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Maintaining Human Resources

3. Maintaining Human Resources

3.1 Employee Rights and HR Communications: An overview

Employer-Employee relations: Definition

Employee relations are a set of human resource practices

that seek to secure commitment and compliance with

organizational goals and standards through the involvement of employees in decision-making and by

managerial disciplinary action.

Employee Relations: Covers communications, employee participation in management decisions, conflict and grievance resolution, trade unions and collective bargaining.

Employee means any person of any age employed by an

employer to do any work for hire or reward under a contract of service; and includes a homeworker, or a person intending to work; but excludes a volunteer.

Employer means a person employing any employee or

employees; and includes a person engaging or employing homeworker. The Employment Relations Act 2000 enlarges definition of employer and it is referred to managers and other people who act on the employers behalf. Employee or independent contractor? Contract of service. Governs relationship between an employer and an employee. Contract for services. Governs relations between an employer and an independent contractor.

Who Constitutes an Employer?

Depending on the applicable statute or provision, an employer is one who employs or uses others to do his work, or to work on her behalf. Most statutes specifically include in this definition employment agencies, labor organizations and joint labormanagement committees.

Why is it Important to Determine Whether A Worker is an Employee?

There is not merely one definition of who constitutes an employee. The answer will vary depending on the court, the issue and the statute to be applied. The issue, however, must be determined because of the following concerns. Discrimination and Affirmative Action. Anti-discrimination statutes only protect employees from discrimination by employers. Cost Reductions. By hiring employees: 1. Employees are more expensive to employ due to the above regulations that require greater expenditures on behalf of employees, as well as the fact that others must be hired to maintain records of the employees. 2. In addition, by hiring independent contractors, the cost of overtime is eliminated (the wage and hour laws do not apply to independent contractors) and the employer is able avoid any work related expenses such as tools, training or traveling.

How Do You Determine Whether a Worker is An Employee?

When the following factors are satisfied, courts are more likely to find employee status. a. Instructions: A worker who is required to comply with other persons' instructions about when, where, and how to perform the work is ordinarily considered to be an employee. b. Training: Training a worker indicates that the employer exercises control over the means by which the result is accomplished. c. Integration: When the success or continuation of a business depends on the performance of certain services, the worker performing those services is subject to a certain amount of control by the owner of the business. d. Services Rendered Personally: If the services must be rendered personally, the employer controls both the means and results of the work. e. Hiring, Supervising and Paying Assistants f. Continuing Relationships g. Set Hours of Work h. Full Time Required i. Doing Work on the Employer's Premises j. Furnishing Tools and Materials k. Payment by Hour, Week, or Month l. Payment of Business and/or Traveling Expenses m. Realization of Profit or Loss n. Right to Discharge o. Right to terminate

Employee Responsibilities
Employees have moral obligations to:
respect the property of the corporation abide by employment contracts, and operate within the bounds of the companys procedural rules. It is legally established that an employer has a right to loyalty

Contingent or Temporary Workers

Contingent Workers
A person who works for an organization on something other than a permanent or full-time basis
Independent contractors On-call workers Temporary employees Contract and leased employees Part-time workers When utilizing contingent and temporary workers, the advantages and disadvantages must be considered. Although contingency or temporary workers provide a cost savings as a short term benefit, depending on their classification, they could be entitled to protection under the employment laws.

WHY FORMING THE EMPLOYMENT RELATIONSHIP The employment relationship has both economic and social dimensions. Employers are willing to pay wages and salaries and provide other benefits in order to have work done and workers are willing to accept those rewards as the economic base for their lifestyles. In addition, peoples work provides them with personal identity, and the workplace offers them opportunities for social interaction. - The employment contract or employment agreement, which establishes the formal and legal relationship of employer and employee, and is subject to the requirement of legislation; -The psychological contract, which embodies all our assumptions and expectations about employment in a job and organization, and is formed through the process of induction and socialization.

At the heart of the employer-employee relationship is a duty of mutual respect Employers obligations -To pay wages; -To provide work; -To provide a safe workplace and safe work systems; -To reimburse expenses or losses; The employees obligations -To be present at work; -To obey lawful and reasonable orders; -To exercise reasonable care; -To work faithfully and honestly.

State sector employment Employees should fulfill their lawful obligations to Government with professionalism and integrity. Employees should perform their official duties honestly, faithfully, and efficiently, respecting the rights of the public and their colleagues. Employees should not bring their employer into disrepute through their private activities. Collective employment agreement An agreement that is binding on - one or more unions, and - one or more employers; and - two of more employees.

Law of Agency
An agent is subject to his principal to act solely for the benefit of the principal in all matters connected with his agency. Specifically, the agent is also under a duty not to act or speak disloyally, and the agent is to keep confidential any information acquired by him as an employee that might damage the agent or his business.

Individual employment agreement. An agreement entered into by one employer and one employee who is not bound by a collective agreement that binds the employer. Individual agreements should contain the following information: -The name of the employee and employer; -A description of the work to be performed by the employee; -An indication of where the employee is to perform the work; -An indication of the arrangements relating to the times the employee is to work; -The wages or salary payable to the employee; -A plain language explanation of the services available for employers and employees to resolve any employment relationship problems.


Types of individual agreements: -Fixed term agreements; -Probationary appointments. Forming the employment contract -Agreement; -Consideration; -Intention to create a contract; -Capacity; -Consent; -Legality.

According to the Employment Relations Act rules, the employer must: - Provide the intending employee with a copy of the agreement; -Advise the intending employee that she or he is entitled to seek independent advice about the agreement; -Give the intending employee a reasonable opportunity to seek such advice. Implied terms -Hours of work; -Public Holidays; -Annual holidays; -Special leave.

Employee-Employer Relations: Two types of employment relationships

Independent Contractor - One who contracts to perform some task for a fixed fee but is independent of the control of the other contracting party as to the means by which the contract is performed except to the extent that contract sets forth specifications and requirements to be followed. No principal-agency relationship. ADVANTAGE: Liability avoidance for the Principal. 2. Employer-Employee - One who performs work for an employer and is under the employers control both as to the work to be done and as to the manner in which it is to be done. KEY: Does the employer control the doing of the work.


Employment & Employee Rights

What rights do employees expect their employers to protect?
Employment at will doctrine: Employees remain employed only if both the employer and the employee want the employment relationship to continue


Employment & Employee Rights

Selam arrived at work one day, and her boss said to her, Thats the ugliest dress I have ever seen. Because you wore that to work today, you are fired. Assuming that Selam is an at-will employee, which of the following is true? a. Selam can be fired for any reason. b. If Selam has the will to work, she cannot be fired without cause. c. If none of the exceptions to the at-will rule apply, Selam can be fired. d. Selam can be fired only if it is in the best interest of the employer. Answer: C

Employment & Employee Rights Exceptions to the at-will rule a. Illegal firing
Public Policy Exception
Refusal to perform illegal act Acts performed in public interest
Jury duty Whistle-blowing


Employment & Employee Rights Girma vs ABC Co.

Girma is a driver with ABC Co., a truck delivery services company. ABCs Co. policy is that trucks cannot be left unattended. The penalty for violating this rule is termination. While making a scheduled stop at a bank, Girma noticed a woman being threatened with a knife by an agitated man. Girma left his truck and went to aid the woman and apprehend the assailant. Naturally, Girma was fired by ABC Co. Was the termination legal?

Employment & Employee Rights

Girma vs ABC Co.

Was the termination legal? No, the driver is protected under the public policy exception. His duties to society outweigh his duties to his employer.


Employment & Employee Rights

Breach of contract
Written employment contract Implied
Length of employment Regular promotions Promise of permanence Positive reviews and/or lack of warning of poor performance

The importance of the employee handbook

Method of firing cannot be defamatory Loss of good name Impact on employment Crime, incompetence

Employment & Employee Rights

Daniel was hired in February of 2008 as a salesperson. There is no written employment contract, and Daniel is paid on a commission basis. Daniels manager has said to Daniel on several occasions that if Daniel continues to meet his sales quotas, that the company will keep him around for a long time. Daniel has always met his sales quotas, but is told one day that they have decided to replace him because he does not project the image that the company wants. If Daniel is an at-will employee, and assuming he can prove the above, which of the following is true?

Employment & Employee Rights

a. As an at will employee, there are no restrictions on the employer terminating Daniel. b. Because there is no written employment contract, the employer can terminate Daniel. c. The statements by the manager could likely give Daniel contract rights that could amount to an exception to the at-will doctrine. d. The employer would not be able to fire Daniel on the basis of public policy. Answer: c.

Employment & Employee Rights

Breach of good faith
Transfers aimed at making employee quit
Solomon is a high-performing employee at the Addis office of Company X. One fine day, his boss tells him he is being transferred to Hawasa to set up the firms Dembidelo operations. Solomon is tipped to take over his incompetent boss job in the near future, and the firms strategic plan does not include doing business in Dembidolo.

Pressure to resign to avoid getting fired

Solomons employment contract stipulates a golden parachute in the event of employment termination. The parachute is inoperative if the termination is voluntary. The boss tells him that he may not get a job in the industry if news leaks out that he was fired for incompetence.

Employment & Employee Rights

Right to privacy A. Drug Testing
Privacy v. safety Federal employees affecting public safety e.g. Transportation Varying state laws

B. Aids Testing
No pre-employment testing

C. Information Gathering and use a. Background checks

Arrest data Credit history workers compensation

b. Necessary Record Keeping

Job related and specific purpose No release without consent Right to know

Employment Discrimination
Employers are restricted from discrimination on the basis of ethnicity, race, religion, region, age, gender, etc. Disparate Impact Discrimination
Occurs when job requirements result in disproportionate work force composition No discriminatory intent required Burden of proof on plaintiff Focuses on validity of hiring practices

Employment Discrimination
The Addis womens prison system had a minimum height requirement of 52 and minimum weight requirement of 56kg for prison guards. Is this rule discriminatory? Answer: Although the rule had a purpose other than one of discrimination, namely, making sure guards were physically large enough to perform their jobs effectively, the impact of the rule was to exclude many females from the job position. With the advances in technology, physical size is no longer a business necessity.

Employment Discrimination Sexual Harassment:

Two types
Quid pro quo
Boss asks for sexual favors in return for promotion

Hostile environment
When there is no exchange sought, but the working environment is characterized by harassment Reasonable person V. reasonable woman standard

Recovery for a sexual harassment claim does not require the plaintiff to prove that she suffered damage to her psychological wellbeing Vicarious Liability - Employer held liable for conduct of employee

Employment Discrimination Sexual Harassment: Dawit v. Alem

Plaintiff alleged that a fellow employees persistent, unwelcome letters and requests for dates had created a hostile working environment. The Court held that a reasonable woman would find such an environment hostile.

Office romances today are fraught with risk Does this law violate the freedom of speech?

Employment Discrimination Sexual Harassment:

Defense for employer
Employer exercised reasonable care to prevent and correct promptly any harassing behavior. For instance, a very thorough and explicitly communicated harassment policy. Plaintiff unreasonably failed to take advantage of any preventive or corrective opportunities provided by employer or to avoid harm otherwise. For instance, extreme delay in reporting the wrongdoing


Employment Discrimination
Affirmative Action:
Applicable to federal contractors Incentives Employment goals and timetables compensatory justice Problems
Reverse discrimination Poor implementation ( quota system) Biased towards large corporations

Diversity -An alternative

Demography or ethnicity driven Advantages of diversity

(The Federal Civil Servants Proclamation (No. 515/2007) prohibits discrimination.)


Management Concerns
Job Descriptions An employer should: create a written job description for the position to be filled; and determine what qualifications are required of the person filling the position. Factors used in considering whether a duty is essential include: whether the position exists to perform the function whether the function is one that a limited number of employees can perform whether the function is so highly specialized that the person performing it must have particular expertise or ability to perform the function


Management Concerns
Job Qualifications In addition to creating written job descriptions, an employer should determine what qualifications are required of the person filling the position. This should be done before the employer begins accepting applications or resumes. Qualifications might include considerations such as: education skills experience necessary licenses specialized training


1. T/F As an employee, I have the right to have a break for lunch. 2. Yes/No My employer provides everyone with a one hour, unpaid lunch break. Some stay and work at their desks, others go out. Since I often work at my desk during my break, I have been asked to answer the phones. Is this fair? 3. Yes/No Today I had a shouting match with the boss when trying to explain that, yes, I had exhausted all avenues in trying to get the flight time and fares he was looking for. Then he wanted me to tell our printer that we would never do business with them again just because they couldn't quote the price he wanted. Then he threatened someone's job just because she neglected to mention that a customer wanted something. This was in one day! Some days are not like this -- many are. Is this illegal harassment? 4. Yes/No I work in the parts warehouse and as a woman, I cant reach some of the higher shelves. Some are very heavy. Can I be fired for not being able to do the job? 5. Yes/No A woman I know recently found out that she has Multiple Sclerosis. Can she be fired because of her MS and the potential health costs which will raise the companys health insurance rates?



6. Yes/No I'm a guy who usually wears a small earring and I just started a new job. I didn't wear my earring during my job interview, but when I started my new job yesterday, I wore the earring I normally wear. My boss had a cow. Does he have the right to tell me how to dress? 7. T/F The restaurant that hires me as a cook is famous for their home cooked chili. The meat comes from a local family farm. Although frozen, it really looks like Purina Cat Chow to me. I refuse to serve it. Free speech laws will protect me if I go public with this information.

8. Yes/No We've been planning a big family reunion at a resort in Florida for months, and my sisters, cousins, parents, etc. have all agreed to a date in April. Last year my boss said taking vacation time in April should be fine, but now he tells me that I'll be too busy to leave that month. What's more, he says that since they've cut back on employees, I won't get my three week's vacation this year. I was told when I started working here in 1987 that after five years I'd get three weeks vacation, and I've been taking three weeks a year since 1992. Can they suddenly take that away from me?



9. Legal? True/False To get ready for the festive holiday, the bosss wife comes in and creates the invitation list by going through the personnel files to collect employee addresses. She then spends hours creating beautiful invitations for a fantastic employee dinner that everyone except the janitorial staff get to attend. 10. Yes/No As a librarian, I know my first amendment rights. I e-mailed my fellow librarians about the new screwed up curriculum that they are pushing on us. My boss heard about it and showed up in my office with a copy of my private e-mail. Can I lose my job for using my office computer?


Do people have a right to a job?

Two components:
Workers believe they have a right to a job in the first place. As employees continue to work at a job, they believe they have a right to retain that job.
This view is not widely held


Employment-at-will Principle
The freedom of the employee to quit, the freedom of the employer to fire, and the right of the employer to order the employee to do his bidding define the essence of the employment contract.


Employee Disobedience
An employees job is protected under common law if an employee disobeys an employer on the grounds that the employer ordered him to do something illegal or immoral.


Bill of Rights
Employees may be protected against government infringements of the Bill of Rights, but they are not protected against corporate infringement of these rights. Why?
Inefficient breakdown in discipline


Employee Rights
Due Process means by which a person can appeal a decision in order to get an explanation of that action and an opportunity to argue against it. Procedural Due Process the right to a hearing, trial, grievance procedure, or appeal when a decision is made concerning oneself.

Employee Rights
Employment-at-will Justifications:
Proprietary rights of employers Defends employee and employer rights equally An employee voluntarily commits to certain responsibilities and loyalty Due process rights interferes with efficiency and productivity Legislation and regulation of employment relationships undermine the economy.

Employee Rights
Analogous to considering employees as a piece of property Arbitrary treatment of employees extends prerogatives to mangers that are not equally available to employees If there is an expectation of employee loyalty, this should be reciprocated


Employee Rights
The institution of due process in the workplace is a moral requirement consistent with rationality and consistency expected in management decisionmaking.


Employee Rights
The Fairness of the Contract at Will
Freedom of contract is an aspect of individual liberty. The individual parties have better information about their preferences The contract is sought by both parties Rules out the use of force or fraud


Employee Rights
The Utility of the Contract at Will
The issue is how to maximize the gain form the relationship, which is dependent upon minimizing employee and employer abuse
Monitoring Behavior Reputational Losses Risk Diversification and Imperfect Information Administrative Costs


Employee Rights
Distributional Concerns
Those who tend to slack off seem to be most vulnerable to dismissal under the at-will rule


Is an Employer Morally Entitled to Loyalty?

The duty of loyalty is a prima facie duty When a corporation is engaged in activity that is seriously wrong, employees may have a higher obligation to be disloyal to their employer and blow the whistle.


There are two sides:
Those who view them as civic heroes, and Those who view them as finks
Whistleblowing: persons who sound an alarm from within the very organization in which they work, aiming to spotlight neglect or abuses that threaten the public interest


Whistleblowing and its effect on trust

They try to portray themselves as acting on behalf of an interest higher then their own the public interest. Believe that there is a substantial audience who will attend to their disclosures. They are leveling an accusation of neglect or abuse at particular persons within the corporation.

The end, not the group per se, commands group members loyalty.
The wrongness in whistleblowing is found in acting to destroy workplace atmosphere if and when this destruction could have been avoided.


Responsibilities of the Firm

Provide a forum for free and open discussion Examine the tasks they impose on employees Grant employees access to information about company practices Critically examine their actions


Responsibilities of the Whistleblower

Must be willing to come forward and be identified Critically examine the position they are being asked to assume Seek out and consider the implications of available information Critically examine their actions

Employee Rights
Managers are required to Consider all activities to ensure that employees are treated fairly. The laws regulating employees rights relate to the following areas of employment.
Fair Labor Standards - prohibits child labor, sets a minimum wage and maximum working hours. Equal Pay - men and women doing equal work will get equal pay. Work Place Safety - mandates procedures for safe working conditions. Unionization- Unions represent workers interests in organizations any employee has the right to form and/or to be a member Job Description- receive a written job description for the position to be filled or task to perform
(refer Federal Civil Servants Proclamation No. 515/2006 and Labor (Amendment) Proclamation NO. 377/2003, ex. Labor Proclamation No. 42/1993)

The Ethiopian Case : Labor rights in the Constitution

The Constitution of Ethiopia contains a full chapter (Chapter 3) on fundamental rights and freedoms. The fundamental rights have been grouped under the headings, Human Rights and Democratic Rights. The Constitution guarantees rights and freedoms, inter alia equality before the law, equal protection under the law, freedom of speech and expression, freedom of religion, belief and opinion, freedom of assembly and association, freedom of person, freedom against jeopardy and ex post facto laws, the right to property.

Labor rights in the Constitution

The Constitution of Ethiopia contains a full chapter (Chapter 3) on fundamental rights and freedoms. The fundamental rights have been grouped under the headings, Human Rights and Democratic Rights. The Constitution guarantees rights and freedoms, inter alia equality before the law, equal protection under the law, freedom of speech and expression, freedom of religion, belief and opinion, freedom of assembly and association, freedom of person, freedom against jeopardy and ex post facto laws, the right to property.

Labor rights in the Constitution

Among these fundamental rights, a whole range of general principles of labor rights are firmly anchored in the constitution. The constitution provides four principles such as the right of the security of the person (Article 16 of the Constitution), the prohibition against inhuman treatment and the abolishment of slavery and servitude (Article 18 (2)) and forced and compulsory labor (Article 18 (3) and (4) of the Constitution). General Freedom of Association is laid down in the Constitution (Article 31, for any cause or purpose), and specified in Article 42, Rights of Labor, which reads: Factory and service sector employees, peasants, agricultural workers, other rural workers, government employees below a certain level of responsibility and the nature of whose employment so requires, shall have the right to form associations for the purpose of improving their economic and employment conditions. 58

Labor rights in the Constitution

This right shall include the right to form trade union and other associations, and to negotiate with their employers and other organizations affecting their interests. The Right to Strike is explicitly mentioned in Article 42 (1) b) of the Constitution. This article, in its paragraph 2, also lays down the right to reasonable limitation of working hours, to rest, to paid leave and to healthy and safe working environment.

Labor rights in the Constitution

Article 35 of the Constitution deals with the rights of women, such as equality with men (Article 35(1)), in particular in employment, promotion, pay and the transfer of pension entitlements (Article 35(7), and 42 (1) d)). The Constitution grants the right to maternity leave with full pay, as well as prenatal leave with full pay, in accordance with the provisions of the law (Article 35(4) a) and b)). Pursuant to Article 36 on the rights of children, every child has the right not to be subject to exploitative practices, neither to be required not permitted to perform work which may be hazardous or harmful to his or her education, health or well-being.

Employee Rights: The new Labor Law

Labor Proclamation 377/2003 amends the previous Labor Proclamation on the following points: It defines managerial employees in Article 3 (2) c); It introduces an obligation of employers to maintain records; It tightens the legal procedure by setting several new deadlines; It introduces a clear ban for compulsory HIV/AIDS testing (Article 14 (2) d); It strengthens the workers' position in case of termination (Article 27 (2) and (3); It clarifies regulations on severance pay and compensation, disablement payment and dependants benefits (Arts. 39, 40, 109, 110); It creates the full guarantee of freedom of association by abolishing trade union monopoly (Article 114), provided that the number of members of the union is not less than ten; It recommends regulations on trade union property to be included into the constitution of workers' organizations (Article 117 (12) (new)); It clarifies the cancellation of a union to be effective only after a court decision (new Article 120 (1)); It introduces a simpler system of collective bargaining and labor dispute settlement, with specified time limits to speed up the resolution of conflict (Articles 130 (2), 142 (3), 143 and 151);

Employee Rights: The new Lab our Law

It intends to improve the efficiency of the Labor Relation Boards (Articles 145, 1474 (4), 149 (6), 150, 153 and 154); It restricts the definition of essential services (Article 136 (2)), excluding railway and inter-urban bus services, filling stations and banks, thereby entitling workers or employers of these undertakings to the right to strike or lockout.

Other sources of labor regulation

The major sources of labor law are federal regulations, above all the new Labor Proclamation No. 377/2003, some collective agreements, work statutes and some government's ordinances, for instance in the field of occupational Safety and Health regulations. However, as Article 3 (2) of the Labour Proclamation excludes certain groups of workers from the application of the Proclamation, the following Acts may be considered, too: The Civil Code (Civil Code Proclamation, No. 165/1960), title XVI, Contracts for the Performance of Services, specifically Articles 2515 to 2639, which contain regulations on general employment contracts, specific forms of employment, such as for domestic servants living in, ed alter, and wage regulations; Proclamation No. 260/1984 and the regulations issued by the Ministry of Education for the employees of public schools, as amended by Proclamation No. 217/2000 . The Central Personnel Agency and Public Servants Order of 1961 (as amended by Order No. 28/1962) and the Public Service Regulations No. 1/1962 (contemporarily under review), which apply to all public servants and state employees.

Contract of employment
Permanent and fixed-term contracts of employment As a rule, the contract of employment is concluded for an unlimited period (Article 9, Labor Proclamation, No. 377/2003),1 except for those listed under Article 10 that allows certain contracts for a definite period of time or a definite piece of work. The duration of a fixed-term contract must be set according to objective conditions such as a specific end date, the completion of a specific task, or the occurrence of a specific event. It must also in principle be based on the justification, which are specified under Article 10 (1) to (7), which comprises among others motives like the temporary replacement of a permanent worker, urgent and abnormal pressure of work, or seasonal work. If the employee wants to claim the ineffectiveness of a limitation, he or she must take legal action within three weeks after the agreed ending of the employment contract. An employee who is employed for a fixedterm must be given treatment equal to that given to full-time employees employed to do similar work (Articles 4 (2) and 3 (2)).


Contract of employment
Any contract of employment shall meet the requirements of Article 4 (1) to (5), namely it shall be clear, specifying the type of employment, the rate of payment and the duration of the contract. The contract shall not lay down less favorable conditions for the employee than those provided by law, collective agreements or work rules. There is no specific form requirement, but where the contract of employment is not made in a written form, the employer shall issue a written contract within fifteen days (Article 7(1)).

Special Contracts of employment

Home Work Contract Article 46 defines the home work contract, and entitles the Minister to give further directives. These directives are not yet proclaimed and in force. Contract of Apprenticeship Contracts of apprenticeship, or vocational training, which primarily intend to train young people in a profession, are considered as special contracts of employment. Articles 46 to 51 of the Proclamation not only define the nature of these contracts, but poses a special obligation on the parties related to the nature of this contract, and specifies the grounds for termination.

Contracts beyond the scope of Application of the Labor Proclamation

Under Article 3 (1), the Labor Proclamation is applicable to employment relations based on a contract of employment that exists between a worker and an employer. However, notwithstanding this general definition, Article 3 (2) of the Labor Proclamation excludes certain special groups from the application of the Proclamation, in particular: contracts for the purpose of upbringing, treatment, care or rehabilitation; contracts for the purpose of educating or training other than as apprentice; contracts relating to persons holding managerial posts who are directly engaged in major managerial functions of an undertaking (...); contracts of personal service for non-profit making purpose; contracts relating to persons such as members of the Armed Force, members of the Police Force, employees of state administration, judges of courts of law, prosecutors and others whose employment relationship is governed by special laws; contracts relating to a person who performs an act in consideration of payments at his own business or trade risk or professional responsibility under a contract of service. The Council of Ministers is also given power to determine the applicability of this legislation to workers employed in foreign diplomatic missions and international organizations within the territory of Ethiopia as well as those employed in religious and charitable organizations (Article 3 (3)).

When concluding a contract of employment the parties may agree on a probationary period for the purpose of evaluating his or her suitability to the job (Article 11 (1)). Such an agreement needs to be done in writing and shall not exceed forty-five consecutive days (Article 11(3)). During this period, the employee enjoys the same rights and obligations that the other workers have (as defined in Articles 12 to 14), but termination is possible without notice, if he or she fails to meet the requirements (Article 11 (6)). Severance pay or compensation is not to be paid (Article 11(5)).

Suspension of the contract of employment

The temporary suspension of a contract of employment is regulated under Articles 17 to 21 of the Labor Proclamation. During Suspension the mutual duties under the contract of employment are suspended, so that the employee does not have to work and the employer is not obliged to pay wages, allowances and other benefits (Article 17 (2)). Article 18 defines the following grounds for suspension: leave without pay on request of the worker; leave of absence for the purpose of holding office in trade unions or other social services; detention for a period not exceeding thirty days (provided that the employer is notified); national call; force majeure for a period of not less than 10 consecutive days; and financial problems that require the suspension of the employers' activities for not less then 10 consecutive days. In the latter two cases of suspension the Ministry has to be informed in writing about the ground of the suspension (Article 19). Articles 20 and 21 then describe the procedure of confirmation by the Ministry. When the Ministry is convinced that the employer cannot resume its activities within the maximum period of suspension of 90 days, the worker shall be entitled to severance pay (Articles 21 (2), 39 and 44).

Termination of the contract of employment

Grounds for termination and notice Generally any contract of employment might be terminated by both parties, and in accordance with the provisions of the law or a collective agreement. Article 23 (2) states clearly that the transfer of ownership of an undertaking does not have a terminating effect. The contract of employment can be terminated on the following grounds: on expiration of the agreed period of employment (Article 24 (1)); by death of the worker (Article 24 (2)); on retirement of the worker (Article 24 (3)); by the insolvency of the employer; completion of the specified task (Article 24 (4)); by the impossibility of performance, where the worker becomes partially or permanently unable to perform his or her obligations in terms of the contract (Article 24 (5)); and by mutual agreement (Article 25). Termination at the initiative of the employee Generally a worker can terminate the contract of employment giving prior notice of fifteen days (Art. 31). Under Art. 32, 1 good causes for termination without notice from the side of the worker are: criminal assault from the side of the employer against him or her; if the employer has repeatedly failed to fulfill his basic obligations. The worker shall give his reasons for the termination in writing (Art. 32, 2). 70

Termination at the initiative of the employer

The contract of employment may not be terminated in the absence of a justified reason. Article 26 of the Labor Proclamation expressly recognizes the following grounds for termination of the employment contract: misconduct on the part of the employee; the employee's poor work performance and/or incapacity; the operational or organizational requirements of the undertaking. The following grounds do not constitute legitimate grounds for termination and make any dismissal unfair (Article 26 (2)): membership in a trade union or participation in its lawful activities; seeking or holding office as a workers representative; submission of grievance or the participation in proceedings against the employer; his or her nationality, sex religion, political outlook, marital status, race, color, family responsibilities, pregnancy, lineage or social status.

Notice of dismissal
The limited grounds for termination without notice are defined in Article 27 (1) a) to k): repeated and unjustified tardiness despite warning to that effect; absence from work without good cause; deceitful or fraudulent conduct; misappropriation of the property or fund of the employer; returning output which, despite the potential of the worker, is persistently below the quality stipulated; responsibility for brawls or quarrels at the work place; conviction for an offence where such conviction renders him or her unsuitable for the post; responsibility for causing damage intentionally or through gross negligence; commission of any of the unlawful activities defined in Article 14, such as reporting for work in a state of intoxication, refusal to be medically examined (except for HIV/AIDS test) or to observe Occupation Safety and Health prevention rules; absence from work due to a sentence of imprisonment for more than 30 days; offences stipulated in a collective agreement as grounds for termination without notice. The new text of the Labor proclamation adds that in these cases, the employer must give written notice specifying the reasons for and the date of termination. 72

Severance pay and compensation

Under Articles 36 to 41 any case of termination provokes payment obligations, such as wages, severance pay and in the case of Article 32 (1) (the employee's poor work performance and/or incapacity) an additional compensation which shall be thirty times his or her daily wages of the last week of service, for the first year of work. If the worker has served for more than one year, payment shall be increased by one-third of the previous sum for every additional year of service, within the limit of a total amount of twelve months wages.

Remedies in case of unjustified dismissal

A worker who intends to challenge the validity of his or her termination must file a submission before a regional first instance court, where a specialized labor division shall be set up (Articles 137 and 138 (1) b). (It should be mentioned at this stage that due to a severe shortage of educated legal personnel, these specialized labor divisions do not exist in every case.) If the termination proves to be unlawful, the proclamation gives the choice of remedies. The court may: Order the employer to reinstate the employee from any date not earlier than the date of dismissal. Order the employer to pay compensation to the employee. The primary remedy in respect of an unlawful termination is to order reinstatement or re-employment (Article 43 (1) and (2)). In the event that the employee does not wish to be reinstated or re-employed or the circumstances are such that a continued employment would be either intolerable or no longer reasonably practical and would give rise to serious difficulties, the court may award compensation rather than reinstatement/re-employment, even in cases the worker wishes to be reinstated (Article 43 (3)). The compensation will be paid in addition to the severance pay referred to in Articles 39 to 40. There are certain limits on compensation. The compensation will be hundred and eighty times the average daily wages and a sum equal to the remuneration for the appropriate notice period in the case of an unlawful termination of an unlimited contract (Article 43 (4) a)), and a sum equal to the wages that the worker would have obtained until the lawful end of his contract (Article 43 (4) b)).

Working time
Hours of work Normal working hours are 8 hours a day or 48 hours a week (Article 61). They should be distributed evenly, but may be even calculated over a longer period of time (Articles 63 and 64). Workers are entitled to a weekly rest period of 24 non-interrupted hours in a period of 7 days. Unless otherwise stated in a collective agreement, the weekly rest should be on Sunday, but another day may be chosen for certain services (Article 70). Overtime Any work exceeding the normal working time of 48 hours a week is overtime. Overtime is only permissible for up to 2 hours a day, or 20 hours a month, or 100 hours a year, in the following cases (Article 67): Accident, actual or threatened Force-majeure Urgent work Substitution of absent workers assigned on work that runs continuously without interruption The proclamation defines the overtime payment in Article 68 (1). The overtime payment ranges from a rate of one and one quarter (1 ) of the ordinary hourly rate (from 6 a.m. to 10 p.m.) to two and one half (2 ) on public holidays.

Employee rights
Night work Pursuant to Article 68 (1) b), night work is work realized between 10 PM and 6 AM. The worker is entitled to a rate of one and a half of the ordinary hourly wage. Paid leave Annual, uninterrupted leave with pay shall be a minimum of 14 working days, plus one working day for every additional year of service (Article 77). Additional leave is granted for employees engaged in particularly hazardous or unhealthy work. It is forbidden to pay wages in lieu of the annual leave (Article 76). Public holidays Ethiopia has twelve public holidays historical memorial days and holidays of Christian and Moslem origin - described by law. These days are: 7 January (Orthodox Christmas Day), 19 January (Timket), Eid-ul-Adha, 2 March (Battle of Adowa), Orthodox Easter Monday, Coptic Good Friday, Mulud, 5 May (Patriots Day), 28 May (National Day), 11 September (Ethiopian New Year/Coptic New Year), 27 September (Finding of the True Cross), end of Ramadan. Under Articles 73 to 75, public holidays are paid. A worker who is paid on a monthly basis will not be subjected to a reduction in wages for not working on a public holiday. An employee who works on a public holiday is entitled to the double of his or her ordinary hourly wages.

Maternity leave and maternity protection

Ethiopian Labor Proclamation provides one part (Part Six) to the Working Conditions of Women and Young Workers. Maternity leave and maternity protection are regulated in Articles 87 and 88. There are provisions around the nature of work that a pregnant employee is not permitted to perform where it could be hazardous to her or the child's health (Article 87 (2) to (6)). Night work is generally prohibited, nor shall she be assigned to overtime-work. Moreover she shall not be given an assignment outside her permanent place of work and be granted time off for medical examinations (Article 88 (1)). Employees are entitled to maternity leave, which is to start from 30 days prior to due date of birth, and end not less than 60 days after birth of the child. Maternity leave is classified as paid leave (Article 88 (3) to (4). A nursing employee does not enjoy special legal protection.


Other leave entitlements

Articles 85 to 86 provide for an entitlement to sick leave after the completion of the probation period. An employee is entitled to a maximum of 6 months of sick leave within 1 year of service. An employer will only be obligated to grant paid sick leave for the first months, whereas the wage is reduced to 50 % for the second and third month, and reduced to zero for the third to the sixth month of sick leave within a year. For any absence for longer than one day the employee has the obligation to produce a valid medical certificate. Moreover, Article 81 to 84 of the Proclamation provide for special leave for family events, union activities and other special purposes, such as for hearings before bodies competent to hear labor disputes, to exercise civil rights, and for training purposes according to collective agreements or working rules.

Minimum age and protection of young workers

Under Article 89 of the Labor Proclamation the statutory minimum age for young workers is 14 years. Beyond the age of 14 years, no person may employ a child for work that is inappropriate or that endangers his or her life or health (Article 89 (2) and (3)). Special measures of protection of young workers (e.g. work in transport, night work, work in arduous, hazardous or unhealthy activities, such as mining) may be taken by the Minister. Work performed under the regime of a vocational training course is exempted from this protection (Article 89 (5)). As shown above, the Ethiopian Constitution gives children general protection from exploitative labor practices Article 36 Rights of Children. Ethiopia ratified the ILO Worst Forms of Child Labor Convention, 1999 (No. 182), in September 2003.


The Constitution guarantees the right to equality in employment, promotion, pay and the transfer of pension entitlement (Article 35 (8) of the Constitution). The Labour Proclamation in its Article 14 (Unlawful Activities) penalizes any discrimination against female workers in matters of remuneration, on the ground of sex (Article 14 (1) b)) and contains a general provision of anti-discrimination on the basis of sex, religion, political outlook or any other condition (Article 14 (1) f)). Even though the Constitution recognizes the given historical disparities, an obligation on certain employers to implement affirmative action measures to advance women participation is not imposed. The world of work is still far from substantive equality.

Pay issues
Ethiopian law does not prescribe minimum wages through statute. Usually wages are fixed by the employer or by collective agreements or by the employee's contract of employment. Articles 53 and 54 of the Proclamation define Wages as the regular payment to which the worker is entitled in return for the performance of the work that he performs under a contract of employment. Overtime pay, allowances, bonuses, etc are not considered as wages. The Proclamation establishes the principle that wage is only paid for work done, except in cases, when the source of the impossibility to work was in the sphere of the employer (i.e. non supply of working material). Under Article 162 (2), claims for payment of wages, overtime and other payments shall be barred after six months from the date they became due. In case of bankruptcy of the employer, wages enjoy priority. If an insolvency proceeding has been opened over the employer's assets, the employees' claims of wages are treated with priority over other payments or debts in accordance with Article 167 of the Labor Proclamation and Article 1025 of the Commercial Code, Proclamation No. 166/1966.

Workers' representation in the enterprise

At the workplace level, workers may be represented by trade union delegates. Trade union regulation Trade union structure under national law The Constitution recognizes the right to freedom of association, the right to form and join a trade union and the right to participate in trade union activities. Part 8, chapter 1 of the Ethiopian Labour Proclamation stipulates the right of both workers and employers to form organizations of their own and to participate in them. Article 113 (2) lays down the trade union structure: There are trade unions (formed by workers), employer's associations, federations (organization established by more than one trade unions or employers' associations) and confederations (established by more than one trade union federations or employer federation). The Proclamation foresees to form federations and confederations and the right to join international organizations (Articles 114 (5) and (6)).

Collective Bargaining and Agreements

The Ethiopian Labor Proclamation states that one of its central objectives is to promote collective bargaining as a means of maintaining industrial peace and of working in the spirit of harmony and cooperation towards the allround development of the country. Collective agreements apply to all parties covered (Article 134(1)) and where their provisions are more favorable to the workers than those provided by law (Article 134 (2)). The collective agreement remains in force even after a trade union, which is party to the agreement, is dissolved. Under Article 133 (3), the duration of an agreement is fixed at three years unless expressly stipulated otherwise.


Proclamation specifically excludes from Chapter Five one class of workers, who consequently do not have the right to strike. These are workers who are engaged in essential public service undertakings. These services are defined in section 136 (3) to include: air transport undertakings supplying electric power undertakings supplying water and carrying out city cleaning and sanitation services urban bus services hospitals, clinics, dispensaries and pharmacies fire brigade services and telecommunication services.

Labor Strikes


Unlawful strikes and lock-outs Article 160 (1) prohibits a strike or lock-out initiated after a dispute has been referred to the Board or to the court and the prescribed 30 days period for decision has not elapsed. It is also unlawful to refuse to obey, or to start or continue to strike or to lock-out against the final order or decision of the Board or the court. However, a strike or lock-out, which is not in conflict with such decision, and which was initiated to seek compliance with this decision, is not unlawful (Article 160 (2)). Pursuant to Article 160 (3), it is prohibited to use violence or threats of physical force together with a strike or lock-out.

Settlement of individual labor disputes

Labor Disputes are generally regulated in part nine of the Ethiopian Labor Proclamation. Individual disputes fall under the jurisdiction of labor divisions at the ordinary courts, established as may be necessary at each regional first instance court (Article 137(1)). Article 138(1) lists the following individual labor disputes as examples: disciplinary measures including dismissal; claims related to the termination or cancellation of employment contracts; questions related to hours of work, remuneration, leave and rest day; questions related to the issuance of certificate of employment; claims related to employment injury; unless otherwise provided for in this Proclamation, any criminal and petty offences under this Proclamation. The decision is to be taken within 60 days. Appeal lies with the labor division of the regional court. The jurisdiction of the labor division of the regional court is defined in Article 139. The decision of the Court in matters of appeal is final (Article 140 (2)). The general court procedure follows the Civil Procedure, laid down in the Civil Procedure Code Decree, No.3/1965.


HR Communication
What is Communication? Communication is the process of transferring information from one source to another. Communication is commonly defined as the imparting or interchange of thoughts, opinions, or information by speech, writing, or signs.


What Is Communication?
Communication is defined as a process by which we assign and convey meaning in an attempt to create shared understanding. This process requires a vast repertoire of skills in intrapersonal and interpersonal processing, listening, observing, speaking, questioning, analyzing, and evaluating. Use of these processes is developmental and transfers to all areas of life: home, school, community, work, and beyond. It is through communication that collaboration and cooperation occur.

What is Communication?
Communication makes possible our relationships, friendships, work and family closeness. Yet mastering communication requires continuous use and practice to maintain the skill.


Communication Issues

Encoding of messages can be done verbally or non-verbally

Verbal: spoken or written communication. Nonverbal: facial gestures, body language, dress.

Sender and receiver communicate based on their perception.

Subjective perception can lead to biases and stereotypes that hurt communication. Effective Managers avoid communicating based on a pre-set belief.

Dangers of Ineffective Communication

Managers spend most of their time communicating so both they and the subordinates must be effective communicators. To be effective: Select an appropriate medium for each message.
There is no one best medium.

Consider information richness: the amount of information a medium can carry.

Medium with high richness can carry much information to aid understanding.

Is there a need for a paper/electronic trail to provide documentation?


Management Concerns
Communication : An employer must exercise reasonable care in hiring applicants who may, as a result of their employment and the employer's negligent failure to obtain more complete information, pose a risk to others. Communication is critical for: Employee motivation (employee need to share visions, also generate the shared visions); ineffective communication lead to high staff turnover and rope in quality and quantity of work. Managing organizational change, downsizing, restructuring, etc. Maintain a casual atmosphere where casual conversation is allowed (leads to creativity and satisfaction) New management models where employees are empowered and work in teams, information is empowering


The Communication Process

Messages are transmitted over a medium to a receiver.

Medium: pathway the message is transmitted on (phone, letter). Receiver: person getting the message.
Decoding allows the receiver to understand the message. This is a critical point, can lead to misunderstanding.

Receiver next decodes the message.

Feedback is started by receiver and states that the message is understood or that it must be 93 re-sent.

Conceptual Perspectives of Communication

Defensive Communication (this is bad) Evaluation - you language, criticize, blaming Control - don't seek input from others Strategy - no one want to be a victim of someone else motivation, Superiority - I am better than you behaviors Neutrality - equal indifferent, this is a problem, when you have a group member who does not care. Certainty - dogmatism, people who knows the answer, require no additional data, certain they are right, feel as teacher vs co-worker


Conceptual Perspectives of Communication

Supportive Communication Descriptive - sharing of feelings or perception, general request for information, ie I feel frustrated when you lie on the coach when the house is dirty. Problem Orientation - seeking solutions to a problem at hand Spontaneity - sense of a person is honest with their intention Equality - I am OK, you are OK, We are all human, we are equal. Empathy - caring and binding into the problem Provisionalism - willing to hear other speaks, willing to experiment with behaviors, attitude and ideas.

Organization Communication Networks

Organization chart depicts formal reporting channels.

Communication is informal and flows around issues, goals, and projects. Vertical Communication: goes up and down the corporate hierarchy. Horizontal Communication: between employees of the same level.
Informal communications can span levels and departments.

Grapevine: informal network carrying unofficial information through the firm.


Organizational Communications Network Figure 1.4

Formal Communication Informal Communication


Technological Advances

Internet: global system of computer networks Many firms use it to communicate with suppliers. World Wide Web (WWW): provides multimedia access to the Internet. Intranets: use the same information concepts as the Internet, but keep the network inside the firm. Groupware: software designed to let workers share information and improve communication. Best for team oriented support.


Communication Skills for Managers as Senders

Send clear and complete messages. Encode messages in symbols the receiver understands. Select a medium appropriate for the message AND monitored by the receiver. Avoid filtering (holding back information) and distortion as the message passes through other workers. Ensure a feedback mechanism is included in the message. Provide accurate information to avoid rumors.

Communication Skills for Managers as Receivers

Pay Attention to what is sent as a message. Be a good listener: dont interrupt.

Ask questions to clarify your understanding.

Be empathetic: try to understand what the sender feels. Understand linguistic styles: different people speak differently.
Speed, tone, pausing all impact communication. This is particularly true across cultures. Managers should expect and plan for this.


A model of the psychological contact (Guest, 1996) CAUSES CONTENT CONSEQUENCES

Organisational culture Fairness Organisational Citizenship HRM policies and practices Trust Experience Motivation Expectations The delivery of the deal Satisfaction and well-being

Organisational Commitment



Communication Networks
Networks show information flows in an organization.

Wheel Network: information flow to and from one central member. Chain Network: members communicate with people next to them in sequence.
Wheel and Chain networks provide for little interaction.

Circle Network: members communicate with others close to them in terms of expertise, office location, etc. All-Channel Network: found in teams, with high levels of communications between each member 102 and all others.

Types of Communication networks




Impact of Network
Speed of Decisions




Quality of Decisions



Networks in action
Wheel Chain All-Channel Macro Networks Principle These networks may emerge naturally or be imposed. Either way, they have a similar impact.

Developing the employee relations plans Answer these questions first: -How good are working relationships in the organization? -What do the managers think of other staff? -What do employees think of the organization and its management? -How well do HR policies and practices contribute to positive employee relations? -How skilled and knowledgeable are the managers in regard to their employee relations and people management responsibilities? The results of the audit will inevitable lead to discussion of what the ideal state should be. The organization needs to consider: -Organizational factors; -Management factors; -Staff factors; 106 -Environmental factors.

Communication in the workplace One way communication

Sender Message and media Receiver

Two-way communication
Message and media


Feedback and media

Communication flows Vertical Horizontal


Communication skills Speaking - informal - planned - formal Writing Listening Asking questions Non-verbal communication Facial expression Eye contact Gestures and movements Posture Physical appearance Non-verbal vocalisations

Space and territory -an intimate zone - a personal zone for close friends; - a social-consultative zone a public zone. Barriers to communication -Inappropriate language; -No feedback; -Wrong medium; -Distractions; -Too much communication; -Poor listening; -Assumptions and conclusions; -Too kind

-Atmosphere -Cultural differences; -Different roles and perceptions;

Organizational barriers -Distance -Long communications lines -Ineffective process -Specialization -Pressures -Status differences -Filtering.


Communication methods -Handbooks -Magazines and newsletters -Manuals -Grapevine -Team briefing Cross-cultural communication -Organizational issues -Job interviews; -New employees -Problems and solutions.


Effective communication -Do I know what I want to communicate? -What do I expect to happen when my message has been passed? -What other interpretations might be put on my message? Can I be misunderstood? If so, how can I prevent that happening? -Is my message complete, correct, and appropriate to the situation under review? -Do I really listen to people? How do I know? -What communication breakdown have I experienced today? Why did it happen? Could it happen again?


3.2 Establishing the Performance Management System


Performance Measurement
What gets measured gets done and What gets measured becomes important!


Performance Management
Management = getting work done through others Managers performance is only as good as his/her employees performance

Managers job = performance management of others

Performance Management
Organizational system

Focusing on employee performance

Consistently applied throughout organization With a supporting structure

Names of Systems
Performance Management
Performance Appraisals Evaluation Systems

Job Review Systems

Feedback Systems

What is Performance Management

Performance Management is a structured visual approach to monitoring the business performance, highlighting issues & reacting to them in a timely manner.


Performance Management
Ensuring appropriate performance by all employees through: -Reinforcement -Rewards -Modeling -Coaching -Training -Development Using a consistent feedback system

Working of Performance Management

Managers Speaks with Employee re: performance

Once per Year Formal goals Organizational Reporting System Tied to Organizational Outcomes

Examples of System Output

Words and What They Mean
Exceptionally well qualified Active socially Family is active socially Plans for advancement Aggressive Uses logic on difficult jobs Expresses himself well Has Leadership qualities Keen sense of humour Career-minded Relaxed attitude Work is first priority Independent worker Good communication skills Loyal Made no major errors yet Parties & drinks too much Family drinks too much Buys drinks for all of the boys Obnoxious Gets someone else to do it Speaks the local language Is tall or has a loud voice Knows lots of dirty jokes Back-stabber Sleeps at work Too ugly to get a date Nobody knows what he does Talks on phone lots Cant get another job

PERFORMANCE = Doing present job at a certain level (high or low) as measured by a formal system POTENTIAL = Includes future service, learning interest, motivation level

Deviation from expectations Do something in different way Not do something Do something not expected/needed

Reinforce/Reward Behavior Change Behavior Model Behavior

Establish Culture

-Based on Scientific Management concepts -Focus on observable performance -Goal directed -Planning required and formalized -Consistent, continuous collection, analysis, and collection of data -Value of feedback reinforced -Facilitates benchmarking

Performance Management Trends

Shift from viewing financial figures as main criteria to one of multiple indicators

More weight on indicators of efficiency and effectiveness

Change to viewing PM as on-going, evolving process

Principles of Performance Management

Supports business-oriented strategy Is values based Communicates organizational mission Fulfills responsibilities to organizational members Enables employees to manage own performance Manages expectations (clarifies roles and responsibilities) Creates partnership between management and employee Emphasizes importance of measurement feedback, and reinforcement Empowers employees Natural extension of management

Aims & Benefits of Performance Management

Aims Make our performance visible Drive us to take action Provide timely feedback on the effects of our actions

Make our performance visible Drive us to take action Provide timely feedback on the effects of our actions Highly visible performance gap Increased pressure to improve Indication where improvement is needed Continuous and sustained improvement in quality, cost, delivery and safety Satisfied customer, shareholders and employees

A performance management system is needed to ensure we meet our obligations to customers, shareholders & employees

Key Elements of a Performance Management System


Key tools
Visible KPIs with agreed targets Cascaded objectives for all Progress tracker for each section Central information system Regular review process

Action centered management

Andon system (line stop) Formal and well understood escalation procedure Standard work Line side rebalancing mechanisms

The performance management system needs to focus not only on 129 monitoring but on action centered management

Performance Management Framework

Define the key Drivers (QCDP) Cascade K.P.I.s through the organization

Create an environment of continuous improvement for a better workplace

1. Design a KPI Hierarchy

2. Set Targets

Create achievable stretch targets for each KPI

6. Build Incentives Performance Mgt System 5. Plan Improvemen t

3. Install tracking systems & process

Create support work streams & have issues logged with them visually

Tackle issues locally Mgt System where possible; utilize systems to solve high priority issues

4. Capture Issues & Resolve

Formalize the shift hand over & IPT around the tracking system & Capture Issues for resolution


Performance Management
Performance Management is a structured visual approach to monitoring the business performance, highlighting issues & dealing with them in a timely manner.


Attributes of Performance Management

1. Clear, visible and succinct mission 2. Simple KPIs each with a target 3. Less then 10 KPIs 4. Targets linked to individual performance 5. Information centre based on shop floor 6. Single location for information 7. Graphs to be owned and updated by production 8. Team leaders and team own process performance 9. Engineering and logistics support line issues 10. PERFORMANCE MANAGEMENT SYSTEM USED TO MANAGE - List Items To Be Improved

Associated Costs
Staff Costs

Production and Processing Costs

Training Costs Action Costs

Opportunity Costs

Key PM Questions
1. 2. 3. 4. 5. 6. Why assess performance What performance to asses How to assess performance Who do assess performance When to assess performance How to communicate performance assessment

The WHY of Performance Management Systems -Administer Salary & Wages -Correct Performance/Behavior -Plan for Future (promotion, transfer, career dev) -Facilitate Decision-Making (counseling, terminations) -Facilitate Human Resource Planning -Create Culture -Building Good Relationships -Increase Organizational Loyalty -Determine Effectiveness of Selection and Placement Methods

WHAT to Assess
Skills/Abilities/Needs/Traits of Individuals

That Interact with the Organization to Produce Behaviors Which

Result in Outcomes

Skills/Abilities/ Needs/Traits
Job Knowledge

Perform Tasks


Coordination Desire to Achieve

Obey Instructions
Report Problems Follow Rules

Production /Service Levels Production Quality

Scrap/Waste Accidents

Business Knowledge Maintain Equipment

Creativity Leadership

Submit Suggestions
Follow-up Write Reports

Equipment Repairs
Customers Served Customer Satisfaction


Completes Reviews


Measures Focus
Consistent indicators across industry or similar organizations Comparison of indicators over time in organization Comparisons with pre-determined standard

Approaches to PM

Attribute Behavioral

HOW to Assess Performance


Assessment Center Peer Review Panel Critical Events Upward Feedback 360 Degree

Techniques of PM
Essay (open-ended) Management by Objective Ranking Paired Comparisons Forced Choice Forced Distribution Ratings: -Checklist -Scales -Behaviorally Anchored Ratings (BARS) Critical Incidents

Essay Technique
Describe in detail the quantity and quality of the employees performance during the past twelve months. Describe the employees strength and weakness. How do you describe the employees potential within the company? What leadership skills does the employee bring to the job? What future development activities do you recommend for the employee?

Morgan Stanleys Essay System

Consider objectives identified in prior years Summary as well as this years objectives.

Evaluation: Strengths 1. 2. 3.
Development Areas 1. 2. 3.



Examples of essays on PMs.

His men would follow him anywhere, but only out of curiosity. I would not suggest breeding for this person. When she opens her mouth, it seems that it is only to change the foot that was previously there. He has carried out each of his duties to his entire satisfaction. He would be out of his depth in a car park puddle. This person is like a gyroscope: always spinning at a fast pace, but not really going anywhere. This person has delusions of adequacy.

Continued examples.

Since my last report, he has reached rock bottom and is digging. She sets low personal standards and then consistently fails to meet them. He has the wisdom of youth & the energy of old age. This person should go far. And, the sooner he starts, the better. In my opinion, this pilot should not be authorized to fly below 250 meters. This person works well under constant supervision and when cornered. This man is depriving a village somewhere of its idiot.

Management-by-Objective Examples
Employee will contribute to organizational profit margin by lower costs in department by 3.5percent.

To implement new recruitment system, the employee will evaluate the effectiveness of the advertisements placed during the year.

Ranking Example
Manager ranks all employees from best to worst: Overall performance On specific criteria (communication, customer relations skills, etc.)

Paired Comparisons Example

Rank each employee grouping overall or on a characteristic: Employee A and Employee B Employee B and Employee C Employee A and Employee C Employee C and Employee D Employee D and Employee A Employee D and Employee B etc.

Forced Distribution Example

Pace each of the employees in your department in the following categories based upon overall or specific category performance:

Top 10 percent: 50 89 percent: Outstanding: Good:

10-49 percent: Bottom 10 percent: Average: Below Average: Unacceptable:

General Electrics Distribution The Vitality Curve

Promotability High Medium Limited Top Performers 10% Highly Valued 70% Least Effective 20%

Ratings Example: Checklists

Program Auditor: _____ 1. Unable to separate important from irrelevant data. _____ 2. Omits important info from summaries. _____ 3. Cross-references to improve reporting. _____ 4. Produces summaries which lead to good reports. _____ 5. Requires excessive instruction to produce work. _____ 6. Unable to reduce data to manageable form. _____ 7. Communicates well with peers on reports. _____ 8. Fails to meet deadlines. _____ 9. Provides detailed, professional work. _____ 10. Protects confidentiality of information.

Ratings Example: Scales

Rate the employees behavior on the scale provided. Excellent Good Fair Poor N/A 4 3 2 1 ___ Reasoning ability Decisiveness in Decision-making Imagination & originality Ability to plan and control Cooperation with peers Cooperation with management Professionalism Interpersonal skills 4 4 4 4 4 4 4 4 3 3 3 3 3 3 3 3 2 2 2 2 2 2 2 2 1 1 1 1 1 1 1 1 ___ ___ ___ ___ ___ ___ ___ ___

Citibanks Performance Scorecard

Measurements Standards Leadership, Managers assessment Below Par Par Above Par

Customer Interaction Community Involvement Contribution to Overall Business People Performance Teamwork Training & Development Employee Satisfaction Control Audit Legal Regulatory Auditors standards Managers assessment

Citibanks Performance Scorecard..

Measurements Customer Satisfaction External company survey Goal of 80% Objective standards Below Par Par Above Par Strategy Implementation

Cross-sell, splits, mergers Retail asset balances Market share Financial Revenue Expense Margin Objective stadards

Citibanks Link to Compensation

Ratings Above Par Par Bonus 30% 15%

Below Par


Microsofts PA System
Overall Employee Rating:
= Exceptional performance rarely achieved; precedent setting results 4.5 =Consistently exceeds all requirements & expectations work highly valued 4 =Consistently exceeds position requirements and expectations; work often noteworthy 3.5 =Exceeds position requirements; successful in all objectives 3 =Meets position requirements and expectations; meets most or all objectives; needs some development for quality 2.5 =Falls below performance standards and expectations; has performance deficiencies 1.0-2.0 =Does not meet minimum requirements in critical aspects of job

Microsoft: Adding Distribution to Rankings

4.0 + = 3.5 = 3.0 or lower = 35% of employees 40% of employees 25% of employees

Ratings Example: BARS

Indicate the appropriate level of performance on each factor: Quantity of work

Quality of work Volume low & erratic

Satisfactory steady volume

Volume above expectations

Judgment Results always accurate; model work

Results accurate and Results generally thorough inaccurate and not thorough

Systematic, analytical, good with complex problems

Practical judgment, solves problems, difficulty with assessing relative value of factors

Does not always show good judgment; problem analysis not always adequate

Microsoft Competency Toolkit

FACTOR: COMPETENCY: Individual Excellence Intellectual Horsepower (is bright, intellectual sharp, learns quickly)

Level 1
Structures basic info accurately; draws informed conclusions

Level 2
Analyzes & organizes complex info from specific content area, identifying key issues, assessing impact, drawing reasonable conclusions

Level 3
Analyzes, explains & draws logical conclusions based upon complex data from multiple content areas

Level 4
Rapidly identifies the significance of info & insightfully determines strategic action.

With guidance, learns quickly on the job

Learns new skills & ideas rapidly

Rapidly learns & assimilates complex info involving unfamiliar situations & circumstances

Rapidly learns new concepts & ideas; integrates & assimilates highly complex info across broad, multi-functional content areas

Picks up new skills & understands ideas when structured Learns effectively from experience

Quickly adjusts thinking for new info or ideas Is able to apply & explain logic related to problems

Microsoft Competency Toolkit

FACTOR: COMPETENCY: Long-term Approach Developing people (provides job-relevant learning, developmental
exercises, and feedback to enhance individual performance)

Level 1
Assigns challenging tasks and assignments that will help people develop their skills Provides direction in correct performance of tasks and assignments

Level 2
Takes time to learn about and understand direct reports; career goals

Level 3
Actively coaches direct reports how to get the most learning from their current assignments Gives direct reports candid, thoughtful feedback on their strengths and weaknesses

Level 4
Holds managers accountable for developing people in their group/ organization Identifies key people in his/her organization to assume high-level management responsibilities, and is an advocate for them when opportunities for advancement occur

Provides stretch jobs and assignments for direct reports to help them develop their skills

Critical Incident Example

Employee Name:___________________________________ Date of Incident:__________________ Type of Incident:___________________________________ Individuals Involved: Description of Incident:

Outcome of Incident:


Date Discussed with Employee:____________ Supervisor Signature:______________________________ Employee Signature: ______________________________

Time orientation Method

Past performance Improving performance by changing behavior through rewards Judge who appraises

Preparation for future performance Improving performance by selflearning & personal growth Counselor who listens, helps, encourages & guides Actively involved in charting future plans

Supervisors Role Subordinates Role

Listener, reactor to, defender of past performance

Criteria for Performance Measures

Relevant Reliable


Problems with Performance Measures

Controllability Motivational impact Fallout Role Modeling Impact Reliability Relevance Control

WHO Should Assess Performance

Superior Only Subordinate(s) Peers/Coworkers Self Customers Others Subordinates All Stakeholders

WHEN to Assess Performance

Probation Period Annually (anniversary date, assigned date, set date for all) Semi-annually For Cause On-going

As needed

How to Communicate PM Info

In Writing Formal Informally

Private Moderated

Handling Performance Issues

What to do

Where to start
How to do it

Deviation from expectations Do something differently Not do something Do something not expected/needed

Performance Management the linking pin !

Vision Strategy Processes Starting with the ultimate goal and mission of the organization. Aligning the business units, teams and individuals


Performance Management
Behavior and Actions Results

What employees look for the linking pin!

Vision Strategy Processes Systems Understand what is expected form them This will lead to aligning individuals towards achievement of organizational goals

Performance Management
Behavior and Actions Results

What does Performance Management Involve?

Achievement of strategic goals & objectives Allocation of KPIs Facilitate employee personal development as part of a integrated process Understanding true strengths and weaknesses at every level of the organization Transformation of people management into a resultdriven, strategic business function Alignment of employee goals and actions with corporate strategy Retention of top performers and development of low performers Increased quality and frequency of communication between managers and employees

CEO Questions
Have I set the right organisation goals to achieve my strategy? There must be a more systematic approach we could use for goal setting. What kind of behaviors and skills and focus should I be directing my employees to have in order to achieve these goals? Does anyone know what behaviors will most likely help to improve our financial performance or improve customer satisfaction? Do the employees understand my vision and strategy? Have they been clearly communicated? Do employees buy-in to these goals and do they understand and buy-in their role or their divisions role in meeting the strategy?

CEO Questions Cont.,

Is my company structured optimally to fulfill our Strategy? Have we set up a performance incentive system that aligns with our organization strategy? Does it include objectives that our staff care about? Do I have the right tools, systems and processes in place, both formal and informal to support performance related communication? Isnt there some form of automation that can give me more detailed, relevant information.


Measurement and Performance

There are some questions that are relevant for business: Do we attract and retain the right people with the right skills? Are we performing effectively in our operations to produce and deliver to our stakeholders? Are we meeting or exceeding our stakeholders expectations? How are we doing financially? o Margins? o Costs? o Revenues? o New business revenues?

Integrated and Balanced Management Approach

Perspective Strategic Objectives Financial
Shareholder value Profit New revenue Differentiation Strategic alliances Customer service

Shareholder Equity Operating margin Revenue from new services Value for money Profits from alliances Customer satisfaction

R X million in 3 years RPI + x% annually 25% in three years

Finance Dir. CEO Business Dev. Mgr

Implement Economic Value Added


Number one customer rating R x million in five years Number one customer rating Best-in-class within five years Reduced by 50% in two years 60% within one year Triple in three years 10 in five years 20% in two years

Marketing Dir Bus. Dev. Mgr. Marketing Dir

Create customer Segmentation model Redefine channel strategy Reengineering new product development process

Business Processes

Productivity New product devt. Segmentation

Revenue/work hour Product development cycle time Number of initiatives targeted at profitable segments Management span of control Number of learning partnerships % management time interfacing with cust.

COO R&D Manager Marketing Dir.

Learning & Innovation

People policy Alliance Mngnt Customer focus

Human Res. Dir. Bus. Dev. Mgr. CEO

Develop new HR strategy Implement performance based compensation program

This prioritised set of initiatives defines the executive agenda and should support the planning and budgeting process. Conversely, senior management should call into question any 177 initiatives inconsistent with the strategic objectives.

Important Questions Is there any difference between organizational and individual performance management? Where should management put more attention to when managing performance? At the end what is performance management?


Defining Individual performance

Performance Management Support and tools Competencies, knowledge and skills

KNOWLEDGE I know how to do it

CONTEXT I know what to do

WILLINGNESS I want to do it

Performance: Those behaviours, that under the right conditions, lead to the expected results

The need to cascading down to level n

Value for clients, stakeholders And employees Organizational Strategies Divisions, Sections, Programs Plans etc Individual Action

Best Practices
In value based managed enterprises, individual employees understand how processes and day-to-day activities contribute to value creation They know what they have to do individually to contribute to value creating This value creation focus becomes the basis for determining appropriate performance measures and enables to differentiate between what could be measured and what should be measured (Business Balanced Scorecard Concept)

Individual performance management infrastructure

Performance Management infrastructure 1. Roles & Responsibilities 2. Annual objectives and feedback 3. Competencies model

Organisation Structure

Compensation & Incentives

Career Development

Training & Education

Recruiting & Selection

Integrated People Management Process


Performance Management System

Core Capabilities & Key Competencies

Corporate Goals

Team Goals

Competency Mix

Individual Goals

Individual Competency


Competencies :What are competencies?

Competencies are a set of behaviours that encompass skills, knowledge, abilities, and personal attributes that, taken together, are critical to successful work accomplishment.


Organisational and Individual Competencies

Organisational Competencies:
Pinpoints the most critical competencies for organisational success. These are an organisations core competencies.

Individual Competencies:
Those competencies that each employee brings to his or her function.


What is a Competency Framework? A Competency Framework is a map to display a set of competencies that are needed to achieve an organisations mission, vision, and strategic goals. A Competency Framework is future-oriented, providing a master of core individual competencies required to develop the ideal future workforce. The competencies that make up the framework will serve as the basis for future employee management, since they play a key role in decisions on recruiting, employee development, personal development, and performance management.

Why a Competency Framework?

A Competency Framework will help to bridge the gap between where the organisation is now and where we want to be in the future. This occurs in two ways.
Serves as a guide for management in making decisions, since it is based on the competencies that support the mission, vision, and goals of the organisation. Serves as a map to guide employees towards achieving the mission of the organisation and their functional areas.

Approaches to Competency Profiling

Two approaches to competency profiling:

Top-down approach:
Generally involves picking, based on a strategic analysis of the organization's performance objectives, an array of competencies from a dictionary of competencies and assessing those for a particular position or class of positions.

Bottom-up approach:
Involves exploratory checklist surveys and subsequent confirmatory interviews to derive the competencies from employees.

Functional Competencies
Administrative Knowledge Business Acumen Computer Filing Financial Health & Safety Knowledge and Skills Human Resources Industrial Relations Legal Knowledge Management Information Marketing/Sales Procurement Quality Knowledge and Skills Security Typing


Task and Leadership Competencies

Analytical Ability Assertiveness Conflict Handling Customer Focus Decisiveness Flexibility Individual Leadership Initiative Judgement Leadership of change Negotiation Skills Oral Presentation Oral Persuasiveness Performance Orientation Persistence


Task and Leadership Competencies Planning/Organising/Control Self-development orientation Strategic and Global Perspective Team Leadership Values Verbal Communication Written Communication


Features of Performance Management System

Setting SMART Goals for Employees Evaluate Employee Performance Coach and Train Employees to improve their performance Define competitive employee compensation plans Promote right employees to critical positions

Benefits of Performance management

Managing employee or system performance facilitates the effective delivery of strategic and operational goals. There is a clear and immediate correlation between using performance management programs or software and improved business and organizational results. For employee performance management, using integrated software, rather than a spreadsheet based recording system, may deliver a significant return on investment through a range of direct and indirect sales benefits, operational efficiency benefits and by unlocking the latent potential in every employees work day i.e. the time they spend not actually doing their job. Benefits may include :


Benefits of Performance management

Direct financial gains Grow sales Reduce costs Stop project overruns Aligns the organization directly behind the CEO's goals Decreases the time it takes to create strategic or operational changes by communicating the changes through a new set of goals Motivated workforce Optimizes incentive plans to specific goals for over achievement, not just business as usual Improves employee engagement because everyone understands how they are directly contributing to the organisations high level goals Create transparency in achievement of goals High confidence in bonus payment process Professional development programs are better aligned directly to achieving business level goals

Benefits of Performance management

Improved management control Flexible, responsive to management needs Displays data relationships Helps audit / comply with legislative requirements Simplifies communication of strategic goals scenario planning Provides well documented and communicated process documentation

Performance Management Principles

Make performance development a priority in your organization Supervisors and managers tend to believe that "putting out fires" with employees is the most important part of their job. Sometimes this is necessary, but if firefighting consumes too much time, then less time is available for correcting the real underlying problems. It may appear that a problem is fixed, but the "solution" may actually cover up something that is still broken. All too often, performance management becomes the weakest link in the chain of management activities that keep companies profitable. What should organizations do then to create a stronger link that will make their staffing and training investments pay off? Help employees develop key competencies Providing effective management in an organization is like maintaining a wheel that can handle any terrain and can go great distances without breaking down. One of the main "spokes" of this management wheel is improving employee performance through proper observation, assessment, and feedback. We call this "performance development" because the main objective is not to manage employee performance but to help employees develop job-related competencies.

Performance Management Principles

Keep your business properly aligned through effective performance development Performance development is important for making the management wheel run true and turn in the right direction. When this spoke is strong, the whole organization moves forward quickly and efficiently. If this spoke is weak, however, everything gets out of alignment and the organization has to slow down. Don't let your wheel of success become the "wheel of misfortune" Managers and supervisors typically do not receive any special training regarding performance development. They often do not understand how to help their employees to become more successful. This is why a performance development system is required to maintain the management wheel in any organization. A performance development system is a structured approach for improving the effectiveness of all employees. Unlike casual approaches for enhancing job effectiveness, a structured system emphasizes the use of standardized tools and procedures to achieve dramatic organizational results in a timely manner. Without these practical tools and standard procedures, the wheel of organizational success can easily become the "wheel of misfortune."

Total Performance Management System Process

Total Performance Management System includes 4 stages: First Stage: Performance Planning We work with you to incorporate the organization's strategic goals into a performance management program for employees. Second Stage: Performance Development This stage ensures that employees and their manager agree on the overall goals for the position and identify the tools necessary to help the employee meet their performance objectives. Third Stage: Performance Coaching We help facilitate a process to provide on-going feedback to employees that incorporates functional job performance as well as work performance on projects so that all performance measures are evaluated and development gaps are properly identified and addressed. Fourth Stage: Performance Review We will customize a Total Performance Review Tool to meet your organizations specific requirements


How KPIs & Issues Management interact to make a complete Performance Management System.


Competency & Skill Library Features & Benefits

Comprehensive Library
No need to reinvent the wheel. Allows a quick start. Completely customisable: Create new skill groups, skills, and sub-skills as needed

Create Common or Unique Performance Levels

Define different levels of competence (for example, from beginner to expert) for each competency, or use one scale for all

Input Performance Targets

Identify performance expectations for each competency/skill group for entry level up to senior management

Competency & Skill Library Features & Benefits

Define Behavioural Indicators

If desired, enter behavioural examples/targets for competencies and skills

Continually Enhanced and Grows in Value

The library is easily enhanced as a by-product of job profiling, performance planning, and employee development

Fully Integrated with Other HR Functions

Your competency/skill library is used in every other function of HR, it ties them all together, and allows consistency throughout all of your performance management and developmental programs

Steps for Implementing Competency & Skill Library

Step 1:Review provided library; eliminate competencies and skills that are irrelevant to the organisation Step 2:Select core competencies based on organisational strategy and values Step 3:Departments review list of competencies and skills for their function and add additional competencies and skills as they are needed Step 4:Library grows naturally as new skill needs are identified while building job profiles, performance, development, or succession plans


Job Profiling


What is Job Profiling

Job Profiling is a systematic procedure for identifying the Competencies critical for success in a particular job or a job role.
Job profiles can then be used for recruitment, selection, performance review, promotion, career development and succession planning.


Job Profiling Procedure

Step 1:Obtain background information about the job to be profiled and how that job fits into the organisation.
Step 2:Develop an initial list of the tasks most relevant to the job being profiled. Step 3:Meet with subject matter experts (SMEs)incumbent workers or supervisors of the job being studiedwho review and revise the list, adding, deleting, consolidating, or changing the wording of each task to make sure that the list of tasks accurately represents the job as it is performed in the organisation.


Job Profiling Procedure

Step 4:Present detailed descriptions of each of the Analytix Competency Framework to the SMEs. The SMEs decide, as a group, which competencies are relevant to the job and which skill levels are necessary for entry into the job and effective performance in the job.
Step 5:The final product of the profiling procedure is a report listing the most critical tasks an individual in that job must perform and, for each relevant Analytix competency, the skill level required to perform the job.


How Employee Empowerment Programs Improve Productivity

Provide opportunity for employees to obtain intrinsic rewards

Employee Empowerment Programs

Improve Productivity

Improve organizational decision making


What Makes a Job Intrinsically Motivating?

skill variety

task identify

Job Characteristics

job feedback

task significance


Job Enrichment Strategies

Combine tasks. Establish client relationship. Reduce direct supervision. Increase identification with product/service.


Job Enrichment
Strengths Often leads to improvements in productivity, quality, absenteeism rates, and retention Weaknesses Production may become less efficient


Quality Circles
Six to twelve employees Identify and resolve production problems in their unit Meet once a week Led by a coordinator


Quality Circles
Strengths Gain valuable input from employees Improve communications among workers and management Increase motivation through empowerment Weaknesses Often used as a quick fix Creates an insideroutsider culture Sometimes operated improperly


Continuous Improvement Programs

Build quality into all phases
Design Production Delivery


Self-Managed Work Teams

Six to eighteen employees From different departments Work together Produce a welldefined segment of finished work


Self-Managed Work Teams

Plan Organize Coordinate Take corrective action


Obstacles to Self-Managed Work Teams

Managers reluctant to give up their power Employees reluctant to accept their new responsibilities


Training for Self-Managed Work Teams

Technical skills Interpersonal skills Administrative skills


Self-Managed Work Teams

Strengths Empower employees to make day-to-day decisions Provide greater flexibility Weaknesses Departmental rivalries when teams formed Absence of supervisor may cause problems


Manufacturing organizations New manufacturing strategies Competitive pressures Advanced production technologies

Where Self-Managed Work Teams Work Best


Line Managers and Employee Motivation

Strengthen the effortperformance link Strengthen the performance-reward link Provide rewards that are valued by employees


Line Managers and Informal Participation

Match the level of participation to each employees desire for challenge, responsibility, and opportunity Match the level of participation to each employees KSAs

Line Managers and Self-Managed Work Teams

Serve as a technical consultant to teams Serve as a facilitator Serve as an area manager


The HRM Department and Productivity Improvement Programs

- Work with top management to establish an appropriate corporate culture - Provide training


3.3 Ensuring a Safe and Healthy Work Environment


HRM and Competitive Advantage

HR Planning Job Analysis

Recruitment Selection Competence Motivation Work Attitudes

Training/Develop. Performance App. Compensation Productivity Imp.

Output Retention Legal Compliance Company Image

Cost Leadership Product Differentiation

Workplace Justice Unions

Safety & Health


Linking Safety and Health Practices to Competitive Advantage

Reduced Absenteeism Reduced Turnover

Minimize Employee Health Problems

Reduced Medical Costs

Competitive Advantage

Increased Productivity
Reduced Litigation

The Nature and Role of Safety and Health

Safety - Protecting employees from injuries caused by work-related accidents Health - Employees' freedom from physical or emotional illness

The Nature and Role of Safety and Health

Employers have responsibility to furnish a workplace free from recognized hazards that are causing or are likely to cause death or serious physical harm

Objectives safety and health

Reduce occupational hazards through direct intervention Promote a safe and healthy culture through compliance assistance, cooperative programs and strong leadership Maximize Occupational Safety and Health Administrations(OSHA) effectiveness and efficiency by strengthening its capabilities and infrastructure

Safety: Economic Impact

Job-related deaths and injuries extract high toll in terms of human misery Significant costs passed along to consumer Everyone affected (directly or indirectly) by deaths and injuries

Focus of Safety Programs

1. Unsafe employee actions - Create psychological environment and employee attitudes that promote safety 2. Unsafe working conditions - Develop and maintain safe physical working environment

Reasons for Management Support of Safety Program

Personal loss.

Financial loss to injured employees.

Lost productivity. Higher insurance premiums Possibility of fines and imprisonment. Social responsibility.

The Costs of Workplace Injuries and Illnesses

Medical and insurance Workers compensation Survivor benefits Lost wages Damaged equipment and materials Production delays Other workers time losses Selection and training costs for replacement workers Accident reporting


Laws Regulating Safety and Health Practices at the Workplace Occupational Safety and Health Employee Right-to-Know Disabilities


Occupational Safety and Health

Sets and enforces workplace safety standards Promotes employer-sponsored educational programs that foster safety and health Requires employers to keep records regarding job-related safety and health matters


Developing a Safety Program

Job hazard analysis - Key to determining and implementing the necessary controls, procedures and training Reauthorization - Requires businesses to communicate more openly about hazards associated with materials they use and produce and wastes they generate

Developing a Safety Program

Employee involvement Include employees, gives sense of accomplishment Safety engineer - Staff member who coordinates overall safety program Accident investigation - Safety engineer and line manager investigate accidents Evaluate safety program

Evaluation of Safety Programs

Reduction in frequency and severity of injuries and illnesses Effective reporting system is needed

Areas of Concern
Fire safety Personal protection equipment Electrical safety Basic housekeeping Machine guards


Inspection Priority
High Priority

Imminent danger Fatality or catastrophe investigations Employee complaint investigations General programmed inspections

Low Priority


Requirements of Employee Right-to-Know Develop a system for inventorying hazardous substances Label the containers of these substances Provide employees with needed information and training to handle and store these substances safely


Causes of Workplace Accidents

Most Frequent

Employee error
Equipment insufficiency Procedure insufficiency
Least Frequent


Accident Prevention Strategies

Employee selection Employee training Safety incentive programs Safety audits Accident investigations Safety committees


High-Risk Personality Characteristics

Risk-taking Impulsiveness Rebelliousness Hostility


Study of human interaction with tasks, equipment, tools and physical environment Ergonomics payoff - Clear payoff in using ergonomics

Workplace Violence
Vulnerable employees Vulnerable organizations Legal consequences of workplace violence Individual and organizational characteristics to monitor Preventive actions

Vulnerable Organizations
Chronic labor/management disputes Frequent grievances filed by employees Large number of workers compensation injury claims Understaffing and excessive demands for overtime in an authoritarian management style

Legal Consequences of Workplace Violence

Negligent retention - Occurs when company keeps persons on payroll whose records indicate strong potential for wrongdoing and fails to take steps to defuse a possible violent situation

2008 by Prentice Hall


Individual and Organizational Characteristics to Monitor

Screaming Explosive outburst over minor disagreements Making off-color remarks

Individual and Organizational Characteristics to Monitor (Cont.)

Crying Decreased energy or focus Deteriorating work performance and personal appearance Become reclusive

Preventive Actions
Ban weapons on company property, including parking lots Under suspicious circumstances, require employees to submit to weapons searches or examinations for mental fitness for work Policy of zero tolerance toward violence or threats of violence Have employees report all suspicious or violent activity

Preventive Actions (Cont.)

Relationships with mental health experts for recommendations in dealing with emergency situations Train managers and receptionists to recognize warning signs of violence and techniques to diffuse violent situations Equip receptionists with panic buttons to alert security instantly

Employee Training
Training on safe and proper job procedures reduces accidents.


Safety Incentive Programs

Motivate safe behavior by providing workers with incentives for avoiding accidents. Formulate safety goals and reward employees if these goals are met.

Accident Investigations
Determine accident causes so that changes can be made to prevent future occurrences of similar accidents.


Safety Committees
Assist with inspections and investigations. Conduct meetings. Answer workers questions. Identify safety concerns. Develop programs.

Employee Health Problems

Repetitive motion disorders Lower back disorders AIDS Substance abuse Employee wellness Workplace stress Workplace violence

Repetitive Motion Disorders

Repetitive stress injuries which affect tendons that become inflamed from the strains and stresses of repeated, forceful motions


Carpal Tunnel Syndrome

Carpal Tunnel Syndrome (CTS) -A repetitive motion disorder in which people experience pain in the eight wrist bones, or carpals, that form a tunnel Results from pressure on median nerve in wrist due to repetitive flexing and extending of wrist

Repetitive Stress Injuries (RSI)

Group of conditions caused by placing too much stress on joint and happens when same action is performed repeatedly

Task Conditions Associated with Carpal Tunnel Syndrome


Task Conditions Associated with Carpal Tunnel Syndrome

Frequent, repetitive use of the same movements of the hand or wrist The generation of high force by the hand Sustained awkward hand positions The regular use of vibrating or hand-held tools Frequent or prolonged pressure over the wrist at the base of the palm

Nature of Stress
Bodys nonspecific reaction to any demand made on it Potential consequences - Diseases that are leading causes of death, may even lead to suicide Stressful jobs - Lack of employee control over work

Twelve Jobs with Most Stress

1. Laborer 2. Administrative Assistant 3. Inspector 4. Clinical Lab Technician 5. Office Manager 6. Foreman 7. Manager/ Administrator 8. Waitress/Waiter 9. Machine Operator 10. Farm Owner 11. Miner 12. Painter

Sources of Stress
Organizational Factors Personal Factors General Environment

Organizational Factors
Corporate Culture The Job Itself Working Conditions

Personal Factors
Family Financial Problems

General Environment
Economic uncertainties War or the threat of war Threat of terrorism Long commutes in rush hour traffic Unrelenting rain Oppressive heat or chilling cold

Managing Stress
Exercise Follow good diet habits Know when to pull back Put stressful situation into perspective Find someone who will listen Establish some structure to your life Recognize your own limitations Be tolerant Pursue outside diversions Avoid artificial control

Individuals lose sense of basic purpose and fulfillment of work Costs: reduced productivity, higher turnover Individuals in helping professions seem to be most susceptible to burnout Danger: It is contagious!

Strategies for Reducing Repetitive Motion Disorders

Ergonomics Training Physical fitness training


Strategies for Reducing Lower Back Disorders

Prescreen individuals with existing back problems or the propensity to develop them Job training (proper lifting techniques) Fitness training (strengthen the lower back)


Strategies for Dealing with AIDS in the Workplace

Do not screen out or terminate qualified HIV-infected victims unless the disease impedes their job performance. Educate employees about how the AIDS virus is transmitted (and how it is not transmitted).


Substance Abuse Costs to Employers

Lost productivity Accidents Workers compensation Health insurance claims Theft of company property


Strategies for Reducing Substance Abuse Problems in the Workplace

Screen out applicants and discharge employees who have been identified as substance abusers. Train supervisors to detect substance abuse. Provide employee assistance programs.


Employee Wellness
Seeks to eliminate certain debilitating health problems that can be caused by a persons poor lifestyle choices


How Poor Employee Health Affects Competitive Advantage

Absenteeism Turnover Medical Costs





Wellness Programs
Traditional view that health is dependent on medical care and is simply absence of disease is changing Optimal health can be achieved through environmental safety, organizational changes, and healthy lifestyles Firm conducts needs assessment to find appropriate health needs Chronic lifestyle diseases are much more prevalent today than ever before

Physical Fitness Programs

Most commonly offered inhouse corporate wellness programs involve efforts to promote exercise and fitness Reduce absenteeism, accidents, sick pay

Employee Wellness Programs

Physical fitness facilities On-site health screening Smoking cessation Stress management Nutrition and weight management


How Workplace Stress Affects Competitive Advantage

Workers may perform poorly. Workers may quit their jobs. Workers may suffer low morale. Conflicts among workers may occur. Workers may miss work. Workers may be indifferent toward coworkers and customers.

How HRM Programs can Reduce Stress

Match workers to jobs Clarify job expectations Clarify performance expectations Clarify reward expectations

HRM Programs

Lower Stress

HRM Practices that can Reduce Stress

Effective selection and training procedures Clearly written job descriptions Effective performance appraisal systems Effective pay-for-performance programs


Costs of Workplace Violence

Victims medical and psychiatric care Repairs and clean-up Insurance rate hikes Increased security measures Increased absenteeism


Employers Legal Liability for Workplace Violence

It knew or should have known that a criminal act was probable. It could have reasonably protected the employee from criminal assault, but failed to do so. Its failure to protect the employee caused the subsequent injuries to occur.


Strategies for Reducing Workplace Violence

Improved lighting Employee escort services to and from parking lots Reception areas that can be locked when no one is on duty A policy stipulating that there are always at least two people on duty Security systems

Strategies for Reducing Workplace Violence

Policies regarding visitor access Curved mirrors at hallway intersections or concealed areas Bullet-proof glass


Substance Abuse
Involves use of illegal substances or misuse of controlled substances such as alcohol and drugs

Steps for Establishing a Substance Abuse Free Workplace

Establish a Drug and Alcohol Free Policy
Provide Education and Training Implement a Drug-Testing Program

Create an Employee Assistance Program

Signs of Possible Substance Abuse

Excessive absenteeism Radical mood swings Decline in personal appearance Smell of alcohol or other physical evidence of substance abuse Accident proneness and multiple workers compensation claims Lack of coordination Psychomotor agitation or retardation. Alcohol, marijuana, and uploads can cause fatigue. Cocaine, amphetamines, and hallucinogens can cause anxiety. Thought disturbances. Cocaine, alcohol, amphetamines, and inhalants often cause grandiosity or a sense of profound thought Other indicators. Cocaine and inhalants can cause aggressive or violent behavior. Alcohol and other sedatives reduce inhibition. Marijuana increases appetite, whereas stimulants decrease it. Both types of drugs cause excessive thirst.

Employee Assistance Programs (EAP) Comprehensive approach that many organizations have taken to deal with numerous problem areas such as burnout, alcohol and drug abuse, and other emotional disturbances

Smoke-Free Workplaces
Secondhand smoke can increase risk of cancer Workplace smoking is not only hazardous to employees health, but also detrimental to firms financial health Some countries ban smoking in workplace Some business owners have taken a personal stand against smoking Some reject employment applications on grounds would-be employee is a smoker

Line Managers and Employee Safety

Help employees want to work safely. Ensure that workers are doing their jobs safely. Investigate accidents.


Line Managers and Employee Health

Ensure legal compliance. Alleviate worker stress. Maintain confidentiality of employee information.


The HRM Department and Employee Safety and Health

Develop safety and health programs. Select safety and health programs. Evaluate safety and health programs. Ensure legal compliance. Incorporate safety and health concerns in HRM practices.


How to Conduct a Safety Audit

Step 1: Observation Step 2: Employee discussion Step 3: Recording and follow-up


How to Investigate Accidents

Ensure the safety of all employees. Identify both immediate and underlying causes of the accident. Make sure the accident scene is kept intact until the investigation is finished. Inspect the location and interview injured or affected workers, eyewitnesses, and others with information.


Safety management system

A system for the management of safety at aerodromes including the organizational structure, responsibilities, procedures, processes and provisions for the implementation of aerodrome safety policies by an aerodrome operator, which provides for the control of safety at, and the safe use of, the aerodrome. If we dissect the definition we can find some useful information. There shall be a system, and as a corollary, a systematic approach to safety. Safety shall be managed and controlled. There must be an organisation with structure and defined responsibilities. There must be procedures. There must be a safety policy which shall be implemented. And the objective, the aerodrome shall be safe for operation. 299