Human resource management Essay
Human resource management
With reference to the employment relationship and employment market, discuss the reasons for the changing dynamics of the contemporary employment market, that is, the rise in flexible working, and the resultant range of job patterns, which characterise the modern workplace. These issued should be addressed in the context of your own area of study and supplemented with appropriate examples and case studies.
The term’s “employee relations” and more traditionally, “industrial relations” are used to indicate those areas of the employment relationship in which mangers deal with the representatives of employee’s rather than managing employee’s directly as individuals. (Edwards 1995). This essay will endeavour to examine the interaction between employer and employees. It will also examine the dynamic work patterns shaping the modern employment market and reasons why many organisations are adapting a range of suitable job patterns for their employee’s. As these job patterns occur legislation has developed concerning Contingent Employment.
The proposed thought that flexible job patterns could help firms, as a whole will be discussed later, along with whether or not employees need a source of protection from employers. Although there is legislation that covers a vast area of employee’s rights, the balance of power was thought to still have laid with the employer in the early 1990’s. This was because legislation through the 1980’s aggressively hit the trade unions, cutting their powers. At this time redundancies and unemployment was high, so employers had to reassure employees that they were being valued and were being treated equally and fairly and that there was no imbalance of power.
WORKING CONDITIONS AND FLEXIBILITY WITHIN ORGANISATIONS.
As we can see in everyday life our world is ever changing. We only have to look at supermarkets that are open for business seven days a week along with many more businesses, such as restaurants and public houses. Along with this come new working patterns. Although in some organisations the traditional hours still exist i.e. 9-5, five days per week, there are many new patterns evolving to suit the changing requirements of business. These include part-time work, temporary work etc. which will be discussed in greater detail later in the assignment.
Charles Handy (1989) views the new emerging work environment as consisting of three pools of people. (Core employee’s) specialised who are likely to be senior management and are likely to work longer hours. (Contracted professionals) are not part of the organisations central work but specialise in a specific field. (Temporary Staff) who are called upon as and when required. These new working patterns may well have emerged within the global labour market due to: lack of skilled labour, job sharing, part-time work, and career breaks etc. These issues will be discussed later in the essay.
With-well qualified job candidates still scarce, employers wont be scaling back on such core benefits on family-friendly work arrangements – flex time, job sharing and telecommuting. If anything, companies are expanding, not contracting flexible working schedules because they’re cheap to implement. Nearly 60% of firms surveyed by the Society of Human Resource Management offer such arrangements, is up to 51% last year.
When there are layoffs, says Jon Van Cleve of Hewitt Associates, flexible working options become even more critical to the performance of remaining employee’s who find themselves working harder.
(Wilcox, M.D (2001) “Kiplinger’s Personal Finance” Vol 55 No. 6, pp.17-18).
HSBC Bank lost 70% of the Banks maternity leave prior to the introduction of their childcare programme. In 2001 and is in it’s thirteenth year of the nursery programme with 85% retention figure for female staff.
(Anonymous) (2002) “The British Journal of Administrative Management”
CASE STUDY (MTM Products)
After reading a journal article from (The British Journal of Administrative Management) I decided to use the material to print a clear picture just how different working patterns are changing people’s lives and in this case for the better. This helped me understand the aspect of working patterns much better. MTM Products have manufactured labels and name plates for over 30 years and are situated in the East Midlands.
By 1996 the company had been making dramatic losses for several years and changes were imminent. MTM offers 26 different working patterns to its 31 employees. Importantly the company is now making a profit and its performance is in the top ten of the sector. It has been able to extend the working day at its key plant, staff turnover is almost negligible and last year absenteeism was just an average of two days per person. Equally, employees are happier now that they are able to balance their working hours with their lifestyles. The case studies concerned problems of an employee whose child was having problems at school.
Balancing the demands of work and life can improve businesses competitiveness and encourage individuals to perform in their workplace.
Alan Johnson (Employment Relations Minister)
See (APPENDIX 1.O) for Case Study
Still on the case of advantages of flexible working as well as employees being happier at work and contributing more I also believe it brings more enthusiasm and greater job satisfaction. They might well bring new ideas to the company cause they know senior figures within the organisation are willing to listen.
Employee’s views on flexible working. (Disadvantages)
Although in theory flexible working seems perfect for some organisations it doesn’t always work out in practical terms. Some workers may find that in terms of pay and benefits they are treated unequal, although equality has been created between full and part-time workers in terms of statutory rights through Employment Protection Regulation (1995), now incorporated into the Employment Act (1996). This has allowed part-timers equal rights to contractual terms, including staff discounts and access to training and promotion opportunities. Workers may still feel that they receive limited training and if they have received training in any context may have deemed it inappropriate. In my own personal experience when I was working in Woolworths the person who trained me had only been there four weeks before me on the shop floor. The impression I got was that nobody cared and that is likely to reflect down through the company.
Job security is also an issue. People may feel that since they are only working a few hours a day and some as and when required, they may feel a sense of insecurity which may lead to the employee in question becoming stressed.
Employers are oblivious to the ï¿½370m workplace stress costs industry each year. Only 28% realise just how much stress is really hitting, according to research carried out by the Department of Trade and Industry’s (DTI). Stress-related sick leave costs industry ï¿½7.1million every week. The findings also showed that:
ï¿½ 57% of employers had never considered offering job-sharing schemes;
ï¿½ 56% had never considered flexible working locations, such as working from home;
ï¿½ nearly (48%) had never considered offering any form of benefits packages;
ï¿½ nearly (11%) said they had never considered any part-time working options.
Alan Johnson, Minister of State for Employment Relations, said: “It’s a real concern that so many employers don’t know how much stress and absenteeism is costing them”.
This then leads me onto discuss the aspect of teleworking. Developments in communication and technology means that workers are no longer required to be in the office in order to fulfil tasks. This type of work is associated with employees who no longer need to travel to work as this can be done through technology. After reading a case study from (The British Journal of Administrative Management) concerning teleworkers, working for The Cooperative Bank in Manchester helped me get a clearer view of the situation. This article is a prime example of today’s fast moving business environment and appreciates the possibilities of employees becoming isolated. It did not however mention how some managers have different styles and may feel uncomfortable managing teleworkers. However, in this case the manager is a teleworker, which I think is an excellent idea.
See (APPENDIX 1.1) for case study.
THE FLEXIBLE FIRM
The logic of the flexible firm is that employers can respond quickly to changes in the economic climate by maintaining a periphery of workers who can be dismissed at short notice.
Quite a bit of attention has been given to the ‘flexible firm model’ developed at he Institute of Manpower Studies, principally by Atkinson. This model outlines different practices that would enable organizations to adjust to market and technological changes, more quickly, smoothly and cheaply. Apart from the forms of flexibility outlined such as;
1. Functional which is a firm’s ability to adjust and deploy. (Multi-tasking).
2. Numerical which is a firm’s ability to adjust labour inputs to produce more output.
3. Pay – flexibility through the pay and reward structure.
The flexible firm will also employs’ distancing strategies’ which involve sub-contracting. Functional flexibility is provided by ‘core’ employees and numerical flexibility through the use of ‘peripheral’ workers who are either temporary or sub-contracted.
As you are able to see from the diagram over leaf the model is divided into three sections, which consist Prime employees, Secondary employees and Outworkers.
Prime employees are usually seen as an asset to the organisation not a cost. These are employees that have been invested inand have a good knowledge in their particular field. They are likely to be senior management with long-term commitments to the organisation.
Secondary employees are direct employees on temporary or part-time contracts. As we can see from the diagram the four pools mentioned are: Temporary, Fixed-term contract, Job Share and Part-time.
The Trades Union Congress (TUC) has highlighted the plight of the Uk’s 1.7 million temporary workers. According to TUC, almost half of temporary workers get paid less than permanent staff. They also miss out on a range of benefits, such as equal pay and pensions that are automatically given to permanent staff. While there is some protection for temporary workers, many do not have access to sick leave or holiday pay.
So what rights do you have if you’re a temporary worker?
Every worker including those who work on a temporary basis or on a fixed term contract is entitled to 20 days holiday (including bank holidays) each year from their employer. Under old rules people could not start earning time off until they had worked for 13 weeks.
Since 25th October 2001 and following a European Court ruling, workers can start earning paid leave from day one. This was due to arguments that bosses were trying to avoid paid leave by offering 13-week contracts. If the temporary worker is working through an agency i.e. Grafton Recruitment, the agency is their employer not the company they work for on a day-to-day basis. All workers must be paid at least the minimum wage and some employers believe companies that pay more than the law in certain industries builds loyalty.
Unfair Dismissal can be claimed if a worker continuously has worked for the same company for one year. However, there are quite a few loopholes for people who do not meet this criteria, which can help temporary workers. These may include pregnancy or if your boss is unwilling to provide an itemised payslip.
Pay and Pensions
Temporary staff is not entitled to equal pay or pensions as these offered to permanent staff. Trade Union Congress wants the governments to include these benefits within a European Union Directive.
Fixed Term Contracts
Newly appointed staff on fixed term contracts, or staff on recently extended contracts may no longer waive their rights to claim unfair dismissal. This does not affect staff appointed on fixed term contracts commencing prior to 25th December 1999 unless the appointment is extended after this date. However, it still stands that staff can be required to waive the right to a redundancy payment. People who have the right to redundancy pay are permissible if the initial term is for two years or more.
If a fixed term contract is issued for two years, but the employer discovers after six months that he/she is unsuitable, a poorly worded contract could see the employer liable to pay the full two years salary.
Major Features of a Fixed-Term Contract
1. Length of the contract, showing the date in which it will become void.
2. Non-renewal at the end of a fixed-term contract is a dismissal.
3. Service over a series of fixed-term contracts can be aggregated to constitute continuity of service.
4. Employment rights of staff on fixed-term contracts.
This scheme was partly developed through women who didn’t wish to return to full-time employment after maternity leave but wish to continue with their careers working less hours. These are skilled workers and companies have realised this is one way regaining their employment and not wasting the money and time invested in them. Job share also brings additional flexibility in terms of availability of staff when there are heavy workloads. Also, worker’s maybe more obliging because of arrangements to meet staff needs. Not only does job-share apply to women, it might well suit men wishing to earn extra income i.e. working at night. Job share may also bring more intelligence and views to the job from employees.
Disadvantages of Job Share
Say for instance there are two employees sharing a specific job and there is friction between them, communication may well break down which would not be good for the organisation, as important tasks may not be completed. Problems may also arise due to supervision and management as employees may find it difficult working for two supervisors etc. Work also needs to be allocated fairly and extra expense may occur for the organisation due to extra training and administration for two people.
There are three main types of part-time work, these are:
Classical – for e.g. cleaning, jobs such as these does not need full-time cover.
Supplementary – this were part-time staff replace full-time staff at busy periods and are usually paid less.
Job Share – this has just been mentioned above.
Part-time employment increased in the early 1990’s. Employees are employed to cover at peak times, but may well affect their morale for those looking for full-time employment. With improvements in the Employment Protection Act for part-time workers it may have encouraged employers to implement the annual hours system. This is were employers estimate how many hours an employee may be needed over a period of a year and contracts them to it at the standard rate, which cuts down on over time.
Part-time workers have generally a lower absence than full-time staff and are less likely to be members of the union, which is good news for the employer. However, according to the EU part-time workers directive it would be illegal for an employer to discriminate against an employee because of his/her part-time status.
In 1998 a set of draft regulations was published by the government relating to the EU directive on working time, which was to be implemented by October 1998. These included:
? Paid Annual Leave
In the year the legislation was introduced paid leave was to be three weeks and four weeks after 1999.
? Working Hours
Maximum of 48 weekly working hours averaged over a period of seventeen weeks, although there can be an agreement made to work more between the two parties, but employees are not obliged to do so.
Groups of workers not covered would be air, sea, and road transport etc.
? in any 24-hour period, there should be eleven consecutive hours of rest
? At least 20 minutes break if the work exceeds six hours.
? 24 hours break in every seven days.
The EU and UK Employment Law.
The EU law takes effect in a number of ways, the most important being regulations which have direct effect in member states (i.e.) override domestic law) and directives which have to be implemented through national legislation. Some directives (i.e.,) improvement in health and safety, can be adopted by majority voting, which means that they must be enacted by all member states, including the minority that voted against them.
Foot and Hook (1999)
Employment Relations Act 1999
New rights to maternity and parental leave and rights for part-time workers are contained in the Employment Relations Act 1999, the Maternity and Parental Leave Regulations 1999 and the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000. These new provisions represent one of the most significant legal advances for working people and their trade unions for over 20 years.
Out-workers are not directly employed by the business.
1. Agency staff – an example would be Grafton recruitment hiring people for a certain company and then taking a percentage of the hourly rate the company is offering.
2. Bought-in products and services.
3. Mergers and Takeovers – businesses buying other businesses are companies merging to become a stronger force.
4. Consultants – maybe to give company advice on certain aspects arising.
5. Contractors – this is work is sub-contracted out to a company which specialise in a specific field i.e. building contractors.
Three major arguments are used to explain the use of contingent workers by focusing primarily on their advantages in providing flexibility, expertise and labour cost savings. First it was argued that firms use contingent workers because they can provide numerical and financial flexibility, enabling them to adjust staffing levels to uncertain market demands more easily than permanent employees. (Atkinson 1985) or who are subject to bureaucratic policies and regulations that limit their hiring and firing (Abraham, 1990). Furthermore, the use of contingent workers also reflects changes in the organisation design and adoption of new work technology that can enhance flexibility. (P’feffer 1994)
Wong, M.L (2001) Human Resource Management Journal vol. 11.
CASE STUDY (MANCHESTER COOPERATIVE BANK)
Kirsty Milne worked for the Cooperative Bank in Manchester for 15 years. She lives 35 miles from the Bank Office’s and used to spend over three hours per day travelling. Since 1995 and through arrangements with senior staff she has been teleworking.
Kirsty now works 35 hours per week from her home and is the team leader for all teleworkers. It involves her in helping them develop skills that will enable them to move upwards through the bank as promotions occur. All the teleworkers are still part of the Managed Account team and attend meetings at the bank once or twice a month depending on situations and workload.
Although this suited Kirsty, the bank is very careful how they select people, particularly because of the potential threat of isolation. Employees also need to be highly motivated. The bank supplies all equipment required and the home of the teleworker is inspected from a health and safety point of view. Teleworkers within the bank need a minimum two years experience, as they require sound knowledge of the banks products.
CASE STUDY (MTM PRODUCTS)
Hayley Lowry who worked at MTM stopped working after her son was born. She returned to work when he was four years old as a packer. She only worked one week in every month to begin. Soon after she was asked to increase her hours and be retrained as a screen printer working between 9am – 3.15pm term time only.
When her son had problems settling in at school Hayley considered three choices. 1 – leave the company 2 – work from home 3 – change her hours.
After discussing her problems with senior management, an agreement was reached to change her hours. She was now to work from 9-11.45am and 1.15pm – 4.50pm still providing cover for the main printers morning and afternoon. This meant Hayley could still take her son home every lunch- time and he became more settled. She then returned to normal working hours once her son settled. Without this arrangement she would have been unable to return to work.
Managing Director Ian Greenaway quoted “the company employs 30 brains as well as 30 arms and legs”. Findings showed flexibility with employees allows them to reciprocate. Its not just the case of people working reduced hours, if people are allowed to work hours or work patterns that balance their work and home lives experience shows they are likely to contribute more to the business.
This essay has examined the different job patterns organisation have adapted with relation to Atkinson flexible firm model 1984 and legalisation concerning contingent workers.
In my opinion businesses need to be smarter when it comes to beating these common problems. Work-life balance policies such as flexible working, job sharing and employee benefits don’t require a huge cash investment – just a good approach. Employers have to start to realise that employee’s are much happier when there is a balance between work-life and this is likely to reflect in their work.
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Redman, T and Wilkinson, A. (2002) Contemporary Human Resource Management Text and Cases, Prentice Hall, London.
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