Pensions o Defined contribution plans 401k plans only guarantees what you will contribute but not what you will get o Defined benefit plans you know what you are going to get Disability insurance o Gives coverage that provides a percentage of income if the employee o Recommended you have disability insurance that provides at least 60 of becomes disabled income From a HR perspective staffing a company involves Recruitment and Selection Overview 1 Strategic planning 2 Job or role analysis 3 Recruitment 4 Selection Why does recruitment selection matter Recruitment can be a very costly process Getting the right person for the right job is difficult Keeping that person in the job long term is increasingly challenging Ultimately the company wants to perform better than its competitors To get the most skilled workers companies have to market themselves In order to do this it has to recruit the right people Staff is 1 Planning Forecasting traditional the amount of employees we will need down the road Forecasting relies on non risk assumption of stability Problem we live in non stable world What are we projecting what we need 2 Job Role Analysis Interview workers create meetings with them make workers create job diaries We then figure out how much do we need of this How can we identify areas of growth What are the things we re doing STRATEGIC 3 Job Recruitment Very costly Can cost up 50 more of that worker s salary Knowing what your major is can predict recruitment in the future If you get the wrong worker it cost a lot to get a new worker 4 Selection 5 Job 1 Strategic Planning over time coming years The traditional way organizations attempt to assess and fill their employment needs Relies on a company s ability to forecast what the labor market will look like in the Many argue that given the unpredictability of the modern business world planning and forecasting are out dated However some argue that given the pressures to control labor costs and profit margins it is even more important to engage in planning 2 Job and Role Analysis Key in identifying the tasks expectations for new recruits Approaches can very in sophistication and cost Can involve observation work diaries interviews questionnaires Results from job analysis can define or describe the job that needs to be filled 3 Recruitment The process of attracting individuals in sufficient numbers with the right skills and at appropriate times to apply for open positions within the organization Some alternatives to recruitment o Outsourcing o Contingent labor o Part time employees o Overtime Very high costs replacing supervisory technical and management personnel can cost from 50 percent of salary to several hundred percent of salary a Recruitment and Economy A firm s interest in recruiting employees depends heavily on the current economy Strong economy very few applicants for lots of jobs Weak economy lots of applicants for very few jobs b Internal Recruitment If a company needs new workers it can promote from within turn to the internal environment Pros Cons o Promotion as a reward for good work o Motivational tool for other employees o Promoted employee gets up to speed must faster in his or her new job o Must fill the position vacated by the promoted employee o Lack of new ideas and creativity that may come from a new person o Jealousy from those not promoted 1 Rely on Job posting 2 Employee referrals Put up a job description conditions rules pay c Nepotism without using Internal recruitment Not illegal If a company needs new workers it might engage in nepotism hiring relatives o May be discriminatory o Hiring someone who is a family member blood relation o Must ensure individuals are not in supervisory positions managing their own relatives o May create issues of favoritism d External Recruitment Turning to the external labor market o Employment agencies o Executive search firms o In house recruiters o Local advertising o Internships o Job fairs o College recruiting o Walk in candidates e Internet Recruiting o Race o Color o Religion o Sex o National origin o Age o Pregnancy o Disability Firms are increasingly turning to the internet to help with their recruiting Cheap often automated method and reaches a wide audience You also get a lot of bad applicants Some companies use a traditional marketing strategy to get out the message that they re hiring Other companies are a little different f Recruitment and Employment Law Employers must keep various laws in mind when hiring so that they do not engage in discriminatory hiring practices 4 Selection Method This is a two way street Selection is the critical further step following successful recruitment Selection methods vary widely and there is no single perfect method often a number of imperfect approaches are taken This variation exists not only across firms but across countries Personal connections in Latin America level of university in France standard interviews in UK USA Selection Methods a Interviews Both the most widely used and roundly condemned method of selection Cheap but unreliable One to one interviews informal encourage rapport potentially more open discussion issues of bias reliability failure to cover subject matter These types of interviews can have unusual consequences Small group or panel minimal overt bias multiple raters ensures focus on subject matter difficult to establish rapport tough on applicants lack of training Major problem with interviews bias attribution theory b Selection Tests Cognitive tests designed to measure mental ability Personality tests designed to identify differences in behavioural characteristics of applicants c Background verification Reference checks and other pre hire checks The importance of checking o 40 percent of applicants lie about work histories and educational backgrounds o 20 percent of applicants falsify credentials and licenses o 30 percent of applicants make misrepresentations on their resumes Other checks o Drug testing LEGAL o Genetic testing ILLEGAL o Social media check LEGAL 5 The job offer Making the job offer May be done by phone letter or in person Discuss salary and benefits Realistic job preview Verify employment eligibility Negotiations Why do we negotiate at all We choose to make ourselves better off But we have to consider that one or more other entities wants to do the same we don t have all the information information asymmetries We do not have perfect information Information Asymmetries Assumption we would make