ENTREPRENEURSHIP DEPARTMENT

Bicol University Tabaco Campus

Tabaco City

SUBJECT : ENTREPRENEURSHIP 23 – HUMAN RESOURCE MANAGEMENT

TOPIC : SUMMARY REPORT ON HUMAN RESOURCE MANAGEMENT
SUBMITTED TO: MR. RODOLFO B. BUEMIA
SUBMITTED BY: RALPH T. RUIZ

I. CHANGING PERSPECTIVE OF HUMAN RESOURCE MANAGEMENT

1. Evolution of Human Resource Management

Based on Atty. Arnulfo Rayos the evolution of human resource, depends upon the
culture and the focus of the company. Whatever the job title is, the implication is that the
position functions within a whole range of personnel – related activities. Changes in
terminologies reflect the significance associated with the management of people in the
organization as well as the broader perspective from which the field is currently viewed.
During the 1930’s and 1940s, those specialized units began to be called personnel
departments, “the word personnel is from an old French word that means person”. Departments
set up a special self-contained departments charge that has responsibility of hiring new workers
and administering basic HR activities. The HR needed to be managed separately and creation
of personnel departments also gave rise to a new type of management. Until 1990s, personnel
management was not seen as an important critical function in most business organizations
although other managers still appreciated it as a necessary vehicle for hiring new workers.
However, the role of HRM changed dramatically and became much more important in most
organization. In late 70s as a reaction against the more functional approach embodied in
personnel management were employees are no longer viewed as a group of individuals needed
to supervise and managed, but rather, to be valued as a distinctive source of competitive
advantage.
2. Main Trends in the HR Profession
Human Resource and Information Technology (IT)
Information Technology deals with how information is accessed, gather, analyzed, and
communicated. IT is used at all phases of the HR work. The advent of the Internet and Web
generated an explosion of HR system and applications. As reflected in the study conducted by
Fortune Magazine, shows that competitive advantage will no longer be defined by other
business processes but will be determined by the quality of workforce.
3. Application of Information Technology (IT) in HR
The Philippines has all the potential to be an active player in the digital domain. At
present, joint government and private sector group are unified in pushing for the development of
its e – commerce. The HR plan should be aligned with the business plan of the organization. It
is then critical for HR people to understand and initiate useful.

Some of this are the following:

a. Use of job boards and other similar web – based recruitment ( e – recruitment )
Provides accessibility to a wider range of applicants for the job and usually
communicates job vacancies and application procedures.
b. E-selection
Uses technology to help organizations more efficiently manage the process of
identifying the best job candidates – those have the right knowledge, skills and
abilities for each job and who may best fit the organization.
c. Employment kiosk
 Provides updates on employee status and other pertinent information initiated
and made by employees themselves.
d. E-learning
Facilitates the learning process by providing just–in–time learning opportunities.
e. Electronic Performance Support System (EPSS)
Provides online coaching and monitoring of system
f. Salary and payroll administration
Ensures timely release of salaries, and other employee benefits and pay system
g. Growth of social networking sites like Facebook and Twitter
One of the next challenges for HR executives in learning to integrate information
from social network sites.
h. Use of Email
A unified messaging that allows workers to check and store email related to work
in one single inbox.
i. Use of IT to foster customer involvement
Companies started using different social media sites
j. Telecommuting/Teleworking
The act of moving the work to the to the workers instead of moving the workers
to work.
4. Human Resource Information System (HRIS)
According to the book of Fundamentals of Human Resouce Management by DeCenzo
and Robbins (2005), HRIS is about employees in a central and accessible location
Purpose of HRIS
 To provide the efficiency with which on employees and HR activities are compiled
 To provide HR information more rapidly and more easily to be used in management
decision making.
HRIS Applications
 IBM Online System - online system has been tremendously well-received by employees
who can now research program information and access decision support tools from their
own homes.
 Toshiba America Medical Systems Inc. (TAMS) - created a library of documents and
forms on its Human Resources Portal, including the benefits guide which earned a 2004
APEX Award
Some of the Benefits of HRIS Solutions
 Salary and Payroll Administration
 HR Training
 Self-service Benefits Transactions
Examples of HR Data Accessed by Various Stakeholders
Position Online Self-Service
Applicants  Job openings
 Application blanks
 Data on the company
Employees  Benefits enrollment and claims
 Print pay slips for fast and current months
 Enroll for training and check training schedule
 Dependent data
 Download forms and templates for HR
administration
 Retirement planning scenarios
 Provide feedback and view latest company news
and announcement
Managers  Training investment factor
 Cost per hire
 Turnover cost
 Executives  Data for HR forecasting and costing
 Succession plans
External Groups  Time and attendance data
 Dependent health insurance status
 Payroll information

Example of Software
Jeonsoft Payroll Suite 2006
 Is a client server based integrated personnel and payroll system specifically
designed for Philippine use.
 It is composed of three major modules, namely: time attendance system, payroll
system and HRIS system all rolled into one complete system.
Electronic Performance Support Systems
 Are also making the work of HR specialists a lot easier.
Employee Self – Service Applicants
 Are also improving the way organizations deliver employee benefits.
According to Johnson and Gueutal, HR is evolving into a more technology based
profession because organizations need to:
 Streamline HR processes and reduce administrative burdens
 Reduce HR administration and compliance costs
 Compete more effectively for global talent
 Improve service and access to data for employees and managers
 Provide real – time metrics to allow decision – makers to spot trends and
manage the workplace more effectively
 Enable HR to transform so it can play a more strategic role in the business
Labor Relations

According to the Bureau of Labor and Employment Statistics, if one will look at the
percentage of labor union members to the total wage and salary workers, there is a notable
decline from 30.7 % in 1982 to 29.5 % in 1993 down to 10.6 % in 2009.

Increase in Social Contribution

Employees pay mandatory contributions in proportion to their salary. Social Security System
(SSS) - 10.4 % of monthly salary. Government Service Insurance System (GSIS) – 21 % of
monthly salary
National Health Insurance Program

Making sure that employees are adequately covered by health insurances. It will enable
them to manage the rising costs to hospitalization.

PAG-IBIG (Pagtutulungan sa Kinabukasan, Ikaw, Bangko, Industriya at Gobyerno) RA.

9679
A mandatory contribution rates for all mandatory covered members includong OFW's are
stated as follows: for those with monthly compensation of P1, 500 and below, the employee
share is 1% of their salary and 2% from their employer while for those with over P1, 500
monthly compensation, The share is 2% for both the employees and the employer. The fund
offers its members various benefits such as savings, short term loans, and access to housing
programs.
Business Process Outsourcing (BPO)

It is an economic force that propels our country to be considered as one of the emerging
global leaders in the BPO industry.
 5. HR Departments’ Organization Charts and Structure
Organizations historically divided their managers into line management and staff
management and HRM was traditionally considered to be a staff function line managers
were responsible for an indirect or support function that would have costs but whose
bottom line was less direct.

 A strategy that locates the design and administration

Centralization responsibility in a single organizational unit
 Gives each unit the responsibility to design and
Decentralization administers own personnel system.
 Design their department or division
 Monitor reporting relationship
 Gain access to information about newly created job
sites, staff duties, and reporting relationships
Organization Chart  Find out how leading agencies organize their
management teams and workforces
 Assess industry patterns
 Examine the competition
 Use in business presentation and to facilitate
placement decision

II. JOB ANALYSIS

Job analysis is conducted to determine the responsibilities inherent in the position as
well as the qualifications needed to fulfill its responsibilities. It is essential when recruiting to
locate an individual having the requisite capabilities and education
1. Importance of Job Analysis
Successful HRM practices can lead to outcomes the create competitive advantage. When
properly performed, job analysis can enhance the success of HRM practices by laying the
required foundation.
2. Definition of Different Job Terms
 Position - consist of the responsibility and duties performed by an individual.
 Job - group of positions that are similar in their duties. In some instances, only one
position may be involved, simply because no other similar position exists.
 Occupation - group of jobs that are similar as to kind of work and are found
throughout an industry.
 Job analysis - the procedure used for determining/collecting information relating to
the operations and responsibility of a specific job.
 Job description - organized, factual statements of the duties and responsibilities of a
specific job.
 Job specifications - a written explanation of the minimum acceptable human qualities
necessary for effective performance of a given job.
 Job classification - groupings of job on some specified basis such as kind of work or
pay.
 Job evaluation - systematic and orderly process of determining the worth of a job in
relation to other jobs.
 Task - coordinated and aggregated series of work elements used to produce an
output.
 O*Net - online resource which has replaced the Dictionary of Job Titles; list of job
requirements for a very large number of jobs.
 Functional job analysis - a task-based or work-oriented technique describing the
work performed.
 Position analysis questionnaire (PAQ) - an example of a job analysis method.
Job analysis provides information in several cases including the following:
 How much time is taken to complete basic tasks?
 How are task grouped together into a job?
 How can a job be designed so that employee performance can be improved?
  What kind of skills is needed to perform a given job?
 What kind of person is best suited to perform a certain type of job?
3. Specific Information Provided by Job Analysis
 Job title and location
 Organizational relationship
 Relation to other jobs
 Job summary
 Information concerning job requirements
4. Uses of Job Analysis Information
 Preparing the job description and writing the job specifications
 Recruitment and selection
 Determining the rate of compensation
 Performance appraisal
 Training
 Career planning and development
 Safety
 Labor relations
5. Methods Used in Job Analysis
 Interview
 Observation
 Questionnaires
 Employee recording/use of log book
6. Steps in Conducting Job Analysis
STEP 1 Examine the total organization and the fit of each job.
STEP 2 Determine the purpose of JA.
STEP 3 Select job to be analyzed.
STEP 4 Collect data by using acceptable JA
STEP 5 Prepare JD.
STEP 6 Prepare JS.
STEP 7 Use information from Steps 1-6 for Job Design, Planning, Selection and
Training, Recruitment, Performance Appraisal, Compensation, etc.

7. Writing the Job Specifications

The original purpose of job description is to establish the level of difficulty of a specific position
for the purpose of establishing pay levels. Suggested contents are given as follows:
1. Date written
2. Job status
3. Job identification
4. Job summary
5. Working relationship
6. Authority of incumbent
7. Competency requirements
8. Working conditions
Below is an example of a job description:

Job Title: HR Manager

Reports to: Vice President of HR
Supervises: HR Assistant, Compensation, Analyst, and
Benefits Clerk
Coordinates with: All department managers and executive
management
 Outside the company: Recruitment agencies, DOLE, union
representative

Below is an example of a specification:

Position Title: Chief Accountant

Division /Department: Accounting Department
Reports to: General Manager
Coordinates with: All Department Heads
Supervises: All Accounting Personnel

SUMMARY OF DUTIES
Apply principles of accounting to analyze financial information and prepare financial reports by
compiling information,preparing profit and loss statements, and utilizing appropriate accounting
control procedures
PRIMARY RESPONSIBILITIES
1. Prepare profit and loss statements and monthly closing and cost accounting reports
2. Compile and analyze financial information to prepare entries to accounts, such as
general ledger accounts, and documents business transactions
3. Establish, maintain, and coordinate the implementation of accounting and accounting
control procedures
4. Analyze and review budgets and expenditures
5. Monitor and review accounting and related system reports for accuracy and
completeness
6. Prepare and review budget, revenue, expense, payroll entries, invoices and other
accounting documents
7. Analyze revenue and expenditure trends, recommend appropriate budget levels, and
ensure expenditure control
8. Explain billing invoices and accounting policies to staff, vendors, and clients
9. Resolve accounting discrepancies
10. Recommend, develop, and maintain financial database, computer software systems,
and manual filings systems
11. Supervise the input and handling of financial data and reports for the company’s
automated financial systems
12. Interact with internal and external auditors in completing audits
13. Perform other duties as maybe assigned by the general manager from time to time
KNOWLEDGE AND SKILL REQUIREMENTS
1. Knowledge of finance, accounting, budgeting, and cost control principles including
generally accepted accounting principles; knowledge of financial and accounting
software application; ability to analyze financial data and prepare financial reports,
statements, and projections. This is normally acquired through a combination of the
completion of a bachelor’s degree in Accounting, three to five years of accounting
experience, and successful completion of CPA exams.
2. Work requires willingness to work a flexible schedule.
WORKING CONDITIONS
Working conditions are normal for an office environment. Work may require occasional weekend
and/or evening.
8. New Jobs and Hot Jobs for the 21st Century
A cursory scan of company openings being advertised in Job Street Philippines; an
online recruitment center gives a sense of what is happening in the job market. The Internet has
changed the people do things. More online shopping, for example, means more jobs in package
delivery services. With more young people online, the Internet is also seen as a key venue for
reaching the coveted youth market. Rapid advances in computers and telecommunications
technology are the main drivers behind the emergence of new jobs titles. An “auditor “ is now
called an “ e – commerce accountant “. Apparently, e – commerce accountants are those who
advise companies on whether they make financial sense to sell goods and services online in the
Philippines, a number of major private and government agencies have already employed web
designers, content producers and other Internet professionals.

9. Writing the Job Specifications

It uses the job description to define the kind of human traits and experience required to do a
specific job well. The information contained in a job specification usually includes the following
basic criteria:

 Knowledge - body of information one needs to perform job.

 Skills – the capability to perform a learned motor task such as word processing skills
 Ability – the capability needed to perform non – motor tasks such as communication
abilities
 Personal Characteristics - an individual’s traits such as tact, assertiveness, concerns for
others, etc.
 Credentials – proof or documentation that an individual possesses certain competencies
 Technical Requirements – includes criteria such as educational background, related
work experience and training

III. RECRUITMENT OF EMPLOYEES

1.Recruitment on the Internet
Using the internet is the fastest, simplest, and most convenient or most cost effective
way to reach hundreds of thousands of qualified candidates, 24 hours a day and 7 days a week.
Responses occur instantly and the results are measurable. Jobseekers have always wanted
detailed job descriptions. Recruitment sites can provide jobs seekers with detailed information
on the qualifications you are looking for in a candidate.

Picking Employment Sites

 Job Sites by Location – job sites with a geographic focus to help you find an appropriate
local resource for your postings.
 Employment Super Sites – provide a visibility in all kinds of media
 Specialty Employment Sites – sites that provide category listing depending on the vacant
position.
Using Employment Sites to Post your Job Openings

 Job postings on the Web site are very different from typical newspaper ads where you
are paying per word posted in the spread.
 You are not restricted by the number of words you can use in your description and most
employment sites have search engines for applicants to use in finding job postings.
 You can offer as many ways as possible for the applicant to reach you, e.g.,phone, fax,
email and “ snail mail “ with complete address.
 You can respond immediately with an acknowledgment, personalized if possible, to the
applicant via email.
Online Job Search for Application

 Identify the jobs, employers and locations that interest you and then find out where you
can submit your application based on your qualifications.
  Read the “Know BEFORE You Go (or Apply) “ series of articles by Job – Hunt’s
research expert Parmelee Eastman about choosing the best potential employers, and
gathering necessary information to prepare a cover letter and how to impress
interviewers with your knowledge of them and their organization.
 Once you know the job you want and have collected the necessary information about the
job and your prospective employer, you need to create your resume, learn how to
complete online forms and customize your LinkedIn Profile or your personal resume
Web page with “Keyboard“ for recruiters to find.
 Establish an email account, different from the one you use in your job or your school.

2. Tips to Job Applicants to Avoid Illegal Recruitment

 Do not apply at recruitment agencies not licensed by POEA or the Philippine

Overseas Employment Administration.
 Do not deal with licensed agencies without job orders
 Do not deal with any person who is not an authorized representative of a licensed
agency.
 Do not transact business outside the registered address of the agency
 Do not pay more than the allowed placement fee
 Do not pay any placement fee unless you have a valid employment contract and an
official receipt.
 Do not be enticed by ads or brochures requiring you to reply to a post office (P.O)
box, and to enclose payment for processing of papers.
 Do not deal with training centers and travel agencies, which promise overseas
employment.
 Do not accept a tourist visa.
 Do not deal with fixers.

3. Recruitment Process/ Recruitment Plan

This plan is an effort to quickly fill the HR request with an individual who first satisfies the
job specifications.

1. Formulating a recruiting strategy – this a choice between internal and external recruiting
strategy

Comparison of Promotion from Within (Internal Hiring ) versus External Hiring

Internal Hiring

Advantages Disadvantages
Promotes inbreeding (narrowing of thinking
Provides greater motivation for good and stale ideas
performance

Provides greater promotion opportunities for Creates political in-fighting and pressures to
present employees compete

Improves morale and organizational loyalty Requires a strong management development

program

Enables employee to perform the new job with Creates a homogenous workforce
little loss of time

Familiar with the organization on how to

operates

External Hiring
 Advantages Disadvantages

Provides new ideas and new insights Loss of time due to adjustment

Allows employee to make changes without Destroys incentive of present employees to

having to please constituent groups strive for promotion

Does not change the present organizational No information is available if the applicant can
hierarchy blend with rest of the group

2. Searching for job applicants – applicant search may involve traditional recruiting
methods or through the use of e – recruitment.
3. Screening applicants – applicants should be screened to eliminate individuals who are
obviously unqualified.
4. Maintaining an applicant pool – applicant pool consists of individual who have expresses
an interest in pursuing a job opening and who might be feasible candidates for the
position.

4. Sources of Applicants
 Internal Sources – the use of promotion from within taking into consideration the
advantages and disadvantages.
 Referrals –This is the most often used recruiting tool in small organizations.
 External Sources
 Job advertisement – placement of help – wanted advertisements in newspapers,
trade and professional publications or on radio and television.
 Employment Centers or Agencies – agencies that charge a fee for each applicant
they place.
 Campus Recruitment – a primary source for entry level job candidates. They usually
coordinated with the university or college placement center.
 Internships – for students with practicum or on – the – job training, this can help them
in honing their business skills, check out potential employers and learn more about
their likes and dislikes when it comes to choosing careers.
 Job Fairs / Special Events Recruiting – joining or sponsoring employment fairs.
 Online Recruitment / E – recruitment
Alternatives to Recruiting

 Subcontracting / Outsourcing – subcontract work to another organization wherein the

organization loses some of its control over work that is outsourced.
 Overtime – used to avoid the incremental costs of recruiting and hiring additional
employees for a short period of time.
 Temporary Help – use of temporary help services to fill the needs of companies on a
temporary basis.
 Employee Leasing – similar to temporary help agency but employees are not temporary.
Leasing companies issue the worker’s paychecks, take care of personnel matters,
ensure compliance with workplace regulations and provide the required employee
benefits.

5. Writing a Resume

In writing resume, you need to use words that would highlight what you do best since
your resume is the first step in ”marketing” yourself to your perspective employer.

a. Name, Address, and Telephone Number

DR. CRISPINA RAFOL CORPUZ

Ambid St. Biluso, Silang, Cavite
09228155973
[email protected]
[email protected]
a. Job objective

Seek a position as an HR manager using my Ph.D. in HRM and proven track record in
human resource management in both industry and the academe

Seek a position as an advertising sales representative using ,y academic background,

proven sales skills, and retail experience

b. Education

University of Santo Tomas

Ph.D in HRM GPA: 1.25

MS in HRM GPA: 1.5

Coursework: compensation and Benefits Administration, Training and Development,

Performance Appraisal, Labor Relation, Career Development, Management Research,
Cooperative Management.

Honors and Awards Receive:

Magna Cum Laude (Ph.D.HRM,UST)

College and Dean List Scholar (UP Baguio)

Regional Finalist, Metrobank Outstanding Teacher

CHIMES Awardee, De La Salle University-Dasmarinas

c. Skills

Prepared the Personnel Policy Manual of Caffmaco and the Personnel Policy Manual for
Silang Municipal Employees. Prepared a textbook in Human Resource Manual for
Cooperatives

Organizational Ability: Actively involve in arranging and initiating leadership and research
conferences: responsibilities include massive information campaign to ensure maximum
attendance, preparing and coordinating the different activities involved.

d. Work experience

Employment Background: Caffmaco Feeds Inc. Personnel Officer

Duties: Prepared the personnel policy

Updated the company’s job description

Initiated training programs to enhance the skills of the employees

Revised and updated the performance appraisal methods and the salary scale by
means of conducting wage and salary survey

e. Communication Skills

Reinforced and interpreted company procedures and policies to newly hired employees
 during orientation

f. References

Web Sites foe Philippine and Overseas Jobs

esljobsworld.com

Excellent web site for Filipinos to find English teaching jobs abroad

WorkAbroad.ph

Overseas jobs for Filipinos posted by Philippine recruitment agencies licensed by POEA

poea.gov.ph

Official web site of the Philippine Overseas Employment Administration which contains
overseas job vacancies

jobstreet.com.ph

You can expand your job search out of Philippines by going to other JobStreet sites

bestjobsph.com

A Philippine job listing site with mostly local, but also overseas jobs

IV. SELECTION OF EMPLOYEES

Job analysis, human resource planning and recruitment are necessary perquisites to
the selection process. These include the technical, personal and personal requirements of
the job discussed earlier.

1. Why Selection Process is Important

 Performance always depends in part on employees
 It is costly to recruit and hire employees
 Company objectives are better achieved by workers who have been properly
selected based on their qualification
 An incompetent worker is a liability to the company causing direct losses in terms
of substandard performance and low productivity, and sometimes a potential
source of problems to management, his/her coworkers, and customers
 Applicants have varying degree of intelligence, aptitudes, and abilities
 Labor laws protect employee making it difficult to terminate or dismiss an
incompetent employee
2. Selection Process
 Define the job before hiring an employee – this is where job analysis will come in handy.
This will help you prepare the job description and job specifications which in turn will
define the recruitment strategy.
 Review application form and credentials carefully - this provides basic employment
information that can be used to screen out unqualified application. Take note of the
following information during your review of application following:
a) Employment gaps – these gaps include dates of employment listed only in years
so that the actual day and month of employment ending are masked.
b) Spelling, grammar and punctuation – attention to details such as appropriate
grammar, spelling and punctuation do set a candidate above the pack.
 c) Evidence that a career has gone backwards or plateaued – in a career that is
progressing successfully, an applicant’s resume should show evidence that job
titles and job description have improved as the year progresses.
d) Failure to follow directions – failure to follow direction is not just a waste of time but
it can be harmful specially to job applicants.
e) Failing to include a cover letter – submitting a high – quality cover letter with your
resume can spell the difference.

Resume
It should show details about the qualifications and experience of the candidate you seek
to fill the job
Cover Letters
Job searching specialists and career counselors recommend that job applicants write a
customized cover letter to accompany each resume sent to an employer.

Employment Application
Employers use the employment application to gather consistent data about prospective
employees.

 Employment Interview
This provides the hiring supervisor the opportunity to review candidates’
qualification and determine their suitability for the position.
Preparation to the interview
 Develop a list of core question which will be asked of all candidates interviewed
 Reviewing the requirements for the position and comparing them with the applications
and resumes of candidates
 Taking note of areas in the person’s job history where clarification is needed
Interview Format
 The same basis questions relating to the job should be asked
 Candidates should be allowed to see the workplace if that is relevant
 The essential functions and other requirements for the position should be described of
each candidate
 If at all possible, all candidates should be interviewed by the same people
Employment Testing
There are many different types of tests and selection procedures including
cognitive tests, medical examinations, credit checks, and criminal background checks.
 Cognitive test assess reasoning, memory, perceptual speed and accuracy and skills
in arithmetic and reading comprehensive as well as knowledge of a particular
function or job.
 Physical ability test measure the physical abilities measure the physical ability to
perform a particular task or the strength of specific muscle groups. Sample job tasks
– assess performance and aptitude on particular tasks.
 Medical inquiries and physical examinations assess physical or mental health
 Personality tests and integrity tests assess the degree to which a person has certain
traits or disposition or aim to predict the likelihood that a person will engage in
certain conduct.
 English proficiency tests determine English fluency.

Background investigation/reference checking

This is done to verify the accuracy of factual information previously provided by the
applicant to uncover damaging background information such as criminal records and violent
behavior. More employers get this information from the following:

a. Personal references
 b. School records
c. Previous employment records

 Final Interview
 Selection Decision

 Physical examination
It determines if the applicant qualifies for the physical requirements of the
position and to discover any medical limitations that should be taken into account in
placing the applicant.
 Final employment
This is the decision to accept or reject the applicant based on the results of the physical
examination and a value judgment based on all the information gathered in the previous
steps.

STEP 1 Job Analysis to Prepare Job Description and Job Specification

STEP 2 Preliminary Screening, Application Blank and Interview
STEP 3 Employment Interview
STEP 4 Employment Testing
STEP 5 Background Investigation / Reference Checks
STEP 6 Final Interview
STEP 7 Selection Decision
STEP 8 Physical Examination
STEP 9 Placement on the Job

V. TRAINING AND DEVELOPMENT OF EMPLOYEES

1. Employee Orientation
Noe et al. (2007), in the book Fundamentals of Human Resource Management, it said that
employees today receive their first training during their first day on the job. This is the orientation
of employees for them to become familiar with their assigned tasks, the organization’s practices’
policies, and procedures.
Regardless of the type of organization, orientation should be conducted at two levels:
 Organizational/overview orientation
 Departmental and job orientation
Training Defined
It is a learning process that involves the acquisition of knowledge, sharpening of skills,
concepts, rules or changing of attitudes and behavior to enhance the performance of
employees.
Objectives of Training and Development
 Improve productivity and the quality and quantity of output.
 Effectiveness in the present job.
 Create more favorable attitude such as loyalty and cooperation.
 Help employees in their personal development and advancement by helping them
acquire additional qualification for a better job.
 Help organization respond to dynamic market conditions and changing customer
demands.
 Safety human resource planning requirements.
Using Training to Deal with Competitive Challenges

 Global challenge
 Quality challenge
 High performance work system challenge

What role does training play? Employees need job – specific knowledge and basic skills to
work with the equipment created with the new technology.
2. Training Process
 Training Needs Analysis (TNA)/Needs Assessment
Refers to the process used to determine if training is necessary. It
identifies specific job performance deficiencies productivity.
Five Methods Used to Gather Assessment Information
 Interviews
 Survey questionnaire
 Observation
 Focus groups
 Documentation examination
Needs Assessment Process
 Organizational analysis
 Person/performance analysis
 Task analysis
Steps in Using Performance Analysis to Determine Training Needs
Step 1 – Appraise employee performance to determine how employees are doing and
how they should be doing their assigned task to take note of behavior discrepancy or
lack of experience.
Step 2 – Determine cost for value of correcting identified behaviors discrepancy to find
out if it is worth the cost, time and expenses involved.
Step 3 – It is important to determine if the employee could do the expected job if he /
she wanted to or he / she cannot do the job because of lack of skills.
Step 4 – Performance standard should be clearly communicated to improve
performance of those who cannot do the job.
Step 5 – Eliminate obstacles by determining other factors that can hinder performance
such as time, equipment and other people.
Step 6 – Practice can help to improve performance.
Step 7 – If performance analysis indicates the need to acquire skills, training is a viable
consideration.
Step 8 – In redesigning through job enrichment, job simplification maybe the best
solution.
Step 9 – Last resort is either transfer or termination if performance is still failure after
exhausting all means to help the employee improve his / her performance

 Designing the Training Programs/Training Objectives

 Instructional objectives
 Organizational and departmental objectives
 Individual and growth objectives
Importance of Training Objectives

a. It provides the clear guidelines and develops the training program in less time because
objectives focus specifically on needs.
b. It tells the trainee what is expected out of him / her at the end of the training program.
c. It becomes easy for the training evaluator to measure the progress of the trainee because
the objectives define the expected performance of trainees.
Training Design : It clarifies what goal has to be achieved by the end of the training program.
 Validation
Introduce and validate the training before a representative audience.
 Implementation of the Training Program
Training is implemented once the staff, course, content, equipment and topics are
ready. Factors that should kept in the mind while implementing a training program:
 The trainer
  Physical setup
 Establishing report with participants
 Reviewing the agenda
Training Evaluation
Purposes of Training Evaluation
 Feedback
 Research
Process of training evaluation
 Before the Training
Skills and knowledge are assessed before the training because this can help
determine whether the actual outcomes are aligned with the expected outcomes of
training.
 During the Training
Consists of short tests at regular intervals.
 After the Training
To determine whether training given had the desired effect at individual
departments and organizational levels.
One can also measure the success of the training program according to:
 Reaction of the learner
 Learning level
 Behavior of the learner
 Results

3. Training Options
 Outsourcing – allows the organization to concentrate on their core business.
 Internal Training – a lot of question has been raised whether to go in for outsource
training or setting up an internal division for training.
 Product – Related Training – the dealer who delivers the apparatus or installs the
system offers the initial training.
 Independent Professionals – considering the emerging threats and opportunities,
professionals need to keep themselves updated of the developments.

4. Outsourcing the Training of Employees

Allows companies to deliver the best training to their employees as they can get the
clients to be the best of their ability.
Top 20 Training Providers

S.No Company Name S.No Company Name

1 Accenture Learning 11 Aptech Worldwide Corporation
2 RWD Technologies 12 Convergys
3 Geo Learning 13 Global Knowledge
4 General Physics 14 Intrepid Learning Solution
5 NIIT, Ltd 15 Innovatia
5 Element k 16 Skill Soft
6 Adayana 17 Lionbridge

7 IBM Learning Solutions 18 Experius

8 Delta College 19 Knowledge Proof
9 Raytheon Professional 20 Development Dimensions
Services International
 10 Affiliated Computer Service

5. Training Methods
 Cognitive methods – dwell on giving theoretical training to the trainees.

The various methods that come under cognitive approach are;

 Lecture / Discussion Approach – it involves transmitting large amount of factual
information to a large number of people at a given time.
Main Features:
 Inability to identify and correct
 Can reach large number of people at once
 Knowledge building exercise
 Less effective because lectures require long periods of trainee inactivity
Variations of the Lecture Method
Method Description
Standard Lecture Trainer talks while trainees listen and absorb information
Team Teaching Two or more trainees present different topics or alternative views of
the same topic
Guest Speakers Speakers visit the season to a predetermined time period.
Panel Two or more speakers presented information and ask questions
Student Presentation Group of trainees present topics to the class
.
 Demonstration/Hands-on Method – requires trainee to be actively involved in training.
Main Features
 Demonstrates the task by describing how to do, while doing
 Help the trainees focus their attention on critical aspects of the task
 Explains why procedure should be carried out in a certain way
 Computer-based Training (CBT)
It analyzes the responses and provides feedback to the trainee.
 Virtual Reality
This type of environment is created to give the trainee an impression of physical
movement in an environment.
Devices include the following:

 Headset – provides audio and visual information.

 Treadmill – used for creating a sense of movement
 Gloves – provide tactile information
 Sensory devices – transmit how the trainees are responding in thevirtual workplace to
the computer.
Features of Virtual Reality (VR) System
 It is poorly understood and requires technical understanding
 It is expensive
 It is time consuming
 It is flexible to nature
 It does not incur travelling, lodging, or food cost
 It requires excellent infrastructure
 Behavioral methods
Are more of giving practical training to the trainees. These methods are best used for
skills development.
The various methods that come under behavioral approach are:
  Games and Simulations
 Case Studies and Role Playing
 On-the-Job Training
Advantages of OJT
 No special space or equipment required
 Provides immediate transfer of training
 Allows employee to practice what they are expected to do after their training end
Techniques for the on-the-job development
 Coaching/Mentoring
 Job Rotation
 Job Instruction Technique (JIT)
Distance Learning or E-Learning in the Philippines
A study conducted by the group of Arimbuyutan (2007) noted that e – learning
can still be regarded as a new concept in the Philippines. Based on the study, the first
to adopt online corporate training methods in the Philippines as expected as expected
were the multinationals followed by local corporations. PLDT used e – learning
techniques to significantly increase its number of certified CISCO network associates.
Benefits of E – Learning

 Reduced logistics and administration cost

 Wider variety of program offerings
 Availability of courses at all time
Problems in the Use of E – Learning

 Poor telecommunication infrastructure

 Cost of appliance
 Cost of service
 Teachers’ fear of the technology because of limited know - how
 Maintenance of ICT resources and lack of technical staff
 Limited availability of education software and courseware

VI. PERFORMANCE REVIEW APPRAISAL

1. Why Measure Performance

 Managers cannot manage and define what is expected and gives feedback and recognition
without defining the basis or performance measures
 On the part of the employee, he/she cannot improve on what he/she is supposed to do
without the necessary data before and after to see if performance is actually improving
 Creating high performance requires a definition of clear goals so you will know it when you
see it.
 Pay for performance requires metrics

2. Early Approaches to Performance

 Focusing on the employees past performance –this is more on management of results,
 Focusing on the employee’s development –in here, result become the driving force for
management development
Common Flaws Identified with Performance Review System Design
 Organizations limit performance review to make employees accountable for past
endeavor
 Typing performance to review to employee salary review

3. Objectives of Performance Appraisal

 Provides information upon which promotion, transfer, demotion, layoff, discharge, and salary
decisions can be made
 Provides an opportunity for the supervisor and his/her subordinates to review and identify
their strengths and weaknesses or work-related behavior
 It forms the basis in identifying the training needs of employees as well as evaluating the
success of the training, thus, development initiatives are not based on opinions rather on
results
 It helps in the firm’s career planning process because it provides a good opportunity to
review the person’s career plans in light of his/her exhibited strengths and weaknesses
 It allows easy monitoring and supervision
 Helps evaluate individuals share relative to the team’s contribution in achieving the
organizational goal
 Provides information to evaluate effectiveness of selection and placement devices

4. Performance Criteria
Criteria in construction of Performance Evaluation
 Relevance
 Reliability
 Freedom for contamination
Indicators or Matrix that Can Help Measure Employee Performance
 Quantity  Creativity
 Quality  Adherence to Policy
 Timeless  Gossiping and other Personal Habits
 Cost-effectiveness  Personal Appearance/Grooming
 Absenteeism/Tardiness

5. Who Should Evaluate Performance

 Manager / Supervisor Appraisal – hierarchical arrangement of formal authority in most
organizations gives the supervisor or the manager legitimate authority to evaluate
subordinates.
 Self – Appraisal – the employee appraises his or her own performance, in many cases
comparing the self, appraisal to management’s review.
 Subordinates Appraisal – provides unique information because subordinates know better
than anyone else whether leadership is good or bad,
 Peer Appraisal – Research on peer evaluation, has found to be predictive of success and
yielded good reliability and validity.
 Customer / Supplier – Customers, vendors, or suppliers can be potential evaluators.
 Team Appraisal – Similar to peer appraisal in that members of a team, who may hold
different positions, are asked to appraise each other’s work and work styles.
 Assessment Center – the employee is appraised by professional assessors who may
evaluate simulated or actual work activities.
 360 – Degree or “Full – Circle“ Appraisal –The employee’s performance is appraised by
everyone with whom he or she interacts, including managers, peers, customers, and
members of other departments.

Sources of Data Appraisal

 Production Data
 Personnel Data
 Judgment of Others

6. Performance Appraisal Method

Multiple Person Evaluation Methods
 Ranking Method – ranking the employee from the most efficient to the least capable on each
trait or quality to be used in judging the employees’ performance.
 Paired Comparison Method – consists of asking an evaluator to consider only two
individuals at one time and to decide who is better.
 Forced Distribution – is a method of performance appraisal that ranks employees through
forced distribution.

Individual Evaluation Method

 Critical Incident Method

 Checklist and Weighted Checklist Method
 Graphic Rating Scales
 Behaviorally Anchored Rating Scales (BARS)
 Management by Objective (MBO)
 Multi – rater Assessment or the 360 – degree Performance Feedback

Possible Advantages of this Method

 Provides evaluation from different stakeholders which may help reduce.

performance appraisal errors and biases.
 Increases employee and possibly customer involvement.
 Increases management responsiveness to employee concerns.
 It statistical record provides good documentation for possible action.

7. Seven Tips for Creating a World-Class Appraisal System

 Design the form first
 Build your company’s values into your form
 Assure ongoing communication during development
 Train all appraises
 Orient all appraises
 Use the results
 Monitor and revise the program
Performance Appraisal
 Halo Effect
 Recency Effect
 Previous performance Bias
 Leniency/Harshness/Strictness Error
 Central Tendency

8. Feedback or Appraisal Interview

Annual discussion of performance should include:
 Review of overall progress
 Discussion of problems that were encountered
 Discussion of sources of ineffective performance
 Agreement about how performance can be improved
 Discussion on how current performance fits with long-range career goals
 Specific action plans for the coming year and how to reach short and long term
objectives

VII. CHANGES IN THE PERSONNEL STATUS

1. Promotion
It serves as encouragement and inspiration to other employees to exert their
maximum effort.
Approaches to Recruit Employees for Promotion
 Closed promotion system – the responsibility of the supervisor to identify promotable
employees for the job to be filled.
  Open promotion system also known as job posting – enhance participation and the
achievement of equal opportunity goals.
Criteria used in Promoting Employees
 Seniority – length in service
 Straight seniority the length of service of an employee is the sole basis for determining
who gets the promotion
 Qualified seniority the more competent employee as compared to another employee with
longer service will be the one promoted
 Current and past performance – promotion is based on previous performance and
evaluation
Unofficial Promotion Criteria
 Personal characteristic
 Nepotism
 Social Factors/Friendship

2. Demotion
This is the reassignment of an employee to a lower job involving fewer skills and
responsibilities.
Reasons behind Demotion
 Reorganization, company merger, or business reverses resulting to fewer jobs forcing
some employees to accept demotion
 Inability of employees to perform their job based on acceptable standards
 As a form of disciplinary action or a way to handle disciplinary problems, also viewed
as a routine form of punishment for wrongdoing
 Tool used to inform the employee concerned that he or she is beginning to be a
“liability” rather than an “asset” to the organization

3. Transfer
This is the reassignment of an employee to a job with similar pay, status, duties and
responsibilities or to another work shift or from one unit to another in the same company just
like being an invoice clerk to a sales clerk.
Reasons for Transfer
 Due to job dissatisfaction
 In conflict with supervisor or coworker
 For employees convenience
 Organizational needs may require transfer due to a business expansion,
retrenchments, erroneous placement, or to meet departmental requirements during
peak season
 For an employee to be better suited or adjusted to the job (remedial transfer)

4. Employee Separation
Different kinds of separation occur depending on whether the employee or the employer
decides to terminate the employment relationship.
Termination of Employment in the Philippines

 Is a complex process, especially of the employee subject for termination.

5. Governing Laws Regarding Separation from the Service

Art. 282 Termination by Employer. (a) Serious misconduct or willful disobedience by the
employee of the lawful orders of his employer or representative in connection with his work (b)
Gross and habitual neglect by the employee of the trust reposed in him by his employer of duly
authorized representative (c) Fraud or willful breach by the employee of the trust reposed in him
by his employer or duly authorized representatives (d) Commission of a crime or offense by the
employee against the person of his employer or any immediate member of his family or his duly
authorized representatives (e) other causes analogous to the foregoing
Art. 283 Closure of Establishment and Reduction of Personnel / Layoffs. (a) Installation of
labor – saving devices (b) Redundancy (c) Retrenchment to prevent losses (d) Closure or
cessation of business

Factors behind Downsizing Leading to Layoff

a. Decline or crisis in the firm
b. Technological advances
c. Organizational restructuring
Separation Pay – is the amount given to an employee terminated due to retrenchment, closure
or cessation of business or incurable disease.

Art. 285 Termination by Employee. An employee may put an end to the relationship
without serving any notice on the employer for any of the following causes: (a) Serious
insult by the employer or his representative on the honor and person of the employee (b)
Inhuman and unbearable treatment accorded the employee by the employer (c)
Commission of a crime or offense by the employer or his representative against the
person of the employee or any of the immediate members (d) Other causes analogous
to any of the foregoing

Article 280. SECTION 9. Termination pay. An employee shall be entitled to termination

pay equivalent to at least one month’s salary for every year of service, a fraction of at
least (6) months being considered as one whole year in case of termination due to
installation of labor-saving devices or redundancy.
SECTION 10. Basis of termination pay. Termination pay of an employee shall be
based on his latest salary rate, unless the same was reduced by the employer to defeat
the intention of the Code, in which case the basis of computation shall be the rate before
its deduction.
Art. 287. Retirement. In the absence of a retirement plan or agreement providing for
retirement benefits of employees in the establishment , an employee upon reaching the age
of sixty ( 60 ) years or more , but not beyond sixty – five ( 65 ) years which is the compulsory
retirement age , who has served at least five ( 5 ) years , may retire and shall be entitled to
retirement pay equivalent to at least one – half (1/2) month’s salary for every years of
service , a fraction of at least six (6) months being considered as one whole year.
Article 280 Section 14 Retirement Benefits – an employee who is retired pursuant to a bona
– fide retirement plan or in accordance with the applicable individual or collective agreement or
establishment employer policy shall be entitled to all the retirement benefits provided therein or
to termination pay equivalent to at least one – half month salary for every year of service,
whichever is higher a fraction of at least six (6) months being considered as one whole year.

For the purpose of computing retirement pay, “one-half month salary” shall include all of
the following:
a) Fifteen (15) days salary based on the latest salary rate
b) Cash equivalent of 5 days service incentive leave salary rate
c) One-twelfth (1/12) of the thirteenth-month pay
The computation should be as follows:
(1/12  365/12) = 0.083  30.41 = 2.52
Thus, “one-half month salary” is equivalent to 22.5 days.
Minimum retirement = daily rate  22.5 days  number of years in service
The retirement benefits under R.A. 7641 and R.A. 8558 are separate and distinct from
those granted by the Social Security System.
Under the law, upon optional or compulsory retirement, the employee is also
entitled to the proportionate thirteenth- month pay for the calendar year and to the cash
equivalent of accrued leave benefits.

6. Types of Employment
Regular Employment
Is a type of employment where the employee has been engaged to perform activities which
are necessary in the usual business or trade of the employer except where the employment
has been fixed in a specific project or undertaking, the completion or termination of which
 has been determined at the time of the engagement or where the work or service to be
performed is seasonal in nature and the employment is for the duration of the season.
Probationary Employment
Refers to the service of an employee who has been engaged on probationary basis.
He/she may be terminated only for a just cause or when authorized by existing laws, or
when he/she fails to qualify as a regular employee in accordance with reasonable
standards prescribed by the employer.
Part-time Employment
Refers to workers employed to render work for a period less than the normal six working
days in a week.
Commission-Paid Employment
When workers are paid depending on the income they brought for their employer, they earn
a percentage of an income they derived for their employer.
Casual Employment
Happens when employees are hired for a particular period or season. They may be hired
for as temporary replacements of on-leave regular employees or are hired during peak
seasons when more workers are needed.
Contractual Employment
Is the state when workers are employed at any time but for a definite period not exceeding
six (6) months.

VIII. COMPENSATING HUMAN RESOURCES

1. Objectives of Compensation
Compensation is the set of rewards that organization provide to individuals in return for
their willingness to perform various jobs and task within the organization. The objective of
compensation is to create a system of rewards that is equitable to the employer and
employee alike. Compensation should be alike: compensation should be:
 Adequate to meet the needs of the employees and to acquire and retain qualified
personnel
 Equitable
 Balanced
 Cost Effective
 Secure
 Incentive-providing
 Acceptable to the employee
 Compliant with legal regulation

2. Main Components of Compensation

 Base Pay – the hourly wage or weekly/monthly salary earned
 Premium Pay – refers to the additional compensation required by law for work
performed within eight (8) hours or nonworking days, such as rest days and special
days.
 Base Pay Progression – movement of base pay overtime, from year to year
 Variable pay – incentive or bonus pay that does not fall onto base pay; such as
earnings may be based on performance against preset goals (incentives) individual,
team, group, or organizational level.
Wages vs. Salaries
Fundamental to compensation understands the distinction between wages and salary.
Wages generally refer to hourly compensation paid to skilled and unskilled workers or those
performing blue – collar jobs, with time as the basis in computation. Salary, on the other
hand, is income paid to an individual not on the basis of time but on the basis of
performance.
Base pay, base pay progression, and variable pay add up to total cash compensation paid in
any given year.

 Benefits and perquisites or perks – in addition to direct cash, compensation is also

paid in the form or indirect cash or benefits that have monetary value.
  Indirect compensation – quality of work life. Total rewards also include a broad array
of nonmonetary, but extremely important, rewards that we place under the general
umbrella of quality of work life. These rewards include:
a. Organizational culture – the norms and values defining appropriate behavior in the
organization.
b. Intrinsic values – rewards inherent in the work itself.
c. Career opportunities – the prospects for development the prospects for development
and growth.

3. Determining Pay Rates

Establishing pay ranges involves two basic phases:

 Determining the relative worth of the different jobs to the organization (thereby
ensuring internal equity)
 Pricing the different jobs (thereby ensuring external equity)
Job evaluation is the primary method used to determine the relative worth of jobs to the
organization.

The following are some of the basic determinants of pay:

I. External Factor
A. Market Factor
1. Supply and demand for labor
2. Economic conditions and unemployment
B. Existing pay level in the community
C. Government regulations and laws, i ,e, minimum wage law
II. Organizational Factors
A. Type of industry
B. Profitability and company‘s ability to pay
C. Unionized or nonunionized
D. Size of the company
E. Capital or labor intensive
F. Value of the job contribution to the company

III. Job Factors

A. Skill
1. Mental requirements
2. Complexity of duties
3. Personal qualifications needed
4. Ability to make decisions, judgments
5. Preparation for the jobs – education, training, and knowledge
B. Responsibility
1. Money, commitments
2. Decision making
3. Supervision – work of others
4. Quality of work
5. Materials, equipment, property
6. Confidential information
C. Effort
1. Physical and mental effort required
2. Attention to details
3. Pressure of work
D. Working conditions
1. Job conditions
2. Physical hazards
IV. Individual Factors
A. Performance, productivity
B. Experience
C. Seniority, length of service
D. Potential, promotability
 4. Job Evaluation Methods
A. Ranking Method - this is the simplest and oldest method and the least often used job
evaluation technique
Advantage:
 Simplest and easiest to explain
 Takes less time to accomplish than other methods
Disadvantages:
 Provides no yardstick for measuring the values of one job relative to another
 It is limited to smaller organizations where employees are very familiar with various jobs
 The method is highly subjective.
B. Job Classification or Job Grading Evaluation Method – This is a simple, widely used
method in which jobs are categorized into groups.

Advantages:
 Provides specific standards for compensation and accommodates any changes in the
value of individual jobs
 Can be constructed simply, quickly, and cheaply
 Easy to understand and explain to employees
Disadvantages:
 Jobs are forced to fit into categories that are not entirely appropriate and feelings of
inequity can result.
 Problems may arise in deciding how many classifications there should be because too
few classes will make it difficult to differentiate job value while to many classes make
writing definitions almost impossible

C. Point System – requires evaluators to quantify the value of the elements of a job.
Steps:
1. Selection of key jobs
2. Selecting compensable factors
Assigning Weights to Factors
Weights are assigned to each of the factors, subfactors, and degrees to reflect their relative
importance.
Assigning Points to Specific Jobs
 Examine the job descriptions
 Determine the degree statement that best describes each subfactor for each
compensable factor
 Add the total number of points

Advantages:
 Can be easily interpreted and explained to employees because of its mathematical
nature
 Detailed and specific - Jobs are evaluated on a component basis and compared against
a predetermined scale
 The system is easy to keep to current as jobs change.
 Because of its quantitative nature, it is easy to assign monetary values to jobs.
Disadvantages:
 Time consuming and costly to develop.
 Requires significant interaction and decision making by the different parties involved in
conducting job evaluate
Factor Comparison Method
This method is similar to the point method but slightly more complex, and involves a monetary
scale.
Examples of compensable factors are:
 Skills
 Responsibilities
 Effort
 Working Conditions
Steps:
 Identify key (benchmark) jobs
 Identify job factors
 Rank jobs with respect to each of the factors independently
 Assign monetary amounts to each job on each factor
 Compare unique jobs with key jobs
 Group similar jobs into pay grades
 Price each pay grade
Advantages:

 Relativity detailed and specific – jobs are evaluated on a component basis and
compared against other jobs.
 Usually easier to develop than the point method
 Value of the job is expressed in monetary terms.
 Can be applied to a wide range of jobs
 Can be applied to newly created jobs
Disadvantages:
 Relatively detailed and specific – jobs are evaluated on a component basis and
compared against other jobs.
 The standards used to determine the pay for each factor may have built in biases that
would affect certain groups of employees like females or minorities.
In conducting job evaluation, the following must be taken into consideration:
 Consistency
 Freedom from bias
 Correctability
 Representativeness
 Accuracy of information

5. Different Forms of Compensation

1. Payment for Time Worked
Pay is usually adjusted upward through six types of increases:
 General – across-the-board increase for all employees
 Merit increases – paid to employees based on some indicator of job performance
 Cost of living adjustment
 Reclassification increase
 Level adjustment
 Promotional increase
2. Incentive Forms of Compensation – method in compensating employees on the basis of
output which means, more production, more earnings.
Classification:
 Piecework or payment by results
 Individual incentive plans
 Group incentives
3. Performance – based Rewards - Organizations want employees to perform at relatively
high levels and need to make it worth their efforts to do so.
4. Spot Bonuses - These are spontaneous incentives awarded to individuals for
accomplishments not readily measured by a standard. An example is to “recognize
exemplary customer service each month to identify employee of the month awardees”
5. Skill and Knowledge – based Pay/Competency – based Pay. This sets pay level on the
basis on how many skills an employee has or how many jobs he/she can do. This
emphasizes the importance of an employee’s ideas, growth, and development.
6. Merit Pay Plans – are compensation plans that base compensation on merit, example,
giving employees pay with the use of valid and reliable measures of what merits entails.
7. Profit Sharing - At the end of the year, some portion of the company’s profit is paid into a
profit sharing pool, which is then distributed to all employees.
8. Stock Ownership Plans - Employees are gradually given a minor stake in ownership of a
corporation.
9. Executive Compensation
 Base pay – guaranteed amount of money that the executive will get from the
company
 Incentive pay/executive perquisites or perks, e.g., stock plan – an incentive plan
established to give the company executives the option to buy company stocks in
the future at a predetermined fixed price.