sbm & hrm
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Human Resource ManagementTRANSCRIPT
1YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
HUMAN RESOURCE MANAGEMENT
ByYMWGPK Udurawana
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Definition of HRM
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Human Resource Management (HRM) is the efficient and effective utilization of human resources (HR) to achieve goals of an organization
Generic Purpose of HRM
Generic purpose of HRM is to generate and retain appropriate and motivated employee force, which gives the maximum individual contribution to organizational success.
3YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Strategic Objectives
Procure RIGHT People, Time, Job Retain most appropriate employee Improve organizational commitment Generate & enhance job
involvement & Organizational Citizenship
Ensure motivate & satisfaction Control the cost of employee
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Job Design
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Job design is a function of arranging task, duties and responsibilities in to an organizational unit (Job) for the purpose of accomplishing a certain objective
Jobs are basic building blocks of the firm or an organization unit of work
There are three main components of JobTaskDutiesResponsibilities
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Task – Duty -Responsibility
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Task is a series of motions and is a distinct identifiable small work activity
Duty is a sense of task and is a larger work segment accomplished by completing a series of task
Responsibility is the obligation (bound ) of to performing the entrusted task and duties successfully
Eg. Lecturer Task, Duty, Responsibility
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Techniques of Job Design
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Scientific TechniquesJob EnlargementJob EnrichmentJob RotationProfessional Techniques
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Scientific Techniques
That is job divided into small parts and which are to execute b various person and who get specification of task.
Result to job specialization This objective is maximize the
organizational productivity by maximizing efficiency (Scientific Management)
Tat results for short job cycle (Requires short time for job)
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
9YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Job Enlargement
Increase the scope of the job Include new duties Additional to current duties Increase the scope of the job It is horizontal loading
This is a job redesigning method Where job cycle is larger
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Job Enrichment
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Increasing the depth of job Expanding Authority Expanding Responsibility For
planning and controlling. It is vertical loading
This is also a job redesigning method
Job Rotation
11YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
It is shifting an employee from one particular job to another without limiting the employee to do a particular job.
This helpful to create a skillful worker
This is also a job redesigning method
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Job Design Elements
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Two element can be seen Efficiency Elements - It is affect of
minimizing job executive time, cost, and attempt to keep efficiency. There are three elements of Efficiency Elements
Behavioral Elements - This factors directed to the employee motivation and development. There are five elements of Behavioral Elements
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JOB ANALYSIS
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
It is a systematic investigation of Jobs and Job holder characteristics in order to create a collection of information that can be used to perform various HRM activities and functions
And also it can be said as collecting, evaluating, organizing and recording information regarding Jobs within the organization
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Components of Job Analysis
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Job Description Job Specification
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Job Description
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Job description is a written statement of what the Jobholder actually does, how he or she does, and what conditions the Job is performed.
There is no common format to JD. But we can identify following thing as generally at JD. Job identification. & Job Summary Relationship, Responsibility and Duties. Authority & Standard of performance Working condition Profile of the job characteristics
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Job Specification
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Specifies the key qualifications an individual needs to perform the Job efficiently and effectively.
Describes the person ideally needed to perform the Job.
A profile of human characteristic needed to perform the Job
(Required abilities, education, experience, training, special mental and physical skills).
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HR Planning
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
HRP is the process of determining future employee needs and deciding steps or strategies to achieve those needs for the purpose of accomplishing organization goals.
18YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
HR Planning Process
Develop Strategies to be Taken
Compare Demand with Supply
Estimate HR Supply
Assess HRP effort.
Forecast Future Demand for HR
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Forecast Future Demand
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
This involves estimating the type and quantity of employee needs for future
Following factors may affect to future demand.
Demand for Organization (Product). Strategic Plans (goals) of the firm Production Method /Technology (Capital /
labor)
Employee Movement External Environment
Internal HR Supply
This involves making internal supply estimate Internal supply can estimate through
following Auditing current human resources Identifying & arranging possible
replacement That summarizes prepare two documents as Skill Inventories Management Inventories
20YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Skill Inventory Skill Inventory
It refers to the document that specifies competencies of a current non managerial employee in the firm. Identify information of the employee
Identify of the job of employee Education & experience Seniority Special competencies & performance Weakness
21YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Management Inventory
22YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
It refers to the document that catalogues technical, human relation, and other competencies of a current manager of firm.
Number of Subordinate Supervised Jobs & Duties of Subordinates Total Budgets Management Training Received Creative & Innovations
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Compare Demand & Supply
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Need comparisons of estimated Hr demand & Hr Supply
Identify net employee requirements May be Human resources shortage
or HR surplus of organization.
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Strategies for Surplus
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Hiring Freeze (No further hiring) Reduction of reward expenditure Attrition (Voluntary Departure) Early retirement Programme Lay off (temporary Stoppage) Formal out placement facility
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Strategies for Shortage
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Overtime Outsourcing Internship Providing Part Time Hiring Capital Substitution Hire Temporary, Casual Workers
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Assess HRP Effort
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Clearly Evaluate cost vs. benefit Determine its import on
organizational goals & objectives
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Recruitment
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
It is the process of finding and attracting suitable qualified people to apply for employment
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Recruitment Process
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Identify Job VacanciesDetermine Job Requirements
Prepare Job Applications
Consider factors affecting Recruiting
Select the Recruiting Method
Implementation & Evaluation
29YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Determine Job Requirements
Characteristics of Proposed Job Skills and Competence of Expected
Person
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Factors Affecting Recruiting
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Organization Recruitment policy Cost & Time Environment Workforce Planning Salary Employee Market Recruiting Habits
Prepare Job Applications
31YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Use common methods to collect data
Only essential information Enough space to provide data Helping information to applicant Simple and attractive
Select the Recruiting Method
At selection process Firm must consider its Recruitment Policy
Internal Recruitment Policy External Recruitment Policy
32YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Internal Recruitment Policy
It refers to procuring candidates to fill vacancies within the organization itself
33YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Advantages Create Employee Moral Workers Career
Development Employee Motivation Cheaper Cost Effective LMR
Disadvantages
Prevent new knowledge Employee conflicts Avoids new BLOOD Retains OLD BOOB
(Error) Inbreeding (Junior
follow same thing)
Method of Recruiting
Simple word of mouth Use Skill Inventories Use Management Inventories Job Posting & Bidding Intranet Succession Plan – that shows the
successors who are to be recruited to future job at right time.
34YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Skill & Management Inventory
Skill Inventory It refers to the document that specifies
competencies of a current non managerial employee in the firm.
Management Inventory It refers to the document that catalogues
technical, human relation, and other competencies of a current manager of firm.
35YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
External Recruitment Policy
36YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
It refers to procuring candidates to fill vacancies outside the organization
Disadvantages
Prevent Employee Moral
Employee De motivation
Higher Cost Less Effective LMR
Advantages
Create new knowledge
Employee performance high
Strength of new BLOOD
Reputation High
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Method of Recruiting
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Employee’s Referrals Pre Applicant Past Employee Educational Institution E- Recruiting Executive Search Firms (Head Hunting) Special Event Recruiting Internship & Collage Recruiting Advertising
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Advertising More popular method for recruiting Use TV, Radio, Banners, News Paper… Consume high cost Attract large number of job seekers It impact on
Attract to qualified applicantAttract already employeesFirms’ own employeeExternal Parties
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Two Type Advertising
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Closed AdvertisementNo reveal about firmUse 3rd party to recruitAvoid canvassingAvoid public relationCompetitive advantagesAttract suitable persons
Open AdvertisementReveal details of firmHigh costAttract more personsHigh public relations
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Implementation & Evaluation
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Take decision on above steps are implemented
Which involves to individuals apply to vacancies, and application receive to the firm
Evaluation can be done through following measuresNumber of applications on decided timeThe cost for one applicantPerformance of recruited personNumber of application received
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Alternative to Recruitment
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Overtime FacilityOutsourcing Temporary Employment
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Selection
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
The process of making the choice of the most appropriate person from pool of applicants recruited to fill the relevant job vacancy Most Appropriate Person Most Qualified Person
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Selection Process
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Evaluation of applications
Test
Interview
Background Investigation
Medical Test
REJECTION
SELECTION
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Effectiveness of Interviews
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Prior knowledge about an applicant Attitude of the interviewer The order of the interview Negative information The first five minutes
45YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Individual Interview Panel Interview Structured Interview Unstructured Interview Mixed Interview Problem Solving Interview Stress Interview
Interview errors can be seen as the major disadvantage
Types of Interview
46YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Interviewer Errors Hallow Effect Over emphasis on one criteria Leading Questions Pressure to hire Personal prejudice Interviewer domination Poor job knowledge
Interview’s Error
47YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Interviewee Errors Conflict answer Time consuming Showing one thing doing another thing Not listener Influence of non verbal behavior Pressure to hire
Interview’s Error
48YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Intelligence Test Achievement Test Aptitude Test Personality Test Practical test Mind Style Questionnaires (MSQ) Assessment Centre - A programme lasting
for one or several days and using multiple methods of selection and multiple assessors to determine the suitability of candidates for particular job vacancies
Employee Test
49YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Check references Past employment Behaviors Academic Finance
Medical TestIt is a formal investigation of applicant physical and mental fit for the job
Background Investigation
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Hiring
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Hiring is the process of appointing the selected candidate to the post/job which is vacant
It involve s placing the selected employee on the right position of the jobs
This process is normally vested in the top management of firm
Highly responsible to get right person, for right job, at right time, in right way
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Hiring Process
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Preparation Appointment Letter
Notification to Appointees
AcceptanceFollow Up Reject
Appoint from Waiting List
Enter in to the Employment Contract.
Probationary Period
52YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
A selected period to prove certain capability for job before confirmed Confirmed employee become permanent Both party can terminate at short notice After probationary period, evaluation can done and,
Confirmed Extend period Terminate
Employee Induction
53YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Induction is the HRM function that systematically & formally introduce new employees to the organization and its task.
It can be a Formal or informal way Formal – Systematic, planned
attempt Informal – Not Planned and it is ad
hoc
54YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Objectives/Importance of Induction Reducing the cost and inconvenience Increasing commitment (work hard) Cultural shock – person vs. firm culture Reality shock – Expected vs. Actual state Reduced tardiness, absenteeism, turnover Strong labor management relationship Accelerating progress up the learning curve Speeding up socialization & increased
loyalty Reduce grievance & eliminate wastages
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Training Training is the formal and systematic
modification of behavior through learning which occurs as a result of education, instruction, development and planned experience.
Training is the systematic process of altering the behavior, knowledge, and motivation of employee in a direction to increase organizational goal attainment.
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Objectives of Training
Develop the right skill & competencies of employee and improve their performance
Help people to grow with the organization
Reduce the learning time of employee to achieve success and ensure fully competent and economical as possible
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Training Methods Apprentice (Beginner) Training
New employee train with his job activities using his immediate boss or other trainer
Job RotationJR is shifting an employee from one particular job to another to provide proper training (identify strength & weakness of each units and its task)
Special Practical AssignmentArrange a practical task, assignment, method to train the job holder
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Training Methods… On the Job Training Method
Training is given by allowing the trainee to perform the duties of job.
Behavioral Model TrainingIt focuses on teaching interpersonal skills, cognitive skills through ideal job related behavior
Vestibule (Hall) TestingTraining is given in an artificial place considering expected aspect of training
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Training Methods… Outside Seminars
Organize to provide skill building training Role paling
A training techniques in which trainees act out the part of people in a realistic problem and who get training related to the job.
Lectures Verbal, written presentation to deliver the job knowledge
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Performance Evaluation
We can identify Performance Evaluation as a system of measuring, evaluating and influencing an employees’ job related attributes, behaviors and outcomes and discover employee present performance on the job.
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
61YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Cont… Who should do –
Immediate SupervisorSeveral SupervisorsOther committee, Outsider Peer, Self, SubordinateCustomers/Clients
How Often–Annually, Quartile, Weekly
62YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Establish Criteria Criteria is the dimension of
performance upon which an employee is evaluated. Those are two types Objective Criteria – These are
quantifiable distinctly & easy to measure (Lecturer hour)
Subjective Criteria – That are not quantifiable distinctly & difficult to measure (Lecture quality)
63YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
PE Method…
Self Evaluation Method Essay Appraisal Method Examination systems Critical Incident Method Point Allocation Method MBO Evaluation 360 Degree Method Field Review Method
64YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
360 Degree Method This means
employees are evaluated by each and every parts of the organization such as peers, customers, superiors, subordinated…
Customer Head
Peer
Employee
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RelationshipsRelationships
AdaptabilityAdaptability
LeadershipLeadershipCommunicationCommunication
PersonalPersonalDevelopmentDevelopment
DevelopmentDevelopmentof Othersof Others
ProductionProduction TaskTaskManagementManagement
Example
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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PE Errors
Errors can be seen on Evaluator Error – errors occurs base
on the evaluator or evaluating panel Employee Error –those are the errors
of employee who are being evaluating
Process Error –that may be errors occur on used evaluation method or process.
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Employee Movement
Employee movements refer to change that occur with regard to the employees.
Therefore EM is any change in the employment of worker which affected to his existed job characteristics and responsibilities.
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Movement Type
TRANSFERTRANSFER
PROMOTIONPROMOTION DEMOTIONDEMOTION
LAYOFFLAYOFF
RETRENCHMENTRETRENCHMENT
RETIREMENTRETIREMENT DISMISSALDISMISSAL
TERMINATETERMINATE
CHANGECHANGE
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Promotion
Promotion is a upward change of the worker’s present position. (Changes can be on responsibility, more prestige, authority, pay, more rank, better job terms & conditions)
At least their must be increased of the pay and a more important gap title
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Transfers Transfer is the moving of an employee
within the same jobs class or grade(From one job, place, time, to another job jobs, place, time and from office to field and also transfer can be offered as a promotion)
Transfers not be done on an imitation basis
It should done on the need of organization
No required frequently transfer for one employee as it breaks family consistency
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Layoff Layoff is a temporary stoppage of the
employment of an employee due to reason/s which generally not controllable by the management and which expects to re-employ them in future.
Characteristics of Layoff Employer must have an inability to retain
further employee on employment Tentative stoppage & Re-employ in future
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Demotion
Demotion is the appointment of an employee who is currently working in the organization to a job that is lower than the job being performed by employee.
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Dismissals Dismissal is moving an employee out of
the organization permanently on disciplinary ground.
Many disciplinary oriented behavior helpful to dismissals those are can be identified as follows
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Termination
Termination is the complete end of the employment service of employee by the employer.
Reasons for TerminationsThe main reason is the resignation for termination, it can be done on employee or by employer
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Resignation It can be identified in different ways as
follows Voluntary Resignation - Employee decide
to resign due to some reasons asFinding a another jobGetting married / Gone abroadPhysical DisabilityJob dissatisfactionReading for study
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Retrenchment
It can be defined as the permanent termination of the employment of an employee due to surplus of employee within the organization.
To manage the retrenchment firm can practice number of activities as follows
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Retirement Retirement can be describe as a leaving an employee from the
organization after he has reached the age at which a person can be get.
Compulsory Retirement - Age Forced Retirement Due to serious rules enumerated in the
service agreement Premature Retirement - disable, dice, bad health, and family
problems before retirement age.
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Compensation
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Pay is defined as the basic reward an employee receives in return for worker contribution rendered for the organization where who work.
Compensation System refers to money, goods and services provided by an employer to an employee in return for specific behavior offered by an employee
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Components of a Pay System It is of twofold
Direct pay - irreducible minimum of base payMerit pay which is contingent on
performance Incentive pay based on work doneDiffered pay such as savings plans, stock
plansIndirect pay and other components
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Components of a Pay System Indirect Pay Protection programs-medical and life insurance Pay for time not work-holidays Perquisites-free meals, housing and transportation
Premium- payment for working at inconvenient and difficult areas
Overtime-for working extended hours Bonus-gratuitous payment not directly earned by workers Special allowances for special skills like language
allowances
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Objectives of PM
To attract suitable, qualified person To retain appropriate employee To motivate employee To comply with legal requirements To ensure equity To control employee cost
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Equity Issues in PM
82YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Fair pay is a pay that ensure equity. The equity is the degree of reasonableness. There are four type of equity Primary Equity Internal Equity External Equity Inputs Equity
Equity… Primary Equity - If the pay received by the
employee is sufficient to meat basic needs it is possible to say that pay possesses primary equity.
Internal EquityThis is refers to degree to which the pay is related to the relative work of jobs. It reveals similar pays for similar job and dissimilar pays for dissimilar jobs
83YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
Equity… External Equity
Payment for certain job is to be equal to that of other similar jobs in other organizations, specially in same sector or industry.
Inputs EquityIf employees are getting enough fair salary against his inputs used to perform duties of job with enough performance it is the input equity.
84YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011
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Factors Affecting for Pay Trade Unions Legal Requirements Financial Ability Productivity Strategy Competence Competitive Pay Cost of Living Labor demand /supply
YMWGPK Udurawana, Lecturer, Faculty of Management Studies, Rajarata University of Sri Lanka - 2011