Employee Morale and HR Management PDF

10.5 Employee morale and welfare HR managers should not just focus on making sure the business has enough workers. Employee productivity and work satisfaction have been shown to be much higher in those businesses that put strategies in place to improve levels of employee morale and employee welfare....

10.5 Employee morale and welfare HR managers should not just focus on making sure the business has enough workers. Employee productivity and work satisfaction have been shown to be much higher in those businesses that put strategies in place to improve levels of employee morale and employee welfare. Most HR departments will offer advice, counselling and other services to employees who are in need of support, perhaps because of family or financial problems. These support services can reflect well on the caring attitude of the business towards its workforce. Improving the working conditions with excellent hygiene facilities and safety equipment is another effective way of improving employee welfare. When workers feel that the employer wants to improve their long-term welfare, it often leads to high morale and a strong sense of loyalty to the business, together with a desire for it to do well. If employee morale is high, productivity often increases and labour turnover is low. Work–life balance The hours and times that people work have always been subject to change, but the pace of this change is now more rapid than ever because: Customers expect to have goods and services available outside traditional working hours. Organisations want to match their business needs with the way their employees want to work. Globalisation has led to much greater levels of competition, so efficiency and flexibility are important for a business to remain competitive. The demands of working long and often unsociable hours that many businesses impose on their employees can lead to stress and poor health. Some analysts suggest that HR departments should assist employees to achieve a better work–life balance, which will reduce stress but also increase employee efficiency. The following methods have been used by some businesses to allow employees to take more control of their working lives and to allow for more time for leisure, relaxation, creativity and their families: flexible working (see Chapter 16) teleworking – working from home for some of the working week job sharing – allows two people to fill one full-time vacancy although each worker will only receive a proportion of the full-time pay sabbatical periods – an extended period of leave from work of up to 12 months. Some businesses pay employees during this period. All employers guarantee to keep the job open for the employee on their return to work. Impact of diversity and equality in the workplace Most organisations have policies that try to ensure equality and diversity in the workforce. Many countries have strict laws that govern equality issues. Businesses that promote equality in the workplace do not base recruitment and dismissal decisions, pay, promotions and other benefits on employees’ race, sexuality, gender, age, religion or national origin. Promoting equality in the workplace impacts on business by: creating an environment with high employee morale and motivation developing a good reputation and the ability to recruit top talent based on fairness measuring employee performance by their achievements at work, not by any discriminatory factor. In contrast, if a company uses discriminatory practices to decide who is promoted, employees who are discriminated against are likely to become discouraged and demotivated. Workplace diversity means acknowledging differences between employees and deliberately creating an inclusive environment that values those differences. A workplace that encourages diversity employs individuals of various races, genders, ages, religions and ethnicities. Many businesses implement diversity programmes, which educate employees on the definition of diversity and how it helps every member of the workforce. Promoting diversity in the workplace impacts on business by: capturing a bigger market share as consumers are attracted by a diverse sales force employing a more qualified workforce as selection is based on merit and not on discrimination increasing creativity because individuals from different backgrounds approach problem-solving in different ways achieving cultural awareness, leading to improved knowledge about foreign markets promoting diverse language skills, which allows businesses to provide products and services internationally. BUSINESS IN ACTION 10.2 Huawei employs nearly 190 000 people worldwide. The business is proud of its diverse workforce. In China alone, it employs workers from 42 ethnic groups. All managers are instructed to support gender equality and prohibit gender bias. The company claims that hiring local employees in its many foreign operations gives it an excellent understanding of the unique culture of each country. Discuss in a pair or a group: Should it be illegal for a business to discriminate in favour of one gender, race or ethnic group? Justify your answer. 10.6 Training and developing employees Having spent a great deal of time and effort on recruiting and selecting the right staff, the HR department must ensure that they are well equipped to perform the duties and undertake the responsibilities expected of them. This will nearly always involve training in order to develop the full abilities of every worker. Types of training Induction training should be given to all new recruits. It aims to introduce them to the people they will be working with most closely, to explain the internal organisational structure, outline the layout of the premises and make clear essential health and safety issues, such as procedures during a fire emergency. On-the-job training involves instruction at the place of work. This is often conducted by either the HR managers or departmental training officers. Watching or working closely with existing experienced members of staff is a frequent component of this form of training. It is cheaper than sending recruits on external training courses and the content of the training is controlled by the business itself. Figure 10.3: On-the-job training allows less-skilled workers to learn from experienced employees Off-the-job training covers any course of instruction away from the place of work. This could take place in a specialist training centre belonging to the company itself or it could be a course organised by an outside body, such as a college, university or computer manufacturer. Outside training has the added potential of being a source of new ideas. These courses can be expensive but may be indispensable if the business lacks anyone with the required degree of technical knowledge. Figure 10.4: Off-the-job training is often undertaken in a specialist college Impact of training on a business and its employees Training can be expensive. It can also lead to well-qualified employees leaving for a better-paid job once they have gained qualifications from a business with a good training programme. When one business seeks to employ well-trained workers from another business, it is sometimes referred to as ‘poaching’. These factors can discourage some businesses from setting up expensive training programmes. In addition, workers may be less productive during the training programme, especially if off-the-job training is used. The costs of not training are also substantial. Untrained employees will be less productive, less flexible and less adaptable. Poorly trained workers often give unsatisfactory customer service. Accidents are likely to result from workers untrained in health and safety matters, especially in manufacturing businesses or in the food industry. There is a significant link between the importance given to the training and development of employees in a business and the levels of employee satisfaction and motivation. The link between training and the sense of achievement that can result from it was identified by motivational theorists (see Section 11.4). Without being pushed to achieve a higher standard or more skills, workers may become bored and demotivated. The multi-skilling of workers can be a great benefit to a business, especially in times of rapid economic and technological change. TIP You may need to analyse why some businesses spend very little on employee training. One reason firms often give for not training their employees is that these well-trained workers will then be recruited by other businesses. Development and appraisal of employees This should be a continuous process. Development might take the form of new challenges and opportunities, additional training courses to learn new skills, promotion with additional delegated authority and chances for job enrichment. To enable a worker to continually achieve a sense of self- fulfilment, the HR department should work closely with the worker’s functional department to establish a career plan that the individual feels is relevant and realistic. The HR department should analyse the likely future needs of the business when establishing the development plan for each member of the workforce. In this way, an individual’s progress and improvement can also be geared to the needs of the company. Employee appraisal is often undertaken annually. It is an essential component of a staff-development programme. The analysis of performance against pre-set and agreed targets, combined with the setting of new targets, allows the future performance of the worker to be linked to the objectives of the business. Both employee appraisal and employee development are important features of Herzberg’s motivators (see Section 11.3). These are intrinsic factors that can provide the conditions for high levels of motivation at work. Employee development to encourage intrapreneurship Many businesses have training and development programmes with the specific aim of encouraging employees to become successful intrapreneurs. Most employees can demonstrate intrapreneurship if they are: encouraged to be independent thinkers and creative given opportunities to mix and work with other skilled employees from different departments empowered with the authority and resources they need to introduce innovations assured that some failure is expected and acceptable. Removing the ‘don’t fail’ ethos is important – intrapreneurs are meant to take risks and some of their ideas will not work! encouraged to start with small ideas and innovations – before moving on to the bigger issues. ACTIVITY 10.6 How Lunar Cafés (LC) develops its employees LC is a multinational chain of cafés. The company relies greatly on face-to-face customer relationships to drive higher sales. Thousands of café employees help develop the customers’ experience and the LC brand image. LC means more than just good coffee, it’s about the relaxed atmosphere, convenient locations and the personal nature of the consumer service. Its employees who make the coffee (‘baristas’) are a key part of the brand. Figure 10.5: Global training programmes improve café workers’ efficiency The company’s training programme plays a big role in its worldwide success. It includes: Lunar Café college: LC offers its own classes, called Barista Stars and Barista Experts. These qualifications can even earn the learners college credits. Several universities recognise these  qualifications as part of management degrees. Convert a complaint into a CAFE: LC’s baristas serve customers quickly because they have become experts in set routines through extensive on-the-job training. LC’s employees have a well-tried and tested procedure for when a customer complains. The following CAFÉ approach is used: Care about the customer’s opinion. Acknowledge the complaint. Find the solution to the problem. Engage with the customer to explain what went wrong. LC motivates all employees: The company has invested $50 million in barista training which encourages loyalty by organising a ‘Leaders for the Future’ conference. The event aims to inspire nearly 8 000 café managers and make them enthusiastic about the coffees they serve. The company cares about all employees: LC has one of the lowest rates of labour turnover of any big food and drink business. A barista said: ‘LC is concerned for the welfare of all its workers. All employees have health insurance, competitive pay, opportunities for career progress and a sense of working for a close-knit team. Employee welfare is considered to be very important. All baristas are trained to make the customer happy.’ 1 Analyse the benefits to LC of extensive employee training. 2 Evaluate whether the extensive training programme at LC is sufficient to ensure a motivated and loyal workforce. REFLECTION In preparing your answer to Q2 in Activity 10.6, how did you decide how important training is to establishing a motivated and loyal workforce? How did you assess whether other factors influence worker motivation and loyalty at LC? Did you prioritise these factors? Discuss your conclusions with another learner. Did your partner reach different conclusions? How would you defend your own conclusion? Or can you now criticise your own conclusion? 10.7 Management and workforce relations The relations between managers and the workforce have a great impact on the success or failure of a business. In most countries, employees are able to join trade unions. Many of the discussions and negotiations needed between managers and workers can then take place through trade union officials. Benefits of cooperation between management and the workforce In some countries, such as France and the UK, there is a long tradition of conflict and disagreement between business managers and their workforce. In other countries, such as Germany and Japan, the relationship between these two groups is much more cooperative. Cooperation can result in real benefits to managers and workers: Fewer days are lost through strikes and other forms of industrial action. It will be much easier for management to introduce change in the workplace. For example, a decision to automate part of a factory could be made with the cooperation of the workforce. The contribution of the workforce is likely to be recognised by management, and pay levels and other benefits might reflect this. Agreement on more efficient operations will increase the competitiveness of the business. Workers’ practical insight into the way the business operates can contribute to more successful decisions. Impact of trade union involvement in the workplace There are various reasons for a worker to join a trade union: The basis of trade union influence has been ‘power through solidarity’. This is best illustrated by the unions’ ability to engage in collective bargaining, negotiating on behalf of all of their members within a business. This puts workers in a stronger position than if they negotiated individually to gain higher pay deals and better working conditions. Individual action – for example, one worker going on strike – is unlikely to be very effective. Collective industrial action could result in much more influence over employers during industrial disputes. Unions provide legal support to employees who claim unfair dismissal or poor working conditions. Unions put pressure on employers to ensure that all legal requirements are met, for example health and safety rules regarding the use of machinery. Many employers have a policy of trade union recognition, which allows for collective bargaining. However, some employers prefer to negotiate with individual workers over pay and work conditions. These employers argue that they do not want to be pressurised through collective bargaining with trade unions into paying higher wages or improving work conditions. Benefits of collective bargaining Employers can negotiate with one trade union officer rather than with individual workers. This saves time and prevents workers from feeling that one individual has obtained better pay and conditions than others. Union officials can provide a useful channel of communication with the workers. This two-way communication through the trade union allows workers’ problems to be raised with management and employers’ plans could be discussed with workers. Unions can impose discipline on members who plan to take hasty industrial action that could disrupt a business. This makes industrial action less likely. The growth of responsible, partnership unionism has given employers a valuable forum for  discussing issues of common interest and making new workplace agreements. These discussions should lead to increased productivity, helping to secure jobs and raise profits. Disputes between trade union and management When cooperation between managers and the workforce does not exist, there is a great chance of industrial action. Trade union leaders can use several forms of industrial action during a dispute with employers over improvements in pay and conditions: Continue collective bargaining, perhaps with the help of an independent arbitrator. Go slow – a form of industrial action in which workers keep working but at the minimum pace demanded by their contract of employment. Work-to-rule – a form of industrial action in which employees refuse to do any work outside the precise terms of the employment contract. Overtime will not be worked and all non-contractual cooperation will be withdrawn. Overtime bans – industrial action in which workers refuse to work more than the contracted number of hours each week. During busy periods, this could lead to lost output for the employer. Strike action – the most extreme form of industrial action in which employees totally withdraw their labour for a period of time. Strike action leads to production stopping and the business shutting down during the industrial action. ACTIVITY 10.7 Cathay Pacific avoids damaging strike before busy holiday season Cathay Pacific avoided a threatened strike by cabin crew after it agreed a compromise deal with the flight attendants’ union. The union welcomed the deal, which gave it most of what it was asking for, and called off the strike. The industrial dispute was over a new money-saving health insurance scheme that Cathay wanted to introduce for its 10 000 workers that would have forced them to pay for visits to the doctor. Cathay has now agreed to drop these charges until May and then to allow ten free visits to the doctor each year. The company refused to say how much the compromise would cost. ‘I hope that the management will continue to cooperate with us to improve workforce– management relations,’ said a spokesperson for the flight attendants’ trade union. 1 Analyse why a strike would have been harmful to both the business and employees. 2 Evaluate the importance of workforce– management cooperation in an airline business. Employers can use various methods to try to resolve an industrial dispute: negotiations to reach a compromise solution with the aim of avoiding industrial action public relations campaign to gain public support for the employer during a dispute and put pressure on the union to settle for a compromise threats of redundancies to pressurise unions to agree to settle the dispute changes of contract, which require workers to work overtime, accept more flexible working or agree not to take industrial action lock-outs – short-term closure of the business or factory to prevent employees from working and being paid closure of the business, leading to the redundancy of all workers. This extreme measure would clearly damage the long-term interests of both workers and business owners. All of these actions, taken by trade unions and employers while in dispute, are damaging to industrial relations in the long term. It is much more beneficial for the long-term interests of the business and employees if effective cooperation takes place between the management and the workforce.