiveness of the training.

© 2022 McGraw Hill Limited 28

Training and Developing Employees
for Optimal Performance, Pt. 3
Some common training and development activities are:
• employee orientation
• on-the-job training
• apprentice programs
• off-the-job training
• online training
• vestibule training
• job simulation

© 2022 McGraw Hill Limited 29

 Training and Developing Employees for
Optimal Performance – Employee
Orientation
• Employee orientation is the activity that initiates new
employees to the organization, to fellow employees,
to their immediate supervisors, and to the policies,
practices, values, and objectives of the firm.
• Orientation programs include everything from
informal talks to formal activities that last a day or
more.

© 2022 McGraw Hill Limited 30

 Training and Developing Employees for
Optimal Performance – On-the-job
Training
• On-the-job training is the most fundamental type of
training.
• The employee being trained on the job immediately
begins his or her tasks and learns by doing, or watches
others for a while and then imitates them, right at the
workplace.

© 2022 McGraw Hill Limited 31

 Training and Developing Employees for
Optimal Performance – Apprentice
Programs
• Apprentice programs involve a period during which a
learner works alongside an experienced employee to
master the skills and procedures of a craft.
• Some apprenticeship programs also involve classroom
training.
• Many skilled crafts, such as bricklaying and plumbing,
require a new worker to serve as an apprentice for
several years.

© 2022 McGraw Hill Limited 32

 Training and Developing Employees for
Optimal Performance – Off-the-job
Training
• Off-the-job training occurs away from the workplace
and consists of internal or external programs to
develop any of a variety of skills or to foster personal
development.
• Training is becoming more sophisticated as jobs
become more sophisticated.

© 2022 McGraw Hill Limited 33

 Training and Developing Employees for
Optimal Performance – Online Training
• Online training offers an example of how technology
is improving the efficiency of many off-the-job training
programs.
• In such training, employees “attend” classes via the
Internet.

© 2022 McGraw Hill Limited 34

 Training and Developing Employees for
Optimal Performance – Vestibule Training
• Vestibule training (near-the-job training) is done in
classrooms where employees are taught on
equipment similar to that used on the job.
• Such classrooms enable employees to learn proper
methods and safety procedures before assuming a
specific job assignment in an organization.

© 2022 McGraw Hill Limited 35

 Training and Developing Employees for
Optimal Performance – Job Simulation
• Job simulation is the use of equipment that
duplicates job conditions and tasks so that trainees
can learn skills before attempting them on the job.
• Job simulation differs from vestibule training in that
the simulation attempts to duplicate the exact
combination of conditions that occur on the job.

© 2022 McGraw Hill Limited 36

 Management Development
• Managers need special training.
• To be good communicators, they especially need to
learn listening skills and empathy.
• They also need time management, planning, and
human relations skills.

© 2022 McGraw Hill Limited 37

 Management Development, Pt. 2
Most management training programs include:
• On-the-job coaching.
• Understudy positions.
• Job rotation.
• Off-the-job courses and
training.

© 2022 McGraw Hill Limited 38

 Management Development, Pt. 3
Empowering Workers
• Empowerment means giving employees the authority
(the right to make a decision without consulting the
manager) and responsibility (the requirement to
accept the consequences of one’s actions) to respond
quickly to customer requests.

© 2022 McGraw Hill Limited 39

 Networking
• Networking is the process of establishing and
maintaining contacts with key managers in one’s
own organization and in other organizations and
using those contacts to weave strong relationships
that serve as informal development systems.
• Of equal or greater importance to potential
managers is a mentor.

© 2022 McGraw Hill Limited 40

 Networking, Pt. 2
• Mentor: a corporate manager who supervises,
coaches, and guides selected lower-level employees
by introducing them to the right people and generally
being their organizational sponsor.

© 2022 McGraw Hill Limited 41

 Diversity in Management
Development
• More women are now entering established
networking systems or, in some instances, creating
their own.
• Some examples of organizations include:
– Canadian Women’s Business Network
– Women’s Enterprise Centre
– Canadian Association of Women Executives &
Entrepreneurs.

© 2022 McGraw Hill Limited 42

 Appraising Employee Performance to
Get Optimum Results
• Identify training needs
• Use as a promotion tool
• Recognize workers’ achievements
• Evaluate hiring process
• Judge effectiveness of orientation process
• Use as a basis for terminating workers

© 2022 McGraw Hill Limited 43

 Performance Appraisal: Six Steps
1. Establish Standards
2. Communicate Standards
3. Evaluate Performance
4. Discuss Results
5. Take Corrective Action
6. Use Results to Make Decisions

© 2022 McGraw Hill Limited 44

 Performance Appraisal
DOs DON’Ts
• DO allow sufficient time, without • DON’T attack the employee
distractions, (e.g., close the office personally. Critically evaluate his or
door), for the appraisal. her work.
• DO end the appraisal with positive • DON’T make the employee feel
suggestions for employee uncomfortable or uneasy. Never
improvement. conduct an appraisal where other
employees are present.

• DO include the employee in the • DON’T wait until the appraisal to

process as much as possible. (For address problems with the
example and if applicable, let the employee’s work that have been
employee prepare a self- developing for some time.
improvement program.)

© 2022 McGraw Hill Limited 45

 Compensating Employees
• Companies do not just compete for customers; they
also compete for employees.
• Compensation is one of the main marketing tools that
companies use to attract (and retain) qualified
employees, and it is one of the largest operating costs
for many organizations

© 2022 McGraw Hill Limited 46

 Compensating Employees – Pay
Equity
Pay equity:
• refers to equal pay for work of equal value. It
compares the value of male and female jobs by
objectively evaluating the jobs in terms of four
neutral factors:
• Skill
• Effort
• Responsibility
• Working conditions.

© 2022 McGraw Hill Limited 47

Compensating Employees – Pay Systems

Pay Systems:
• Salary
• Hourly Wage or Day work
• Piecework System
• Commission Plans
• Bonus Plans
• Profit-Sharing Plans
• Gain-Sharing Plans
DoxaDigital/Getty Images

• Cost-of-Living Allowances (COLAs)

• Stock Options

© 2022 McGraw Hill Limited 48

Compensating Employees – Compensating Teams

Compensating Teams:
• While most managers believe in using teams, fewer
are sure about how to pay them.
• This suggests that team-based pay programs are not
as effective or as fully developed as managers would
hope.

© 2022 McGraw Hill Limited 49

 Compensating Employees – Fringe
Benefits

• Fringe benefits are benefits that provide additional

compensation to employees.
• Fringe benefits in recent years grew faster than wages.

© 2022 McGraw Hill Limited 50

Compensating Employees – Cafeteria-style
Benefits

Cafeteria-style benefits (flexible benefits plan):

• Benefit plans that allow employees to choose which
benefits they want, up to a certain dollar amount.

© 2022 McGraw Hill Limited 51

 Scheduling Employees
Flex time plan:
• Work schedule that gives employees some freedom to
choose when to work, as long as they work the
required number of hours.

© 2022 McGraw Hill Limited 52

 Scheduling Employees, Pt. 2
Compressed workweek:
• Work schedule that allows an employee to work a full number
of hours per week but in fewer days.

© 2022 McGraw Hill Limited 53

 Scheduling Employees, Pt. 3
Telework, also known as telecommuting:
• Occurs when paid workers reduce their commute by carrying
out all, or part, of their work away from their normal place
of business.
• Changing gas prices,
leading-edge technology,
and pushes for work–life
flexibility have all contributed.

© 2022 McGraw Hill Limited 54

 Scheduling Employees, Pt. 4
Job sharing is an arrangement whereby two part-time
employees share one full-time job.
• The concept has received great attention as more and
more women with small children have entered the
labour force.

© 2022 McGraw Hill Limited 55

 Career Management
Promoting and Reassigning Employees
• Many companies find that promotion from within the
company improves employee morale.
• Internal promotions are also cost-effective in that the
promoted employees are already familiar with the
corporate culture and procedures.

© 2022 McGraw Hill Limited 56

 Career Management, Pt. 2
Terminating Employees
• Downsizing and restructuring, increasing customer
demands for greater value, the relentless pressure of
global competition, and shifts in technology have
human resources managers struggling to manage
layoffs and firings.

© 2022 McGraw Hill Limited 57

 Career Management, Pt. 3
Retiring Employees
• In addition to layoffs, another tool used to downsize
companies is to offer early retirement benefits to
entice older (and more expensive) workers to retire.
• Early retirement offers increase the morale of the
surviving employees.

© 2022 McGraw Hill Limited 58

 Career Management, Pt. 4
Losing Employees
• Learning about their reasons for leaving can be
invaluable in preventing the loss of other good people
in the future.

© 2022 McGraw Hill Limited 59

 Law Affecting HR Management
• Common law versus • Occupational Health &
statutory Law Safety
• Labour Standards
• Provincial
• Workers’ Compensation • Canadian Human Rights
• Human Rights Act
• Labour Standards • PIPEDA
• Trade Union Act
• FOIPOP
• Canada Labour Code
(Federal)
• Industrial relations

© 2022 McGraw Hill Limited 60

 Human Rights Act
• The Act requires that every employer ensure equal
opportunities and that there is no discrimination
with regard to race, ethnicity, religion, age, sex,
sexual orientation, marital/family status, disability,
etc.
• The duty of the employer is to accommodate to the
point of undue hardship.

© 2022 McGraw Hill Limited 61

 Occupational Health and Safety
Act
• The Act focuses on safe and healthy workplaces and work
practices, and safety standards protecting the general
public.
• It sets standards and ensures compliance with
requirements.
• The most important employee right is the right to refuse
unsafe work.
• Employer liability can be very high for failing its obligations
(criminal charges and fines).

© 2022 McGraw Hill Limited 62

 Workers’ Compensation Act
• Insurance scheme designed to protect employees
who are injured at work.

• Scheme is comprehensive and prevents employees

injured at work from bringing a legal action against
the employer.

© 2022 McGraw Hill Limited 63

 Privacy Legislation
• Federally:
• PIPEDA (Personal Information Protection and Electronic
Documents Act): sets out ground rules for how private
sector organizations may collect, use, or disclose personal
information in the course of commercial activities.
• Privacy Act: imposes obligations on federal government
departments and agencies by placing limits on the
collection, use, and disclosure of personal information.
Gives the right to access personal information held by
federal government organizations.

© 2022 McGraw Hill Limited 64

 Employment Equity
• Employment equity refers to employment activities
designed to increase employment opportunities for
four groups given past discrimination toward the
designated groups.
• Reverse discrimination has been defined as
discriminating against members of a dominant or
majority group (say, whites or males) usually as a result
of policies designed to correct previous discrimination
against minority or disadvantaged groups.

© 2022 McGraw Hill Limited 65

 Employment Equity, Pt. 2
• Disabilities
• Legislation protects people with disabilities.
• Businesses cannot discriminate against people on the
basis of any physical or mental disability.

© 2022 McGraw Hill Limited 66

 Chapter Summary
1. Explain the importance of human resource management
as a strategic contributor to organizational success, and
summarize the five steps in human resource planning.
2. Describe methods that companies use to recruit new
employees, and explain some of the issues that make
recruitment challenging.
3. Outline the six steps in selecting employees, and illustrate
the use of various types of employee training and
development methods.

© 2022 McGraw Hill Limited 67

 Chapter Summary, Pt. 2
4. Trace the six steps in appraising employee performance, and
summarize the objectives of employee compensation
programs.
5. Demonstrate how managers use scheduling plans to adapt to
workers’ needs. Consider the ways in which employees can
also move through the company.
6. Illustrate the effects of legislation on human resource
management.

© 2022 McGraw Hill Limited 68