Human Capital
quid pro quo
"something for something in exchange"; two people in unequal bargaining positions; sexual blackmail
compensatory damages in intentional discrimination
$ to make you whole, put you in place you would have been had there been no discrimination
fair labor standards act
1938; set minimum wage (currently $7.25/hour); set work hours-overtime for hours over 40 in a week; est. child labor provisions; later amended to include equal pay
age discrimination in employment act (ADEA)
1967; prohibits discrimination against those 40 and over; allows employers to favor older workers; covers employers with 20 or more employees
family and medical leave act
1993; requires employers to provide employees up to 12 weeks of unpaid leave; only business with 50 or more employees in 75 mile radius; top 10% highly paid employees are exempt; must have worked for over a year
what is involved with human capital?
HR planning, recruitment and retention, staffing, job design, training/development, performance appraisal, communications, compensation, benefits, labor relations
legal defense of discrimination
business necessity; bona fide occupational qualification; formal seniority systems are permitted
hostile work environment
can be between equals in the workplace; no "welcome or unwelcome" issues -porn mags, vulgar comments, offensive touching, stories about your sex life, sexually oriented pictures, dirty jokes
proactive change
change initiated to take advantage of targeted opportunities
reactive change
change that occurs after external forces have already affected performance
labor demand curve is shifted by
changes in demand for firm's product; changes in productivity of labor; expectations about the economy
human resource information system (HRIS)
computerized system that provides current and accurate data for purposes of control and decision making
exceptions to employment at will
congressional acts, contracts, sate court rulings
executive order 11246
issued by executive branch; applies title VII to all federal contractors; requires affirmative action plans of all federal contractors (issued by LBJ); company should keep track of makeup of labor force and labor participation force to see where they are off % employee wise; come to U of A sometimes
child labor provisions
limited work for those below 18 yrs old
non-economic costs
loss of income, scarring effect, psychological and emotional costs
economic cost
lost output, okun's law, non-economic costs
labor force participation rate
percentage of the potential labor force who are actually in the labor force
4 types of unemployment
seasonal, frictional, structural, cyclical
hidden costs of layoff
severance/rehiring costs; accrued vacation and sick day payouts; pension and benefit payoffs; potential lawsuits from aggrieved workers; loss of institutional memory and trust in mgmt; lack of staffers when economy rebounds; survivors who are risk-averse, paranoid, and political
characteristics of structural unemployment
tends to be concentrated among certain groups of workers; tends to be long lasting
downsizing
the planned elimination of jobs
evidence of disparate treatment
vary case by case, must establish event occurred (usually involves individuals and often intentional discrimination)
effects of society and culture on the labor market (changes)
women in workforce, attitudes toward education; population growth, globalization; discrimination; overall opportunities and expectations
affirmative action plans
work force analysis, availability analysis, underutitlization/concentration, goals and timetables, in-house programs, auditing
knowledge workers
workers whose responsibilities extend beyond the physical execution of work to include planning, decision making, and problem solving
work force analysis
what is make up of workforce in different categories-gender and racial makeup?
availability analysis
what is relevant labor makeup for that job?
why do governments intervene
when the market provides an inefficient outcome when left to its own devices; when market solution offends our values (ex: anti-discrimination laws)
establishing a "prima facie case"
-evidence of disparate treatment -evidence of disparate or adverse impact
business necessity in legal defense of discrimination
-necessary for the safe and efficient operation of the organization -job relatedness (validity)
bona fide occupational qualification in legal defense of discrimination
-only for sex, religion, national origin, and age -NEVER for race or color -"reasonably necessary to the normal operation of that particular business or enterprise" -ex: Hooters; only hiring women waitresses is a part of their business strategy
sexual harassment
-prohibited by Title VII of CRA -unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature -quid pro quo -hostile work environment
affirmative action
-started by executive order 11246 (LBJ) -to remedy past wrongs -required of federal contractors -voluntary, court ordered and consent decree -affirmative action plans **never tells us to hire a less qualified person**
EEOC procedures
1. charge is filed with EEOC within 180 days 2. EEOC investigates and makes a determination of "reasonable cause" 3. if no reasonable cause, issues right-to-sue letter 4. if reasonable cause, attempts to resolve matter through negotiations then litigation
criteria to be considered unemployed
1. he or she is without a job 2. he or she would be able to take a job if it were offered 3. he or she has looked for work in the preceding 4 months
civil rights act of 1991
George H W Bush signed it in; clarified the burden of proof issue; allowed for jury trial; allowed for compensatory and punitive damages in cases of intentional discrimination; talking about $ not putting people in jail
plaintiff has initial "burden of proof" to establish
a "prima facie case" of discrimination
psychological contract
a person's perceptions about what each party owes the other in a relationship; transactional and relational
characteristics of frictional unemployment
affects a relatively large number of people across all groups of the labor force; usually temporary; often voluntary; tends to be relatively short in duration; is unavoidable; may be beneficial
frictional unemployment
arises because of the constant flow of people between jobs and into and out of jobs
#1 hiring decision
as long as the value of the marginal product is greater than the wage rate
negative outcomes of breeching contracts
attitudinal, behavioral
why does marginal product get smaller
because a company is limited by its capital
outsourcing
contracting outside the organization to have work done that formerly was done by internal employees
what does it mean to be employeed?
contractual relationship between employer and employee; independent contractors; temporary employees
attitudinal negative outcomes
decreased commitment, job satisfaction, trust, justice perceptions, and increased cynicism
at-will employee
default in US; employer can fire you at any time for any reason; you can quit at any time for any reason
derived demand
demand for an input derived from consumers' demand for the good or service produced with that input
labor demand is a
derived demand
in-house programs
details programs to support the plan-how will you get back in sync
adjustments/issues caused by globalization
different geographies, cultures, laws, and business practices; identifying capable expatriate managers; developing foreign culture and work practice training programs; adjusting compensation plans for overseas work
market demand curve
downward-sloping, indicating a lower wage results in an increase in quantity of labor demanded
temporary employees
employed by staffing agency (ex: staffmark); secretaries at U of A
"unwelcome" issues
employee did no solicit; employee communicated "unwelcomeness"
behavioral negative outcomes
enhanced likelihood of turnover and deviant behavior, decreased job performance
Equal Employment Opportunity Commission (EEOC)
enoforces most civil rights legislation-investigates charges of discrimination, attempts to settle charges, can file lawsuit in federal court; develops guidelines-uniform guidelines on employee selection procedures; est. by civil rights act of 1964
potential labor force
entire non-institutionalized population over the age of 16
federal legislation/regulation related to employment
equal pay act of 1963; civil rights acts of 1964 and 1991; executive order 11246; age discrimination in employment act of 1967; americans with disabilities act of 1990; fair labor standards act of 1938; family and medical leave act of 1993; occupational safety and health act of 1973
evidence of disparate or adverse impact
evidence of disparate or adverse impact, stock statistics- comparisons to relevant labor market, flow statistics-4/5 rule (look at people who "flow" through
contracts (exceptions to EAW)
explicit or implied; could be an oral contract (ex: employee handbook)
benefits of no-layoff policy
fiercely loyal, more productive workforce; higher customer satisfaction; readiness to snap back with the economy; recruiting edge
independent contractors
usually hired for specific duty for specific time; not an employee of company (ex: custodians)
Okun's law
for every 1% unemployment exceeds the natural rate; a rate 2.5% GDP gap occurs
overtime
for hours over 40 in a week, each hour is paid 1.5 times regular pay
state court rulings m(exceptions to EAW)
identifying tort exceptions-violation of public policy (firing a whistleblower-can't be fired for reporting a company for illegal things, etc.), violation of implied contract, violation of good faith and fair dealing
stock statistics
if labor market is 50/50 M/F, and your company is 30/70 M/F there is an issue (also can't just mirror labor market with quota system-50/50-because that is illegal)
labor supply curve is shifted by
immigration and population growth; migration; wages in other professions; number of hours people are willing to work; non-wage income; amentities (ex: fringe benefits)
trend: opening up foreign markets to int'l trade/investment
impact: partnerships with foreign firms, "anything, anywhere, anytime" markets, lower trade and tarriff barriers
disparate or adverse impact
individuals are treated identically, but the outcome of the treatment has a different impact; measuring height of men and women but only giving job to ppl over 5'5" (men are on avg taller)
stakeholders
individuals or groups that have interests, rights, or ownership in an organization (owners and investors, customers, society, etc)
punitive damages in intentional discrimination
intended to punish; capped for sex, religious, and disability discrimination; NOT for race or national origin
Equal Employee Opportunity Commission
interprets laws and tells employers how to abide
government regulations of labor market
minimum wage; overtime laws; discriminative/affirmative action; OSHA; immigration; taxes and subsidies; governmental spending (government employees, government infrastructure)
flow statistics
minority=100 applicants, 30 hired, 30% non-minority=200 applicants, 100 hired, 50% less percent of minority was hired and it is not within 4/5 of majorty percentage (40%) -this shows disparate impact has occured, DOES NOT mean it was illegal
disability
must limit major daily life activities; complicated to define this
lost output
potential GDP is not realized; potential GDP-actual GDP=GDP Gap
psychological disbilites
probably protected under ADA
employee leasing
process of dismissing employees who are then hired by a leasing company (which handles all HR-related activities) and contracting with that company to lease back the employees
human resource management
process of managing human capital to achieve organization's objectives; involves many different processes/funcitons
civil rights act of 1964
prohibit discrimination based on sex, race, color, religion, national origin; title VII applies to employment; signed in by LBJ; act established Equal Employment Opportunity Commission; applies to employers with 15 or more employees
congressional acts (exceptions to EAW)
prohibiting discrimination, etc
americans with disabilities act 1990
prohibits discrimination against individuals with disabilities who are able to perform the essential functions of the job with or without reasonable accommodation; signed by George HW
equal pay act of 1963
prohibits gender discrimination in pay for "substantially equal" jobs; jobs are equivalent if they require the similar levels of skill, effort, and responsibility, and are performed under similar working conditions; differences in pay are legal if based on seniority. job-performance, non-gender factors
employer response to sexual harassment
promptly investigate and stop harassment, confidentiality should be maintained, no retaliation against involved employees allowed, take disciplinary actions as warranted, application of policy should be consistent
unemployment rate
proportion of the labor force that is unemployed; likely understates the true extent of unemployment
2 types of change
reactive and proactive
seasonal unemployment
result of a decrease in the demand for labor due to the changing of the season (ex: many agricultural and construction jobs; resort/holiday jobs)
structural unemployment
result of major industrial or technological changes; mismatch of skills to labor needs (ex: when a major industry is in decline and lays off many of its workers)
cyclical unemployment
result of movement through the business cycle; during expansions, unemployment is low; during recessions, unemployment is high
marginal product of labor
the additional output from hiring each worker (unit of labor)
offshoring
the business practice of sending jobs to other countries
value of marginal product of labor
the dollar value of a worker's contribution margin
human capital
the knowledge, skills, and capabilities of individuals that have economic value to an organization
discouraged workers
those not seeking employment are not unemployed
disparate treatment
treating individuals differently because of a protected characteristic; ex: women were asked about children in an interview but men were not
employment discrimination
treatment followed by impact
transactional contract
type of psychological contract in which the parties have a brief and narrowly defined relationship that is primarily economic in focus
relational contract
type of psychological contract in which the parties have a long-term and widely defined relationship with a vast focus
market supply curve
upward-sloping, indicating that higher wages cause the quantity of labor supplied to increase