Human Resource Management Final
Discuss the three major provisions of the FLSA and the penalties for misclassification of employees. Know the difference between an exempt and non-exempt employee.
1. Minimum wage rates identify the lowest hourly rate of pay generally allowed under the FLSA. There are many exemptions; but if a person is nonexempt, minimum wage willapply. 2. Overtime rates are also required for persons who are nonexempt. However, there are different exemptions for overtime than there are for minimum wage, so HR managers must check the law to determine who will have to be paid overtime. 3. Child labor requirements within the FLSA identify the jobs and allowable working hours for individuals between 14 and 18 years old. Sixteen- and 17-year-olds can be employed only in nonhazardous jobs, but their work hours are unrestricted. However, 14- and 15-year-olds can work only outside school hours, and the jobs that they are allowed to do are limited to retail and other service positions. They may not work overtime. The employer can personally be criminally prosecuted and fined up to $10,000 per misclassification infraction. There is no maximum limit to the allowable fines, so fines in the millions of dollars have been assessed in the past. A second conviction can result in imprisonment. Employers who willfully or repeatedly violate the exemption rules may be assessed civil penalties of up to $1,100 per violation. For child labor violations, the civil penalty can be up to $11,000 per worker for each violation and can go to as much as $50,000 or even $100,000 if the violation causes the serious injury or death of an employee younger than 18 years old.
Identify the major labor laws in the United States and the other legal issues in labor relations
1. The Railway Labor Act of 1926 was enacted to force negotiation between labor and management, first in railroads and later in the airlines, to prevent shutdown of these critical services. 2. The National Labor Relations Act of 1935 was the first major law to deal with the rights of labor to form unions in the general workforce and collectively bargain with employers. It identified unfair labor practices for management in negotiating with labor organizations. 3. The Labor Management Relations Act of 1947 was an amendment to the NLRA that focused on unfair labor practices on the part of unions and other labor organizations. It outlawed or restricted a variety of strikes and boycotts, and it also allowed the states to pass right-to-work laws. 4. The Labor Management Reporting and Disclosure Act of 1959 was passed as a result of congressional investigations linking organized crime with labor unions. The LMRDA required a series of reports from labor unions and created restrictions on their activities. 5. The Worker Adjustment and Retraining Notification Act of 1988 required that organizations with certain qualifying characteristics should provide 60 days' notice when laying off more than 50 people or closing a plant. Other legal issues discussed include corporate whistle-blowers; express-, implied-, and quasi-contracts; and wrongful discharge and constructive discharge.
Briefly discuss EAPs, EWPs, and ergonomics and what the value of each of these is to companies and employees. Briefly discuss the causes of stress and how it can be managed.
EAPs and EWPs both help employees with their work-life balance. EAPs provide confidential counseling and other personal services to employees to help them cope with stress created by personal issues related to either work or home life. EWPs help employees with their physical wellness. They provide programs to employees such as health education, training and fitness programs, weight management, and health risk assessments. Ergonomics is the science of fitting workplace conditions and job demands to the capabilities of the working population. The goal of ergonomics is to reduce stress and limit injuries due to overuse of muscles, bad posture, and repetitive tasks. OSHA provides guidelines on ergonomics in the workplace that are voluntary but that can be assessed during an inspection based on the general duties clause of the OSH Act. OSHA also has specific ergonomic guidelines for a number of different industries, so HR representatives should check to make sure that they are following OSHA guidelines based on the industry that they are a part of. The major causes of stress include personality type, organizational culture and change, management behavior, type of work, and interpersonal issues. Type A personalities, weak organizational cultures and rapidly changing organizations, bad management, jobs that employees don't enjoy, and poor interpersonal relations all make stress more prevalent in the workplace. Stress management techniques include good time management skills, the ability to relax once in a while (in whatever form you choose), good nutrition, moderate amounts of exercise, positive thinking skills, and a strong personal support network. All of these tools help us cope with stress successfully.
Briefly discuss the union certification process, the NO TIPS rules for labor elections, and the concept of collective bargaining
Employees organize and select a union to represent them and then attempt to collect authorization cards from at least 30% of the employees in the appropriate bargaining unit. If they get 30% or more, an election will be called by the NLRB. If more than a simple majority vote for the union, the collective bargaining unit is certified by the NLRB; if not, then the union vote fails. NO TIPS is an acronym that stands for No Threats, No Interrogations, No Promises, and No Spying. This means first that employers cannot threaten to terminate employees from their jobs, threaten to close the plant, or threaten other harmful consequences to employees in any other manner during the period prior to a labor election. Secondly, employers cannot question or interrogate employees about union organizing activities within the organization. Third, management cannot promise that if employees vote against unionization, the organization will provide them with benefits because of their votes. Finally, management cannot spy on individual employees taking part in union organizing events, either through planting individuals in such meetings or through electronic or other means. Collective bargaining allows the employees to collectively negotiate an employment contract through their union representatives with management of the organization. This contract will generally cover major employment conditions such as compensation (pay and benefits), work hours and working conditions, and other conditions that both sides agree to.
Discuss the strategic value of benefits programs, why these programs continue to grow, and considerations that need to be taken into account in providing benefits.
Human resources are one of the few potential sources for competitive advantage in a modern organization. The totality of their compensation—including their benefits packages—is one major factor in keeping employees happy and engaged and willing to create a competitive advantage for our company. Today's workers demand more benefits and a better mix to fit their lifestyles. Because people demand it, companies add new benefits. This allows companies to increase job satisfaction and engagement, because when we take care of our employees, they work harder and take better care of our customers and organization, which in turn allows us to create a competitive advantage based on our people. There are four major reasons for benefits growth. First, there are tax advantages to providing employee benefits to both employers and employees. Second, federal laws are requiring companies to provide more benefits than ever before. Third, organized labor has historically bargained for benefits for their workers, and benefits earned in these negotiations carry over to nonunion companies. Finally, buying in bulk can save significant amounts of money, so if companies buy many insurance plans, each plan costs less than if the individual bought the same insurance. The three major considerations in providing benefits are amounts, mix, and flexibility. Amount is a function of how much the company is willing to spend on its employees. Many companies will calculate this as a percentage of direct compensation. Mix deals with the types of benefits that will be offered to employees. In many cases today, the number and type of benefits available are limited only by the imagination of the employees of the firm. Finally, we need to consider how much flexibility we are willing to build into our benefits program, because flexible options are very important to today's employees. Can different employees choose different benefits from the mix available, or will they all have to get the same benefits?
Discuss the major reasons why incentive plans fail and the challenges involved.
Incentive plans usually fail for one or more of five reasons. The first is bad management—managers have to manage the incentive program, and if they fail to do so, employees won't trust the program. Second, programs may be so complex that people can't figure them out, so they don't change their behavior. Third, plans may not really increase the potential rewards available, or the rewards may not appear significant to the employees. The fourth problem is that in a lot of cases, employees can't affect the desired outcomes by their actions. Finally, in many "reward" programs, employees never know how they are doing, so they don't know whether to modify their behavior to change their output. Challenges: There is still some concern that, at least in some cases, incentives don't work. The evidence shows that group incentives do work better than individual incentives when cooperation is required in a work group, but in general it is difficult to tie employee actions to company success. If we fail to do that, incentives will not work. There is also an issue of incentives becoming an entitlement. If this occurs, the incentive no longer motivates changed behaviors. Third, external incentives may act to lower a person's internal motivation to do something, which may mean that we actually lower performance instead of raising it when we apply incentives. Finally, there is the problem of people only focusing on what they are receiving incentive pay to do.
Discuss the major reasons why companies use incentive pay.
Incentives are necessary because they give us the opportunity to recognize our best people and provide us with flexibility to give them greater rewards than average or low performers. Variable pay systems also shift some of the company risk to the employee when economic downturns affect our businesses. Companies don't have to pay out some incentives if they are tied to organizational performance and the organization underperforms because of problems in the economy. Finally, incentive pay helps us achieve strategic goals, assuming that our incentives are aimed at accomplishing these objectives.
Identify the advantages and disadvantages of both individual and group incentives.
Individual incentives make it easy to evaluate each individual employee; they provide the ability to choose rewards that match employee desires; they promote a link between performance and results; and they may motivate less productive workers to work harder. Disadvantages include the fact that many jobs have no direct outputs, making it hard to identify individual objectives; we may motivate undesirable behaviors; there is a higher record-keeping burden than in group incentives; and individual rewards may not fit in the organizational culture. Group incentives help foster more teamwork; they broaden the individual's outlook by letting them see how they affect others. They also require less supervision and are easier to develop than individual incentives. Disadvantages include the potential for social loafing; the possibility that we will discount individual efforts and output; the fact that outstanding performers may lessen their efforts; and the potential for group infighting.
Describe what FMLA provides, which companies must provide FMLA leave, when employees become eligible for FMLA when working for a covered company, which conditions are covered, and what protections employees receive due to being covered by the act.
It provides unpaid leave for birth of child, adoption of child, serious health condition to child, spouse, parent, serious health condition to employee
Discuss the primary reason why measuring job satisfaction is so difficult, identify the best tool for getting employees to tell the truth about their level of satisfaction, and list the major determinants of job satisfaction
Job satisfaction is an attitude, not a behavior. We can experience behaviors directly, while we can measure attitudes only indirectly. Because of this, we must use some form of survey and ask the employees about their job satisfaction level. When using job satisfaction surveys, we have to ensure that they are anonymous, or employees will most likely not tell the truth about their satisfaction levels. The seven determinants of job satisfaction include: Individual personality; The work itself; Compensation; Growth and upward mobility; Coworkers; Management; and Communication.
Discuss the new OSHA regulation on drug testing and the value of wellness programs.
OSHA announced new rules that basically made it illegal to do blanket post-accident drug and alcohol testing. OSHA says these blanket policies have the effect of retaliating against workers who report injuries. Employers can continue to test when there is "a reasonable possibility" that drug use by the reporting employee was a contributing factor to the reported injury or illness to justify an employer requiring a drug test. However, companies need to go over existing policies and train supervisors on the new regulation. eDocAmerica is an online provider of occupational and employee health-related services that gives individuals and their family members unlimited email access to board-certified physicians, psychologists, dietitians, and the like who provide personal answers to all health-related questions. The main benefits are that the employee can take control of their health and that it takes some pressure off of the larger health care system because employees are not constantly going to the doctor's office.
Briefly describe what OSHA does in a worksite inspection, the types of violations that OSHA looks for, and employer rights during the inspection.
OSHA can inspect a worksite without advance notice. The inspector will identify themselves and provide the reason for the inspection when they arrive. Once the employer provides access to the worksite, the inspector will do an inspection. The inspector has the right to interview employees during the inspection and may do so unless the interview becomes confrontational or disruptive of the work environment. The inspector will provide the employer with a list of discrepancies upon completion of the inspection. Violations include the following: 1. Willful—where the employer knew that a hazardous condition existed but made no effort to eliminate the hazard 2. Serious—where the hazard could cause injury or illness that would most likely result in death or significant physical harm 3. Other than serious—where any illness or injury incurred is unlikely to cause death or serious physical harm, but the violation does have a direct impact on safety and health 4. De minimis—violations that have no direct or immediate safety or health danger 5. Failure to abate—where the employer has not corrected a previous violation for which a citation was issued and the settlement date has passed 6. Repeated—the employer has been cited for the same type of violation within 5 years The employer has a right to ask for positive identification from the OSHA inspector. The employer also has a right to know the reason for the inspection. Employers can refuse to allow the inspector into the worksite, unless they have a court order, but this is usually not a very good idea. The employer also has a right to have a representative accompany the inspector and has the right to tell employees their rights in the inspection process. The employer can also have a representative in any interviews unless the employee specifically requests that the interview be private, and the employer can stop interviews if they become disruptive. Finally, the employer has the right to contest any citations that they receive.
Discuss the issue of executive compensation and how the major provisions of the Dodd-Frank Act affect the issue.
There is no doubt that in some cases, executive compensation has gotten out of control. However, research shows that overall executive pay only runs about four times the pay of an average employee in most firms, which means that as a general rule, executive pay is probably not out of line, considering the pressure on executives to perform at the highest level all the time. Dodd-Frank requires that shareholders be allowed a "say on pay," where they vote on executive compensation packages at least once every 3 years. Shareholders also have a vote on "golden parachute" payments to executives who are forced out of the company because of a merger or acquisition, and every public company is required to disclose the total compensation of the CEO and provide a ratio of CEO pay to the average pay in the company. Finally, all public companies are required to provide information on executive compensation compared to the company's total shareholder returns every year to allow shareholders to evaluate the performance of companies in which they own stock.
Identify the seven basic issues that make up the organization's compensation strategy.
1. Ability to pay. This is an honest assessment of how much we can afford, or are willing to afford, in order to compensate our employees. 2. Types of compensation. This refers to the mix of the four basic components of compensation—base pay, wage add-ons, incentives, and benefits—that we employ. We must divide available funds among the components. 3. Pay for performance or longevity. Will we pay people based on organizational loyalty/tenure, or will we pay based on performance in their jobs? 4. Skill- or competency-based pay. 5. At, above, or below the market. What will our general pay structure look like, and why? 6. Wage compression. This lowers the pay differential between long-term and newly hired employees. 7. Pay secrecy. Will we utilize pay secrecy clauses in employment contracts? Pay secrecy may allow us to hide actual wage inequities from employees, but it has the potential to create dissatisfaction and demotivation.
Discuss what management can do to limit union organizing efforts.
Management can prevent union organizers from soliciting employees on company property during working hours, as long as such prohibitions are consistent with the company's general solicitation policies. Management can also identify costs that would be associated with union membership and can provide truthful information concerning how unionization will affect relationships between individual employees and management. These relationships can include things such as performance-based promotions, merit-based raises, and training opportunities.
Explain the processes of mediation and arbitration and the major difference between the two.
Mediation and arbitration both deal with inserting a third party as an intermediary into a dispute between two other individuals or groups. However, they differ in how much power the third party has in the process. Mediators enter into a conflict to assist the two conflicting parties in coming to a resolution and to act as a facilitator in their negotiations, but the mediator has no authority to force a solution on the opposing parties. In contrast, arbitrators also assist the two parties in attempting to work out a solution to their conflict, but arbitrators have the ability to enforce decisions they make on both of the conflicting parties. Such decisions are called binding decisions.
What is merit pay? What are the advantages and disadvantages of merit pay?
is a program to reward top performers with increases in their annual wage that carry over from year to year Advantages are higher employee motivation through a significant increase to that employee. Productivity within the organization will increase and employee morale also increases. Disadvantages could be very minimal increase because the increase could be spread out to all employees. It can also cost the company a lot of money if every employee gets merit pay over a longer time span and then employees that are always getting merit pay start expecting it and may not work for it as hard.
Identify the guidelines for creating motivational incentive systems.
1. Base all incentive programs on the company strategy and culture. 2. Make sure that the incentive program has some rewards for everyone—nobody should be left out. 3. Make the incentive program easy to understand and clearly communicate it to all involved. 4. Base the incentive on factors that the individual or group can affect. 5. Use SMART goals—specific, measurable, attainable, relevant, and time-based. 6. Clearly separate incentives from base pay to avoid the question of entitlement. 7. Make the reward a significant piece of overall compensation. 8. Take great care in program administration to provide rewards in the amount owed, when they are owed. 9. Promptly apply any incentive award—immediate reinforcement works much better than delayed reinforcement. 10. Don't forget to use nonmonetary rewards too—not everyone is motivated by cash. 11. Don't reward nonperformers, or you risk ruining the incentive system. 12. Make the incentive program part of a comprehensive approach to managing—pay attention to the entire performance of employees, not just specific behaviors tied to incentive payments.
Identify the components of a compensation system and describe how expectancy and equity theories apply to compensation.
1. Base pay, either an hourly wage or salary. Base pay is frequently a major decision factor for most employees in deciding to accept the job. 2. Wage and salary add-ons. These include overtime pay, shift differential, premium pay for working weekends and holidays, and other add-ons. 3. Incentive pay for performance. Incentives give workers strong reasons to perform above the standard. 4. Benefits. This is indirect compensation that provides something of value to the employee. Benefits cost the company money even though they aren't direct compensation.
Identify the three types of job evaluation and discuss whether they are more objective or subjective in form.
1. The job-ranking method is simply the process of putting jobs in order from lowest to highest or vice versa, in terms of value to the company. However, it has limited usefulness because it is subjective. 2. Point-factor methods, on the other hand, attempt to be completely objective in form. They break a job down into component skills or abilities, known as factors, and then apply points to each factor based on its difficulty. 3. The factor comparison method combines the job-ranking and point-factor methods to provide a more thorough form of job evaluation. It identifies benchmark jobs, and then analyzes and rank-orders them. We then compare all other jobs in the organization to the benchmark jobs to determine where each one fits in the rankings.
Briefly describe the concept of a pay structure, including broadbanding and delayering.
A pay structure is created by laying out our pay levels, one next to the other. The entire group of pay levels creates the pay structure. Benchmark jobs can be plotted on the pay structure to get a market pay line—a line that shows the average pay at different levels in a particular industry. Once pay levels are set, we can actually plot employee rates of pay on the pay structure to see if any are plotted outside our pay-level ranges, either high or low. Individuals who fall outside our pay range to the high side are paid red-circle rates, and those who fall outside low are paid green-circle rates. Each of these rates should be reviewed and corrected if necessary. Broadbanding lowers the number of pay levels that a company administers by combining multiple pay levels into one. Lowering the number of pay levels makes the process simpler. It takes a long time to create, maintain, and evaluate many pay levels; but instead, we can have just a few broadbands. Because pay bands are wider and taller under broadbanding, the company also has more flexibility in pay rates for individuals who are overperforming or underperforming. Broadbanding may also cause most red- and green-circle rates to disappear. Delayering also lowers the number of pay levels, but it does so by getting rid of layers of vertical hierarchy in the organizational structure.
What is the chief objective of most benefit plans?
Compete Retain Attract Motivate and Satisfy
Briefly discuss options for group-based incentives and for organizational incentives.
Group incentives are mostly based on organizational gains of some kind or on gaining an ownership stake in the company. First, there is profit sharing, where if the company's profits increase over thecourse of a year, the employees share in those increased profits. However, in some cases, gainsharing may be better, because profit can be easily manipulated. Gainsharing is based on other organizational gains that are more difficult to manipulate, such as revenue changes, lost-time accidents, or lower per-unit labor costs. If the company gains in these areas, it saves money, and some of the savings is shared with employees. ESOPs are thefirst stock (ownership) option, where at least part of the company's stock is provided to the employees over time. Other stock incentives are stock ownership awards or stock options, where employees earn stock by meeting goals.
Briefly discuss options for individual incentives.
Individual incentives can come in many forms. The first form that we discussed was bonus payments, lump sum payments for reaching a goal that don't change base pay. Commissions can also be used as incentives for sales. Commissions also only occur based on certain actions on the part of the employee—they don't add to base pay. Merit pay is different. Merit pay is based on past performance (appraisals) and does change base pay in future pay periods. However, merit pay is frequently too small to be considered a significant reward. Piecework and standard hour plans also work as incentives for speed of production. Under piecework, theemployee gets paid for each item produced, and under a standard hour plan, they are paid based on a standard time allowed toperform an action. Both plans may give rise to quality issuesifnot monitored. Finally, there are recognition and other nonmonetary rewards, which are very powerful incentives if used in the right ways.
Explain the TIPS acronym for guiding supervisors with respect to their activities to stop unionization. Next explain the FOE acronym.
Supervisors cannot threaten, interrogate, promise, or provide surveillance They can provide facts, opinions, and give examples
Identify the top concerns for security in the workplace today and what can be done to make the workplace more secure.
The five biggest concerns of employers today are Internet/intranet security, workplace violence, active shooter threats, business continuity planning, and mobile security. Cyber security in the form of both Internet/intranet and mobile security deals with the company's computers and network security, including how mobile devices connect to those company systems. Workplace violence is another major issue because of the continuing rise in incidents of workplace violence. Active shooter threats, while uncommon, must be taken seriously, and companies should take precautions to respond if such an incident happens to them. Business continuity planning has become a much more significant issue to most employers in the past 10 years, partly because of terrorism threats but also because of a number of large-scale environmental and natural disasters worldwide. Companies need to do the following: 1. Develop a policy on violent behavior, defining the concepts and making it clear that such behavior will not be tolerated. 2. Train all employees on the policy on a routine basis. 3. Develop mechanisms for reporting violent behaviors that are outside the normal chain of command. 4. Investigate all reported incidents using Just Cause procedures. 5. Take prompt, fair disciplinary action with those found guilty of any violent behaviors.
Briefly discuss the question of whether incentives improve performance and some options available for incentivizing employees other than knowledge workers.
There is an argument that incentive pay doesn't increase performance, but if you read the research, at least in most cases, evenarticles that argue against incentives note that group orteam incentives tend to work. There is concern that financialincentives create pay inequality, but again, that is not necessarily a problem. Equitable rewards work better than equal rewards. Pay and incentive programs are also being used more in non-knowledge worker occupations. In every industry—from restaurants to construction and low-tech manufacturing—companies are using more comprehensive pay and incentive programs to attract and keep workers in a tight labor market. These programs include everything from across-the-board pay increases to paid time off (PTO), to bonuses and changing pay policies.
Describe what organizations and managers can do to address wage compression.
They can have better benefits for those who have worked with the company longer, they can update salary ranges on a more consistent basis, and have a better structure within the organization for specific salary ranges
Identify and explain statutory benefits required by law, i.e., social security, unemployment insurance, workers' compensation, etc.
Workers' compensation is a program to provide medical treatment and temporary payments to employees who are injured on the job or become ill because of their job. Unemployment Insurance is a federal program managed by each state to provide payments for a fixed period of time to workers who lose their jobs. FMLA is leave that must be provided by the employer to eligible employees when they or their immediate family members are faced with various medical issues. The leave is unpaid, but the employer must maintain health coverage for the employee while they are on leave. ACA requires that all employers with more than 50 employees provide health insurance for their full-time employees or face significant penalties levied by the federal government. COBRA is a law that requires employers to offer continuation of health insurance on individuals who leave their employment for up to 18 to 36 months if the employee is willing to pay the premium cost of the insurance policy. HIPAA requires that, if the employee had health insurance at their old job and the new company provides health insurance as a benefit, it must be offered to the employee. In other words, the individual's health insurance is "portable." HIPAA also requires that companies take care to protect the health information of employees from unauthorized individuals. ERISA lays out requirements that must be followed if the employer provides a retirement or health and welfare plan of basically any type. ERISA determines who is eligible to participate and when they are eligible, it provides rules for "vesting" of the employee's retirement funds, it requires portability of those funds, and it requires that the funds are managed "prudently" by the fiduciary that maintains them.
Briefly describe the concepts of job structure, pay levels, product market competition, and labor market competition.
• The job structure is what gives us a job hierarchy. The job hierarchy is the stacking of the jobs in the organization from the lowest (simplest) to the highest (most complex) levels. • A pay level (frequently called a pay grade) will be made up of several different jobs. Pay levels provide a framework for the minimum and maximum pay for a particular group of jobs in the organization. Pay levels are then laid out one next to another in order to create the entire pay structure for the company. • Product market competition sets the top of a pay level. We can pay someone only as much as we can recover from a customer when we sell our goods or services. We can't pay more than the value added to the product or service by the labor. Together, product market and labor market competition identify the maximum and minimum rates of pay for a particular group of jobs in a pay level. • Labor market competition sets the bottom of a pay level. We have to compete with other companies to attract labor; and if we don't pay enough, we will be unable to attract the workers we need. So we compete in the labor market for available workers.
