A REPORT ON

HRM Issues and Practices in the Workplace

Submitted to

Prof. Kirti Mishra

In partial fulfillment of the requirements of the course

HUMAN RESOURCE MANAGEMENT (Module-I)

By

Group C 9 - Section C

1911021 - Ambati Phani Kiran

On

05-02-2020
XYZ PADDY DRIERS TECH

This report is about XYZ office, which is a manufacturing unit, producing Paddy Driers.
The office is located in the outskirts of the city A. It is a company with an employee base
of 35-40 members. The work at the manufacturing unit involves mostly physical work in
the outdoors. The division of labour is mainly of two types - outdoor physical work, which
consisted of 80% of the employees (workers, working on a daily or weekly wage basis)
and indoor managerial work, which constituted only 20% of employees. The outdoor
workforce are mostly people from different states, who have migrated as a community and
have settled in different lodgings near the manufacturing unit itself. The managerial
workforce majorly consists of people from local areas.

Recently, the issues in the company have come out in the open when the founder(also the
CEO) of the company started observing the growing turnover rate of a large number of
workers in less than a year of their joining. This is severely affecting the organization to a
large extent. The company, as a result, is incurring huge and regular recruitment costs.
This is a big deal for the organization as it is still a small scale company and is not
enjoying the economies of large scale. He decides to hire an HR consultant to propose a
method of hiring new people as well as to understand the reason behind the employee
turnover.

What exactly happened?

The company generally had a 6 day-week as the work routine, and the employees worked
for almost 10-12 hours a day (which was already higher than the regular work hours), and
there was no fixed number of work hours. Hence the employees sometimes were forced to
work for unreasonably long hours when there was a high load of work. At times, the
employees were made to work even on Sundays. Even after all this extra work, the
employees were not given any bonus for the extra work done, nor were they provided with
additional leaves when there was a dire requirement. There was an immediate requirement
of a new policy of variable pay or individual incentives and a different step towards the
policy of granting leaves.

An example which happened within the company: - (Fictitious names were taken)
One fine day, Mr. Karthik, an employee working in the office, was preparing himself to
ask for a leave to visit his village for his sister’s marriage. Mr. Karthik has joined the XYZ
office recently as an employee in the internal, managerial department and is thus new to
the accustomed culture of the organization. He was pretty sure he would be approved the
leave for two days, which he wanted, as he worked even on a Sunday, the last week, and
also has been working overtime on some days. He also hasn’t applied for any leave in that
particular month. Mr. Karthik, based on his previous experiences, was also expecting
some bonus for the extra hard work he has done, under some employee welfare scheme, as
that would be really helpful for his sister’s marriage and he knew how some good
companies take steps in order to take care of the interests of their employees.

As he approached the senior manager for leave, it filled him with mere shock, that his
leave has been disapproved. The manager gave him the following reasons:

 Only one paid leave is allowed per month per person. If an employee takes an extra
leave, there would be a pay cut from the actual salary.
 Even if a person worked on the day he actually had a week off, or if the person has
worked overtime on certain days, these won't be considered as a substitution to the
new leaves a person would ask for. Instead, the person should consider this as
dedication towards his own job.
 No bonus would be given for any kind of extra work done or any extra day worked.

This took Mr. Karthik in shock as he was not even informed about all this at the time of
his joining. He did not want to continue in a work environment like this.

Problems in the system:-

As the HR consultant carried on further analysis, the flaws leading to the employee
turnover have been well understood.

1) Lack of Variable Pay or Individual Incentives: (Individual Level)

There was no system of providing a bonus to individuals in any context. There was
never a bonus given or any kind of Variable pay or incentives provided for the people
based on their performance. There is no scheme or plan established in order to reward
or incentivize the employees on the basis of their performance every now and then.
This eliminates the scope of motivation in the employees to perform in a better way
and to improve themselves from time to time.

2) Ignorance of the importance of Employee Welfare: (Group Level)

The employees were allowed only one paid leave per month even though they worked
on the weekend without getting paid for it. If an employee requests for another leave
for the same month, after submitting proper reasons, he was given leave, but his
salary was cut proportionately. This shows how the company was ignorant of the
importance of employee welfare. As a growing organization, it is essential for the
firm to take care of the well being of the employees in different aspects. This would
help the employees to build a self of accountability and oneness with the organization.
It encourages the employees to work for the organization with a sense of
responsibility.

3) No recognition to the extra hard work done by individuals from time to time:
(Group Level)
There were frequent situations where the employees had to work for more than 12
hours, or even on a single day, which was actually supposed to be a week off. This
majorly happened because of the sudden heavy workload on a lesser number of
people, on certain days. Considering this, even though the workers compensated the
workload by working for extra time, there was no compensation being provided to
them. Instead,the officials just considered it as the duty or obligation of the employees
towards the company. Their hard work was never recognized, and they were not given
any benefits for the same.

Consequences: -
The consequences of the above-mentioned flaws can be analyzed and understood at 3
different levels.

Individual: The employees started losing motivation to work harder or perform better for
more efficient results. Their hard work was never recognized due to which they started
losing the spirit of doing the same, as time passes. Even though they worked for extra
time, there wasn’t efficiency in their work, thus reducing the productivity of the
employees from time to time.
The lack of a reasonably fair leave system has started developing a sense of frustration
among the employees.

Colleagues: The above individual effects simultaneously play a significant role in the
behavior and attitude of their colleagues towards the organization. We have learned that
the actions taken by the manager towards recognizing the work of some employees set
precedents for the future, and the other employees take that as a signal about how their
behaviors or hard work is valued. Thus as XYZ, has been displaying no recognition
towards the contribution of the employees who worked extra hard, the other employees do
not get motivated to work in a better way, as there is no reward or additional benefit being
obtained by that. Thus they might just sit back doing their routine work and not focus on
any kind of improvement.
In this same context, the employees who would like to work harder in the future in order
to gain some incentives might tend to leave the organization.

Organization: The organization thus suffers from low productivity and efficiency among
the employees. This gradually turns out as a higher turnover rate with the employees
leaving the organization for another organization that would provide fair variable pay and
individual incentives.
This gives us an answer to the issue for which the HR consultant has been hired.
The employee turnover is a serious issue to ponder upon by XYZ company, i.e., in this
case, the causality is severe job dissatisfaction due to unfair compensation criteria. Some
of the potential solutions to the aforementioned issues faced include introducing a 360-
degree approach where feedback can be obtained on a particular employee’s job
performance (including both quantitative and qualitative aspects) and the variable pay
being allocated accordingly. Additionally, other perks and benefits can also be assigned to
increase job satisfaction. The compensation criteria can be determined according to the
principle of distributive justice, i.e., focusing on the outcomes and the value-added to the
organization by the one being evaluated, which can further be notified to the employees up
to a permissible limit.

Word Count: 1478