Human resource policies are the formal rules and guidelines that businesses put in place to hire, train, assess, and reward the members of their workforce. These policies, when organized and disseminated in an easily used form, can serve to preempt many misunderstandings between employees and employers about their rights and obligations in the business place. Human resource policies are systems of codified decisions, established by an organization, to support administrative personnel functions, performance management, employee relations and resource planning. Each company has a different set of circumstances, and so develops an individual set of human resource policies. Purpose
The establishment of policies can help an organization demonstrate, both internally and externally, that it meets requirements for diversity, ethics and training as well as its commitments in relation to regulation and corporate governance of its employees. For example, in order to dismiss an employee in accordance with employment law requirements, amongst other considerations, it will normally be necessary to meet provisions within employment contracts and collective bargaining agreements. The establishment of an HR Policy which sets out obligations, standards of behavior and document disciplinary procedures, is now the standard approach to meeting these obligations. HR policies can also be very effective at supporting and building the desired organizational culture. For example recruitment and retention policies might outline the way the organization values a flexible workforce, compensation policies might support this by offering a 48/52 pay option where employees can take an extra four weeks holidays per year and receive less pay across the year. Objectives
To provide fair, acceptable & efficient leadership
To provide an opportunity for expansion & voice in management To strengthen & appreciate the human assets continuously by providing training & developmental programs To provide facilities & conditions of work & creation of favorable atmosphere for maintaining stability of employment To attain an effective utilization of human resources in the achievement of organizational goals, etc
What Are the Benefits of HR Policies?
The human resources department of your company is the cornerstone of interaction with and management of your workforce. The company policies your human resources department creates are essential to the organization and productivity of your business. That said, there are numerous benefits to implementing human resources policies in your business.
Recruitment and Selection
Policies pertaining to the recruitment and selection process are the foundation of building any workforce. You must have a plan for creating applications, how to prequalify applicants, how applicants move up to become a candidate and other employment procedures. This set of policies also benefits current employees who refer applicants to your business.
Training and Professional Development
Provisions for employee training and development are included in human resource policy documents because it informs employees of the kind of professional development available to them. In addition, policies related to training and development assistance in the formulation of employee development plans or performance improvement plans. Training and development policies serve as an outline of educational benefits available to current employees.
Handling Employee Concerns
Many companies have written procedures for handling employee complaints, whether they are internal, informal complaints or allegations made about the employer to enforcement agencies. The benefit of this policy is to document your company’s commitment to nondiscriminatory practices and how such complaints are resolved. These policies also benefit employees because they provide important information about workplace communication in the event an employee is unsure of who she contacts to discuss any concerns or problems.
In a time when more than worker safety in the performance of her job is the primary issue addressed in safety policies, employers distribute policies that address matters such as workplace violence. These types of policies are generally discussed in detail with employee groups; an emergency evacuation policy isn’t effective if you don’t discuss it until the emergency happens. Another benefit to having a human resources safety policy is adherence to federal and state guidelines for workplace safety.
An introduction to the human resources policy manual explains the organizational structure, what departments fulfill which expectations and company leadership. In the introductory section, many employers also explain the company philosophy as it is related to customer service, co-workers, leadership and business ethics. Ethics statements are extremely popular, especially in a world where social responsibility is observed by so much of the population. This section of a human resources policy manual may also state the company’s compliance with federal, state and local anti-discrimination laws.
Employees are accustomed to learning specific workplace rules such as dress code, discipline procedures, parking, attendance and working hours, holidays, employee benefits and payroll dates. The human resources policy on these issues is easy accessed by employees who have questions, or reviewed by new employees eager to learn more about their new employer. The benefit is that you have a written commitment to employees about the operation of the business.
Innovative HR Policies
Gone are the days when a simple textbook formulation and execution of HR policies was sufficient to effectively manage an organization. With ever increasing competition, organizations need to come up with creative HR policies to attract talent, retain employees and grow the leaders within. This article presents some case studies on innovative HR policies implemented by different companies. It is now commonplace in companies to offer various facilities for free or on subsidy. For example breakfast/lunch/dinner, beverages, gymnasium, healthcare, club memberships, cab to home, internet/phone, playschool for children etc. In fact, modern day employees have come to expect (and even demanding!) that some of these facilities will be provided by their company. So, these are necessary but no longer sufficient to attract and retain talent. Have a look at what other companies are doing to keep their HR policies on the cutting edge. Google
Google is considered to be one of the most preferred destination for the career aspirants in information technology. Google is a brand name where ideas of the employees are most valued and encouraged. The most innovative HR policy of Google is to encourage the employees to spend 20% of their productive time on their own creative ideas and value addition initiatives. Tourism Australia
Australia Tourism came with the concept of a Dream Job inviting job applications for the role of “Island Caretakers” for islands with pristine beaches, beautiful flora and fauna and island guests who are nothing short of celebrities. The jobs of course aren’t for relaxing. In fact they are one of the toughest in the world. However the concept of a dream-job gave millions of dollars worth of free advertising to Australia Tourism as the job description was published by all leading newspapers, magazines, television shows and social media. Now this is truly innovative – marketing your country for free by way of a great job description.
What makes its employees so loyal? Programs that focus on work/life balance such as assisting employees in elder-care and child-care and adoption assistance of up to $7,500, paid vacation of four weeks in the third year of employment in addition to the usual 13-14 days leave and free membership to a professional organization of the employee’s choice. Trilogy
Trilogy created a highly successful employee induction program called Trilogy University (or TU). In TU, new employees were given mission impossible software development tasks (for e.g. create a new Google killer in 3 months). This concept had two benefits – the new employees brought fresh ideas on the table, and, they simultaneously got trained on various software skills. Over years, Trilogy produced many start-ups out of TU that not only brought great revenue to the company, but also helped create new leaders within the company. Valve
Believe it or not, the billion dollar Valve Software (the company behind the Half-Life, Counter-Strike, and Portal video game series) has no managers! Valve, whose website says the company has been “boss free” since its founding in 1996, also has no managers or assigned projects. Instead, its 300 employees recruit colleagues to work on projects they think are worthwhile. At Valve, there are no promotions, only new projects. To help decide pay, employees rank their peers? But not themselves? Voting on who they think creates the most value. Larsen and Toubro
L&T engineering and construction division was recently awarded the Asia Pacific HR Conclave Award for most innovative HR practices. The main strength of the company’s HR practice lies in rigorous and continuous training in general management, technical disciplines and business policy and this made L&T as one of the top companies with most innovative human resource management practices. Best HR Policies of Accenture
Accenture has an integrated talent management initiative that focuses on career building for their employees, on both domain skills related learning and leadership skills. They collaborate with learning organizations – for example, they partner with XLRI to build HR talent; they partner with ISB to build middle management and senior management; they also partner with IGNOU to build talent in the BPO space. Buddy Program: Any new employee is allocated a buddy and they do it for team leads and above. Before you join the organization, your buddy will reach out to you, talk to you, and take you through the entire settling down process. Accenture is a listening organization. They listen to the unique needs of employees. This helps them to reinvent themselves.
Career counselor framework: Every employee is allocated a career counselor. He would take an interest in your career. He would help you become an effective leader in the organization. The last piece is “reverse mentoring”. The young generation mentors the older employees. The unique policy that Accenture have worked on is that if you require an extended time off because of an illness, other employees could donate “hours of work” to you. It is not a cash donation. It is not leave without pay. So other employees can pitch in. Hot Skill Bonus: They provide extra bonus for employees whose skills are rare in the market. Adoption leave policy: Just like a maternity leave they have introduced adoption leave policy. A large segment of their workforce goes for adoption. It has been well received.
HR policies metrics
It becomes a requirement for every modern HR department to show the organizational value of money and time spent on human resources management training and activities. For human resources policies to be effective and to measure the efficiency of these policies there must be right metrics which should be aligned with business objectives. There is an endless array of HR metrics that one can use spanning payroll, compensation, benefits, engagement, retention, training policies, and more – all of which can provide incredible insight into the effectiveness of the HR policies. STRATEGIC HR METRICS EXAMPLES
Monthly Turnover Rate = (number of separations during month / average number of employees during month) x 100). Revenue per Employee = total revenue / total number of employees. This is especially important when evaluating the cost of a lost employee due to voluntary or involuntary turnover. Yield Ratio = percentage of applicants for a recruitment source that make it to a determined stage of the application process. Human Capital Cost = Pay + Benefits + Contingent Labor Cost / Full Time Equivalents. HR to Staff Ratio = Employees / Human Resources Team Members. This ratio is important since during the recession HR departments have reduced in number dramatically. HR serves as the internal customer support staff just like call center customer service employees serve as external facing. Return on Investment = (total benefit – total costs)/ cost x 100. Promotion Rate = Promotions / Headcount.
Percentage Female at Management Level = Female Management Level
Employees/Management Level Headcount. This formula can also be used when evaluating executives at a female level and other diversity categories like veterans and race.
GENERALIST HUMAN RESOURCE METRICS EXAMPLES
Employee Absence Rate = number of days in month / (average number of employees during month x number of days). I have used this analysis to look at employee absence rates for different departments and managers. Sometimes the best way to determine if their is a culture or manager opportunity is through evaluating the percentage of absences by department or manager. Worker’s Compensation Cost Per Employee = total workers compensation cost for year / average number of employees. Worker’s Compensation Incident Rate = (number of injuries and/or illnesses per 100 full-time employees ∕ total hours worked by all employees during the calendar year) x 200,000. Overtime per Individual Contributor Headcount = Overtime Hours/Individual Contributor Headcount. Average Employee Age = Total Age of Employees / Headcount. This is an important metric in my mind when looking at succession planning and forecasting staffing areas of opportunity as older workers begin to consider retirement. Also an important metric when calculating benefits cost for your organization.