February 2, 2022

Classification of Companies The Companies Act requires that all businesses be registered. After the business is registered, the registrar must issue a certificate of incorporation. Companies may be formed in a variety of ways depending on the jurisdiction. The following are some of the most prevalent business types: Private company If a firm’s stockholders are unable to transfer their shares, it is referred to be a private company. If share transfers are permitted, the corporation restricts membership to 50 people and does not issue invitations to the general public to subscribe for shares. These businesses have minimal obligations for their stockholders, but they also have some ownership limitations. A private corporation might have as few as two members and as many as fifty, excluding staff and stockholders. A private corporation is preferable in situations when it is designed to benefit from corporate life, has limited liability, and the firm is controlled by a small number of people. An individual can obtain control of an entire commercial enterprise in the private sector. Public company At least seven members are needed to form a public company. The maximum number of members remains unrestricted in the case of public companies. A Prospectus is issued by the public companies to invite people to buy the shares of the company. The liability of the members is limited by the value of the shares they purchase. The shares of a public company are sold and bought freely without any obstruction in the stock market. Companies limited by a Guarantee In the case of the company’s collapse, each of its members undertakes to pay a certain sum of money. This sum is referred to as a guarantee. There is no obligation to pay more than the share’s value and the guarantee. Charities, community initiatives, clubs, societies, and other organizations are some of the significant outcomes of firms limited by guarantee. The majority of these businesses are not profitable. These businesses can be classified as private firms with limited liability for their owners. A guarantee business replaces share capital with guarantors who agree to pay a guarantee sum if the firm is liquidated. Companies limited by  Share In a company limited by shares, the shareholders contribute a nominal amount of money to the share capital. Payments can be made entirely at once or in installments. Members are not required to pay anything more than the share’s fixed value. Among the registered businesses, firms limited by shares are the most common. The suffix ‘Restricted’ is necessary at the end of the names of these corporations so that the public is aware that the members’ responsibility is limited. Unlimited company In the context of partnership businesses, limitless corporations are those in which the shareholders’ obligations are infinite. The Companies Act allows for such businesses, although they aren’t well-known. These sorts of businesses can be formed with or without a share capital. Should the business go into formal liquidation and there is a requirement to meet the inadequacy of assets to pay the obligations and liabilities, as well as the fixed cost of liquidation, the shareholders are obligated to give whatever sums are necessary to satisfy the firm’s existing debts. An unlimited company’s members or shareholders have no direct accountability to its creditors or security holders.

Entrepreneurship Skills  The origins of entrepreneurship have been disputed by many industry analysts. It’s worth noting that the majority of those debating the origins of entrepreneurship are either economists or historians. The common consensus accepts that the term “entrepreneur” is derived from the French word “entreprendre,” which roughly resembles the English idea of “business activity”; in this case, “to undertake.” To undertake simply means to establish a business from a business standpoint. This is an introductory course designed to provide readers with a basic knowledge of entrepreneurial ideas. Throughout many decades of company growth, entrepreneurship theory has evolved and received several definitions and characteristics from various researchers, who think that certain characteristics are shared by all entrepreneurs. The roots of entrepreneurship are founded on economics as well as other disciplines including history, politics, education, culture, experience, and networking. What is Entrepreneurship Self-employment demands the use of all available options inside the economic system in the formation and operation of new businesses. A potential entrepreneur should demonstrate an interest in seeking out market investment prospects so that they may effectively manage their business based on the identified opportunities. Following the foregoing obligations of an entrepreneur, the word ‘entrepreneurship’ has been described as a function that encompasses a variety of roles including as Creating and managing organizations. Providing self-employment opportunities Making the most of the resources available The application of innovation to a fresh concept Bringing together numerous production aspects in a practical way. Identifying and capitalizing on business possibilities in the market. Who is an Entrepreneur Entrepreneurs are persons who can recognize and perceive the presence of business prospects in any situation. They will then take advantage of these chances to develop new items by applying innovative manufacturing techniques in various markets. They will also operate in a variety of ways, utilizing a variety of resources to generate profit. Need these notes in PDF for reading when offline and printing? Click link below ENTREPRENEURSHIP NOTES

In a world unpredictability and rapid change, what makes one organization a winner, yet another fails to adjust to the same opportunities? How do some companies move forward and seize new product and market opportunities, yet other larger companies fail to take advantage of their size and situation? A strategy is way of getting things done. It provides a game plan for action. Strategy includes the formulation of goals and action plans for their accomplishment. Strategy considers the competitive forces at work in managing an organization and the impact of outside environment on organization action. Good management does not mean trying harder by using old, out of date methods. It involves developing strategies for coming up with new product, making sure they are what the customer wants, and recruiting skilled employees to provide a competitive advantage. Acceleration change in technology, shorter product life cycle, and new unexpected competition contribution to make succeeding in business harder than even. The evidence indicates that people play a major role in whether or not an organization performs. Managers make strategy determine business success or failure. The excellent companies must be able to transform the way they operate and recognize the importance of corporate culture in devising and executive new strategies. In fact, we suggest the biggest stumbling block in the path of strategic changes is usually an old and inflexible corporate culture. A culture that prevent a company form meeting competitive threats or from adapting to changing economic or social environments can lead to the company’s stagnation and ultimate failure unless it make a conscious effort to change. This HRM culture change effort include activities, which are design to improve the skill, abilities, structure, and motivation levels of organization members . The goals are improved technical skills and improved interpersonal competence and communication. Such HRM effort may also be directed towards improved leadership, decision making and problem solving among organization member. The assumption underlying such effort is that by developing an improved culture, a more effective organization will result. The need for strategy management has increasing become a fact of organization life. The strategy plan is often the starting point for the evaluation of the actions of management personnel and their organizations. Strategy management provides the basic direction and framework within which all organization activities take place. An understanding of strategic management, potentially the most advanced and sophisticated type, makes it easier for managers to develop a vision of the future for their organization. In this lesson we examine stage six of Success System Model: changing for success. An overview of the strategy HR management is, how it is used an dhow it fits into the strategy management process. If you gain a thorough understanding of this process, you are more likely to become an effective HR manager. Organizational Strategy Acceleration changes in technology, shorter product life cycles, and unexpected indicates that managers play a major role in determining how well an organization perform. There are four core characteristics that are exhibited in all best run organization. 1.] Managing into the future. The first characteristic is the necessity to think constantly about new product and then to allocate resources and get them to the market place fast. Well-managed companies provide a clear sense of direction and strategic vision of the future. There is a basic toward action, rapid problem solving and innovation. 2.] A strategy action plan. The managers of best-run companies tend to develop a strategy game plan for achieving advantage. Successful companies do their marketing homework. Staying close to the customer is a characteristic of successful: they seek what the customer wants. A related factor is staying close to what the competition is doing. 3.] The corporate culture. In well – organized associations, people make things happen. There is a commitment to cooperate values and objectives and a willingness to take risks. There is a sense of autonomy in entrepreneurship and a belief in the importance of HR values and services. 4.] Strategic flexibility. The companies that cope best with the rapidly changing environment try to anticipate changes even if this means reformulating strategy or altering the corporate culture. These companies are result-oriented and market driven. There is a belief in productivity through people that encourage change and supports risk taking in order to gain succession of both current and new product markets.

Job evaluation is the name given to any activity which sets out to make systematic comparison between jobs to asses their relative worth, for the purpose of establishing a rational pay structure. In essence job evaluation aims to reduce reliance on arbitrary methods of pay determination by introducing an element of objectivity in the ways jobs are compared. Every job evaluation method requires at least some basic job analysis in order to provide factual information about the jobs concerned. Nevertheless, as with many other aspects of personnel management, judgment has to be exercised in the final analysis. As Kempner (1980) points out: “Job evaluation methods depend to some extent on a series of subjective judgments made in the light of concepts like logic, justice and equity and the progressive refinement of job evaluation techniques is an attempt to minimize the subjective element.” Purpose of Job Evaluation The purpose of job evaluation is to produce a defensible ranking of jobs on which a rational and acceptable pay structure can be built. There are a number of important features of job evaluation which need to be recognized at the outset. These are: 1. Job evaluation attempts to assess jobs, not people. 2. The standards of job evaluation are relative, not absolute. 3. The basic information on which jobs evaluation are made is obtained from job analysis. 4. Job evaluations are carried out by groups, not by individuals. 5. Job evaluation committees utilize concepts such as logic, fairness and consistency in their assessment of jobs. 6. There is always some elements of subjective judgment in job evaluation. 7. Job evaluation does not determine pay scales, but merely provides the evidence on which they may be devised. Job Evaluation Methods Job evaluation methods can be divided into two basic categories: Non-analytical methods Analytical methods The primary difference between these two categories is that the non-analytical methods take whole jobs and rank them, whereas the analytical methods break jobs down into their component parts and then compare them factor by factor. The implication is that analytical methods provide a more refined means of measurement than non-analytical methods. This point is particularly relevant for equal pay legislation, since only analytical schemes are considered to provide an acceptable means of identifying “work of equal value”. 1. Non-analytical methods The two most widely-used non-analytical methods are job ranking and job grading or job classification 1. Job Ranking The basic process in job ranking is to select a representative sample of jobs (so called benchmarks), prepare basic job description for them, compare them on the basis of the information in the job descriptions and rank them in order of their perceived importance. Each evaluator’s ranking is discussed job evaluation committee, compared with the results obtained by other evaluators, and eventually a final rank order is drawn up. The remaining jobs in the organization are then slotted in to the evaluated rank order on a like-for-like basis. The advantage of this form of evaluation is that it is relatively simple and cheap to operate. Its main disadvantage is that it relies heavily on the subjective assessments of the evaluators, and in particular on their personal knowledge of the benchmark jobs. In essence, the paired comparisons approach is an attempt to reduce the subjective element to a limited extent by at least forcing judges to make comparisons in a systematic way. Nevertheless, in the final analysis, such a system of evaluation relies considerably on personal judgment. 2. Job Grading This form of evaluation, also known as job classification, attempts to distinguish between work levels by establishing a small number of general criteria against which specific jobs may be compared. The most well-known, and widely used, system of job grading is the scheme developed by the Institute of Administrative Management. This scheme now has eight grades, each with their statement of general criteria, into which almost 1000 typical office tasks can be slotted. As fig 10.2 shows, grades A and B contain jobs at the elementary level of office work, while Grade F, G and H contain work of high professional level. In a survey of job evaluation methods conducted by Thakur & Gill (1976)², about one third clerical, administrative and supervisory jobs were evaluated using some form of grading or classification. Summary of I.A.M. Job Grading Scheme Grade A – Tasks requiring no previous clerical experience; each individual task is either very simple or closely supervised. Examples include: simple sorting and filling, and messenger work. Grade B – Simple tasks carried out in accordance with limited number of well-defined rules; fairly short period of training; tasks closely directed and checked. Examples include: simple copying work, and straightforward adding operations and using machine. Grade C – Tasks of routine nature and following well-defined rules, but requiring some experience or special aptitude. Examples include: simple calculating machine operations preparing routine invoices, and shorthand –typing of routine work. Grade D – Tasks requiring considerable experience, but only a limited degree of initiative, and which are carried out within existing procedure. Work is not subject to same amount of direction as in lower grades. Examples include; shorthand typing of non-routine work, routine administrative of a group of sales or purchase accounts. Grade E – Tasks of requiring a basic level of professional knowledge or the performance of clerical/administrative work requiring the occasional use of discretion and initiative, or the supervision of two to six clerical staff. Examples include: routine computer programming, supervision of a section of typists. Grade F – Tasks requiring intermediate professional or specialized knowledge, or the performance or control of complex clerical or routine administrative work requiring occasional non-routine decisions and some use of judgment on routine matters, or the supervision of five to twelve clerical staff. Examples include supervision of a print room, conducting routine O&M or systems analysis surveys, complex computer programming, and full secretarial service to chief executive. Grade G – Tasks requiring professional or specialized knowledge to first degree standard or advanced professional qualification, or the performance

Jobs are fundamental to organizations. They are the principal vehicles for the allocation of tasks, duties and roles to the various personnel employed by the organization. Most organizations are faced by change in one form or another. Adapting the organization to respond adequately to change, is a growing focus of attention in business and public services. Job design is therefore a key element in responding to changing conditions. Job Design The concept of job design is ascribed to Davis and Canter (1955), who saw job design as the organization (or structuring) of a job to satisfy the technical –organization requirements of the work and the human requirements of the person performing the work. Davis’s work led him to identify a number of design problems relating to the structuring of jobs. These were: Identifying job boundaries Identifying the factors of work in jobs Determining methods of estimating and controlling these factors Developing systematic design methods Developing criteria for evaluating designs Davis concluded that in order to achieve more effective performance and greater job satisfaction on the part of the employee, it was necessary for jobs to be meaningful to the individual concerned. Approaches to Job Design 1. Job Design and Scientific Management The rationale of Scientific Management is where human work and effort is seen in terms of its relationship to machines and the systems created for them. The hallmarks of job design according to scientific management approach are as follows: Maximum degree of job specialization Minimal level of skill Minimal level of completion of tasks Minimal learning time Maximum use of machines Minimal degree of flexibility or discretion in the job Measurability of job tasks 2. Socio –Technical Systems Jobs are seen as arising from, and dependent on, the way in which the management approached the technical and social features of their organization. The social system embraces both formal and informal groups, for example, official work-teams and unofficial groupings based on friendships and other informal relationships. The technical system encompasses tasks and production processes as well as visible features such as plant and equipment. 3. The Quality of Working Life The aim of quality of working life is geared towards creating conditions in which employee needs are given a high priority compared with the requirements of technology. In relation to tasks: Tasks should form a coherent job Tasks should provide some variety of peace, method , location and skill Tasks should provide feedback on performance Tasks should provide for some degree of discretion by the person concerned In relation to job and work organization: There should be opportunities for learning and development Some sort of desirable future should be available People should be able to contribute towards decisions affecting their job Work goals should be clear and provide a degree of challenge Adequate resources should be available to the job holders In relation to the work context: Industrial relations procedures should be jointly agreed between management and employees Payments systems should be seen to be fair and should be related to contribution made. Personnel policies should be fair and adequate Physical surroundings should be reasonable 4. Job Enrichment and Job Enlargement The term job enrichment was coined by Hertzberg (1968) to denote the vertical enlargement of a job by adding responsibility and opportunity for personal growth. Job enlargement generally involves only the horizontal extension of the job i.e. more of the same thing. Hertzberg (1968) puts it thus: Job enrichment provides the opportunity for the employee’s psychological growth while job enlargement merely makes a job structurally bigger. In job enrichment the emphasis in redesigning jobs is directed towards individual job satisfaction rather than towards increased efficiency. 5. Autonomous Work Groups The idea of autonomous work groups is an extension of job enrichment to a collection of jobs. Such groups tend possess the following characteristics: They permit full labour flexibility by job rotation They have a considerable degree of autonomy in the allocation of work between members Changing Technology in Office Systems Microelectronic technology has a number of distinctive features. It is flexible. Instantaneous and can be rapidly modified. It is reliable, available and cheap. The new technology poses a challenge to trade union representatives. If questions of job content, skills, training and grading are neglected (by the union) there is a danger that a large potion of the office workforce will find itself in more routine and less satisfying jobs. Information Technology presents opportunities as well as threats to employees. Advantages Learning new skills Tedious jobs can be relegated to machines Possibility of upgrading Easier and quicker access to information Easier means of remedying typing errors/ amending text More jobs for those who are skilled in maintenance of electronic equipment More jobs for programmers and software designers Opportunities for shorter working day/week Disadvantages Fewer jobs will be required Office workers might become machine minders Individuals might be tied to their work stations Health problems associated with Visual Display Units/printers, etc Difficulties of learning to operate electronic machines Strong competition between employees for available jobs Loss of personal contact as information is passed by machine instead of mouth

The government of Kenya has been involved in human resource issues in both the private sector and the public sector. For instance, the development of the HRD Policy for Public Service of Kenya was necessitated by the challenges that were faced in training and capacity building processes in the Kenya Public Service since independence. Training was hitherto guided by administrative circulars, human resource General letters and various guidelines issued to the Service from time to time. Human Resource Development Policy The formulation of a comprehensive HRD Policy was therefore part of the Government efforts to improve efficiency and effectiveness in service delivery. In the past Kenyan Public Service had paid scanty attention to Performance Management. As part of the reform initiatives undertaken by the Government, Performance Management has taken centre stage as a priority area for the Government in its efforts to respond to the needs of the Public in terms of service delivery. Role of the government in human resource development The government provides funding of training and capacity building programmes in the Public Service. It also ensures optimal staffing levels in the service, recruiting human resource on the basis of knowledge, skills and experience, and providing the cases for succession management. It emphasizes demand driven and cost effective training that responds to service delivery requirements and seeks to facilitate career growth in the Public Service. Government Institutions Involved In Human Resource Issues Ministry of Labour Its Core Functions include: 1. Promotion of harmonious industrial relations in the country. 2. To ensure compliance with labour laws, international labour standards and codes of practice 3. as well as review of labour standards and domestication of international conventions and 4. recommendations 5. Promotion of best practices of occupational safety and health in all workplaces 6. To plan, development and promotion of effective utilization of human resources 7. Judicial determination of trade disputes and registration of Collective Bargaining Agreements 8. (CBAs) 9. Facilitation of the development of micro and small enterprises. 10. Provision of labour market information 11. To ensure availability of skilled manpower for the industry 12. Promotion of productivity improvement 13. Provision of social security through National Social Security Fund (NSSF) Industrial Court of Kenya The Industrial Court of Kenya has been one of the country’s pillars for maintenance of industrial peace. It was established under the Trade Dispute Act, Cap. 234, (Repealed) and Laws of Kenya and implement the following mandate: 1. To hear and determine industrial disputes that are referred to it by the Minister for Labour; 2. To register Collective Bargaining Agreements (CBAs) between employers and workers; 3. To promote the spirit of tripartism between Government, employers and employees.

The philosophy HRM has been translated into the following prescriptions, which constitute the HRM model for employee relations: A drive for commitment – wining the ‘hearts and minds’ of employees to get them to identify with the organization, to exert themselves more on its behalf and to remain in it, thus ensuring a return on their training and development; An emphasis on mutuality – getting the message across that ‘we are all in this together’ and that the interests of management and employees coincide The organization of complementary forms of communication, such as team briefing, alongside traditional collective bargaining – i.e. approaching employees directly as individuals or in groups rather than through their representatives. A shift from collective bargaining to individual contracts. The use of employee involvement techniques such as quality circles or improvement groups. Emphasis on teamwork; Harmonization of terms and conditions for all employees. The Parties to Industrial Relations The parties to industrial relations are The trade unions Shop stewards or employee representatives The Trade Union Congress (the TUC) Management Employer’s Organizations The Confederation of British Industry Various institutions, agencies and officers The Trade Union Traditionally the fundamental purpose of trade unions is to promote and protect the interests of their members. They are there to redress the balance of power between employers and employees. The basis of the employment relationship is the contract of employment. But this is not a contract between equals. Employers are almost always in a stronger position to dictate the terms of the contract than individual employees. Trade Unions, as indicated by Freeman and Medoff (1984), provide workers with a ‘collective voice’ to make their wishes known to management and thus bring actual and desired conditions closer together. This applies not only to terms of employment such as pay, working hours and holidays, but also to the way in which individuals are treated in such aspects of employment as the redress of grievances, discipline and redundancy. Trade Unions also exist to let management know what there will be time to time, an alternative view on key issues affecting employees. More broadly, unions may see their role as that of participating with management on decision making on matters affecting their members’ interests. Within this overall role, trade unions have had two specific roles, namely to secure, through collective bargaining, improved terms and conditions for their members, and to provide protection, support and advice to their members as individual employees. An additional role that of providing legal, financial and other services to their members, has come into prominence more recently. Trade Union Structure Trade unions are run by full-time central and usually district officials. There may be local committees of members. National officials may conduct industry-wide or major employer pay negotiations while local officials may not be involved in plant negotiations unless there is a ‘failure to agree’ and the second stage of a negotiation procedure is invoked. Major employers who want to introduce significant changes in agreements or working arrangements may deal direct with national officials. The trade union movement is now dominated by the large general unions and the merged craft and public service unions. Shop Stewards Shop stewards or employee representative may initial be responsible for plant negotiations, probably with the advice of full-time officials. They will certainly be involved in settling disputes and resolving collective grievances and in representing individual employees with grievances or disciplinary matters. They may be members of joint consultative committees, which could be wholly or partly composed of trade union representatives. At one time, shop stewards were the ogres of the industrial relations scene. Undoubtedly there were cases of militant shop stewards, but where there are recognized trade unions, managements have generally recognized the value of shop stewards as points of contact and channels of communication. International Union Organizations The two main international union organizations are the European Trade Union Confederation and the International Trade Union Confederation. At present neither of these makes much impact on the UK, but this could change. Staff Associations Staff association may sometimes have negotiating and /or representational rights but they seldom have anything like the real power possessed by a well organized and supported trade union. They are often suspected by employees as being no more than management’s poodle. Managements have sometimes encouraged the development of staff association as an alternative to trade unions but this strategy has not always worked. If fact, in some organizations the existence of an unsatisfactory staff association has provided an opportunity for a trade union to gain membership and recognition. Staff association have their uses as channels of communication, and representatives can play a role in consultative processes and in representing colleagues who want to take up grievances or who are being subjected to disciplinary proceedings. The Role of Management The balance of power has undoubtedly shifted to management who now have more choice over how they conduct relationships with their employees. But the evidence is that there has been no concerted drive by managements to de-recognize unions. As Kessler and Bayliss (1992) point out: If managers in large establishments and companies wanted to make changes they looked at ways of doing so within the existing arrangements and if they could produce the goods they used them. Because managers found that the unions did not stand in their way they saw no reason for getting rid of them. ‘They argued that management’s industrial relations objectives are now generally to: Control the work progress Secure cost-effectiveness Reassert managerial authority Move towards a more unitary and individualistic approach As Storey (1992) found in most of the cases he studied, there was a tendency for managements to adopt HRM approaches to employee relations while still coexisting with the unions. But they gave increasing weight to systems of employee involvement in particular communication, which bypass trade unions. Employers Organizations Traditionally, employer’s organizations have bargained collectively for their members with trade unions and have in general aimed to protect the interests of those members in their dealings with unions.

The purpose of this lesson is to provide a review of labour relations (employee relations. It deals with a summary of the elements of employee relations and the developments in industrial relations. It concludes with the various types of third party dispute resolution in industrial relations. The Elements of Employee Relations The elements of employee relations consist of: The formal and informal employment policies and practices of the organization. The development, negotiation and application of formal systems, rules and procedures for collective bargaining, handling disputes and regulating employment. These serve to determine the reward for effort and other conditions of employment, to protect the interests of both employees and how the latter are expected to behave at work. Policies and practices for employee voice and communications. The informal as well as the formal processes that take place in the shape of continuous interactions between managers and team leaders or supervisors on the one hand and employee representatives and individuals on the other. These may happen within the framework of formal agreements but are often governed by custom and practice and the climate of relationships that has been built up over the years. The philosophies and policies of the major players in the industrial relations scene; the government of the day, management and the trade unions. A number of parties each with different roles. These consist of the state, management, employer’s organizations, the trade unions, individual managers and supervisors, HR managers, employee representatives or shop stewards and employees. The legal framework A number of institutions such as the Advisory, Conciliation and Arbitration Service (ACAS) and the employment tribunals. The bargaining structures, recognition and procedural agreements and practice which have enrolled to enable the formal system to operate. Industrial Relations as a System of Rules Industrial relations can be regarded as a system or web of rules regulating employment and the ways in which people behave at work. The systems theory of industrial relations, as propounded by Dunlop (1958), states that the role of the system is to produce the regulations and procedural rules that govern how much is distributed in the bargaining process and how the parties involved, or the ‘actors’ in the industrial relations scene, relate to one another. According to Dunlop, the output of the system takes the form of: The regulation and policies of the management hierarchy; the laws of any worker hierarchy; the regulations, degrees, decisions, awards or order of governmental agencies: the rules and decisions of specialized agencies created by the management and worker hierarchies; collective bargaining arrangement and the customs and traditions of the work place. The system is expressed in many more or less formal or informal guises: in legislation and statutory orders, in trade union regulations, in collective agreements and arbitration awards, in social conventions, in managerial decisions, and in accepted ‘custom and practice’. The ‘rules’ may be defined and coherence, or ill-defined and incoherent. Within a plant the rules may mainly be concerned with doing no more than defining the status quo which both parties recognize as the norm from which deviations may be made only by agreement. In this sense, therefore, as industrial relations system is a normative system where a norm can be seen as a rule, a standard, or a patter for action which is generally accepted or agreed as the basis upon which the parties concerned should operate. Systems theory, however, does not sufficiently take into account the distribution of power between management and trade unions, nor the impact of the state. Neither does id adequately explain the role of the individual in industrial relations. Types of Regulations and Rules Job regulation aims to provide a framework of minimum rights and rules. Internal regulation is concerned with procedures for dealing with grievances, redundancies of disciplinary problems and rules concerning the operation of the pay system and the rights of shop stewards. External regulation is carried out by means of employment legislation, the rules of trade unions and employer’s associations, and the regulative content of procedural or substantial rules and agreements. Procedural rules are intended to regulate conflict between the parties to collective bargaining, and when their importance is emphasized, a premium is being placed on industrial peace. Substantial rules settle the rights and obligations attached to jobs. It is interesting to note that in the U.K., the parties to collective agreements have tended to concentrate more on procedural than on substantive rules. In the USA, where there is greater emphasis on fixed-term agreements, the tendency has been to rely on substantive rules. Collective Bargaining The Industrial relations system is regulated by the process of collective bargaining, defined by Flanders (1970) as a social process that ‘continually turns disagreements into agreements in an orderly fashion’. Collective bargaining aims to establish by negotiation and discussion agreed rules and decisions on matters of mutual concern to employers and unions as well as methods of regulating the conditions governing employment. It therefore provides a framework, often in the form of a collective agreement, within which the views of management and unions about disputed matters that could lead to industrial disorder can be considered with the aim of eliminating the causes of the disorder. Collective bargaining is a joint regulating process, dealing with the regulation of employment. It has a political as well as an economic basis – both sides are interested in the distribution of power between them as well as the distribution of income. Collective bargaining can be regarded as an exchange relationship in which wage-work bargains take place between employers and employees through the agency of a trade union. Traditionally, the role of trade unions as bargaining agents has been perceived as being to offset the inequalities of individual bargaining power between employers and employees in the labour market. Collective bargaining can also be seen as a political relationship in which trade unions, as Chamberlain and Kuhn (1965) noted, share industrial sovereignty or power over those who are governed, the employees. The sovereignty is held jointly by management and

There are three important point related to the effective administration of incentive plans: 1. Incentives. Incentives systems are effective only when management is willing to pay incentives based on differences in individual or team performance. 2. Motivation. Incentives must be large enough to motivate and reinforce exceptional performance. 3. Standards. Incentive systems must be based on clearly defined and accepted performance standards effectively communicated to employees. There are a number of types in incentive programs, which are described in the following sections. 1. Individual Incentives Many factors are involved in the design of an individual incentives plan. For example, most incentive plans are designed to set production rates according to the technology used. Incentive payments for hourly employees are based upon the number of units produced, by the achievement of specific performance goals, or by productivity improvements in the organization. Who would be including in incentives? The incentives system should be designed with a focus on specific employees in mind – such as production middle managers, sales people, engineering, or senior executives. Most organizations are different incentives systems for different levels. How will performance be measured? The decision whether to use an individual, team or organization wide incentive is critical. The major factor is the extent to which results can be measured at the individual or team level, whether the individual’s contribution is measured, and the effect on teamwork among unit members. 2. Piecework One of the oldest most commonly used incentives plans is piecework. In a straight piecework plan, the employee receives a certain amount of pay for each unit produced. Compensation is then determined by the number of units produced during a specific time period. Employees often earn as much as 55 per cent more than their base pay in a piecework system. The differential piece plan enables employees whose production exceeds the standard output to receive a higher rate of all of their work than the rate rapid to those who perform below the standard. The piecework systems are more like succeed in repetitive jobs where units of output can be reliably measured, when quality is less critical, and with a continuous flow of work. Unfortunately, it is not effective in jobs that do not have reliable standards of performance. One of the weaknesses of piecework is that it may not always be an effective motivator. If workers find that increases in output bring disapproval their fellow workers, then the need for friendship and approval may outweigh the incentive to produce more. Secondly, the standards for piece rates often tend to change, because employees discover ways to do the work in less than standard time. 3. Individual Bonuses Individual bonuses are an incentive payment that supplements the basic wage. It has the advantage of reward workers with more pay for higher performance effort, yet still providing a basic paycheck. 4. Team Bonuses Team bonuses are usually used when the contribution of an individual employee is either not measurable or when performance depends on team cooperation. Which work process requiring more teamwork and coordination among workers, team bonuses are very popular. Most team bonus plans are tied to such measurable outputs as company profit, improvements in quality, or cost reductions. Team bonuses, like individual incentives plans, often improve employee motivation. This allows the organization to: Reward team productivity. Compensate team members for new skills. Increase overall performance Incentives for Management Employees Merit raises represent one of the most commonly used incentives systems for managerial level employees. They are used to motivate managerial, sales and professional employees where raises can be directly related to performance. Merit increases are usually separate from the person’s base pay. 5. Sales Incentives Sales incentive plans are often based on the same factors as individual incentive programs. The drive needed in selling demand highly motivated sales personnel. The competitive nature of selling underlines the widespread use of sales incentives. Sales incentive plans often share many of the characteristics of individual incentives, but there are also unique requirements. Sales output measures can usually be establishes as the level of sales (in shillings or units), but sales people are not paid just on sales volume. They often provided other services, such as customer training, product development, consultation and new accounts, which involve complex measures of performance. A critical first step for a sales incentive program then is to determine the most important performance factors. In general, sales performance maybe measured by the total sales volume and by their ability to generate new accounts. If measures are used such as promoting new products and providing customer service, then more complex measures may be used. Setting performance standards for sales are not without problems because sales performance is often affected by external factors beyond the control of the salesperson. There are economic and seasonal fluctuation, differing levels of competition, changes in demand, and more lucrative sales territories which can all affect an individual’s sales level. Because sales volume along not be an accurate an indicator of the effort salespeople have expanded many organizations set quotas based on sales potential. In designing an incentive plan for sales people, there are also the problems of rewarding extra sales effort and compensating for promotional activities that may not impact directly on sales. 6. Managerial and Executive Incentives There is research to support the use of incentive systems for executives, which are usually related to the strategic goals of the organization. Incentives for managerial and executives are believed to have an impact upon organizational performance although there is little data to support this belief. In most cases executive incentive plans are linked to net income, return on investment, stock price, or total dividend paid. These incentives are usually paid in the form of bonuses and stock options. CEO’s often receive over half of their compensation from incentives resulting in criticism of what they actually contribute to the corporation. Pros and Cons of Executive Bonuses Are top executives really worth the exorbitant salaries and bonuses they receive? The answer usually depends on

As global competition causes our businesses to restructure, the empowerment of employees to work faster and smarter has become increasingly important. However, the success of employee empowerment depends upon our ability to motivate this extra effort. Motivation may be defined in terms of some performance behaviour. Motivation is an emotive state causing persons to want or need something intensely enough to put forth the necessary effort to achieve it. This drive to achieve is usually goal-directed, and becomes more complex when dealing with groups or teams. What drives us as individuals to achieve is often difficult to decipher, as our needs and desires will vary over time. Motivation Motivation is a process in which people chose between alternative forms of behaviour in order to achieve personal goals. The goals sought by individuals can be relatively tangible, such as monetary reward or promotion, or intangible such as self-esteem or job satisfaction. The rewards available to an individual are generally classified under Intrinsic rewards – those that derive from the individuals own experience e.g. sense of achievement or a feeling of self-esteem. Extrinsic rewards – those conferred on a person from outside e.g. a pay rise or promotion. Managers find reliable links between individual motivation and effective performance. There are many theories of motivation. The human relations school believes employees want to do a good job. Although their individual may differ, they would be motivated to achieve their potential. Hygiene factors include working conditions, pay, company policies, and interpersonal relations. When hygiene factors are only factors present in the job, they do not motive employees, they only satisfy them. However, if they are not present, the work then becomes dissatisfying. To motivation, the employee needs the presence of the hygiene factors plus the motivators. The motivators are higher-level employee needs of achievement, recognition, responsibility and opportunity. However individuals act to obtain these goals, they must believe their behaviour will lead to their attainment. A crucial element is how valuable the goal is to the individual. The more value the individual attaches to the goal, the more effort the individual will expend to achieve the goal. The three basic needs are achievement, affiliation, and power. The need for power is defined as controlling others, assuming responsibility for others and having authority over other. Reasons for Pay Performance Plans Many organizations have implemented incentive plans for a variety of reasons: increasing labour costs, more global competitive markets, faster technological advances and greater needs for productivity quality. In the twenty first century, incentives plans and focusing on pay-for performance, improved quality and productivity. By using pay for performance managers are finding employees improve their job performance. Incentive plans may not always lead to organization improvement for two main reasons. First some companies feel that incentive plans are in conflict with a team-oriented approach. Second management may have to give sufficient attention to the design and implementation of incentive programs. The success of pay for performance system mainly depends on the organization. If the organization has a strong corporate culture, high morale, and employees trust the management, then there is a stronger probability of success. Team incentives should not be used in situations where a few individuals are likely to maximize their output at the expenses of their coworkers. Group incentives should reduce rivalry and promote cooperation and concern for all members in the units overall performance.

The Issue of Equal Pay or Comparable Worth One of the important compensation issues of the twenty-first century is equal pay for comparable work. The issue stems from the fact that jobs performed pre-dominantly by women receiving less pay for jobs that are different from, but comparably worth to, those performed by men. The issue of comparable worth goes beyond providing equal pay for jobs that involve the same duties for women as for men. It is not only concerned with whether a female secretary should receive the same pay a male secretary. Rather the argument for comparable worth is that jobs held by women should be compensated the same as those held by men, if both job types contributes equally to organizational success. However, this is continuing problem and will continue be an active issue as the percentage of women in the workforce continues to climb. Two Tier Pay Two-tier pay rates are recent innovation as businesses attempt to cut their labor costs. There are actually two different pay systems for the employees. Some plans continue this difference for long time periods and others set a limit – such 90 days or longer before they become equal. Fair and Square What can HRM professionals do to make their compensation program achieve wage parity while avoiding federal scrutiny for a defective gender-neutral system? Although employee’s use different techniques to keep salaries fair and square, equitable compensations have several common features such as salaries based primarily on the industry market pay rates, not on some employee’s value to the firm based on an arbitrary evaluation system. Another common feature is system in which skills, performance, and tenure are objectively evaluated and measured. This allows HRM to monitor the process and control adherence to the approved procedures. The results should be accepted as not deviating from the process. The last common feature of a gender-neutral compensation system is a regular review for any irregularities caused by cutbacks, transfers, mergers, or sudden increases in recruiting. When irregularities are uncovered, they are immediately corrected. The corners of all companies fair and square compensation system requires continuous adjustments. The gender system goal is to be able to highlight any unfair treatment for all employees, even between two white male employees. Variable Pay The twenty-first century is witnessing the hottest trends in HRM. It is the redesign of compensation, packages to support organizational goals and objectives. This is the result of helter skelter compensation plans with not coherence policies. The answer to these problems is the total compensation plan. In such a plan, employees receive a base pay for core duties, individual and small group achievement pay, and variable pay that is based on the company’s success. Total compensation plans are not uniformly successful. The reason is poor implementation of the variable pay segment of the plan. The correct implementation requires careful attainable performance goals and techniques to objectively measure those goals. This requires knowledge of the company’s rent performance results in key areas and comparative industry data. The variable pay program success requires establishing employee’s trust. If employees don’t trust their management to tell them the truth or fairly considered their suggestions without ridicule or punishment, variable any programs will not work. To make variable pay work, companies should do the following:- Do not make the program complicated. Goals must clear and straightforward. One way to accomplish is follow the example of a major national food manufacture. Employees were asked to set specific variable pay goals for each plant. Representative group developed very specific goals for manufacturing have the final approval employees were told the implementation would be immediate. Never underestimate the ability of employee to understand. They are at least as sharp as the managers who created the original compensation program. When the subject is pay-related, they listen carefully and are away of inequities, which will then share with other employees. Avoid compensation legal terms and unnecessary details. All employee communications containing excessive financial and legal terms are very ineffective. A more effective method is quarterly posters to update employees on the two main goals of variable pay; operating margins and customer satisfaction. An effective poster tells what is needed and is understood in seconds. Management must acknowledge present deficiencies in the current compensation plan. The current deficiencies are the reason for implementing variable plan. The real success is whether margins and customer satisfaction improves as a result of employee recommending improvement strategies. The variable pay program is whether the employees perceive it a being fair and equitable. The employees must buy-it that the variable pay plan is in their and the company’s best interest.

Without proper planning of the training process, a lot of money will end up being wasted on unnecessary or obsolete training programs. To ensure that training money is invested wisely requires the same logic used in all management decisions. The manager must: 1) Identify training needs and establish specific objectives and evaluation criteria 2) Design the appropriate training methods and conduct the training 3) Evaluate the results of the training Step 0ne: Identifying Training Needs The initial step in a training program is to identify training need s, often termed needs assessment. The needs assessment refers to a systematic, objective identification of training needs. Training needs can usually be determined by consulting with appropriate managerial personnel regarding the results of assessment centers, areas of need revealed through employee performance appraisals and determining managers’ concerns for specific training needs to improve bottom line performance. Step Two; Designing Training Programs The second step in a training program is developing training objectives and criteria. The instructional objectives and criteria describe the performance in terms of training. One example of an objective would be the attainment of a specific skill or performing a work task within a certain frame. An example of criteria would be as specified score on test instrument or validation of performing a specific operation flawlessly a number of times. There are two advantages to developing objectives. First the objective provides criteria for evaluating the training program. Second, the objective provides trainers with the specific topics and contents to focus on. This ensures that training programs are focusing on important topics and goals that have meaning to trainees. Achieving the objectives and criteria can be accompanied through the selection of an appropriate training approach. The basic techniques include coaching, internship, on-the-job training, apprenticeship, job rotation, job instruction method, mentoring, case method, continuing education, college and correspondences courses, lecturers, role playing, simulation programmed instruction and vestibule training. These training methods can be used to achieve either one or a combination of learning objectives: cognitive, non-cognitive, and psychomotor. Cognitive learning relates to job specifics. It is concerned with facts and method sequences. Non-cognitive is concerned with behaviours : creating and responding to position requirement. Psychomotor involves performing tasks requiring use of hands, feet and body. 1.Orientation Training Orientation training may be defined as training that introduces new employees to the organization and learning the ropes and familiarize them with the rules procedures, tasks and values of the organization. In general, the orientation process accomplishes the socializing of the new employee. Socializing refers to a new employee learning the norms, values, goals, work procedures and patterns of behaviour that are expected by the organization. 2. In-house Coaching Coaching requires a person who has the necessary knowledge to instruct other individuals on one-to-one or small group basis. The coast most often is a supervisor, but may be a coworker. Coaching is most often associated with team sports, such as baseball and football, where individual and team skills are developed through practice and critique. Although knowledge of the task is important, an effective coast must also possess the ability to communicate the information to the individual in an efficient manner. The coach and the one being coached must develop a mutual trusting relationship, if this method is to be successful. 3.Internships Interns usually follow a formalized training program. An internship program usually consists of a series of job assignments over specific time periods designed to prepare person for better job responsibilities. To ensure interns make the necessary progress in their job assignments, daily log of their activities is kept and/or written reports are reviewed by appropriate supervisors. These jobs are usually channeled through the internship coordinator who oversees the progress and functions as the administrators of the internship program. 4.On-the-Job Training In on-one-job training, the employee is placed in the work situation and the supervisor instructs the employee in how the job is done directly at the workstation. On-the-job training has several advantages. First, it is cost efficient. Workers actually produce while they learn. Second it builds motivation and involves a feedback situation. Finally, it minimizes problems of transfers of training. When employees learn in the actual job situation, the skills learned are the ones needed. Although on-the-job training is usually low cost and practical, it does have some disadvantages. Because training is conducted at the normal production point, trainees may damage equipments, cause excessive waste materials, and involve significantly higher accident rates. Another major disadvantage of on-the-job training centers on the trainer. In the majority of cases, the instructors are either supervisors or experienced line workers. In either case, the trainer may not have the training skills, interest or tie necessary to properly train the new employee. These conditions could produce improperly trained employees who, through no fault of their own, are not performing the job at a high level of productivity and safety. 5. Apprenticeship Training Among the oldest types of on-job-training is apprenticeship training. This training is commonly used by industries including metalworking, construction, and out repair, where the apprentices are trainee who spent a set of period of time (usually 2 to 3 years) working with an experienced journeyman. When used properly and apprenticeship programs allows the worker to earn wages while learning in both on-the-job situations. The major disadvantages to apprenticeship training seems the set time period placed on all enrolled in the programs. People have different abilities and learning rates, but all must serve predetermined training period. In the changing technological environment of the 200s, apprenticeship programs also face new challenges. A trainee may spend several years learning a specific job skill, and then find upon completion of the apprenticeship that these job skills are no longer needed. 6.Job Rotation Job rotation training involves moving trainees around among different jobs within the organization. This system is often used for management level training and self managed work team programs. Job rotation allows the employee to learn several job skills and a wide range of operations within an organization. Cross-trained personnel