UNIT 2. Chapter 11. Further human resource management

Question 1

What are the tools to monitor employee performance? (3)

Answer 1

• Labour productivity
• Absenteeism rates
• Labour turnover

Question 2

Labour productivity

Define? How to calculate? Why labour productivity might increase? (5)

Answer 2

Labour productivity is the output per worker in a given time period.

Total output in time period / Total staff employed

Reasons for increase in productivity:
• Improved staff motivation
• More efficient capital equipment
• Better staff training
• Increased worker involvement in problem solving to speed up methods of production
• Improved internal efficiency e.g. supplies arriving on time

Question 3

Absenteeism rate

Define? How to calculate?

Answer 3

Absenteeism rate measures the rate of workforce absence as a proportion of the employee total.

Absenteeism (%) = (No. of staff absent / Total no. of staff) x100

Question 4

Labour turnover

Define? How to calculate?

Answer 4

Labour turnover measures the rate at which employees are leaving an organisation.

(No. of staff leaving in 1 year / Average number of staff employed) x100

Question 5

What are the costs of high labour turnover? (4)

Answer 5

• Costs of recruiting, selecting and training new staff
• Poor output levels and customer service due to staff vacancies
• Difficult to establish loyal employees
• Difficult to establish team spirit

Question 6

Potential benefits of high labour turnover? (3)

Answer 6

• Low skills and less productive staff might leave
• New ideas and practices are brought more often
• Business that plan to reduce staff can benefit

Question 7

Possible solutions to improve employee performance (5)

Answer 7

• Regular appraisal
• Training
• Quality circles
• Job enrichment: work in a group on a project
• Financial incentives

Question 8

Define MBO

Answer 8

Management By Objectives a system designed to motivate and coordinate a workforce by dividing the organisation’s overall corporate aim into specific targets for divisions, departments and individuals.

Question 9

Possible benefits of MBO (3)

Answer 9

• Each manager and subordinate will know exactly what to do. This helps them see the importance of their work to the organisation, as well as avoid confusion
• Avoid conflicts and gain coordination between departments and divisions
• To monitor performance by the managers

Question 10

Possible problems of MBO (3)

Answer 10

• The process is very time consuming
• Objectives can be outdated quickly in competitive environments
• Does not ensure success

Question 11

What are the possible conflicts between managers and employees (2)

Answer 11

• Business change: Managers think change in necessary to remain competitive. Employees think change may lead to job losses.
• Rationalisation: Managers think business needs to cut overheads and be flexible. Employees will have reduced job security and lower pay -> damaged motivation.

Question 12

What are the three approach to labour-management relations?

Answer 12

• Autocratic ( ‘take it or leave it’ attitude)
• Collective bargaining between powerful trade unions and major employers and their associations
• Cooperation between labour and management

Question 13

Autocratic approach to labour-management relations.

Evaluation (5)

Answer 13

In USA and Europe in 1920s and 1930s
Employees have little to no power against employer.
Evaluation: This may lead to low labour costs but,
• No labour security and low levels of motivation
• Staff will not be trained
• Can’t establish good relationship with employees
• No employee contribution to make better decisions

Question 14

Collective bargaining approach to labour-management relations.
What it is and evaluate (5)

Answer 14

In USA and Europe in 1960s and 1970s
When representatives of unions and national employers negotiate with business’s managers. The trade unions can threaten with strikes.
Evaluation: Worker’s wages and conditions can improve but,
• Strikes are disruptive to value of output and sales
• Slows down development of certain industries
• Businesses lose competition

Question 15

Cooperation between labour and management approach to labour management relations
What it is and its effect

Answer 15

In Japan after 1960s
• Managers try to actively involve employees in decision making and operational issues
-> Gains greater harmony and no strikes

Question 16

Def. Trade union

Answer 16

An organisation of working people with the objective of improving the pay and working conditions of their members and providing them with support and legal services.

Question 17

What are the reasons for employees to join trade unions? (3)

Answer 17

• ‘Power through solidarity’ -> collective bargaining
• Collective industrial action -> going on a strike in large numbers is more affective
• Provide legal support

Question 18

Recently, unions have retained from striking and adopted much more cooperative role with employers. Why? (3)

Answer 18

• Increase in globalisation allows unions to understand the attractiveness of low-wage economies to employers.
• Unions membership is declining -> Unions need be seen acting responsibly.
• Confrontation and industrial disputes would makes losses for the business -> doesn’t benefit the unions either

Question 19

Def. Union recognition

Answer 19

When an employer formally agrees to conduct negotiations on pay and working conditions with a trade union rather than bargain individually with each worker.

Question 20

Benefits to employers of union recognition (4)

Answer 20

• Employers can negotiate with 1 representative instead of many employees -> quicker
• Allows a useful channel of communication with employees
• Unions can impose discipline on member who take individual industrial action.
• The growth of responsible, partnership unionism allows employers better control and leads to better motivation

Question 21

Def. Single union agreement

Importance (1)

Answer 21

An employer recognises just one union for purposes of collective bargaining.

• This is because 1 business can have more than 1 union, which could have conflicts with each other. So the business signs with only 1 that will represent the others.

Question 22

Def. No strike agreement

Importance to unions (2)

Answer 22

Unions agree to sign a no strike agreement with employers in exchange for greater involvement in decisions that affect the workforce.

• Improves the image of unions as “responsible”
• Win - win settlement as employees get involvement and employers get motivated and productive employees

Question 23

Def. Industrial action

Answer 23

Measures taken by the workforce or trade union to put pressure on management to settle an industrial dispute in favour of employees.

Question 24

Actions that can be taken by unions (5)

Answer 24

• Negotiations
• Go slow - Employees work to the minimum required by the contract
• Work to rule - Employees refuse to do any work outside of the contract’s requirements
• Overtime bans - Employees don’t work overtime.
• Strike action - Employees withdraw labour for a period of time.

Question 25

Actions that can be taken by employers to deal with unions (6)

Answer 25

• Negotiations
• Public relations - using media to get public to support the employer
• Threats of redundancies
• Changes of contract - to issue higher working rates minimums
• Closure - closing down the factory or office where the dispute is occuring
• Lock outs - short term closures

Question 26

When will unions power be higher than employers? (5)

Answer 26

• Most workers are in the union
• The business is very busy
• Industrial actions have large costs to employers
• There is public support for unions
• Inflation making higher wages requests reasonable

Question 27

When will employers power be higher than unions? (3)

Answer 27

• Unemployment is high - few alternative jobs
• There is public support for the employer
• Profits are low -> closure is taken more seriously

Question 28

Def. Conciliation

Def. Arbitration

Answer 28

Conciliation is the use of a third party in industrial disputes to encourage both employer and union to discuss an acceptable compromise solution.

Arbitration is resolving an industrial dispute by using an independent third party to judge and recommend an appropriate solution.