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Flashcards in Chapter 14 Deck (87):
1

HRM

Human Resource Management
The set of organizational activities directed at attracting, developing, and maintaining an effective work force.

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The Strategic Importance of HRM

HRM has become increasingly important as firms have come to realize the value of their human resources in improving productivity.
HRM is critical to the bottom-line performance of the firm.

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The Legal Environment of HRM

Equal Employment Opportunity
Compensation and Benefits
Labor Relations
Health and Safety
Emerging Legal Issues

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Equal Employment Opportunity

Title VII of the Civil Rights Act of 1964
Adverse impact
Equal Employment Opportunity Commission
Affirmative Action
Pregnancy Discrimination Act
Age Discrimination in Employment Act of 1967
Americans with Disabilities Act of 1990 (ADA)
Civil Rights Act of 1991

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Title VII of the Civil Rights Act of 1964

Forbids discrimination in all areas of the employment relationship.
Employers are not required to seek out and hire minorities but they must treat fairly all who apply.
Protected classes include race, color, national origin, sex and religion.

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Adverse Impact

When minority group members pass a selection standard at a rate less than 80% of the rate of the majority group.

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Equal Employment Opportunity Commission

Federal agency charged with enforcing Title VII as well as several other employment-related laws.

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Affirmative Action

The commitment of employers to proactively seek out, assist in developing, and hire employees from groups that are underrepresented in the organization.
Several executive orders require federal contractors to develop affirmative action plans and take affirmative action in hiring veterans and disabled.

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Pregnancy Discrimination Act

Specifically outlaws discrimination on the basis of pregnancy.

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Age Discrimination in Employment Act of 1967

Outlaws discrimination against persons older than 40 years of age.

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Americans with Disabilities Act of 1990 (ADA)

Forbids discrimination on the basis of disabilities and requires employers to provide reasonable accommodations for disabled employees.

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Civil Rights Act of 1991

Amended the original Civil Rights Act, making it easier to bring discrimination lawsuits while also limiting punitive damages that can be awarded in those lawsuits.

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Compensation and Benefits

Fair Labor Standards Act of 1938 (FLSA)
Equal Pay Act of 1963
Employee Retirement Income Security Act of 1974 (ERISA)
Family and Medical Leave Act of 1993 (FMLA)

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Fair Labor Standards Act of 1938 (FLSA)

Sets a minimum wage and requires overtime pay for work in excess of 40 hours per week for non-exempt employees.
Salaried professional, executive, and administrative employees are exempt from the Act’s minimum wage and overtime provisions.

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Equal Pay Act of 1963

Requires men and women to be paid the same amount for doing the same jobs; exceptions are permitted for seniority and merit pay.

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Employee Retirement Income Security Act of 1974 (ERISA)

Sets standards for pension plan management and provides federal insurance if pension plans go bankrupt.

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Family and Medical Leave Act of 1993 (FMLA)

Requires employers to provide up to 12 weeks of unpaid leave for family and medical emergencies.

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Labor Relations

National Labor Relations Act of 1935 (Wagner Act)
Labor Management Relations Act of 1947 (Taft-Hartley Act)

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National Labor Relations Act of 1935 (Wagner Act)

NLRA set up procedures for employees to vote whether to have a union; if they vote for a union, management is required to bargain collectively with the union.
National Labor Relations Board (NLRB).
-The federal agency empowered to enforced provisions of the NLRA.

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Labor Management Relations Act of 1947 (Taft-Hartley Act)

Amended the NLRA to limit the power of unions and increase management’s rights during organizing campaigns.
Allows the U.S. president to prevent or end a strike that endangers national security.

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Health and Safety

Occupational Safety and Health Act of 1970 (OSHA)

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Occupational Safety and Health Act of 1970 (OSHA)

Requires that companies:
Provide a place of employment that is free from hazards that may cause death or serious physical harm.
Obey the safety and health standards established by Occupational Safety and Health Administration (OSHA).

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Emerging Legal Issues

Sexual Harassment.
Alcohol and drug dependencies.
AIDS in the workplace.

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Change and HRM

Temporary Workers
Dual-Career Families
Employment-at-Will
Just Cause—The New Argument

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Temporary Workers

An increasing trend in organizations is to use more temporary workers without the risk that the organization may have to eliminate their jobs.

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Dual-Career Families

Firms Firms are increasingly having to make accommodations for are increasingly having to make accommodations for dual-career partners.
- delaying transfers
- offering employment to spouses
- providing more flexible work schedule and benefits packages.

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Employment-at-Will

A traditional view of the workplace in which an employer can fire an employee for any or no reason.

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Just Cause—The New Argument

An organization should be able to fire only people who are poor performers or who violate rules.
Courts have limited an employer’s ability to terminate employees by requiring just cause for firing or dismissal as part of an organization-wide cutback.

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Attracting Human Resources

Job Analysis
Forecasting HR Demand and Supply

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Job Analysis

A systematic analysis of jobs within an organization.
Job Description—a listing of the job’s duties; its working conditions; and the tools, materials, and equipment use to perform the job.
Job Specification - more specific to the job; skills that the incumbent holder has to be successful.

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Forecasting HR Demand and Supply

Replacement chart
Employee information system (skills inventory)

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Replacement chart

A list of managerial positions in the organization, the occupants, how long they will stay in the position, and who will replace them.

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Employee information system (skills inventory)

A database of employees’ education, skills, work experience, and career expectations, usually computerized.

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Recruiting Human Resources

Recruiting
Internal Recruiting
External Recruiting

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Recruiting

The process of attracting qualified persons to apply for jobs that are open.

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Internal Recruiting

Considering present employees as candidates for openings.

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External Recruiting

Attracting persons from outside the organization.
Realistic Job Preview (RJP) is considered a successful method to ensure person-job fit.

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Selecting Human Resources

Validation
Application Blanks
Tests
Interviews
Assessment Centers
Other Techniques

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Validation

The process of determining the extent to which a selection device is really predictive of future job performance.
Predictive validation
Content validation

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Predictive validation

Correlating previously collected test scores of employees with the employees' actual job performance.

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Content validation

The use of logic and job analysis to determine that selection techniques measure the exact skills needed for job performance.
Used to establish the job relatedness of a selection device.

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Application Blanks

Used to gather information about work history, educational background, and other job-related demographic data.
Must not ask for information unrelated to the job.

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Tests

Ability, skill, aptitude, or knowledge tests are usually the best predictors of job success.
Must be validated, administered, and scored consistently.

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Interviews

Interviews Interviews can be poor predictors of job success due to can be poor predictors of job success due to interviewer biases.
Interview validity can be improved by training interviewers and using structured interviews.

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Assessment Centers

A popular method for selecting managers and are particularly good for selecting current employees for promotion.
A content validation of major parts of the managerial job.

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Other Techniques

Polygraphs Polygraphs have declined in popularity due to passage of the have declined in popularity due to passage of the
Polygraph Protection Act.
Employers now use physical exams, drug tests, and credit checks to screen prospective employees.

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Developing Human Resources

Training and Development
Performance Appraisal
Performance Feedback

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Training and Development

Training
Development
Assessing Training Needs
Common Training Methods
Evaluation of Training

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Training

Teaching operational or technical employees how to do the job for which they were hired.

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Development

Teaching managers and professionals the skills need for both present and future jobs.

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Assessing Training Needs

Determining what needs exist is the first step in developing a training plan.

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Common Training Methods

Lectures
Role play and case studies
On-the-job and vestibule training
Web-based and electronic training

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Evaluation of Training

Training and development programs should always be evaluated.
Approaches include measuring relevant job performance criteria before and after the training to determine the effect of training.

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Performance Appraisal

A formal assessment of how well employees do their jobs.
Reasons for performance appraisal.
Objective measures of performance.
Judgmental Methods.
Performance Appraisal Errors.

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Reasons for performance appraisal.

Appraisal validates the selection process and the effects of training.
Appraisal aids in making decisions about pay raises, promotions, and training.
Provides feedback to employees to improve their performance and plan future careers.

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Objective measures of performance

Actual output (units produced), scrap rate, dollar volume of sales, and number of claims processed.
Can become contaminated by outside factors resulting in “opportunity bias” where some have a better chance to perform than others.
Special performance tests are a method in which each employee is assessed under standardized conditions.
Performance tests measure ability and not motivation.

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Judgmental Methods

Ranking
Rating

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Judgmental Methods - Ranking

Compares employees directly with each other.
Difficult to do with large numbers of employees.
Employees are ranked only on overall performance.
Do not provide useful information for employee feedback.
Difficult to make comparisons across work groups.

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Judgmental Methods - Rating

Compares each employee with a fixed standard.
Graphic rating scales consist of job performance dimensions to be rated on a standard scale.
Behaviorally-anchored rating scale (BARS) is a sophisticated method in which supervisors construct a rating scale where each point on the scale is associated with behavioral anchors.

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Performance Appraisal Errors

Recency error
Errors of leniency and strictness
Halo error
Central Tendency Error

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Recency error

The tendency of the evaluator to base judgments on the subordinate’s most recent performance because it is the most easily recalled.

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Errors of leniency and strictness

Being too lenient, too strict, or tending to rate all employees as "average."

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Halo error

Allowing the assessment of the employee on one dimension to spread to that employee’s ratings on other dimensions.

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Central Tendency Error

Occurs when a rater gives all the workers the same rating in order to avoid conflict between workers.

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Performance Feedback

Is best given in a private meeting between the employee and immediate supervisor.
Discussion should focus on the facts.
Properly training managers can help them conduct more effective feedback interviews.
“360 degree” feedback, in which managers are evaluated by everyone around them, provides a richer array of performance information on which to base an appraisal.

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Maintaining Human Resources

Determining Compensation
Determining Benefits

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Determining Compensation

Compensation
Purposes of Compensation
Wage-Level Decision
Wage-Structure
Individual Wage Decisions

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Compensation

The financial remuneration given by the organization to its employees in exchange for their work.
Wages - Hourly compensation paid to operating employees; non-exempt employees.
Salary refers to compensation paid for the total contribution of an employee and is not based on total hours worked.
Incentives represent special compensation opportunities (e.g., sales commissions) that are usually tied to performance.

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Purposes of Compensation

Provide the means to maintain a reasonable standard of living.
Provide a tangible measure of the value of the individual to the organization.

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Wage-Level Decision

The wage-level decision is a management policy decision to pay above, at, or below the going rate for labor in an industry or geographic area.
Factors that affect the wage-level decision.
Area wage surveys can provide information about the maximum, minimum, and average wages for a particular job in a labor market.

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Wage-Structure

Job evaluations are the basis for determining the worth of each job relative to other jobs in the organizational wage-structure.
Wage surveys data and the wage structure are combined to set the actual wages for a job.

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Individual Wage Decisions

Factors such as seniority, initial qualifications, individual merit, and labor market conditions influence wage decisions.

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Determining Benefits

Benefits
Managing Benefits Effectively
Types of Benefits
Cafeteria Benefit Plans
Other Benefits

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Benefits

Things of value other than compensation that an organization provides to its workers.
The average company spends an amount equal to more than one-third of its cash payroll on employee benefits.
A good benefit plan encourages employees to stay with the company and attracts new employees.
Benefits do not necessarily stimulate high performance.

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Managing Benefits Effectively

Shop carefully for the best-cost providers.
Provide only the benefits that employees want.

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Types of Benefits

Pay for time not worked.
Insurance—Life and health insurance, workers’ compensation, social security, and private pension plans.
Employee service benefits—Tuition reimbursement and recreational opportunities.

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Cafeteria Benefit Plans

Flexible plans that provide basic coverage and allow employees to choose the additional benefits they want up to the cost limit set by the organization.

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Other Benefits

On-site childcare, mortgage assistance, and paid-leave programs.

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Managing Labor Relations

Labor Relations
Why Unions Have Declined
Collective Bargaining
Grievance Procedure

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Labor Relations

The process of dealing with employees when they are represented by a union.
Organizations prefer employees remain nonunion because unions limit management’s freedom.

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Why Unions Have Declined

Increased standards of living made union membership less important.
Unionized manufacturing industries have declined.
Globalization of business has caused many unionized jobs to be lost overseas.

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Collective Bargaining

The contract contains agreements about wage, hours, and working conditions and how management will treat employees.

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Grievance Procedure

The step-wise means by which a labor contract is enforced.
Grievances are filed on behalf of an employee by the union when it believes employees have not been treated fairly under the contract.

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New Challenges in the Changing Workplace

Managing Knowledge Workers
Trends in Contingent and Temporary Workers.
Challenges in Managing Contingent Workers.

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Knowledge workers

Employees whose contributions to an organization are based on what they know (e.g., computer scientists, engineers, and physical scientists).
They tend to work in high-technology areas and are experts in abstract knowledge areas.
They like to work independently and identify strongly with their professions.

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Trends in Contingent and Temporary Workers

Consistent increases in contingent workers—10% of the U.S. workforce is either contingent or temporary.

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Challenges in Managing Contingent Workers

Integrating contingent workers into the organization in a coordinated fashion.
Understanding their advantages and disadvantages.
Calculating labor-cost savings of contingent workers.
Deciding how similarly contingent employees will be treated relative to permanent employees.