Ethics and Human Resource Management - Coursework Example

Ethics and human resource management Your name:   Course name:         Professors’ name: Date: Business ethics is a vital part of any manager’s job or business owner. The human resources (HR) function in any company deals with many ethical issues or challenges; being the department in a company that deals directly with employees in the company (Miles & Snow, 1984), Human resources includes a lot of ethical issues or pitfalls that can damage company’s financial sustainability or reputation if not handled rightly. Thus, it is important for any business owner or company to understand human resource ethics, whether in a multinational powerhouse or a local startup company (Miles & Snow, 1984). In the period of liberalization and globalization, workers are becoming competitive advantage for businesses. A business may be managed by mediocre but competent employees can be propelled to greater heights. On the other hand, bad workers can cause a successful business to collapse (Danley, 2000). In a competitive business environment, keeping good workers and developing worker’s loyalty in a company has become a continuing challenge and increasingly important. With tight labour market, companies need a strategy to retain their crucial skilled employees (Danley, 2000). Businesses need to retain their employees, businesses must therefore allocate sufficient resource to keep workers satisfied and motivated (Danley, 2000). This paper discusses whether ethics in human resources management have a positive effect on workers or employees loyalty. In recent study by Robert Half International, half of the surveyed company’s executives said that welfare benefits is the most critical factor in workers retention (Wright and Kehoe. 2008). The purpose welfare benefit in a company is to develop the whole personality of an employee in order to make him/her a better workforce. In other words, welfare benefits creates loyal, healthy, efficient and satisfied worker in a company (Stanton, Young, Bartram, & Leggat, 2010). Welfare benefits will have a positive effect on employee loyalty in a company. This effect can be summarized as follows: welfare benefits provide mental and physical health to employees and thus promote a healthy working environment (Stanton, Young, Bartram, & Leggat, 2010). Facilities like medical benefits, education and recreation, and housing schemes facilities for employees’ families help in raising their standards of living. This will make an employee to be satisfied, happy (Stanton, Young, Bartram, & Leggat, 2010), and in return an employee will be able to pay attention in his/her work and thus will increase their productivity in the company. One way in which employers may get a stable labor force is through providing welfare facilities to their employees. This is for the simple reasons that employees take active interest in their work and jobs with a feeling of participations and involvement. Employee’s welfare benefits promote healthy industrial relations at same time increase productivity among employees thereby maintain industrial peace. Almost all companies provide welfare benefits to their workers to retain them and keep their motivation level high. Promotion as a means of retaining an employee can be tricky to a company unless there is justification that such promotion will resolve concerns pertaining to job satisfaction. Reasons that contribute to job dissatisfaction vary; some workers are simply dissatisfied due to poor relationships with their superior or overall working conditions; others employees are bored in their current positions. Promotion is an important aspect of an employee’s life and career, affecting other facets of the work experience. Promotion creates an important aspect of employee’s labor mobility, in most cases it carry substantial salary increment (Beacon, 2001), and will have a significant effect on other job characteristics such as subsequent job attachment and responsibilities (Beacon, 2001). A company can use promotion as a reward for highly skilled or productive employee, creating an incentive for the employee to put more effort (Beacon, 2001). Promotion also helps the company to place employees into different responsibilities, where their skills can be used to greater effect. Because promotions carry with them an increase in work amenities such as spending account or bigger office, some employees might enjoy increase in authority over co-workers which come with promotion, and this will make an employee to be loyal to the company (Beacon, 2001). Review of past studies discloses various factors that enhance employee loyalty and work commitment. According to a survey of 2000 employees by Aon Consulting, recognition of personal and family life was among the top five drivers of employee loyalty and work commitment (Movicerk and Harvey, 2001). This study was backed by survey carried out in 2002 by the Manpower International Employee Loyalty Survey. The survey consisted of 2,680 telephone surveys of HR mangers in Germany, France, Japan, Italy, the U.K, the Netherlands, the U.S. and Australia declared that recognition of personal and family life was among the top five drivers of employee loyalty and work commitment. The two survey show that companies that help employees manage the dual demands of home and work will emerge winners (Bodhwar, 2000). Financial incentive still lures employees away, but almost half of the participants in both survey said it would take a 20 per cent raise to get them to move. While one-third of the participant said they would change jobs for a 10 per cent salary raise. A study at the University of Delaware states that workers are more loyal and are likely to work harder if the company cares for them. Thus companies that take affirmative action to create a conducive work environment whereby a worker is valued can enhance employee loyalty (Wright and Kehoe. 2008). Quality of supervision, fairness and support for worker life style are essential factors in employee loyalty. According to University of Delaware research the following have been found to be the main drivers of loyalty are participation in performance feedback; goal setting, justice in performance appraisals; sufficiency of pay; favorable developmental opportunities; and defining appropriate work behavior (Bodhwar, 2000). If loyalty is defined as being faithful to ideal, cause, or company, then there seems to be a certain amount of infidelity in the workplace. Consider recent survey: MetLife's 10th annual survey of employee attitudes, trends, and benefits released in April puts workers loyalty at a six-year low. The survey found that one in four employees plans to leave his or her current employment by the end of the year. According to Careerbuilder.com 2011 report, 76 per cent of employees, while not actively looking for a new career, would leave their current employment if the right chance came along (Movicerk and Harvey, 2001). Other studies, show that annually, companies loses anywhere from 20 per cent to 50 per cent of its workforce base (Wright and Kehoe. 2008). Among reasons cited for this: a whittling away of benefits, and a generation of young millennials (Danley and Sullivan, 2000). Read More