CHAPTER 8 Managing Human Resources in Organizations CHAPTER SUMMARY This chapter explores how organizations manage their human resources The topics covered in the chapter include the environmental context of HRM and how organizations attract develop and maintain human resources This is followed by a discussion of workforce diversity After presenting information about labor relations the chapter concludes with an explanation of how to manage knowledge contingent and temporary workers LEARNING OBJECTIVES After studying this chapter students should be able to 1 Describe the environmental context of human resource management including its strategic importance and its relationship with legal and social factors Discuss how organizations attract human resources including human resource planning recruiting and selecting Describe how organizations develop human resources including training and development performance appraisal and performance feedback Discuss how organizations maintain human resources including the determination of compensation and benefits and career planning Discuss the nature of diversity including its meaning associated trends impact and management Discuss labor relations including how employees form unions and the mechanics of collective bargaining Describe the issues associated with managing knowledge and contingent and temporary workers 2 3 4 5 6 7 LECTURE OUTLINE I The Environmental Context of Human Resource Management Human resource management HRM is the set of organizational activities directed at attracting developing and maintaining an effective workforce A The Strategic Importance of HRM 1 The HRM function has become more and more important over the past several years because organizations perceive that effective HRM functions translate into effective organizations and improved bottom line performance Responsibility for HRM functions is shared between HR departments and line managers HR staff have specialized skills and knowledge and line managers are in daily contact with workers The term human capital emphasizes that a firm s commitment to its people is equally important as its financial resources Human capital reflects the organization s investment in attracting retaining and motivating an effective workforce 2 3 B The Legal Environment of HRM 1 Equal employment opportunity a Title VII of the Civil Rights Act of 1964 forbids direct and indirect discrimination on the basis of race ethnicity national origin language religion Copyright Cengage Learning All rights reserved 104 Chapter 8 Managing Human Resources b c d e f b c d b or gender Discrimination is said to occur when an employment requirement has an adverse impact that is when minority applicants pass the requirement at a rate lower than 80 percent of the pass rate for nonminorities The Equal Employment Opportunity Commission EEOC is the federal agency that enforces employment related laws The Age Discrimination in Employment Act outlaws discrimination against workers older than 40 years Affirmative action refers to a set of executive orders requiring companies that contract with the federal government to actively seek out and hire employees from underrepresented groups Protected groups are defined by such parameters as race gender ethnicity veteran status disability status and pregnancy Note that affirmative action requirements go beyond the more limited scope of Title VII The Americans with Disabilities Act ADA requires employers to provide reasonable accommodation in hiring disabled workers The Civil Rights Act of 1991 strengthens the ability of workers to bring discrimination lawsuits while also lessening the amount of financial damages that can be sought The Fair Labor Standards Act established minimum wage and required overtime pay The Equal Pay Act of 1963 requires that men and women be paid the same amount for doing the same job if they have the same qualifications The Employee Retirement Income Security Act ERISA regulates pension funds The Family and Medical Leave Act of 1993 requires up to 12 weeks of unpaid leave for family and medical emergencies for both men and women 2 Compensation and benefits a 3 Labor relations a The National Labor Relations Act the Wagner Act establishes guidelines for forming a union and requires companies to bargain collectively with a properly established union The National Labor Relations Board was established to enforce the Act The Labor Management Relations Act the Taft Hartley Act was passed to establish a balance between firms and unions It allows the president of the United States to end a strike that threatens national security Health and safety The Occupational Safety and Health Act of 1970 OSHA founded the federal agency OSHA which regulates the safety of workers from job related accident and disease Emerging areas of legal concern Emerging areas of legal concern include sexual harassment alcohol and drug dependence and AIDS II Attracting Human Resources A Human Resource Planning Job analysis is a systematic analysis of jobs within an organization It consists of a job description listing the duties of a job working conditions tools and materials of a job and the job specification which explains the skills abilities and credentials required to perform the job Forecasting human resource demand and supply requires managers to collect relevant information forecast the supply of and demand for labor and then develop appropriate strategies for addressing differences Copyright Cengage Learning All rights reserved 4 5 1 2 Chapter 8 Managing Human Resources 105 B Recruiting Human Resources a b Replacement charts can be used to plan for management positions These list each important managerial position who occupies it now how long he or she will probably stay in it before moving up and who is or soon will be qualified to move into the position Employee information systems or skills inventories can be used to identify individuals who are ready for a transfer or promotion 3 Matching human resource supply and demand requires managers to plan and deal with predicted human resources shortfalls or overstaffing 2 Recruiting is the process of attracting qualified individuals to apply for jobs that are open There are two types of recruiting internal recruiting considers present employees as 1 applicants for higher level jobs in the organization while external recruiting attracts persons outside the organization to apply for jobs A realistic job preview RJP provides