Human resource management (HRM)
Contents: 8 sections
Recruitment and selection are two different words
Recruitment is attracting people to apply for a job. Selection is choosing between the people who applied. A definition that describes only one half of that scores 1 of the 2 marks, so keep the two apart.
Hiring costs real money. Adverts have to be paid for, managers sit in interviews instead of running the business, and a new employee is slow for the first few weeks. Everything in this section is a way of cutting the chance of choosing the wrong person, because that is the mistake that costs the most.
The stages of recruitment
| Stage | What it contains | What it is for |
|---|---|---|
| Job description | Job title, duties and responsibilities, who the postholder reports to, place of work, hours | Describes the job. Applicants read it to decide whether they want the work |
| Person specification | Qualifications, skills, experience and personal qualities needed, usually split into essential and desirable | Describes the person. Gives the business fixed criteria to judge applicants against |
| Job advertisement | A short version of both, plus how and by when to apply | Attracts applicants. Where it is placed decides who ever sees it |
These first two are the pair most often swapped in an exam answer. If the sentence you have written could sit on a payslip it is a job description; if it could sit on a school report it is a person specification.
Where the advert goes matters as much as what it says. A local newspaper reaches people who already live near the site. A trade magazine reaches people who already do that kind of work. Online recruitment, on the firm's own website or a jobs board, is cheap, reaches a wide area and can be changed the same day, but it can produce hundreds of unsuitable applications that somebody then has to read. An employment agency does the searching and the first sift on the firm's behalf and charges a fee for it, which is worth paying when the post is senior or specialised, or when the business is too small to have a personnel department.
Internal against external recruitment
Internal recruitment fills the post with somebody who already works for the business. External recruitment brings somebody in from outside.
| Advantages | Disadvantages | |
|---|---|---|
| Internal | Cheaper and quicker, no advertising costs. The candidate is a known quantity, so the risk is lower. Induction is shorter because they know the business. Chance of promotion motivates everybody below | No new ideas enter the business. Promoting one person leaves a second vacancy to fill. Rivalry between internal candidates can sour a team |
| External | Brings in fresh ideas and skills the business does not currently have. A larger pool of applicants, so a better chance of an excellent one. Avoids jealousy between existing staff | Slower and dearer. The applicant is only as good as their paperwork suggests, so the risk of a poor appointment is higher. Longer induction |
Selection methods
| Method | What it does well | What it misses |
|---|---|---|
| Curriculum vitae (CV) or resume | Shows qualifications and work history in the applicant's own order, quickly and free of charge | Written by the applicant, so it shows them at their best. Different layouts make candidates hard to compare |
| Application form | Every applicant answers the same questions, so answers line up side by side | Takes longer to design and to read. Does not show personality |
| References | A previous employer confirms whether the claims are true and whether the person was reliable | Referees are chosen by the applicant, so they are rarely negative |
| Testing and assessment centres | Aptitude, skills and personality tests show what somebody can actually do, not what they say they can do | Expensive and time-consuming. A nervous candidate can test badly and still be right for the job |
| Interviews | Tests communication face-to-face, allows follow-up questions and lets the applicant ask about the business | Some people interview far better than they work. An interviewer's personal bias can decide the result |
No single method is enough on its own, which is why most businesses shortlist on the paperwork, interview the shortlist, and take up references only for the person they want.
Recommending who to employ
0264 asks you to recommend and justify who to employ in a given situation. A recommendation is not the same thing as a preference. Marks for the decision come from the reason attached to it, and the reason has to be about this business.
The method that works is to go back to the person specification. Rank the essential criteria for this particular business, then judge each candidate against the top one or two.
The chain the examiner is looking for runs like this. Knowledge: an experienced candidate needs less training. Application: this candidate has already managed a bakery of a similar size, so the owner can leave the shop unsupervised. Analysis: that lets the owner spend the time on the new market stall instead, which is where the extra sales are meant to come from. Naming the business is not application; using something from the case that changes the point is.
Then reject the others out loud. "Candidate B has stronger qualifications but has never supervised anyone, and this post is 80 per cent supervision, so the qualification is worth less here than the experience." Saying why the rejected candidates were rejected for this business is what separates a top-level answer from a middle one.
Employment contracts
An employment contract is a legal agreement between employer and employee setting out the terms on which the person is employed. No 0450 past paper asks about it, so you will not meet one in the practice questions on this site, but 0264 lists it and it can be examined.
| Contents | What it states |
|---|---|
| Duties and responsibilities | The job title and what the person is actually employed to do |
| Working hours | How many hours per week, which days, and any requirement to work overtime or shifts |
| Holiday entitlement | How many paid days off per year, and how they are booked |
| Sick pay | What the employee is paid if illness stops them working, and for how long |
A contract usually also states the rate of pay, the place of work and the notice period each side must give.
| Benefits to the employer | Benefits to the employee |
|---|---|
| The duties are written down, so an employee cannot refuse a task that is plainly part of the job | The employee knows exactly what is expected of them, which reduces arguments with a manager |
| Working hours are agreed in advance, so the business can plan its staffing rota | Pay, hours and holiday cannot be changed on the employer's whim |
| Protects the business in a dispute, because there is written evidence of what was agreed | Sick pay and holiday entitlement give security, so worry about money does not follow every illness |
| A clear, fair contract helps attract and keep good staff, which lowers recruitment costs | The contract is legal proof of employment, useful when applying for a loan or renting a home |
Legal controls over employment
| Control | What the law does | Effect on the employer | Effect on the employee |
|---|---|---|---|
| Unfair dismissal | Stops a business sacking somebody without a fair reason and a fair procedure | Must keep records, give warnings and follow the procedure. Harder to remove a weak employee | Job security. Cannot be sacked for being pregnant, for joining a union or on a manager's whim |
| Discrimination | Bans treating people differently because of gender, race, religion, age or disability, in hiring, pay and promotion | Recruitment and promotion must be documented and defensible. Widens the pool of applicants, so the business can hire the best person available | Equal chance of the job and equal pay for the same work |
| Health and safety | Requires safe equipment, training, protective clothing, breaks and reasonable temperatures | Costs money to install guards and run training. Fewer accidents means less lost output and lower compensation | Less likely to be injured at work, and better morale |
| Legal minimum wage | Sets a wage below which nobody may be paid | Wage costs rise, which may force higher prices or fewer staff. Better paid workers are often better motivated and stay longer | A guaranteed income floor, and less need to work extreme hours to live |
Notice that every row has a cost and a benefit for the business. An answer that treats employment law as pure cost misses the marks available for the other side: lower labour turnover, fewer accidents, a better reputation as an employer and a wider pool of applicants all follow from obeying it.
Training
Training is teaching employees the skills the job needs. It matters to the business because output per worker rises, quality improves, waste and accidents fall, and people who are being developed are less likely to leave. It matters to the employee because skills raise their pay and their chances of promotion, and because a person who knows what they are doing enjoys the work more.
| Type | What it is | Advantages | Disadvantages |
|---|---|---|---|
| Induction | Given to a new employee in their first days: the layout, the rules, safety, the people | Settles the newcomer quickly, so they are productive sooner. Reduces early mistakes and early resignations | Costs time before any work is done. A long induction can bore an experienced recruit |
| On-the-job | Learning by doing the job, watching or being guided by an experienced worker | Cheap, and the training is exactly the work the person will do. Output continues while it happens | The trainer stops producing while teaching. Bad habits are passed on. Mistakes happen on real customers or real materials |
| Off-the-job | Learning away from the workplace, at a college or a training centre | A specialist teaches it properly, and a wider qualification results. No production is disrupted by mistakes | Expensive, including course fees and lost output. The employee may take the new qualification straight to a competitor |
The choice between the last two is decided by the skill. A skill that only makes sense inside this business, such as using its own till system, is trained on the job. A skill governed by an outside standard, such as driving a forklift truck or accountancy, has to be trained off it.
Common mistakes
- Defining recruitment as choosing the best candidate. That is selection.
- Swapping the job description and the person specification.
- Writing that internal recruitment brings in new ideas, or that external recruitment is cheap.
- Listing every selection method instead of choosing between them and saying why.
- Recommending a candidate without saying why the other candidates were rejected for this business.
- Naming the business and calling it application. Application uses a detail from the case that changes the point.
- Confusing induction training with on-the-job training. Induction is about the business; on-the-job is about the tasks.
- Saying off-the-job training is always better because it is more thorough, without weighing the cost and the lost output.
- Treating employment law only as a cost, with no mention of lower turnover, fewer accidents or a better reputation.
- Saying an employment contract is a job advertisement, or that it only protects the employee. It protects both sides.
What the syllabus asks for on this topicSyllabus points
Syllabus points
- Describe the stages of recruitment: job description, person specification and job advertisement, including employment agencies and online recruitment.
- Describe selection methods: CV or resume, application forms, references, testing and assessment centres, interviews.
- Give the advantages and disadvantages of internal and external recruitment.
- Recommend and justify who to employ in a given situation.
- State the main contents of an employment contract: duties and responsibilities, working hours, holiday entitlement, sick pay.
- Explain the benefits of employment contracts for employers and for employees.
- Explain the legal controls over employment issues: unfair dismissal, discrimination, health and safety, legal minimum wage.
- Explain the effects of those legal controls on employers and on employees.
- Explain the importance of training to a business and to employees.
- Give the advantages and disadvantages of induction, on-the-job and off-the-job training.
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