The Loyalty of Employees and the Most Important Aspects in Human Resource Management - Essay Example

?Analytical report on a current ‘people issue’ in the business news event as a ‘case study’ Table of Contents Introduction 3 about the news article 3 Application of Theories and Models in practice (Whether HRM care for employees) 5 Application of Theories and Models in practice (Resourcing the Organisation) 7 Recommendations 8 Conclusion 10 Reference 11 Bibliography 11 Introduction The project aims to bring forth two major aspects of human resource management and their implication in the organizational context. It analyzes the major HRM issues involved in organisations while drawing on the major theories and models associated with it. The project begins with a brief description about the news story. Then it applies the associated theories and models in real life. The two major areas of HRM chosen for the purpose are human resource management care for the employees in organisations; and resourcing the organisation. The article chosen is on a recent survey which was undertaken by the “WorldatWork” (HRM Guide, 2010). The article has been chosen to ensure that it highlights the major aspects of recruitment practices and other benefits that employees are liable to in an organisations. It tries to bring about a link between the theories and practices and identifies the gaps between the same. Lastly, it provides suitable and needful recommendations to be undertaken by organisations in removing the same. Description about the news article The news article which was published on July 02, 2010 brings forth the results of a survey which was conducted on a number of employers in the US over “paid time off work” (HRM Guide, 2010). Three fourth of the employers in USA responded by saying that it was necessary to offer programs of paid time off in order to remain competitive in the labour market. They conducted the programs through traditional and non-traditional ways. There were 1036 numbers of respondents from the benefits and compensation departments in the large corporations in USA. Lenny Sanicola, a member of the WorldatWork said that “time is the new currency and employers remaining committed to providing paid time off as a key employee benefit and reward” (HRM Guide, 2010). The three programs which were used in by employers are the traditional method, the PTO Bank type method and the Unlimited Leave method. The first method was used by 54% of the US companies. Under this program, employees are given particular allotments for vacations, sick and personal days. The PTO Bank model were being used by 40% of the employers under which employees were given a particular numbers of days to be used as leave for individual purposes. The unlimited leave strategy was undertaken by only 1% of the organisations under which employees would be given as many leaves as they wanted. It was seen that majority of the companies in USA were losing numerous dollars in the form of productivity and payroll expenses. The reason was that they were failing to manage the employees’ time off effectively. Employers believed that this would be crucial for successful recruitment, selection and retention of candidates but most of them did not maximise on the value of this aspect in the benefits program. The survey on 421 companies showed that 11% of them provided the time-off programs equally among all the employees. This made it difficult for them to manage and administer. The reports showed that the time-off programs were important tools for increasing attractiveness of organisations as employers but it had become extremely complex. This had made their administration and management difficult. It is crucial that companies undertake such programs which would allow them to quantify and track the time-off that their employees take since the programs involved are as expensive as that involving health care benefits, or overtime and temporary labour. It is realised that employers are the first ones and directly responsible providers of welfare to the employees. It is their involvement with the welfare facilities which accounts for the success of the programs and indirectly benefits the organisation (Durai, 2010, p.405). In doing so, organisation would save numerous dollars in the form of pay-roll expenses. This would not only have a positive impact on the employees’ productivity but also provide them with the satisfaction through these benefits. Application of Theories and Models in practice (Whether HRM care for employees) The following portion reveals that the paid time-off work is one human resource practice that can be followed in organisations as a measure of providing care for the employees. It would also reflect how such programs would make employers more attractive and retain competitive edge in the market. An association has been drawn with regard to application of theories of employees’ benefits in real life. In human resource management, an employee benefit is referred to as the compensation apart from the hourly wages or salaries. Some of the specific employee benefits are paid vacations, coverage of medical and insurance, tuition reimbursements. Apart from the above heads, there can be many other employee benefits varying from organisation to organisation. The following figure would reveal the various dimensions of employees’ compensation. Figure 1: Employee Benefits in the total Compensation Scheme (Source: Martocchio, 2010, p.5) The benefits programs are characterized by three fundamental roles. They are protection, accommodation and enhancement, and paid time-off. The protection programs are meant to provide benefits for the family, promote health, and also provide a shield against income loss because of catastrophes like disability, illness and unemployment. Paid time-offs are primarily effective in compensating the employees when they are performing different activities from the regular and primary work activities. The “accommodation and enhancement benefits“(Martocchio, 2010, p.6) serve for the provision of opportunities for the employees as well as their families. The effectiveness of the scheme was reflected in the news article. As per the news article, an increasing number of companies have been resorting to providing paid time-offs. This includes combination of vacations, incidental sick time, personal days. The benefit of this can be achieved in the form of improvement in cost management as well as giving employees greater flexibility. The popularity and effectiveness of the scheme is also apparent from the results of the survey as present in the article. It demonstrates an increase in the number of companies practicing the scheme in 2010 as compared to that in 2000. It was found that 32% of the companies were presently providing paid time-offs as compared to 18% in 2000. Among the various human resource management schemes which are meant for providing employee welfare, the paid time-off plan has gained immense popularity over the last few years. This has been primarily because of the fact that the workforce has become extremely diverse where employers allow the employees to use their time in the way they choose to. The plans are also effective in reducing the maintenance of administrative records. Under the plan, employers are able to bundle all the PTO (paid time-off) benefits in a single package (Rosenbloom, 2005, p.450). The following figure would reflect a standard sample of paid time-off accrual schedule Figure 2: Sample Accrual Schedule (Source: Guerin & DelPo, 2007, p.142) Following is an example to show the application of such benefits in practice in the organisations. The Developmental Disabilities Institute provides its employees with a very generous package of paid time-off benefit. The benefit includes vacations, program closing, floating holidays, holidays, personal days, sick days. However, the program may vary across different departments (Developmental Disabilities Institute, n.d.). In the St Clair Hospital in Pittsburgh, the benefit is a little more stringent. The employees can accrue for vacations based on the complete years of service and the position status (St. Clair Hospital, 2011). Application of Theories and Models in practice (Resourcing the Organisation) It is seen that the various aspects of human resource management are interlinked and mutually dependent on each other. The effectiveness of the process of resourcing in organisations would depend on the attractiveness of the organisation as an employer. It is not only about recruiting employees, but also retaining them. This includes providing them with the required benefits and working environment which earns the goodwill of employees as a favourable employer. This is extremely crucial for the sustenance of the organisation and remaining competitive in the market. Resourcing is considered to be strengthening of the organisation with the required manpower. It is a dynamic concept and involves moving the human resources within the organisation (Kaila, 2006, p.198). It is considered to be a critical issue for the human resource professionals. This is because, even in times of high unemployment, organisations are seen to be facing difficulties in getting the proper skills. Organisations in Britain and Australia have shown records of failure in providing the young people with the right vocational training. If the organisations are not able to find the right skills, this consequently affects their growth prospects and competitiveness. Organisations employ human resource professionals or personnel specialists for conducting and coordinating employee resourcing. Employee resourcing is undertaken in one of the following three ways (Kaila, 2006, p.198). Reallocating the tasks among the employees with the view that the existing staffs undertakes greater or different responsibilities. In this case, the employer emphasises on the flexible work practices which requires multi skilled workers and the use of sophisticated development and assessment programs. Resourcing can also involve reallocating individuals within the organisation. Traditionally, Japanese and German organisations are shown to fill the management and supervisory posts through people from within the organisation. Finally, resourcing would include recruiting new employees from the existing job market. Nations having the free market traditions have shown to be focussing on recruiting people from outside the organisation (Kaila, 2006, p.198). Recommendations As apparent from the case, it shows that paid time-off have been increasingly used by organisations. It is recommended that organisations design proper benefits systems In this regard, special emphasis can be provided with respect to the paid time-off system. It would allow the companies to quantify and keep track of the time-off that their employees were taking. This would allow the companies to save the numerous dollars which they would otherwise lose in the form of payroll expenses and productivity loss. Apart from directly gaining from such programs, organisations can also make themselves more attractive and favourable as employers to attract candidates. A favourable benefits program reflects the company’s concern for its employees. A favourable benefits program is one such strategy which differs across organisations. However, it is a great determinant of the attractiveness of the company in comparison to its competitors. The main objective of organisations should be to show that the human resource management practices are aimed to maximise the benefits for the employees. Apart from the benefits schemes, it is important that organisations also design proper resourcing strategies. It is crucial that candidates are recruited as per the requirements of the organisation. The recruitment strategies must be proactively undertaken by organisations. In this regard also, it is important that employers try to attract candidates based on the company’s goodwill. Moreover, the process should be transparent and without any loopholes. Recruiting the right candidates would be beneficial in retaining the same employee in the long run. Recruitment can be done from within the organisation or from outside, as per the requirements of the organization. Generally, in the free market economies, the human resources are employed from outside the organisation. The external job market is found to be the best provider of the necessary skills and attributes. Conclusion As revealed in the news article it is apparent that more and more organisations have been resorting to implementing proper employee’s benefits program as a means of staying competitive as an attractive employer and also earning the loyalty of employees. In this regard, the paid time-off scheme has specifically gained importance over the years. The most important aspects in HRM which has been chosen are whether HRM benefits the employees and the resourcing of organisations. The benefits scheme reflects itself as being effective in both resourcing of candidates as well taking care of employees' welfare. This gets reflected through the fact there has been an increasing number of companies which have been implementing such practices since 2000. With regards to the resourcing of candidates, organisations practice both eternal and external resourcing based on the requirement and availability of skills. However, in the free market economies, recruitments are generally done from the external job market. Reference Developmental Disabilities Institute. No Date. Paid Time Off. [Online]. Available at: http://www.ddiny.org/index.php/Benefits-and-Rewards/paid-time-off.html. [Accessed on March 15, 2010]. Durai, P. 2010. Human Resource Management. Pearson Education India. Guerin, L. & DelPo, A. 2007. Create your own employee handbook: a legal and practical guide. Nolo. HRM Guide. July 02, 2010. Managing Time Off. [Online]. Available at: http://www.hrmguide.com/performance/time-off.htm. [Accessed on March 14, 2010]. Kaila, H. L. 2006. Industrial And Organisational Psychology (2 Vols.), Volume 2. Gyan Publishing House. Martocchio, J. J. 2010. Employee Benefits. Tata McGraw-Hill. Rosenbloom, J. S. 2005. The handbook of employee benefits: design, funding, and administration. McGraw-Hill Professional. St. Clair Hospital. 2011. Paid Time-Off Benefits. [Online]. Available at: http://www.stclair.org/127/paid-time-off-benefits. [Accessed on March 15, 2010]. Bibliography Demkin, J. A. 2008. The architect's handbook of professional practice. John Wiley and Sons. Steingold, F. S. & Steingold, F. 2009. The employer's legal handbook. Nolo. Read More