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Chapter 1
Development of Human Resource Management
Traditional Viewpoint
Labor was regarded as a mere commodity that could be acquired or disposed of like any other property
Workers employed to operate the machines were considered parts of these machines
Labor was considered a machine, an operating organism capable of certain amount of output
Industrial Revolution
The age that followed the invention of machines
 Machines supplanted human labor in factories which led to the organization of the modern factory system
with emphasis on machines, methods, money and large-scale production
 Establishment of factories led to the migration and concentration of workers giving rise to problems in
psychological and social relationships
 Growing problems was overlooked because of the benefits of large-scale production
 The resulting changes and developments in the social, economic and political structures caused greater
demand for products.
 As industries expanded, workers with varied social, educational, economic and political backgrounds
converged in these industrial areas
 This created social problems at work—long hours of work, low wages and poor working conditions
 Certain abuses perpetrated by factory owners on the workers gave rise to industrial disputes
People at Work—The Study of People
In order to arrive at a clearer understanding of the relationship between human resource policies and the style of
management of an organization, it is necessary to look at the findings of those who have studied the behavior of people
at work
The study of people at work falls within the province of social sciences which are concerned with studying the
relationships between individuals, group of individuals and their environment
To understand and predict changes, to focus on process
Theories that Contributed to Management Thinking
 Frederick Taylor
- founder of scientific management
- the scientific selection and progressive development of the workman
- constant and intimate cooperation of management and men
 Elton Mayo
-founder of human relations movement
-famous for Hawthorne investigations which led to a fuller understanding of the “human factor” at work
 Douglas McGregor
- famous for theories X and Y
- theory X: people are assumed to dislike work and need direction and control
- theory Y: people are assumed to enjoy work and external control is not necessary
 Frederick Herzberg
-famous for demonstrating the factors that lead to dissatisfaction (hygiene factors) and those that lead to
satisfaction (motivators)
 Abraham Maslow
- saw human needs in a form of hierarchy. As one need is satisfied, another emerges
- their order is:
physiological, safety and security, acceptance, esteem and self-actualization

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Growth and Development of HRM in the Philippines
Personnel management is a relatively new field in the Philippines
It was only in the early 1950’s that it gradually gained acceptance and recognition in private business and
industry
Contributing Growth Factors
- Increasing complexity of business operations
- Government regulations and labor laws promulgated in recent years
- Growth of labor unions
- Influx of new concepts in management
The need for a more efficient, economical, and equitable management of human resources in business and
industry has never been as pronounced as it is today.
This need has been brought about by factors that inevitably affect not only the established structures and ways
of doing things within the personnel area, but also by the more meaningful task of managing the organization’s most
important asset- its human resources!
Chapter II
Human Resource Management
(Its Functions and Roles in the Organization)
Human Resource Management Defined
-the process involve in managing people in organizations
-It covers all activities dealing with the management of people in an organization
-the function of management concerned with promoting and enhancing the development of work effectiveness
and advancement of the human resources in the organization
-consists of the managerial functions of planning, organizing, directing and controlling of the human resource of
an organization using the personnel operative functions to accomplish individual and organizational goals and
objectives
-the strategic and coherent approach to the management of an organization’s most valued asset--the people—
who individually and collectively contribute to the achievement of the objectives of the business
Organization Defined
-organization is subsidiary to management
-embraces the duties of designing the departments and the personnel that are to carry on the work, defining
their functions and specifying the relations that are to exist between departments and individuals
-the process of identifying and grouping the work to be performed, defining and delegating responsibility and
authority, and establishing relationships for the purpose of enabling people to work most effectively together in
accomplishing objectives
-the determining, grouping, and arranging of the various activities deemed necessary for the attainment of the
objectives
-It holds the different divisions and units of the firm as one and the people as a team, working effectively to
attain their goals
Organizational structure
- the framework by which the activities of an enterprise, as determined by the managers are performed
- the arrangement of the functions performed by the various personnel in the different units classified into divisions,
departments, sections, and the rank and file workers

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-guides management in undertaking the proper division of labor so that people who work for the organization are
assigned to positions according to their skills, experiences and abilities
- it defines the responsibilities and the limits of authority of each member of the firm
- indicated by divisions, departments and sections
Departmentalization or Division of Work
- refers to the particular groupings of functions or activities in an organization, showing their relationships and the people
doing them
- the groupings establish the logical arrangement of the functions and activities into levels in the organizational structure,
facilitating the assignment of personnel according to their abilities and fields of specialization
Principles of Delegation of Responsibility and Authority
a. Delegation
- the conferring of a certain amount of authority and responsibility from the superior to his subordinates
- process of decentralizing or distributing responsibility and authority preventing bottlenecks or overworks for top
management
b. Authority
– the right to act or direct others to act
- the person possessing authority has the right to decide what should be done and the right to do it or require someone
else to do it
- person delegated an authority is acing for or representing the person who delegated the authority, however, retains
control over the delegated authority as he is still fully accountable to his superior for the actions taken by the delegated
person
Levels of Management
-different groups of people who manage the enterprise as “top management,” “middle management,” or
“operating management,” and “operating supervision”
Top Management
Executives and managers whose authority and responsibility covers the entire company
Operating Management
Includes personnel of widely different ranks and responsibilities, interprets and carries out policies, formulates
plans and utilizes manpower
Operating Supervision
Composed of members of management who deal directly with the workers, known as first-line supervisors
Workers/ rank and file workers/ operating personnel
Not part of management, most numerous in the organization, their task is to accomplish the work assigned to
them and carry out decisions and policies made by top management
Types of Organization
a. Line-Type
- word line is similar to “chain-of-command” or “man-boss relationship”
- a supervisor has direct authority and control over the people he supervises and has responsibility for them
- the flow of authority and responsibility is direct from superior to subordinate
- oldest and simplest type
- each employee directly knows his supervisor
- efficient in transmitting instructions from the supervisor to the workers
b. Line-and-Staff Type
- combination of the line type and staff type
- when a line manager’s job expands, beyond the limits of his capacity or when activities become so varied that
he must perform functions that are not related, he needs the help of a specialist to assist him in his work

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- staff functions include a number of specialized fields of industrial activity (personnel relations, executive
assistant, administrative assistant, legal dept., research)
- staff officers are persons or an entire unit in the organization trained to provide specialized services to the line
or operating officials, giving them advice and guidance
- staff dept. cannot use command in its relations with the rest of the organization
Management Functions
Planning
- the objective is to create a favorable climate for human resources in the organization
- ascertaining in advance how the task, work, mission, objective will be achieved
Organizing
- refers to the arrangement and relationships of jobs and positions, which are necessary to carry out the
personnel program
- establishes lines of responsibility, authority and communication
Directing
- done through effective supervision, work rules and procedures
- workers must know their duties and responsibilities, so that they can work with greater efficiency and
accomplish more
- managers uses the principles of leadership, motivation and human relations
Coordinating
- method of getting people in an organization to work together harmoniously
- orderly arrangement and execution of personnel policies and programs in the various departments and levels
of the organization
Controlling
- purpose is to ensure that the organization is accomplishing its objectives
- the control system will show whether or not the personnel program is being carried out as planned
Operative Functions
HR Planning
- study of the labor supply of jobs which are compared with the demand for employees in those jobs within an
organization to determine future requirements
Recruitment
- the process of encouraging job applicants from outside an organization to seek employment in the organization
Selection
- the process of determining the most qualified job applicant or employee for a given position in an organization
Placement
-the process of making an employee adjusted and knowledgeable in a new job and work environment
Training and Development
- refer to any method used to improve the attitude, knowledge, skill or behavior pattern of an employee for
adequate performance of a given job
Employee performance Rating
- the evaluation of the traits, behavior and effectiveness of an employee on the job as determined by established
work standards
Compensation
- the pay received by an employee in the form of wages or salaries, bonuses, commissions
Maintenance
- covers all activities intended to provide an acceptable working environment for employees
Labor Relations
- refer to the relationship existing between the management of an organization and its employees, refers to
efforts of satisfactory accommodations both employees and management

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Importance of Human Resource Management
Human Resource Management is important for the following reasons:
1. Complicated jobs performed by managers
- the manager’s job has changed and has become complicated and demanding with the advances in technology and
globalization, managers need assistance on matters pertaining to employee management
2. Labor laws compliance required
- violations of labor laws can be costly for an organization because it could lead o dismissal or damages, therefore, labor
laws have to be implemented as well as employee health and safety standards
3. Changing attitudes and values of both employers and employees
- employee needs and wants have to be satisfied before optimum performance efficiency can be expected
- with the advances in technology coupled with better skills and education, the employee would have greater expectations
4. Consistency maintenance within organizations
- consistency in personnel actions is imperative with regards to any of the operative functions
- there must be the same personnel philosophy, personnel program, and personnel policies
5. Cost involved in personnel problems
- labor cost is the largest single cost for most organizations, it is made considerably higher than need be primarily due to
personnel problems of tardiness, absenteeism, labor turnover, etc.
Factors Affecting Human Resource Management
Internal factors
a. Organizational Objectives
- these are statements of the overall purpose for the establishment of the organization, the end result
which motivates people in an organization to strive to achieve
- it is regarded as a factor within an organization that affect the personnel functions
b. organizational Climate
- the psychological environment existing within an organization that affects all human activities
- it is the attitude and feelings that people have about the organization, their supervisors, their peers and
their jobs
- the organizational climate may either be favorable or unfavorable
- factors that determine organizational climate are working conditions, motivational theories, leadership
styles
External Factors
a. Competition
- the ability of an organization to survive competition to a large degree depends on how it is able to
maintain qualified personnel
-wages or salaries of employees of the organization must be competitive with or better than those paid
by others in the same industry
b. Customers
- customers are more and more demanding better service or higher quality products, the workforce of an
organization must be capable of providing these services or products, otherwise the organization will be
losing its customers who feel they are not getting the value for their money
c. Labor unions
- when a labor union is present within an organization, HRD has to deal with labor leaders who are
knowledgeable in the field of labor-management relations

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Chapter III
JOB ORGANIZATION and INFORMATION
Job Analysis
The process of studying positions, of describing the duties and responsibilities that go with jobs and of grouping
similar positions into job categories.
 Human Resource Management starts with job analysis, wherein positions are classified according to skill
requirements and other qualifications
 This analysis leads to the specification of the skills that the job occupants must possess
 The process of getting detailed information about jobs
Job
- consists of a group of related activities and duties
- the duties should consist of natural units of work that are similar and related
Position
- the set of duties (job) performed by a particular person
Uses of Job Analysis
-To know the duties of each job by studying the requirements in terms of skills, effort, responsibilities, and
working conditions
-To serve as a guide in the recruitment, selection and placement, and counseling of employees
-To serve as a basis for job evaluation and wage and salary administration
-To help determine working conditions that are hazardous, unpleasant or unhealthy to help management take
preventive and corrective measures
-To help in effective supervision
-To determine the training needs of employees
-To standardize job titles
Job Data gathering
Techniques and Processes Used:
Questionnaires
- an effective way of obtaining job information is to have employees accomplish well-designed Job Analysis
Questionnaires later reviewed by their immediate superiors
Interview
- to obtain a whole perspective of the job, employees are interviewed by their immediate superior in their place of work,
thus clarifying all the aspects of the job
Observation
- jobs are better understood by observation, go to the workplace and observe the people at work
Draft and Review
- when job information have been adequately obtained, the job description and job specification can now be written, then
it is given to the employee and immediate superior for any corrections and inputs
Job Description
-are broad statements of the scope, purpose, duties and responsibilities involved in a job
main purposes are to:
- give employees an understanding of their jobs and standards of performance
- clarify duties, responsibilities and authority in order to design the organization structure
- assist in assessing employees’ performance

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- assist in the induction of new employees
- evaluate jobs for grading and salary administration
- provide information for training and management development
Job Description of a Chef
Title: Chef
Department: Food and Beverage
Scope: All hotel food preparation operations
Responsible to: Food and Beverage Manager
Responsible for:
1. Personnel: all kitchen staff including kitchen manual staff
2. Equipment: all kitchen fixed and removable equipment and kitchen utensils
Lateral Communication: Restaurant Manager, Front Office Manager, Head Housekeeper
Main Responsibilities: The planning, organization and supervision of food preparation in the hotel including:
1. menu compilation according to agreed costed recipes
2. purchasing of foodstuffs, kitchen materials and equipment from nominated suppliers
3. portion and waste control
4. control of labor and other variable costs within budget levels
5. arrangement of staff rosters
6. training of new staff
7. Hygiene and cleanliness
8. fire precautions
9. security of all kitchen supplies, equipment, utensils and silverware
Limits of authority: engagement and suspension of all subordinates until circumstances can be reported to the Food and
Beverage Manager
Hours of Work: as agreed with Food and Beverage Manager
Job Specifications
-enumeration of the qualifications of the employee who is supposed to be appointed for the job that is described
-indicates the qualifications in terms of skills, work experience, training, educational qualification, psychological
traits particularly the mental and personality characteristics, health status and special qualifications like age, sex,
status and special skills needed
Job Specification of a Storekeeper
Job Title: Storekeeper
Knowledge: Receiving, storing, issuing and inventorying methods. Quality and grades of foods, beverages and equipment.
Skills and abilities: follow both verbal and written instructions, perform basic arithmetical calculations. Apply company
policies and procedures for this area. Perform heavy physical work
Personality and related characteristics: Must have strong safety awareness, be able to show initiative and work w ell with
others, must be organized and able to respond effectively to the demands of others
Work History: A minimum of two years’ experience as storekeeper is preferred
Education: Well-qualified school with competence in literacy and arithmetical skills
Job Evaluation
-the process of determining the work of one job in relation to that of the other jobs in a company so that a fair
and equitable wage and salary system can be established
-the principle behind job evaluation is that jobs should be paid in accordance with difficulty, importance,
competencies required of the job, and the impact of results achieved by the job—with the more difficult and important
jobs being rated higher than the less difficult ones
-equal pay for equal work
-differences in pay must be based on differences in work

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Illustration:
A construction firm acquired a contract o quickly complete the finishing of several hundreds of housing units. Carpenters
were hired all at the same rate based on their claims of their skill levels. Over time, skill differences showed in the speed,
work quality, and overall productivity of the carpenters. The pay rates, however, remained the same as when they were
hired. After some time, these skilled workers resigned to join a rival construction firm.
Job Evaluation Methods
Non-Quantitative Methods
- the job as a whole is compared to other jobs in terms of its elements or component parts
1. The Ranking Method
2. The Position Classification/ Grade Description Method
Quantitative Methods
- the job is broken down into its characteristics and evaluated by the use of factors in a standard rating scale
1. The Point System
2. the Hay Method
Non-Quantitative Methods
The Ranking Method
- process of comparing and simply ranking a job against others based on an overall judgment of the skill, effort,
responsibility, and working conditions of the job
- the simplest method and easy to understand
Position Classification/ Grade Description Method
- process of grouping jobs by comparing each job against a rating scale comprising several job grades
- to ascertain the grade to which each job appropriately belongs
Quantitative Methods
Point System
- evaluates the job by appraising it separately against each of the factors or characteristics such as skill, effort,
responsibility, and working conditions and adding up the corresponding point values to arrive at a single point
score for each job
-uses a series of rating scales, one for each of the major factors
Hay Method
- Hay and Associates developed a method using three factors: Know-how, problem-solving and accountability
- this method requires that the organization develop its own key jobs, called benchmarks, selected from among
the positions within the company
- the factors and the quantitative weights are established, similar to the point system
Chapter IV
Human Resource Planning, Recruitment, Selection and Placement
Human Resource Planning
-A dynamic management process of ensuring that at all times a company or its units has in its employ the right
number of people with the right skills, assigned to the right jobs where they can contribute most effectively to the
productivity and profitability of the company
-Is concerned with the efficient acquisition and maximum utilization of the company’s human resources so that
the company can attain its goals and objectives
-It compares the present state of the organization with its goals for the future, and then identifies what changes
it must make in its human resources to meet those goals

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The changes may include:
- downsizing
- training existing employees in new skills
- hiring new employees
To be able to effectively carry out HR Planning:
Organizations need a clear idea of the strengths and weaknesses of their existing internal labor force.
They must know what they want to be doing in the future
- what size they want the organization to be
- what products and services it should be producing
- define the number and kinds of employees they will need
The Process of Human Resource Planning
Determining the workload
- the kind and magnitude of the workload determine the organizational structure, as well as the number and
quality of employees needed to man the organization under a desirable level of performance
- as an aid in determining workload inputs, the company should consider several factors such as:
Business development and assumptions
Corporate planning
Economic forecasts
Changes in plans and products
New product lines
Mergers and acquisitions
Other trends
2. Study of jobs in the company
3. Forecasting human resource needs
- after determining the work input and studying the requirements of each job, forecasting manpower
needs comes next
- forecasting tries to determine the supply of and demand for various types of human resources. The
primary goal is to predict which areas of the organization will experience labor shortages or surpluses
- an organization forecasts demand for specific job categories or skill areas. After identifying the relevant
job categories or skills, the planner investigates the likely demand for each. The planner must forecast
whether the need for people with the necessary skills or experience will increase or decrease
- appropriate questions to ask are:
How many specialists, professionals or executives are needed?
What is the level of each?
What kind of specialization should each have?
What level of expertise is required?
What other production personnel are necessary and how many for each category?
4. Inventory of manpower
- inventory or audit of available current manpower
- assessment of the skills, career aspirations, strengths and weaknesses of each incumbent, their potentials and
promotability. Each is matched against the positions forecasted
- positions are filled either by promotion, transfer or assignment of qualified personnel
- the net result of this operation is that you either find:
That you have just enough manpower
That there is excess in the number of available manpower, but they lack skills required
That the number of available manpower is insufficient and their skills are also inadequate to meet the needs of the work
inputs
5. Improvement plan

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- the difference or gap in the number of people or in quality of skills, represents a shortfall in personnel which
must be remedied by an implementation and improvement plan to meet the objectives of the department or
organization
- this includes action plans to improve the capabilities of current personnel through training and development
- when the shortfall is in the number of personnel, the remedy is to recruit from either inside or outside the
organization
- when the shortfall is in the skills of present employees, the remedy is to increase their skills through planned
training and development program which covers career planning and management development programs
Recruiting Human Resources
Recruiting consists of any practice or activity carried on by the organization with the primary purpose of identifying and
attracting potential employees
-The role of human resource recruitment is to build a supply of potential new hires that the organization can draw
on if the need arises
-It creates a buffer between planning and the actual selection of new employees
3 areas of recruitment:
Personnel policies
Recruitment sources
Characteristics and behavior of the recruiter
Personnel Policies
- are an organization’s decisions about how it will carry out human resource management, including how it will fill
job vacancies
- personnel policies relevant to recruitment:
Recruiting existing employees to fill vacancies or hiring from outside the organization
Meeting or exceeding the market rate of pay
Emphasizing job security or the right to terminate employees
Recruitment Sources
- decision about where to look for applicants
- Internal Sources
Employees who currently hold other positions in the organization
Recruitment is done through Job Posting and Management Referrals
- External Sources
Direct Applicants
Referrals
Help-Wanted Advertisements
Electronic Recruiting
Public Employment Agencies
Private Employment Agencies
Colleges and Universities
Job Posting
The process of communicating information about a job vacancy on company bulletin boards, in employee
publications, on corporate intranets, and anywhere else the organization communicates with employees
Direct Applicants - people who apply for a vacancy without prompting from the organization
Referrals - people who apply for a vacancy because someone in the organization prompted them to do so
Help-Wanted Advertisements - advertisement of job openings in newspaper or magazines
Electronic Recruiting - the Internet has opened up new vistas for organizations trying to recruit new talent. Through
company web sites and job sites
Public Employment Agencies - employers can register their job vacancies with the local state employment office and the
agency will try to find someone suitable using its inventory of local unemployed individuals
Private Employment Agencies - workers interested in finding a job can sign up with a private employment agency whether
or not they are currently unemployed
Colleges and Universities - most colleges and universities have placement services that seek to help their graduates

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obtain employment. On-campus interviewing is the most important source of recruits for entry-level vacancies
Screening vs. Selection
Screening is the process of sifting the good applicants from the host of recruits.
Selection is choosing the best among the screened applicants
Types of Screening Methods
Typical method - used by many groups and consists of various tools and different stages
Atypical Method - this process required the applicants screen themselves utilizing both the organization brochures and job
analysis data
Initial Phase Middle Phase
- Information Sheet - Employment &
- Preliminary Interview Psychological
- Personal Data - Interview
- School Records - Investigation of Previous History
Final Phase
-Interview with HRD Manager
-Interview with Department Head
-Physical Examination
-Final Interview
Organization Brochures
Job Description and Job Specification
Personnel Selection Process
-The process through which organizations make decisions about who will or will not be allowed to join the
organization
-Selection begins with the candidates identified through recruitment attempts to reduce their number to the
individuals best qualified to perform the available jobs
-At the end of the process, the selected individuals are placed in jobs with the organization
-The process of selecting employees varies considerably from organization to organization and from job to job
Reasons for Proper Selection of Employees
Company Objectives are better achieved by workers who have been properly selected
An incompetent worker is a liability to the company
Personnel requirements vary from job to job
People have varying degrees of intelligence, aptitudes, and abilities
Labor laws protect employees, making it difficult to fire incompetent and problem employees
Individuals have different interests, goals and objectives in life
Careless hiring is costly and can cause problems to the company, especially to the supervisors and managers who have to
deal with the workers
Employment Tests Often used in Choosing Applicants
Mental Alertness Tests - also known as intelligence tests, verbal reasoning tests and personnel tests. They
measure a person’s ability to quickly learn jobs, which involve memory, reasoning, abstracting, analyzing, solving
problems, as well as reading comprehension
Clerical Aptitude Tests - these measure the individual’s speed and accuracy in dealing with similarities and

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clerical relationships
Shop Arithmetic Tests - these measure how well an individual can work out mathematical problems that come
up frequently in the shop
Mechanical Aptitude Tests - these measure mechanical abilities or skills, either natural or acquired, they also
indicate the applicant’s potential for certain trades especially in factory or maintenance work
Space Relations Tests - these measure the ability to visualize a constructed object from a picture or pattern, if
rotated in various ways, designed to evaluate the ability to manipulate things mentally to create a structure in one’s mind
from a plan
Proficiency, Trade or Achievement Tests - these measure the individual’s proficiency on the job or trade in
which he has had prior experience
Vocational Interest Tests - designed to discover the patterns of employee interest and thus suggest what
types of work may be satisfying to the individual
Dexterity and Manipulation Tests - these tests are given to applicants for jobs requiring manual skills,
especially the use of fingers
Personality Tests - these measure personality characteristics which are considered to be the basis of success in
the job, particularly for supervisory and managerial positions, determine the emotional maturity of the individual
Interview
Objectives:
- to find out how well-qualified the applicant is for the vacancy
- to give the applicant the information he needs to decide whether or not he will take the job if offered to him
- to create goodwill for the company
Factors to consider during the interview:
- emotional ability
- dependability
- self-confidence
- attitude towards job
- creativeness
- attitude toward other persons
- value system
- critical attitude
Types of Interview
a. Directive Interview - it asks specific information. The interviewer uses a printed form to record the answers to
specific questions about the background of the applicant
b. Non-directive Interview - consists of questions that are broad, open-ended and require a narrative answer
c. Group Interview - conducted by a panel or committee of three or five interviewers. This may be done for
considering applicants for supervisory or higher positions
d. Team Method -a team of three interviewers may interview applicants separately and then compare notes
afterwards. The team may use different types of questions
TYPE of QUESTIONS OBJECTIVE EXAMPLES
Open Draw the candidates out
Allowthe candidates to display their eloquence
Did you enjoy life at college?
How doyou getalongwithotherpeople?

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Closed To check facts
Generally permits limited answer
You have worked for 3 years in your
current job?
Direct Test candidates’ responsiveness
Require clarity of candidate
How much do you expect us to pay for
this job?
Why did you leave your last-but-one job
after only two months?
Episodic Assesscandidates’abilityto adapt and , to some
degree, how they live their lives
What has been the best moment in your
career to date?
How did your family cope with your last
relocation?
Hypothetical Test problem solving ability of candidates What do you do if a guest dies in a bath?
What do you do if a guest complains of a
fly in his soup?
Placement
-It is the determination of the specific branch, department, division, section or unit where the individual is to be
assigned for work
-Looking for the best fit between candidate and position—applicants who have the best combination of ability and
motivation to fit in the position and in the organization as a whole
Factors in determining work assignment:
a. Requisitioning Office
b. Branch
c. Department, Division, Unit, Section
Chapter V
Performance Appraisal
Performance Appraisal/ Employee Performance Rating
• The measurement of specific areas of an employee’s performance
• Refers to a system of measuring and evaluating the traits, behavior and effectiveness of an employee on the job
for either judgmental or developmental use of management
• It is judgmental in purpose when it requires information on what happened or what was accomplished to be able
to make decisions for promotions, transfers, pay increases and terminations
Methods of Performance Appraisal
1. Making Comparisons- compare one individual performance with that of others
a. Simple ranking: requires managers to rank employees in their group from the highest performer to the
poorest performer
b. Paired-comparison method: involves comparing each employee with each other employee to establish
rankings
2. Rating Individuals- looking at each employee’s performance relative to a uniform set of standards, the
measurement may evaluate employees in terms of attributes believed desirable
a. Graphic Rating Scale: lists traits and provides a rating scale for each trait, the employer uses the scale to
indicate the extent to which an employee displays each trait

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b. Behaviorally Anchored Rating Scale: intended to define performance dimensions using statements of
behavior that describe different levels of performance rates behavior in terms of a scale showing specific statements
of behavior that describe different levels of performance
3. Measuring Results- performance measurement that focus on managing the objective, measurable results of a
job or work group
a. Management by Objectives: a system in which people at each level of the organization set goals in a
process that flows from top to bottom, these goals become the standards for evaluating each employee’s
performance
- it provides for what is expected, obtaining teamwork, programming work, recognizing
Uses of Employee Rating
• It is used as a tool for developing employees by identifying employees who could be developed to assume
greater responsibilities
• It is an instrument to strengthen employee weak points to make employees more productive and it motivates
employees to be more productive on the job
• It is used to measure the contribution of an employee to the organization and to evaluate the performance at
work of each employee
• It is a tool in personnel planning: to inventory employee talents, to determine present supply of personnel, to
plan for possible replacements, to plan for the future manpower needs
• It helps determine fair pay for performance as well as incentives to be given depending upon the performance of
an employee on the job
• It is an instrument to determine changes in personnel: promotion, transfer, demotion, layoff, termination
Types of Employees
• Regular Employee – an employee who has been employed to perform necessary or desirable activities in the
business or trade of the employer who is employed beyond the probationary period
• Probationary Employee – where the work is learnable or apprenticeable, the probationary period is limited to
the authorized learnership or apprenticeship period. If not hired as a learner or apprentice, the probationary
employment is for a maximum of six months from the date of employment. Beyond the 6-months period, the
probationary employee becomes a regular employee
• Contractual Employee – an employee hired with a fixed employment period such as a specific project or
undertaking the completion of which has been made clear to the employee as the end of his employment
• Casual or Seasonal Employee – an employee hired to perform work or service that is seasonal in nature and
the employment is for the duration of the season
• PROMOTIONS : refers to the upward or vertical movement of employees in an organization from lower level
jobs to higher level jobs involving increases in duties and responsibilities, higher pay and privileges
2 bases: - competency or merit
- seniority
• TRANSFERS : the movement of employees from one job to another on the same level in the organization with
more or less the same pay, privileges, duties and responsibilities
reasons: - for personal reasons
- signified his desire to work at a different shift
- the employee may have relations problems
- to meet organizational requirements brought by expansion or contraction of organizational
activities
• DEMOTIONS : refer to the movement of an employee to a les important job from a higher level job in the
organization which may or may not involve a reduction in pay, status or privileges
• SEPARATIONS :take the forms of:
a. layoffs: means the separation of an employee initiated by the employer due to business reverses, the
introduction of labor-saving devices, or the reduction in the demand of manpower skills
b. resignations: occur when employees voluntarily decide to end his employment with an organization
c. retirement: occurs when employees having satisfied certain conditions under existing laws are

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separated from employment with entitlement to retirement benefits given either in lump sum amount or
in the form of a monthly pension for life or both
d. termination: means putting an end to the employer-employee relationship initiated by the employer.
Chapter VI
Training and Development
Training
• A carefully planned and handled effort of management through competent instructors, to impart “know-how” and
to develop or improve certain phases of an individual’s skills, attitudes, discipline, behavior or knowledge, to make
him either more effective on his present job or better qualified for another job
Development
• It is future oriented.
• implies learning that is not necessarily related to the employee’s current job
• it prepares employees for other positions in the organization and increases their ability to move into jobs that
may not yet exist
• May also help employees prepare for changes in their current jobs, such as changes resulting from new
technology, work designs or customers
• preparing for change in the form of new jobs, new responsibilities, new requirements
Rationale for Training
• Training helps to improve the skills and work habits of employees thus reducing the incidence of accidents
coupled with the unpleasant experiences and incidental costs that goes with it.
• Training is essential to improve production efficiency and to insure satisfactory performance of work thus
improving organizational efficiency
• Training helps to prepare employees for advancement thus improving employee morale
• Training helps to reduce if not eliminate waste in the use of manpower and resources of an organization thus
improving organizational capability to attain organizational, individual and societal goals
• Training helps to improve relations between management and subordinates thus making work a pleasant daily
experience where supervisors and employees alike develop a deep sense of belonging and camaraderie
• Training may be used to change employee attitudes, implant the company’s philosophy to its new employees
• Training may be used to develop interpersonal skills of employees: listening, handling grievances, communication
and team building
• Training helps to improve the skills of employees to solve problems and to make decisions
Major Categories of Training Program
a. Employee familiarization and placement training
- Intended to provide guidance and knowledge about the policies and practices of an organization that a new
employee needs to know
- Also to inform employees about new developments, activities and organizational procedures
Orientation: training designed to prepare employees to perform their jobs effectively, learn about their
organization, and establish work relationships
b. Skill development training
- Given to employees when they must acquire new skills to perform their jobs satisfactorily
- Used when new machines and equipment are being introduced or when employees experience job changes
c. Safety training
- Required by law to prevent accidents
- Impart safe working habits, emphasize safety measures and practices
d. Managerial and supervisory training
- Emphasis is on how to work with people and how to perform the managerial functions

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e. Technical and professional training
- The intention of this type of training is to reduce to zero technical and professional obsolescence
- This is necessary because of the fast pace of changes in practically all business activities
Training Methods
• Classroom Instruction
- typically involves a trainer lecturing a group, trainers often supplement lectures with slides, discussions, case
studies, question-and-answer questions, and role playing
• Audiovisual Training
- presentation methods need not require the trainees attend a class, trainees can work independently using
course materials prepared on audiotapes or videotapes or on workbooks
• Computer-based Training
- participants receive course materials and instruction distributed over the Internet or on CD-ROM, often these
materials are interactive, so participants can answer questions and try out techniques, participate also in on-line
discussions
• On-the-job Training
- refers to training methods in which a person with job experience and skill guides trainees in practicing job skills
at the workplace
a. apprenticeship: a work-study training method that teaches job skills through a combination of structured
on-the-job training and classroom training
b. internship: on-the-job learning sponsored by an educational institution as a component of an academic
program, sponsoring schools work with local employers to place students in positions where they can gain experience
related to their area of study
• Simulations
- a training method that represents real-life situation, with trainees making decisions resulting in outcomes that
mirror what would happen on the job
- enable trainees to see the impact of their decisions in an artificial, risk-free environment
• Team Training
- coordinates the performance of individuals who work together to achieve a common goal
a. cross-training: team members understand and practice each other’s skills so that they are prepared to step
in and take another member’s place
b. coordination training: teaches the team how to share information and make decisions to obtain the best
team performance
• Action Learning
- training in which team get an actual problem, work on solving it and commit to an action plan, and are
accountable for carrying it out
Approaches to Employee Development
• Formal Education
- organizations may support employee development through a variety of formal educational programs, either at
the workplace or off-site, these could be workshops or short courses
• Assessment
- another way to provide employee development is through collecting information and providing feedback to
employees about their behavior, communication style or skills
- information for assessment may come from the employees, their peers, managers, and customers
• Job Experiences
- most employee development occurs through job experiences—the combination of relationships, problems,
demands, tasks,, and other features of an employee’s jobs
• Interpersonal Relationship
- employees can also develop skills and increase their knowledge about the organization and its customers by
interacting with a more experienced organization member
a. mentoring b. coaching

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Chapter VII
Financial Compensation and Conditions of Employment
Financial Compensation
• Consists of base pay in the form of wages or salaries, incentives, and benefits provided by law and/or agreement
and by the management of an organization
• Is the basic source to satisfy basic needs and wants as well as the means to attain the standard of living and
economic security
Factors Affecting Financial Compensation
• Cost of living
- used to determine the wages and salaries that employees may be paid
- the increase in the wages and salaries of employees should at least be equal to the increase in the cost of living
• Wages and salaries paid by other companies in the same and other industries
- wages and salaries of an organization should be comparable or preferably more than those paid by other
companies if qualified and competent employees are expected to work to the fullest of their abilities and stay
loyal
• Supply and Demand of Labor
- when a demand for a particular type of labor is greater than the supply , the wages or salaries that would be
paid will be higher. If the supply is more than the demand, wages and salaries would tend to be low
• Company’s ability to pay
- organizations operating at maximum plant capacity tend to be able to pay their employees fat salaries and
wages
• Strength of labor unions
- through labor unions, employees financial compensation are far better than what the legislated minimum
benefits and compensation provide
• Governmental regulations and controls
- these legislations are imperative to enforce the constitutional provisions to free the people from poverty through
policies that provide adequate social services, promote full employment, a rising standard of living and the
improvement in the quality of life for all
BASE COMPENSATION or basic compensation refers to the varying rates or wages and salaries that personnel are paid
on account of the different jobs or positions existing in an organization. Job evaluation is used to determine what
constitute an equitable base compensation.
Base compensation should not be lower than statutory minimum wage.
The task of determining the minimum wage or base compensation is given to Regional Tripartite Wage and Productivity
Boards.
Supplementary Compensation
 In addition to the base compensation and incentive or variable compensation used as the primary method of
compensating personnel, additional forms of financial compensation called supplementary compensation are
provided
 Some supplementary compensation are mandated by law: SSS benefits, sick leaves with pay, medicare benefits,
COLA, and 13th month pay
The different forms of supplementary compensation include:
 employee profit sharing
 production sharing plan
 employee stock ownership
 fringe benefits

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• Employee profit sharing plan
- this is usually provided for in an agreement whereby the employer or an organization commits to share, fixed in
advance, with employees the profits that may be made during a given year
- two types:
a. trust or deferred distribution
- a trust fund is established from which benefits are distributed as certain contingencies such as
death, disability
b. cash or current distribution
- the benefits are received by the employees in cash
• Production sharing plan
- the savings coming from the reduction in labor or production costs are divided among the employees
• Employee stock ownership
- usually provide employees of an organization to purchase at a reduced rate or on easy terms through
payroll deductions shares of stocks of the company
 Fringe Benefits
- vacation leave with pay
- sick leave with pay
- bereavement leave
- SSS benefits
- medicare benefits
- hospitalization plan
- life insurance
- accident insurance
- Christmas bonus
- mid-year bonus
- educational plan
- housing plan
- car plan
- management bonus
- maternity leave
- sabbatical leave
- 13th month pay
- personal leave
Conditions of Employment
• Coverage: employees in all establishments and undertakings, whether for profit or not, except for government
employees, managerial employees, field personnel, domestic helpers, persons in the personal service of another
and workers paid by results are covered. As such compliance with the conditions of employment provided by the
LCP is obligatory
• Normal Hours of Work: the normal working hours for an employee is 8 hours a day
• Meal Periods: employees are to be given by their employees not less than 60 minutes time-off for their regular
meals
• Hours Worked: hours worked mean all the time when an employee is on duty or be at a prescribed workplace
and all time when an employee is to work. Rest periods of short duration during working hours is considered as
hours worked
• Night Shift Differential: every employee working between 10 o’ clock in the evening and 6 o’ clock in the
morning should be paid at least 10% of his wage as night shift differential
• Overtime Work: employees may work beyond 8 hours a day but the employer has to give additional
compensation equivalent to 25% of his regular wage. For work performed beyond 8 hours on a holiday or rest
day shall be paid additional compensation equivalent to the rate for the first 8 hours on a holiday or rest day plus
at least 30% thereof
• Compensation for Rest Day, Sunday or Holiday: when an employee is made to work on his rest day, he
shall be paid an additional compensation of at least 30% of his regular wage. An employee is entitled to such
additional compensation for work performed on a Sunday only when it is his established rest day. Work

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performed on any special holiday shall entitle the employee to additional compensation of at least 30% of his
regular wage. When the holiday work falls on the employee’s scheduled rest day, he is entitled to an additional
compensation of at least 40% of his regular wage
• Right to Holiday Pay: every worker is entitled to the payment of his regular daily wage during regular holidays,
except in retail and service establishments with less than 10 workers. The employee may be required by his
employer to work on any holiday but he shall be paid the equivalent of twice his regular rate as compensation.
• Right to Service Incentive Leave: an employee who has worked for at least one year is entitled to a yearly
service incentive leave of five days with pay
• Manner of Wage Payment: wages shall be paid in legal tender and the use of tokens, promissory notes,
vouchers, coupons, or any other form alleged to represent legal tender is absolutely prohibited even when
expressly requested by employee
Executive Order No. 203 lists ten regular holidays in a year:
New Year’s Day- Jan 1
Maunday Thursday- Movable date
Good Friday- Movable date
Araw ng Kagitingan- April 9
Labor Day- May 1
Independence Day- June 12
National Heroes Day- last Sunday of August
Bonifacio Day- November 30
Christmas Day- December 25
Rizal Day- December 30
When Employer May Require Work on a Rest Day
• In case of actual or impending emergencies caused by serious accidents, fire, flood, typhoon, earthquake,
epidemic or other disaster
• In case of urgent work to be performed on the machinery, equipment or installation to avoid serious loss which
the employer would otherwise suffer
• In event of abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be
expected to resort to other measures
• To prevent loss or damage to perishable goods
• Where the nature of the work requires continuous operations and the stoppage of work may result in irreparable
injury or loss to the employer
Emergency Overtime Work
• When the country is at war or when national or local emergency has been declared
• When it is necessary to prevent loss of life or property or there is imminent danger to public safety
• When there is urgent work to be performed on machines, installation or equipment in order to avoid serious loss
or damage to the employer or some other cause of similar nature
• When the work is necessary to prevent loss or damage to perishable goods
• Where the completion or continuation of the work started before the 8th hour is necessary to prevent serious
obstruction or prejudice to the business
Chapter VIII
Human Resource Maintenance
Essentials for Successful Maintenance of Personnel
 an acceptable employee compensation package must be provided to the employees
 the physical and mental health and safety of employees should be a major concern of the company
 employee complaints and grievances are attended to
 disciplinary actions against employees are carried out in accordance with organizational policies, practices and in
accordance with law

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 the organizational climate must be conducive to the maintenance of good supervisory-subordinate relationship
 good communication at all levels in the organization
 comfortable working conditions and physical facilities are provided
Employees will be motivated to continue working for an organization only when there is an acceptable work environment.
The work environment is favorable when the personnel are safe, physically and mentally healthy, and are able to enjoy
the conveniences of modern day living.
Employee Health and Safety
• Maintenance of employee health and providing for the safety requirements of the organization are the
justifications for the establishment of employee health and safety programs
• Organizations that put a premium on employee health and safety maintenance can minimize losses in life and
limb and reduce the irreparable damage resulting from death or injuries caused by accidents
• Health: refers to the physical, mental, and emotional condition of a person. A person is healthy when he is free
from physical and mental illness and emotional problems
• Safety: involves protecting personnel from diseases, death or injuries which are work related
Hazardous Workplace:
 where the nature of work exposes the workers to dangerous environmental elements
 where the workers are engaged in construction work, logging, mining, blasting, etc.
 where the workers are engaged in the manufacture or handling of explosives
 where the workers use or are exposed to heavy or power-driven machinery or equipment
Grievances and Complaints
• Grievance: defined as any real or imagined feeling of personal injustice that an employee has about the
employment relationship. This feeling does not have to be expressed to become a grievance. Neither does it have
to be true or correct. A feeling that arises from imaginary conditions or from incorrect reasoning is still a
grievance if it causes a feeling of injustice
• In the Philippines, a grievance refers to any complaint regarding the terms and conditions of employment or a
formal dispute that is brought to the attention of either the management or the labor union for settlement in a
unionized organization
• Complaint: refers to any dissatisfaction on the part of an employee that is work related in an organization that is
not unionized
• Causes of Grievances:
- grievances usually arise when employee morale is low and when frustration and discontentment is prevalent
among personnel due to poor supervision or to unfair management practices
1. a violation of management or the union of the labor agreement or collective bargaining agreement (CBA)
2. vague provisions of the CBA that lead to different interpretations of the CBA
3. unfair treatment of a subordinate by the supervisor
4. violations of Philippine laws on labor, health and/or safety
5. faulty supervision due to: dictatorial tendencies of a supervisor, refusal to listen to employee complaint, unfair
or inconsistent disciplinary actions, display of take-it or leave-it attitudes for subordinates, unclear and insufficient
instructions, failure to inform employees of changes

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Steps in Grievance Procedure
Fellow worker
Aggrieved
employee
Foreman
Top
Management
Dept. Head
Grievance
Committee
Personnel
Manager
Union
President
Supervisor
Arbitration
Disciplinary Procedures
• Defined as the actions or steps that the management through its managerial employees initiate to correct or put
an end to violations of acceptable norms of behavior required of the personnel of an organization
• Approaches to discipline:
- handled in many different ways
- can be categorized in to two:
a. positive approach: the purpose of the disciplinary procedure is to correct the wrong behavior and
put a stop to further mistakes
b. negative approach: the intention of the disciplinary process is to punish the erring employee and to
discourage non-violators from misbehaving because of fear
• Penalties given erring employees
- when the facts and the violation of an employee could be justified, varying penalties are given for the
first, second, third offense of the same infringement
- the range of penalties available are: oral reprimand, written reprimand, fines, loss of privileges,
layoff or suspension, demotion, and termination from work
- when the employee is found guilty of a serious offense, the penalty could be immediate termination
from employment
• Characteristics of an effective disciplinary procedure:
- it should be based on definite policies
- the responsibility for administering disciplinary actions should be determined, with the initial responsibility being
placed on the immediate supervisor
- the rules must be communicated to all employees
- disciplinary action should be administered consistently among all employees
- the rules and penalties should be reasonable and related to effective and safe operations
- situational pressures and an individual’s circumstances should be considered when the appropriate disciplinary
action is being determined
- written reprimand should not remain in an employee’s file indefinitely, a statute of limitations should exist
regarding the change or removal of such reprimands
• Requirement for Effective Disciplinary Action Meeting
- the interview must be held in private
- the employee’s personal file must document both exemplary actions as well as violations
- state facts in a straightforward manner
- point out the work rule violated and its effect to the organization

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- the employee should be allowed to explain and deny his/her actions without interruptions
- if the infringement was due to a miscommunication, admit it and terminate the case
- do not use bad words or foul language, remain unemotional and treat the employee with respect
- if the violation was an honest mistake, take action to prevent it to recur
- after discipline is administered, forget the past and show confidence in the employee
Chapter IX
Labor-Management Relations
Labor Relations
• refers to the relationships between the employees on one hand and management on the other
• also covers the relationship between management and labor unions in unionized companies
• these relationships are governed by the Constitution, pertinent provisions of the Labor Code of the Philippines,
social legislation and applicable court decisions and regulations promulgated by the appropriate government
agencies affecting employer-employee relations
Rights of Labor
• Right to protection by the state
• Right to full employment
• Right to equal work opportunities regardless of sex, race and creed
• Right to collective bargaining and negotiations
• Right to security of tenure
• Right to just and humane conditions of work
• Right to peaceful, concerted activities including strikes
• Right to participate in policy and decision-making processes affecting their rights and benefits
• Right to certain hours of work and rest periods
• Right to overtime and premium pay
• Right to living wage
• Right to emergency, medical and dental treatment
• Right to protection under safety and health standards
• Right to employee’s compensation in case of injury, or illness in line of duty
• Right to social security and medical care
Labor Unions
• Unions are guardians of the just interests of labor
• One of the chief objectives of a union is to secure a labor contract from the employer which defines the rights
and duties of both management and workers. This contract covers wages, hours of work, and working conditions.
• Provide a medium through which management may know how the workers feel about management and amicably
discuss problems with them through grievance procedures
Labor Organization: any union or association of employees that exists in whole or in part for the purpose of collective
bargaining or for dealing with employees concerning terms and conditions of employment.
Why do workers unionize?
Union arise as a reaction to:
 non-competitive wages and benefits
 poor working conditions
 ineffective supervision
 poorly defined job content
 poor communication channels
 lack of job security
 failure of management to provide equitable mechanisms for resolving grievances
Collective Bargaining

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 is a process whereby management and the union discuss and decide terms and conditions of employment which
will govern the conduct of their relationships within the duration of the agreement
 it is a serious and highly technical process
 it is the primary concern not only of management but also of the employees because it affects not only the
welfare of employees but also the life of the business enterprise
Strikes and Lockouts
• Strike : covers concerted work stoppages, slowdowns, mass leaves, sit-downs, as well as attempts to damage,
destroy, or sabotage plant equipment and facilities
• Lockout : comprises shut-downs or the suspension or cessation of business operations in the course or as a result
of a deadlock in collective bargaining negotiations or labor dispute
• Picketing : the act of strikers in patrolling back and forth, carrying posters, signs and placards in front of the
company’s premises under strike
• Labor dispute : includes any controversy or matter concerning terms and conditions of employment
Causes of strikes and lockouts:
 to enforce demands for higher wages
 overtime premiums
 differential pay
 shorter working hours
 wage adjustments
 better working conditions
 unfair labor practices of the employer
 management fails to recognize and deal with a union
 strikes declared without valid reason
• Kinds of strikes:
a. Unfair labor practice strike: staged because management has allegedly committed an act unfavorable to
the interest of the union
b. Economic strike: staged to enforce demands for higher wages, overtime benefits, shorter working hours,
wage adjustments
c. Sit-down strike: when employees refuse to work but remain in the premises of the company, refuse to leave
the plant and machines and not allow these to be operated by others
d. Slow-down: a form of work stoppage in which employees deliberately reduce their individual production
e. Sympathy strike: employees in a company with which they have no labor dispute stop work as a means of
showing their support for a strike by another group of employees working elsewhere
f. Wildcat strike: a strike that is declared suddenly, quickly, is unauthorized by the union members and contrary
to the labor agreement