1- “Employment contracts are likely to effective working relationships. The so called psychological contract is meaningless.”
a- How far do you agree with the statement above? Give reasons and examples?
Employment contract is a written agreement between the employer and employee, which gives legal protection to both parties. Employment contract includes, the terms and conditions of the post with respect to organizational objectives.
Psychological contract is a set of unwritten expectations of both employer and employee, which continuously changing. The expectations can be about work, pay, loyalty, commitment, trust, flexibility, security and career development etc. These unwritten expectations are usually not formal and there it is not legally binding. They may be incidental due to past setbacks, action of either parties or a statement made by employer during a performance review or during recruitment process.
Traditional psychological contract is referred as loyalty and commitment in return of long term job security or job for life. However, in today’s competitive business environment traditional psychological contract is almost impossible as firms are trying to give least possible wages to the employees and demand for flexibility is evident in order to keep least number of employees. This does not mean that traditional psychological contract is not exist. But it is very rare and hardly seen in today’s competitive business environment.
It is obvious that if the psychological contracts are not rewarded, it creates conflicts, dissatisfaction, looses trust and feels his/her are not secured. This will affect the morale, motivation and performance. This is particularly case where the managers themselves are responsible for breaches, for an instance, the employee does not receive the promised training, wage increase or a performance review are badly handled.
The Psychological contract plays a vital role in shaping the attitude towards the organization and therefore it is more influential than the written contract between both parties. It tells employees what to expect and what they should do in order to meet their expectations. In order to make the best use of employees, the organizations must pay special attention to reinstate the employment trust and meet the commitments and continues monitoring of employees attitudes.
It is equally essential to manage the psychological contract by clarifying the employees’ expectations and at the same time communicating employer’s expectation from them. For this the organization can do the following.
- Offer realistic job preview for new recruits.
- Telling organizational vales and what they are expected to do.
- Getting agreement from the employees in order to make them more committed
- Continuous feedback on how well they are doing.
The psychological contract is not strictly legally enforceable but the courts may be considered certain elements when making a verdict.
b- To what extent are employees and employers equally protected by the employment contract? Give your reasons for your answers?
Employment contract is a legally enforceable agreement between employer and employee. Employment contract covers variety of procedures and policies that the employee must agree to as conditions of his or her employment. Employment contracts are required, because the employer seeking to protect its own interest.
Employment contract may require that the employee not work for a competitor or work in similar industry during a given period of time after they leave or terminated by the organization. The employment contracts aims at discouraging employers from dismissing or varying the terms the terms of the employment contract of their employees in order to evade their liabilities under the regulation.
An employee may claim compensation against an employer under the following situation.
Unreasonable Dismissal
If the employee has been employed continues contract for a period of not less than 24 months, and the employee is dismissed other than a valid reason as specified in the law may claim for reinstatement or an award for terminal payments.
Unreasonable Variation of the terms and conditions
The employee has been employed a continues contract and the employment contract is varied without the consent and if the employment contract does not contain such express terms which allows variation and the terms and condition of the employment contract are varied other than for a valid reason as specified in the law may claim reinstatement and the terminal payments.
At the same time, the employee can be dismissed or varied the terms and condition of the employment contract in the following situations;
- The conduct of the employee
- The capability or qualifications of the employee for performing his work.
- Redundancy or other operational requirements of the business.
- Statuary requirements, (i.e. it would be contrary to the law to allow an employee to continue to work in his original position or to continue with the original terms in his employment contract)
- Other considerable reason.
However, under any given circumstances, the employee is not equally protected by employment contracts due to special clause that gives authority to ask employee to carry out extra activities which are not clearly specified in the employment contract.
2- Dave Ulrich’s model for human resource management is based on the argument that the human Resources professional needs to fulfill four roles: strategic partner, change agent, administrative Expert and employee champion.
Briefly indicate what each of these roles is about,
And why each should be considered so important within the human resources function.
Dave Ulrich Strategic Business partner model recommend that HR professionals need to fulfill four roles in order to become a business partner. They are;
Strategic Partner
Strategic partner refers to HR manager being an essential part of the management team running an organization and contributing to the achievement of the organizational or corporate objectives by translating business strategy into actions. According to Ulrich model, the HR professionals must be able to make best use of employees to achieve organizational goals and HR professional has to help other line managers when they are taking decisions on HR related issues. In short, HR professionals are required to assist in execution of the organization’s business strategy.
However the critics argued that the HR practitioners must play a more central role in formulating the business strategy rather than just assisting execution of the business strategy.
Administrative Expert
This refers to the efficiency of HR managers and the effective management of HR activities, such as selection of new recruits etc, so that they create value. According to Ulrich, HR professionals must be able carry out HR activities effectively and efficiently using technology. For an instance, training and development program with newly available technologies.
If HR professional become administrative experts, it is more likely that they would be carrying out more administrative tasks.
Change Agent
Ulrich recommends that the HR professionals have to act as a catalyst for change. This means that the HR managers must be able to manage the change smoothly within the organization. HR professionals must possess certain skills of effective communication, able to influence on others, solving disputes among the employees and manage the resistance carefully and successfully.
Ulrich says that HR professionals should act as an agent of continues transformation. But the reality is that the HR professional does not actually execute change or play any major role in the strategic decision making but rather they just “oil the wheels of change”, meaning that they just manage the change along with any resistance arises.
Employee Champion
Requires the HR manager to raise the employee’s voice in the management decisions and have to protect employee’s interests and must make sure that being fair and assuring the employee’s voices are being heard.
But when the HR professionals are involving and assisting while taking management decisions, it seems that the same person is going two different ways, especially HR professional are to become Employee champion.
And why each should be considered so important within the human resources function.
All the four HR functions proposed by Dave Ulrich are essential for the success of the whole HRM function. Many HRM managers forget to balance the approach and they decide to a real stat in one of the needed components and they forget about the danger not meeting the basic requests and expectations in the rest.
In the Ulrich model, HR professional should a strategic partner, Administrative expert, change agent and an employee champion. Meaning that as strategic partner, HR manager does have a role while undertaking organizational decision and policies. As an administrative expert, the HR professionals are expected to carry out the administrative activities more effective and efficiently through the available technological advancement. The change within the organization and change that involves further expansion of the business, the HR managers should be able to handle it smoothly and they should possesses good communication skills, problem solving and influential skills in order to manage the resistance. In Ulrich’s model, he proposes that the HR professional should be an employee champion by promoting employee interests and bringing employees voices in management decisions. Being fair and assuring that employees and their concerns are being raised.
Therefore, it is obvious that all four functions are essential within the HRM function as it helps to carry out the HRM activities more effectively and efficiently.
3- As HR Assistant you are to make a presentation to a meeting of line managers, to clarify the respective roles of HR and of line managers in managing people.
a- Outline three key purposes of HRM and indicate the respective responsibilities of HR professionals and of line managers in ensuring that these key purposes are properly fulfilled.
Overall objectives of the HRM are to ensure that the organization is able to achieve the organizational objective through its employees. In order to achieve the organizational objectives, the HR professionals must support all the other Line Managers within the organization. Or the HRM functions should be integrated horizontally and vertically. The specific objectives of the HRM are as follows;
- Staffing the organization
- Improving the organizational performance
- Organizational change management
- Employment Administration
1- Staffing the organization
This is to make sure that the organization has the sufficient number of employees of right quality in the right place at right time. As the HRM functions are vertically integrated, the line managers have to play an essential role in recruitment process by assisting in preparing the necessary documents etc.
2- Improving the organizational performance
For improving the organizational performance, the HRM must be integrated horizontally and vertically. Therefore, it is the line managers to engage and support the workforce to make the best use of their best contributions. HR professional should consult with other line managers in making them more confident about the HRM activities involve in the tasks they carry out day to day.
3- Employment administration
It is HR professional’s responsibility to keep the organization within the law on employment related activities. However, the line manages does have a role in assisting the HRM to carry out the HR activities successfully and effectively. Usually, the HR professional gives importance on getting staff paid and developing HR related policies and carrying out the administrative practices.
HR professionals are person who carry out administrative activities associated with human resources planning, recruitment, selection, orientation, training, appraisal, motivation, remuneration, etc. HRM aims at developing people through work.
HR professionals get involvement from the line managers in designing the HR policies and put into practice. They help the line managers by giving advice and assisting their people management activities and measure and monitor their performance as well. HR professionals also conduct the training for line managers to try to equip them to deliver their people management roles.
Line managers are person who heads departments (manufacturing and selling) and is responsible for achieving an the organization's main objectives by executing functions such as policy making, target setting, decision making. They have to report back to higher level of the management. Their main responsibilities include managing operational costs, providing technical expertise or technical know-how and task allocation and monitoring process etc.
Apart from this, the line managers have to carry out some people management tasks, which they have to manage the employees in their own departments. People management activities are usually shared between the line managers. For an instance, during the process of designing performance appraisal, HR managers seek advice from Board of Directors. And planning appraisal, the line managers seek advice from HR managers.
4- You are asked to write an article for HR professionals entitled, “HR Goes Global”.
a- Explain what globalization is.
b- Outline how and why globalization is increasingly important to the practice of HRM.
c- Show how the practice of HRM is adapting to the changes brought about by globalization.
a- Worldwide movement toward economic, financial, trade, and communications integration. Globalization implies opening out beyond local and nationalistic perspectives to a broader outlook of an interconnected and inter-dependent world with free transfer of capital, goods, and services across national frontiers.
b- Traditionally organizations are secured within the domestic business environment. Due to effects of globalization, the organizations not only faced domestic but also international competition from similar type of business. In order to compete, the organizations are under pressure to reduce the cost and make the employee more productive and carry out its business activities cost effectively.
In today’s global economy, the work will go where the staffs are competent and skilled, for an instance, the call centers moved to India where the costs are lowest. And also, many UK and US firms are moving to Asia where the labor cost is relatively low.
In a globalized market, the HR professionals are tend to manage people with different cultures, language etc. it means that when there is more globalization, there is more diversity and when there is more diversity, the organization can recruit people with different skills and experiences. However, in the globalised market, the role of HR professionals became more difficult.
In the globalize market it is very likely to relocate the businesses one place to another and merger with similar business in order to compete in the market. Each of these, the HR professionals plays a vital role in adapting and formulating new HR policies and execution of the management decisions time to time. Apart from this, the organization may purchase a similar business in order to strengthen the market share and compete with other similar organization.
c- In globalization, the organizations are likely to recruit the potential employees from global labor market. For an instance, most UK and US, IT related firms hire skilled labor from India. Because both UK and US there are no sufficient number of IT skilled labors. So there it becomes recruitment global.
Globalization increases the international travel and relocations due to various reasons. Usually organizations decide to move or relocate for cheap labor and cost effective functioning of their business. For an instance, one of the world famous aircraft manufacturing companies like Air Bus have moved to Asia. They built a manufacturing plant in china and first aircraft of china branch Airbus A380 was brought into market last and were sold to Singapore Airlines. This is for cheaper skilled labor cost. Because china is one of the most populous countries in the world and they are truly potential market.
When there is globalization, the roles of HR professional are immense. They have to carry out a lot of cultural training programs in order to make the employees learn and accept different cultures. HR professionals must make sure that their employees are not discriminated or racially abused or harassed.
When there is a globalization, the diversity is natural and HR professional should conduct awareness programs for its employees in order to avoid any possible conflicts or bullying within the organization. It is also an advantage for the organization as different people have different skills and experiences.
Language barrier is one of the common difficulties with globalization. HR professionals have to carry out language training programs for its employees. Because, people from country to country, it differs their way of speaking and language.
HR professionals are required to grip with a flexible HR policy and practice in order to motivate different people from different cultures and to reward them. It is important to note that the employment legislation is different from country to country. Therefore, HR professional must adapt with flexibility.
When an organization go for the global market, it is clear that the organizational structures must change. Because, there should be away to communicate with their global branches within the organizational structure. This means that everything becomes global when the organization enters into the global market.
In globalization, communication is far more important than anything. For this HR professionals should find new ways to interact with global market and encourage their employees to involve at global level.
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