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Chapter 16: Role of human resources

Introduction
  • Human resourcesare the process of managing employees in a workplace. It involves:
  • reviewing the goals of the business
  • rewarding valued employees
  • Working within the legal framework that regulates the employment relationship.
Human resource management
  • Human resource management -The process of managing staff within an organisation. It focuses on the relationship between the employer and the employee.
  • By being proactive and adopting a long-term think approach, managers may seek to affect and improve a diverse range of human resource issues within the business. E.g. policies and practices, employment performance review techniques and training. The business must also develop appropriate performance review measures to examine the effectiveness and efficiency of their employees.
  • The benefits of adopting a long term (strategic) role to human resources include:
  • The development of a highly qualified workforce
  • The employment of a workforce relevant to the organisational needs of the business.
Interdependence with other key business functions
  • The operations function work closely with the human resource to ensure that the business has recruited staff with the relevant skills experience.
  • The human resource is related to marketing as staff must be motivated and skilled to develop products. It is also through marketing that businesses’ are able to determine the skills required for employees to produce the desired product.
  • The human resource is related to finance as budgets are often established that allocate funds towards training and workplace education issues. Human resources must also work within these budgets to provide for the needs for its employees.

Outsourcing
  • Outsourcing- When a company takes a part of its business functions and gives it to another company to complete.
  • Some businesses lack funds to employ specialist human resource managers to manage the role of employment relations..
  • Some reasons for outsourcing are that it:
  • Provides the ability to access staff whose specialty is human resource management. They would have a better understanding of issues and can give advice on the best strategy.
  • Allows managers to on the core business operations, this means that it can focus on production and attending to the needs of its customers.
  • The decision can generate cost savings as this reduces the need to employ full time staff for human relations.
  • Some issues with outsourcing human resources are:
  • There is the chance that the company which was chosen may lack an understanding of the key aspects of the business. E.g. business culture.
  • The key relationship between staff and their line managers must continue to be developed within the business to ensure that the work on relationships still has to be handled.
Contractors
  • Contractors- an external provider of services to a business. It may be an individual or a business.
  • Independent contractors exist in a situation where an individual’s employment by one employer is not ongoing and an agreed fee is paid for the service. It is also known as contract for services. E.g. builders, lawyers and electricians. They must provide their own insurance. They are subjected to no government legislation.
  • Employee- position of employment is ongoing and will not be terminated once a task has been completed. They are subjected to a negotiated wage or condition.Insurance and protection are provided by the employer. They are subjected to government legislation.
  • Contract of service- Exists where an employee offers his or her services to an organisation on a regular basis and is subject to the lawful control and authority of the employer
  • The law regards an employee to be a person who is subject to a contract of service.
Foreign contractors
  • Using global contractors as an external provider of services. It allows the Australian business to access the use of labour, without having to consider such issues as minimum labour requirements, and OH&S.

Chapter 17: key influences

Stakeholders
  • Stakeholders need to be considered apart from the employer and employee. Each stakeholder seeks to protect and promote its own interests. They include unions, employers, society, employer organisations, employees and government organisations.
Employers
  • Employer- the individual or organisation that pays others to work for its business. They are often the owners and take responsibility in the organisation’s goals.
  • In large businesses:
  • Managers are voted by, from shareholders to take on this responsibility and to consult with the owners to develop strategies.
  • Human resource departments are also hired. Human resource departments are a specialist unit in a business that has as its main role the management of the issues involved in the employment relationship. Their roles would include:
  • work with other departments to recruit the appropriate staff
  • implement a range of training and development programs to cater for the changing staffing needs.
Employees
  • Employee-an individual who provides his or her skills to a business in return for a regular source of income.
  • They were traditionally just workers, but are now considered in the decision making process.
  • Family-friendly practices such as childcare centres and flexibility in working times have been initiated. Workers can now work from home.
Employer associations
  • Employer associations-organisations that aim to promote the interests of employers within the business environment.
  • They lobby governments to develop policies that enhance the interests of the employer and consult with governments on changes to key policy issues. E.g. the Business Council of Australia and NSW Nurses’ Association.
  • The Australian Council of Trade Unions (ACTU) lobbies the government for improved working conditions and wage increases for Australian employees.
  • National wage case- where trade unions, employers, employer associations and the federal government provide arguments to Fair Work Australia on the appropriate level of increase to the minimum wage.
  • Shop steward- The union’s representative in the workplace. They acts as the first point of contact between the union and its members.
Government organisations
  • Government organisations- establish the legal framework by which employers, employees and trade unions coexist and operate within the employment relationship. Terms such as the ones below are considered:
  • Awards- a legal document that specifies the minimum working conditions that apply to all people employed in a common industry.
  • Working conditions- the non-wage features of an employee’s workplace contract.
  • Certified agreement - an agreement that is negotiated between an employer and all its employees.
  • enterprise bargaining- the process of negotiating an enterprise agreement
  • Better off Overall Test- a test by the Fair Work Australia to examine whether employees will be any worse off if they sign a new wage agreement.
  • Industrial dispute- a problem that arises between an employer and either a group of employees or an individual employee at a workplace.
  • Conciliation- Used when Fair Work Australia offers suggestions to help resolve an industrial dispute.
  • Arbitration- a process Involving a commissioner hearing the cases put forward by both parties in an industrial dispute and then making a decision, which is legally binding on both parties.
  • Some Government organisations include:
  • Fair Work Australia- an organisation established under the Fair Work Act 2009 (Cth). Their primary functions encourage the prevention and settlement of industrial disputes between employers and employers through conciliation and arbitration.
  • Federal Court of Australia- an government federal organisation that acts as an avenue for appeal regarding decisions made by the Fair Work Australia. They can impose fines
  • The Human Rights and Equal Opportunity Commission- enforce federal government legislation on discrimination in the workplace
  • The Equal Opportunity for Women in the Workplace Agency (EOWA).- to promote equal opportunity for women in the workplace and administer the Equal Opportunity for Women in the Workplace Act 1999 (Cth).

Key influences on human resources
  • Society- workplace practices are reflective of behaviours that are upheld within society. Issues such as discrimination and harassment are becoming publicised. Businesses must act consistent with the views of society.
  • Legal- The employment relationship is subject to considerable number of regulations and laws. The government has established the legal framework by which employers and employees are encouraged to coexist cooperatively.
  • Employment contract- a contract in the Australian workforce between an employer and their employee. The employment contract is based on the employee offering his or her services on a regular basis and being subject to the lawful control and authority of the employer. An employment contract creates rights and responsibilities for employers and employees including a safe workplace, minimum wage and anti-discrimination.
  • Duties of employers
  • Duty of care- a business’s legal obligation to provide all its employees with a safe and healthy workplace. The skills, knowledge and tools must be provided. It also includes warning employees of risks.
  • Duty to pay the agreed wage- the legal obligation to pay the employee the correct, legal wage. Employees in a contract must be paid the amount in the agreement.
  • Duty to provide work- the responsibility of the employer to provide a constant source of employment to its full-time and part-time staff. Employees must be given the opportunity to leave the business with financial compensation
  • Duty of employees- employees must offer their labour to a business
  • Duty to obey lawful instructions and commands- the employee is expected to follow the instructions of supervisors and senior management. These instructions must be lawful.
  • Duty to work with skill- the employee will perform the task to the best of his or her ability.
  • Duty to disclose relevant information- employees need to provide the employer with information that will affect their performance.
  • Regulating the relationship between employers and employees
  • It is the role of industrial tribunals and organisations to ensure that stakeholders in the employment relationship follow the rules and regulations outlined in this legislation.
  • Minimum wage rates
  • A minimum wage - an employee’s minimum rate of pay for hours worked. Fair Work Australia is responsible for ensuring that employers and employees cannot agree to a rate of pay that is lower than the normal.
  • Minimum wages are generally determined once per year by a specialist Minimum Wage Panel of Fair Work Australia. They differ for adults according to experience and qualifications.
  • The current national minimum wage is $15 per hour or $569.90 per 38 hour week (before tax).
  • Awards
  • Awards - legal document that outlines the minimum wages and working conditions for all employees working in a particular industry.
  • They are established through negotiations between employers and associations.
  • Under the Fair Work Act, parties to a wage agreement may apply to Fair Work Australia to have the award changed.
  • Agreements
  • Agreements - a system that aims to meet the needs of individual businesses and their employees. E.g. certified agreements and Australian workplace agreements.
  • Certified agreements- known as enterprise agreements are exclusive to a business and its employees.
  • Types of employment contracts
  • Part time employment-an employee working a fixed set of hours per week, but usually less than those of a full-time employee. They are entitled to all benefits on a pro rata basis (the proportion of hours)
  • Permanent employment-a person who is provided with continuing employment within the organisation. They work between 35 to 40 hours a week. They are entitled to four weeks holiday per week, 1.1 weeks leave andcan be given overtime for working more than the required amount.
  • Casual employment-employees employed by a business for short periods of time. They must work for a minimum of between one to three shifts. They receive no holiday or sick leave entitlements. The employer can choose when they work.
  • Fixed term contracts-the use of labour for only a specific period of time. Both parties are in agreement to this time period.
  • Occupational health and safety and worker’s compensation
  • Occupational Health and Safety Act- TheOccupational Health and Safety Act 2000(NSW) establishes the rights and responsibilities of employers in the workplace in regards to employers and employees.
  • Workers Compensation Act and Workers Compensation and Workplace Injury Management Act- The Workers Compensation Act 1987 (NSW) ,Workers Compensation and Workplace Injury Management Act 1998 (NSW) govern the process of employees gaining financial compensation for injuries sustained at work.
  • Anti-discrimination legislation- anti discrimination laws such as Sex Discrimination Act 1984(Cth), Racial Discrimination Act 1975 (Cth), Human Rights and Equal Opportunity Commission Act 1986 (Cth) and the Disability Discrimination Act 1992(Cth) prohibit discrimination in the workplace. The Human Rights and Equal Opportunity Commission protect the interests of the employee.
  • Economic
  • Economic cycle
  • Business is the fuel that drives production, price changes, employment and our standard of living. The level of economic activity in an economy is primarily determined by the level of consumer and business spending.
  • Employment is fundamental for all economies. If employees are confident about job security, then there is an increased willingness to spend more of their income on consumer goods. This demands more labour as more goods and services need to be produced.
  • Impact of inflation
  • During periods of wage negotiations, employees will seek higher wages from employers due to inflation. This leads to increases in the costs of production of any business. Workers would need to be sacked making staff needing to increase their workload.
  • Globalisation
  • Globalisation -the integration of the world’s economies into a single market where goods and services can be traded with ease.
  • Due to more competition, workers are retrenched when their services are no longer needed.
  • Employees need to receive their legal entitlements if they are retrenched and workplaces must be free of discrimination and harassment.
  • Technological
  • Technology seeks to improve the quality of products and the efficiency with which they have been produced.
Positive aspects of Technology / Negative impacts of technology
  • allows the business to develop more efficient production techniques
  • fosters teamwork whereby staff become mentors to colleagues through the process of learning the new technologies
  • encourages the employee to deliver the product/service in new and improved way
/
  • loss of employment as technology itself
  • employee resistance to change as the workforce becomes reluctant to learning the use of new technology
  • reduced employee morale as the workforce feels their positions are less valued.

  • Recent data has shown that the manufacturing sector is declining rapidly.
  • Social
  • Today, there are more multicultural workplaces and more working woman .
  • Many employees want to achieve a balance between work and family.
  • Changing work patterns
  • Women now account for a greater proportion of the Australian workforce and are under-represented in positions of power.
  • Technological developments have facilitated the considerable decline in employment in Australia’s manufacturing sector.
  • There are fewer unskilled jobs available within the market.
  • Living standards
  • Less educated people, who lack skills and qualifications, may often be employed in industries with wage rates that are low.
  • Many would be scared to challenge their employers for fear of losing their jobs.

Ethics and corporate social responsibility
  • CSR- the continuing commitment by companies to behave ethically and to contribute to economic development, while improving the quality of life of the workforce and their families, as well as the local community and society at large’
  • Stakeholders apart from shareholders include employees, customers, suppliers, community organisations and local communities.
  • Examples of CSR include investing in community projects, supporting research initiatives and adopting environmentally friendly products.
How does human resources relate to CSR?
  • It enhances the reputation and standing of the business and may be used to promote recruitment of staff for the business.
  • Strategies to promote CSR within the workforce includes:
  • promote effective affirmative action and anti-discrimination programs
  • encourage staff to volunteer their time to participate in community-building activities.
  • develop initiatives that reduce the business’s impact upon the environment

Chapter 18: processes of human management

Introduction
  • Employment relations- the function that deals\ specifically with the relationships between the employer and the employees of the business
  • The role of employment relations is to provide the business with the workforce that it requires. They also aim to find, attract, develop and motivate the people who can provide services the business needs.
The human resource cycle
  • Human resource cycle-Acquisition, development, maintenance and separation of employees.It involves acquiring people with skills for the job and the continued development of employees’ knowledge and capabilities. The cycle also involves providing incentives for effective, reliable employees to remain motivated and stay with the business. There are 4 stages:acquisition, development, maintenance and separation.
Acquisition
  • Acquisition- the stage in the human resource cycle that involves identifying staffingneeds,recruitment and selection.
  • In order to examine whether it has the appropriate staff to meet the firm’s needs, it needs to:
  • Identify the skills and number of employees required in the future
  • Analyse its existing workforce
  • Identifying staffing needs- If staff cannot cope with changes, more employees are needed.
  • The job needs to be identified and analysed anda job description (awritten statement describing the duties tasks and responsibilities associated with the job) needs to be created.
  • A job specification (Written statement describing the key skills, experience and qualifications needed for a job) must be made after.
  • Recruitment- To accumulate a pool of potential candidates for a job. It is from this pool that the business must make its selection. The business can fill a vacancy by recruiting applicants internally (from existing staff) or externally (from outside the business).
  • Existing staff could receive a promotion, resulting in other staff to improve their performance.
  • The business can advertise externally for job applicants through methods such as:
  • outsourcing to private employment agencies
  • interviews on university campuses,
  • Trainee positions may be offered to HSC students to complete ‘cadetship courses.
  • Selection- A screening process in staff acquisition. The information gathered about job applicants is reviewed and the most appropriate applicant is chosen. The individuals are assessed on their ability to interact with each other.The process may involve:
  • Interviews
  • Application forms
  • written tests, such as mathematics or English
Staff development