Managing Human Capital Flashcards
The 6 functions of human resource management
· staffing · training & development · performance management · rewards & benefits · health & safety · employee-management relations
performance management
the HR function that refers to aligning individual employees’ goals and behaviors with organizational goals and strategies, appraising and evaluating past and current behaviors and performance, and providing suggestions for improvement
competitive advantage
doing something differently from the competition that leads to outperformance and success
human resource management
the organizational function responsible for attracting, hiring, developing, rewarding, and retaining talent
rewards & benefits
the HR function that refers to the sum of all of the rewards employees receive in exchange for their time, efforts, and performance
employee handbooks
print or online materials that document the organization’s HRM policies and procedures
employee-management relations
the HR function that refers to industrial relations, more commonly known as unionized employment situation
financial risk
risk related to an organization’s workforce costs and productivity directly through compensation, benefits, turnover, overtime, and time-to-hire and indirectly through errors, accidents, delays, and lost production
direct financial compensation
compensation received in the form of salary, wages, commissions, stock options, or bonuses
indirect financial compensation
all the tangible and financially valued rewards that are not included in direct compensation, including free meals, vacation time, and health insurance
business strategy
defines how the firm will compete in its marketplace
total rewards
the sum of all the rewards employees receive in exchange for their time, efforts, and performance
compliance risk
risk related to employment-related decisions that can have legal ramifications, particularly in the areas of diversity, health and safety, union relations, whistleblowers, and harassment
training and development
the HR function that refers to the growth of employee capabilities through both formal and informal activities; also includes career planning, organizational development, and legal compliance
nonfinancial compensation
rewards and incentives given to employees that are not financial in nature including intrinsic rewards received from the job itself or from the work environment
operational risk
risk related to the speed and the effectiveness of talent acquisition, development of employees’ skills, and the identification and retention of top performers
Strategic risk
HRM initiatives can affect business strategy. These may include the overall talent strategy, company culture, ethics, investments in people, and the implementation of change initiatives.
talent philosophy
A system of beliefs about how its employees should be treated.
human resource strategy
Links the entire human resource function with the firm’s business strategy.
Global mindset
A set of individual attributes that enable you to influence individuals, groups, and organizations from diverse socio/cultural/institutional systems.
shared service center
Centralizes routine, transaction-based HRM activities.
Outsourcing
Hiring an external vendor to do work rather than doing it internally.
professional employer organization (PEO)
A company that leases employees to companies that need them.
Organizational culture
The norms, values, and assumptions of organizational members that guide members’ attitudes and behaviors.
performance culture
Focuses on hiring, retaining, developing, motivating, and making work assignments based on performance data and results.
high-performance work systems (HPWS)
High-involvement or high-commitment organizations.
Ethics
The standards of moral behavior that define socially accepted behaviors that are right as opposed to wrong.
utilitarian standard
The ethical action best balances good over harm.
rights standard
The ethical action is the one that best respects and protects the moral rights of everyone affected by the action.
fairness standard
The ethical action treats all people equally, or at least fairly, based on some defensible standard.
common good standard
The ethical action shows respect and compassion for all others, especially the most vulnerable.
virtue standard
The ethical action is consistent with certain ideal virtues including civility, compassion, benevolence, etc.
Omission errors
Remission errors
Commission errors
a lack of written rules
pressure to make unethical choices
a failure to follow sound, established operational and ethical practices
Codes of conduct
Specify expected and prohibited actions in the workplace and give examples of appropriate behavior.
code of ethics
A decision-making guide that describes the highest values to which an organization aspires.
Federal Sentencing Guidelines for Organizations, six basic elements are important to a complete ethics and compliance program
Written standards for ethical conduct
Ethics training
Providing a way for seeking ethics-related advice or information
Providing a mechanism for anonymously reporting misconduct
Disciplining employees who violate the law or the standards of the organization
Evaluating ethical behavior as part of an employee’s regular performance appraisals
Corporate social responsibility
Businesses showing concern for the common good and valuing human dignity.
stakeholder perspective
Considering the interests and opinions of all people, groups, organizations, or systems that affect or could be affected by the organization’s actions.
Power distance
How much inequality exists and is accepted among people with and without power.
Individualism
The strength of the ties people have with others in their community—high individualism reflects looser ties with others.
Masculinity
The extent to which a culture reflects traditionally masculine (e.g., assertiveness, achievement, and material rewards) or feminine (e.g., modesty, cooperation, and quality of life) traits.
Uncertainty avoidance
The degree of anxiety felt in uncertain or unfamiliar situations.
Long-term orientation
Reflects a focus on long-term planning, delivering on social obligations, and avoiding “losing face.”
Absence rate
Number of employee absences/(average number of employees during the period × the number of workdays)
Cost per hire
Recruitment costs/(cost of compensation + benefits)
Customer service ratings
Average customer ratings of employee customer service performance
Health care cost per employee
Total cost of employee health care/number of covered employees
Innovation
Percent of sales coming from products introduced in the last five years
Workers’ compensation cost per employee
Total annual workers’ compensation cost/average number of employees
Tenure
Average years of service at the organization
Revenue per employee
Revenue/total number of employees
Return on investment (ROI)
[(value of a program or intervention’s benefits - total cost)/total cost] × 100
Profit per employee
Profit/total number of employees
Percent of performance goals met or exceeded
Number of individual or group performance goals met or exceeded/total number of performance goals
Job offer acceptance rate
Number of job offers accepted/number of job offers extended
risk management
Identifying, assessing, and resolving risks before they become serious threats.
Risk assessment
Identifying, analyzing, and prioritizing risks.
Risk control
Risk management planning and monitoring and resolving risks.
Avoidance
: Eliminate, withdraw from, or do not become involved in the situation leading to the risk (e.g., decide not to acquire a company because of poor cultural fit).
Reduction
: Mitigate or reduce the risk (e.g., conduct contingency and succession planning and employee development activities to improve the depth of the company’s leadership pipeline or train all hiring managers and recruiters in common hiring biases, relevant employment laws, and the organization’s interview process).
Sharing
: Transfer the risk by outsourcing or insuring against it (e.g., decide to outsource employee background checks to a qualified vendor).
Retention
: Accept and budget for the risk (e.g., set aside funds to cover equal employment opportunity (EEO) fines, employee severance payments, or lawsuit settlements).
Unfair discrimination
When employment decisions and actions are not job-related, objective, or merit-based.
Fair discrimination
When only objective, merit-based, and job-related characteristics are used to determine employment-related decisions.
Unlawful employment practices
Violate a federal, state, or local employment law.
Equal employment opportunity (EEO)
A firm’s employment practices must be designed and used in a manner that treats employees and applicants consistently regardless of their protected characteristics, such as their sex and race.
Common law
The body of case-by-case court decisions that determines what is legal and what remedies are appropriate.
workplace tort
A civil wrong in which an employer violates a duty owed to its customers or employees.
National Labor Relations Act of 1935
Congress enacted the National Labor Relations Act (NLRA) to protect employee and employer rights and to encourage collective bargaining between labor unions and employers.
Fair Labor Standards Act (FLSA) of 1938
The Fair Labor Standards Act establishes a national minimum wage, overtime rules, recordkeeping requirements, and youth employment standards.
Equal Pay Act of 1963
To promote equal pay for equal work, the Equal Pay Act of 1963 prohibits discrimination in pay, benefits, and pensions based on an employee’s gender.
Title VII of the Civil Rights Act of 1964
Title VII of the Civil Rights Act29 prohibits employment discrimination based on race, color, religion, sex, or national origin and provides monetary damages in cases of intentional employment discrimination. Title VII prohibits not only intentional discrimination but also practices that have the effect of discriminating against individuals because of their race, color, national origin, religion, or sex.
bona fide occupational qualification (BFOQ)
A characteristic that is essential to the successful performance of a relevant job function.
The Age Discrimination in Employment Act (ADEA) of 1967
The Age Discrimination in Employment Act36 (ADEA) prohibits employers from discriminating against any worker with respect to compensation or the terms, conditions, or privileges of employment because he or she is age 40 or older.
The Rehabilitation Act of 1973
The Rehabilitation Act of 197340 requires employers to engage in affirmative action to promote the hiring of individuals with a disability.
Reasonable accommodation
An employer is required to take reasonable steps to accommodate a disability unless it would cause the employer undue hardship.
Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA) (Amended in 2002 by the Jobs for Veterans Act)
The Vietnam Era Veterans’ Readjustment Assistance Act43 (VEVRAA) prohibits discrimination against protected veterans and requires federal government contractors and subcontractors with a contract of $25,000 or more with the federal government to take affirmative action to employ and promote protected veterans.
The Pregnancy Discrimination Act of 1978
The Pregnancy Discrimination Act of 197844 amended Title VII of the Civil Rights Act to prohibit sex discrimination on the basis of pregnancy.
Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1986
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health plan benefits.
The Immigration Reform and Control Act of 1986
Under the Immigration Reform and Control Act, employers must use an I-9 verification form to verify the employability status of every new employee within three days of hiring.
The Worker Adjustment and Retraining Notification Act (WARN) of 1988
The WARN Act is a federal law requiring employers of 100 or more full-time workers who have worked at least six of the last 12 months and an average of 20 hours or more per week to give employees 60 days’ advance notice of closing or major layoffs.
The Americans with Disabilities Act (ADA) of 1990
The Americans with Disabilities Act (ADA) and the Americans with Disabilities Act Amendments Act that became effective on January 1, 2009, guarantee equal opportunity for individuals with disabilities or perceived as having disabilities.
Disability
The condition of a person who has a physical or mental impairment that substantially limits one or more major life activities, has a history or record of such an impairment, or is perceived by others as having such an impairment.
Family and Medical Leave Act of 1993
The Family and Medical Leave Act (FMLA) of 1993 (amended by the Family and Medical Leave Act and National Defense Authorization Act of 2008) requires eligible employees at worksites with at least 50 employees to take unpaid, job-protected leave for specified family and medical reasons with continuation of group health insurance coverage under the same terms and conditions as if the employee had not taken leave.
The Uniformed Services Employment and Reemployment Rights Act (USERRA) of 1994
The Uniformed Services Employment and Reemployment Rights Act of 199460 (significantly updated in 1996 and 1998) prohibits employers from discriminating against job applicants who may be called into military service or who volunteer for military service.
The Health Insurance Portability and Accountability Act of 1996
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires the Secretary of Health and Human Services to publicize standards for the electronic exchange, privacy, and security of health information.
The Genetic Information Nondiscrimination Act of 2008 (GINA)
The Genetic Information Nondiscrimination Act prohibits employers from discriminating against individuals based on the results of genetic testing when making hiring, firing, job placement, or promotion decisions.
The Patient Protection and Affordable Care Act of 2010
The Patient Protection and Affordable Care Act, often shortened to the Affordable Care Act (ACA) or nicknamed Obamacare, is a federal law that took effect on March 23, 2010.
Global Differences
Employment laws also vary across countries. Some countries make it much more difficult to terminate an employee than in the United States, and others give different legal rights to blue- and white-collar employees.
Affirmative action
Proactive efforts to eliminate discrimination and its past effects.
Protected classes
Groups underrepresented in employment.
affirmative action plan
Describes in detail the actions to be taken, procedures to be followed, and standards to be met when establishing an affirmative action program.
Preferential treatment
Employment preference given to a member of a protected group.
independent contractor
An individual or business that provides services to another individual or business that controls or directs only the <em>result</em> of the work.
Sexual harrassment
Unwelcome sexual advances, requests for favors, and other verbal or physical conduct of a sexual nature.
quid pro quo harassment
Unwanted verbal or physical conduct of a sexual nature made as a term or condition of employment or as a basis for employment and/or advancement decisions.
hostile environment harassment
Unwanted verbal or physical conduct of a sexual nature that creates a hostile, intimidating, or otherwise offensive working environment.
Disparate treatment
Intentional discrimination based on a person’s protected characteristic.
Adverse impact
An employment practice has a disproportionate effect on a protected group, regardless of its intent.
Race norming
Comparing an applicant’s scores only to members of his or her own racial subgroup and setting separate passing or cutoff scores for each subgroup.
Fraudulent recruitment
Misrepresenting the job or organization to a recruit; also known as “truth in hiring.”
Negligent hiring
A company is considered responsible for the damaging actions of its employees if it failed to exercise reasonable care in hiring the employee who caused the harm.
Stereotypes
Believing that everyone in a particular group shares certain characteristics or abilities or will behave in the same way.
