Organization and Management

Employee Relations
Employee Movements
Reward System
1.1 EMPLOYEE RELATIONS
Effective employee relations management is an essential component that contributes to the
success of the company. It is the connection created among employees/workers as they do
their assigned tasks for the organization to which they belong.
Effective Employer Relations and Social Support
Social support is the sum total of perceived assistance or benefits that may result from effective
social employee relationships. Without social support, effective employee relation is not
possible; and without effective social relationships, social support, likewise, is not possible.
Below are some barriers to good employee relations:

Anti-social personality
Lack of trust in others
Selfish attitude
Lack of good self-esteem
Not a team player
Being conceited
Cultural/subcultural differences
Lack of cooperation
Communication problems
Lack of concern for other’s welfare

Here are some ways to overcome barriers to good employee relations:

Develop a healthy personality to overcome negative attitudes and behavior.
Find time to socialize with coworkers.
Develop good communication skills and be open to other’s opinions.
Minimize cultural/subcultural tension.
The diagram below shows the ideal relationship between the employee and
employer which centers on good communication.

The diagram shows the elements of maintaining good relationships between

management and employees. Harmony, unity, joint effort, fairness, and rapport contribute
maintaining relations characterized by mutual respect, cooperation, and shared responsibilities
and benefits. Good communication is key in resolving conflict between employees and
management. The company must ensure that there is constant dialogue between employees
and management.
1.2 EMPLOYEE MOVEMENTS
Employee movements is a series of actions initiated by employee groups toward an end
or specific goal.
It is inevitable and are often the result of evaluation or structural changes within an
organization. An organization can move its employees either vertically or horizontally.
Vertical movement – entails the movement of an employee from a lower position to a higher
one.
Horizontal movement – involves the transfer of an employee to another department or position
with similar responsibilities or status.
Types of employee movements:
Promotion is a movement to a higher level or position.
Tenure refers to the number of years in service of an employee.
Meritorious performance refers to an excellent or outstanding performance of an
employee.
Demotion is a movement to a lower level or position. A common reason for an
employee’s demotion is inefficiency or poor performance.

 Transfer is a movement to another position but with the same level or scope of
responsibility. It can also mean a transfer to another branch or location but the employee still
occupies the same tasks.
Separation or an employee’s departure from the organization is the last type of
movement. It may take the following forms:
1. Resignation – this is an employee’s voluntary decision to leave the organization.
2. Separation with authorized cause – it is also known as layoff; this is the company’s
decision to terminate employees due to business reasons.
o Redundancy – one of the reasons for layoff wherein the introduction of new technology will
duplicate some of the existing functions of certain jobs.
o Severance package – it is a monetary package to enable employees to maintain of their
standard of living during the period that they are unemployed.
3. Separation with just cause – this will be occurred when the employee terminated due to
theft, fraud, and other serious offenses. In this scenario, the employee will not be receiving
severance pay from the company and may also be subjected to legal sanctions.
4. Retirement – this refers to the end of a worker’s employment with the company due to old
age, illness, or infirmity. Company’s have different prescribed retirement age either 60 years old
or age 65. The retiring employee will be given a retirement package as mandated by law.
Labor Unions and Collective Bargaining
Employees have the option to form labor unions, also known as labor organizations.
Labor Union is a formal union of workers that deals with employers, for the purpose of
collective bargaining or mutual aid, interest, cooperation and protection.
Labor unions in the Philippines are classified into two:
1. Public sector unions – it is also known as government employees’ unions in which
organized by employees of government agencies.
2. Private sector unions – are those whose members are employed in commercial, industrial
and agricultural enterprises including non-profit or charitable organizations, medical, religious,
and educational institutions.
Reasons why employees/workers unionize:
a. Financial needs – complaints regarding unjust wages or salaries and benefits given to them
by the management.
b. Unfair management practices – one example is favoritism related to promotion and giving
of training opportunities and exemption of disciplinary action.
c. Social and leadership concerns – some join unions for the satisfaction of their need for
connection with a group.
Steps in union organizing:
Step 1. Employee/union contact – these actions by employees and union officers are necessary
to build a case against the employer.
Step 2. Initial organizational meeting – this is conducted to attract more supporters and select
potential leaders.
Step 3. Formation of in-house organizing committee – the strength of union is shown by the
number of employees who signed the authorization card. At least 30 employees must sign the
said card before the National Labor Relations Commission (NLRC) approves the holding of a
representation election.
Step 4. If a sufficient number of employees support the union movement, the organizer
requests for a representation election or certification election.
Step 5. End of union organizing – when the sufficient number of votes is garnered, the NLRC
certifies the union as the legal bargaining representative of employees.
Collective bargaining refers to the process by which the labor union negotiates a labor
contract with the management. This labor contract or collective bargaining agreement contains
agreements on the following:
compensation
benefits
duties of employees and management
work hours
job security
promotion
layoffs
vacation and rest periods
1.3 REWARD SYSTEM
Companies also provide additional payments and benefits on top of the employee’s basic
salaries. These form part of the company’s reward systems and are given to motivate
employees as they perform their tasks. Further, rewards promote personal growth, development
and present fast turnover among employees.
Types of rewards:
a. Monetary rewards – pertaining to money, finance, or currency.
o Pay/salary – financial remuneration given in exchange for work performance it is either
weekly, monthly or per hour.
o Benefits – indirect forms of compensation given to employees like health care benefits,
retirement, and educational benefits.
o Incentives – based upon a pay-for-performance philosophy, examples are bonuses, merit
pay, sales incentives, etc.
o Executive pay – a compensation package for executives of organizations which consists of
five components: basic salary, bonuses, stock plans, benefits, and perquisites.
o Stock options – grant employees the right to buy a specific number of shares of the
organization’s stock at a guaranteed price during a selected period of time.
b. Nonmonetary rewards – it does not pertain to money, finance, or currency; refer to intrinsic
rewards that have psychological effect on the employee who receives them.
o Award – given to employees for meritorious service or outstanding performance like trophies,
medals or certificates.
o Praise – reward given by superiors to their subordinates when they express oral or verbal
appreciation for excellent job performance.
Contingent Pay is given on top of the basic pay rate and is based on the employee’s
performance, competency, contribution, and skills.
Individual contingent pay can be implemented along five schemes:
1. Pay for performance scheme
2. Pay for competency
3. Pay for contribution
4. Pay for skills
5. Pay for service
Group contingent pay can be implemented into two schemes:
1. Team-based pay – this is given to groups of employees who have related jobs and are
assigned to work on certain project. Team-based pay is usually given at a rate proportionate to
an employee’s basic pay while other companies distribute the pay equally among team
members.
2. Organization-wide pay – this is given to employees on the basis of the achievement of
organizational goals. There are two types of organization-wide payments:
a. Gainsharing – primarily emphasizes increased productivity and improved performance of
employees. An example of gainsharing is when a company gives a bonus to its employees
when its sales revenues surpass the sales targets.
b. Profit sharing – this refers to a scheme where employees share in the profits of the company
either through cash payments or share of stocks.