CH7 - HRM Approaches To Managing And Controlling Performance

Question 1

What is purpose of Human Resources management?

Answer 1

As part of resource based view of strategy, Human Resources are a potential source of competitive advantage.
However, benefits come at a cost-recruitment, retention and training.
Therefore effective management of Human Resources is a vital part of an organisations success.
A management accountant needs to understand the importance of good managerial practices and how to get the best of people. This encompasses recruiting and selecting, development and reward, performance management, and ensuring legal requirements relating to HR are met. All this has the aim of helping the organisation meet its strategy.

Question 2

In HR context what is management control?

Answer 2

Control is a primary task and is the process of ensuring the operations process according to plan.
Control will need to be exercised over recruitment of staff, their performance and legal requirements connected with employment

Question 3

Distinguish the different levels of control within an organisation

Answer 3

Strategic-setting the control

• strategic planning determine course to be taken
• board procedures which will include appointment of directors,segregation of duties etc
• setting,reviewing organisational structure
• policies on the conduct of the business, financial performance measures, risk assessment, environmental and ethical issues etc
• monitoring compliance with plans and policies set

At this level policies on recruitment, selection, appraisal, discipline, training and reward of employees will be set

Tactical -controls should be in place to implement the decisions and policies of the board. Controls include-

• tactical planning, determining the production requirements and production schedule
• production budget
• procedures governing recruitment, training,risk management etc
• monitoring achievement to plans and policies set

At this level procedures for controlling recruitment, selection,appraisal, discipline, training and reward of employees will be established and monitored.

Operational - occurs a lower level of organisation-designed to control structured, routine, repetitive activities according to preset rules eg-
*computerised stock control
*production scheduling
*order processing systems
At this level controls established at higher levels are intergrated into day to day operations. Control failure are highlighted and escalated

Question 4

Internal control systems exist to enhance achievement of organisational objectives. They promote orderly and efficient conduct of business, help it stay on course and help it change safely.

In CIMA’s framework of control, the control system is seen as consisting of what?

Answer 4

The control environment- includes management Philosophy, operating style and managements policies

Control procedures- includes control mechanisms such as segregation of duties, authorisation, reconciliation etc.

Today, one of the most important systems of control is the HR System as its essential to get right. HR is responsible for

• Appraisal system
• Health & Safety
• Discipline and grievance
• dismissal and redundancy
• Fairness in the workplace

Some are management control whilst other are legal requirements

Question 5

A legal requirement, Management must identify health and safety risks, decide how to control them and put appropriate measure in place.
What are the benefits of health and safety controls?

Answer 5

• Employers legal obligations are being met
• cost savings-Accidents and illness cost the employer money in legal damages and operating costs
• Company image - no company wants to be associated with a poor health and safety image
• preserving well being of employees and others improves morale, motivation and trust

Question 6

Briefly, describe health and safety at work act

Answer 6

Every organisation employing 5+ people required to prepare and revise health and safety policy statement of
*their policy for health and safety 
*the organisation to enforce it
*the arrangements to implement it
And bring it to attention of employees

key areas-

• Provide and maintain risk free plant and systems of work
• ensuring safety in use,handling,storing and transport of articles and substances
• provide information, training,instruction and supervision
• maintenance of a safe workplace
• means of exit and entry
• adequate facilities

Senior member of organisation should be responsible for implementing, may be supported by safety officers
Employees also have basic responsibility

The health and safety executive provides workplace inspections and ensures compliance

Large organisation should have a safety committee, smaller ones can choose to have a committee or have safety meetings

Question 7

“Discipline” bring to mind authority or force and carries the disagreeable meaning of punishment. There is another way to think of discipline, what is it?

Answer 7

Latin “distipulus” meaning learner or pupil.
Discipline means learning
Discipline is present when the members of the enterprise follow goal or objectives sensibly without conflict and conduct themselves according to the standards of acceptable behaviour.
Discipline can therefore be consider as positive when employees willingly follow or go beyond the rules of the organisation.
Discipline is negative when employees follow rule over strictly, disobey regulations and violate standards of acceptable behaviour .
Main purpose of disciplinary action is to achieve a change in behaviour so that future action is unnecessary

Question 8

What issues do disciplinary rules usually cover?

Answer 8

Absence, lateness, leaving early
Defective or inadequate work performance
Breaking safety rules or other regulations and procedures
Refusing to carry out a legitimate work assignment
Poor attitude which influence work of others or which reflects on public image of firm.
Improper use of company equipment
Discrimination
Bullying and harassment

Question 9

What is the process for handling disciplinary procedures?

Answer 9

Informal talk
Oral warning
Written or official warning 1st and 2nd
Suspension 
Demotion 
Dismissal 

Good procedure can help organisations resolve issues internally so avoid employment tribunal claims

Question 10

Organisations can be flexible about how formal or extensive their procedures need to be regarding disciplinary, but there is a minimum statutory procedure they must follow if they are contemplating dismissal or suspension,demotion. If not adhered to employment tribunal would automatically regard dismissal as unfair. What is the statutory procedure?

Answer 10

A statement in writing of what employee is alleged to have done
A meeting to discuss the situation
The right of appeal

Question 11

the ACAS code of practice states that disciplinary procedures should :

Answer 11

Be in writing

Specify to whom they apply

Provide for matters to be dealt with quickly

Indicate the disciplinary action that may be taken and what level of management has authority

Provide individuals to be informed of complaints and have an opportunity to reply.

Give right to be accompanied by fellow employee or trade union representative

Ensure that no employees are dismissed for a first breach of conduct (except in gross misconduct)

Ensure no disciplinary action is taken until the case is fully investigated

Ensure an explanation is given for any penalty imposed

Provide a right of appeal and specify the procedure to be followed

Question 12

What advice could you give to someone on handling discipline?

Answer 12

1. Encourage improvement
2. Act promptly -nip in bud?
3. Gather the facts- manager should be objective as possible, once gathered
   - drop the matter if trivial
   - arrange counselling/take informal action -in attempt to correct a situation without using disciplinary procedure
   - arrange a disciplinary meeting-this will be necessary when the matter is considered serious enough to require disciplinary action.
4. stay calm
5. Be consistent
6. Consider each case on its own merits
7. Follow the disciplinary procedure
8. Where there appears to be serious misconduct, consider suspension with pay whilst the matter is investigated.

Question 13

Explain Douglas mcgregors hot stove rule

Answer 13

Comparison between touch a stove and discipline.
When you touch a hot stove the reaction is
immediate
Consistent
Impersonal
With warning

Comparison between hot stove rule and disciplinary action is that the discipline should be directed against the act and not the person

Question 14

Grievance not same as disciplinary. Grievance occurs when they feel they have been treated wrongly by superiors and colleagues.
What sequence does grievance procedure often follow?

Answer 14

Employees discusses grievance with a colleague or staff/union representative.
It grievance is warranted, it’s taken to employees immediate superior
If they can’t help, it goes to superiors manager at which stage HR should be informed.
Distinction should be made between individual and collective grievance
Colleague or staff/union representative should be permitted to be involved.
Timeframes and deadlines should be stated to resolve the issue or submit an appeal

Question 15

What is a tribunal?

Answer 15

If an employee is not happy with the outcome of a grievance procedure they can make a claim at an employment tribunal. An independent judicial body, less formal than court, which aims to hear claims and resolve disputes between employers and employees over employment rights.
Eg
Unfair dismissal
Breach of contract
Discrimination 
Equal pay

Question 16

How can you resolve disputes without tribunal?

Answer 16

Arbitration-
an independent arbitrator hears the case and delivers a legally binding decision in favour of one party. Used to decide cases of alleged unfair dismissal or claims under flexible working legislation.
Benefits are speedy private informal hearing,no cross examination, limited grounds for review of arbitrators decision

Mediation- impartial third party facilitates discussion and encourages the to reach a mutually satisfactory conclusion. Benefits are speedy resolution,avoid stress of formal hearing and parties can express their view to each other

Conciliation - used to settle a dispute before it goes to tribunal. Involves trying to build a positive relationship between disputing parties. Benefits- confidentiality, less time and stress than tribunal,lessening damage to employment relationship, reaching agreement that satisfies both parties

Question 17

What are the benefits of a discipline and grievance procedure?

Answer 17

Employers legal obligations met
Cost savings-fewer cost for legal damages
Company image- company wouldn’t want association with a discipline and grievance record
To preserve well being of employees and others, improves morale,trust and motivation

Question 18

Under uk law dismissal is described as termination of employment, with or without notice from the employer, or in the case of constructive dismissal, resignation by the employee because of the employers conduct. Dismissal without notice is wrongful dismissal;that is breach of the contract of employment; it may or may not also be unfair dismissal.

When is dismissal deemed fair?

Answer 18

• reason related to employees conduct
• reason related to employees capability or qualifications for the job
• because a statutory duty prohibited the employment being continued
• because the role was redundant

Question 19

What is redundancy ?

Answer 19

A type of dismissal, may be justified on following grounds-
Cessation of business
Cessation in the place where employee was employed
Cessation of the type of work for which he/she was employed

Question 20

What are Rosseau and Greller’s 3 types of psychological contract?

Answer 20

Coercive - employees feel forced to contribute and view rewards as inadequate. Motivation and commitment would be low

Calculative - employee act voluntarily and work in exchange for an identifiable set of rewards. Motivation and commitment could be increased if rewards increase.

Cooperative - employees contribute more than would normally be expected. They actively seek to contribute further to the achievement of company goals. Motivation and commitment is linked to achievement.

Motivation is bound to be highest when both employee and employer view the contract in the same way.

Question 21

Solomon looked at achieving equality in relation to pay. What are the considerations ?

Answer 21

A living wage (compare employee needs and income)

Rate for job (compare employees carrying out same role)

Output reward (compare output of employees working in same area)

Responsibility (compare responsibility of employees at different levels of organisation)

Differentionals - (compare employees carrying out different roles within the organisation)

Comparability - (compare employees carrying out same roles in different organisations)

Status ( compare employees different roles in different organisations)

Contribution (compare employees pay to profitability of organisation)

Supply and demand (compare organisations ability to pay and its need for labour)

Question 22

What is equality act 2012?

Answer 22

Brings together and strengthens a number of existing pieces of legislation, including race and disability. Covers-
Age
Disability 
Gender reassignment 
Marriage and civil partnership
Pregnancy and maternity 
Race 
Religion 
Sex
Sexual orientation 

Whether they are trade union member or not
Whether they are part time worker or not

Under the equality act it is unlawful to discriminate on any of the above.

Question 23

What the main points of a typical equal opportunities policy?

Answer 23

• fairness for all; recognition, development and use of everyone’s talents
• this fairness will run through recruitment, selection, training, promotion, specialisation and career development generally. It should also govern the relationship of all employees to each other
• Equal opportunity does not just relate to sex or marital status, but the fact that people can be disadvantaged for those reasons is reflected in the legislation
• no job applicant or employees shall receive unfavourable treatment directly or indirectly on the ground of race,gender,sexual orientation,marital status, nationality, religious beliefs, trade union membership, age or disability etc
• selection criteria and procedures will be frequently reviewed to ensure individuals are selected, promoted and dealt with on the basis of merit, fitness and competence.
• training is an important part of the implementation of an equal opportunities policy. Training will be arranged to ensure that staff are made fully aware of their roles and responsibilities and have the opportunity to develop and progress within the organisation.

Question 24

What are the differences between equal opportunities and diversity?

Answer 24

Equal opportunities. Diversity

Removing discrimination. Maximising potential
Issue for disadvantaged groups. Relevant to all employees
A Human Resources role. A managerial role
Relies on proactive action. Does not rely on proactive action