CHAPTER 2: LITERATURE REVIEW: EQUAL TREATMENT OF EMPLOYEES IN
2.2 Theoretical background
To provide context to the discussion in this chapter, it is important to first explore the history of HRM as a field, because the title of this study has its focus on the application of HRM policies and practices. In this regard, it is important to note how equal and different treatment of employees influences employee behaviour in the workplace.
In an organisation, the human resources division is responsible for the implementation of policies and practices that impact on employee wellbeing in the workplace (Armstrong and Taylor, 2014; Price, 2011). This division also plays a significant role in ensuring that it creates an environment that will contribute to the progress and success of the organisation (Benson and Scroggins, 2011; Dessler, 2011).
How employees are treated is linked to the role played by the HRM department (Armstrong, 2011; Dessler, 2011) since it is operationally responsible for implementing policies. It is also assumed that the HRM would implement policies fairly and equally across the organisation.
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The HRM department is viewed as the custodian of organisational policies and practices that govern employees (Dessler, 2011, Nankervis, Compton, Baird and Coffey, 2011; Nel, 2011), and it is expected that the HRM department should apply policies equally across the entire organisation, in other words, as stated above, all employees must be treated equally.
In instances when policies and practices are not applied equally, employees are likely to react to this; their reaction is likely to lead to employees leaving the organisation (Dessler, 2011; Hewertson, 2017; Kaufman, 2015). It is for this reason to emphasise that the HRM department is not just any department within the organisation, which is only responsible for hiring and firing employees, but a key role-player and business partner in an organisation (Kaufman, 2015).
In addition to the aforementioned HRM functions, there are other HRM-related functions (Nel, 2011) such as ensuring that compensations, rewards and benefits are market-related. This is to ensure that compensations, rewards and benefits are comparable to other organisations in that specific sector. The HRM department must ensure that the organisation has a policy on performance management, and its application is appropriate.
However, the HRM department cannot achieve its goals without the involvement of employees in decision-making processes (Armstrong, 2011; Noe and Hollenbeck, 2010).
That is why it is important that an organisation should create an environment that promotes good relations with employees through structures like forums, such as a workplace forum, or allow for trade union representation for collective bargaining purposes.
The HRM department should be cognisant of the fact that the implementation of HRM policies and practices assist in creating a working environment, which would keep employees, motivated, satisfied, engaged and reduce turnover intention Noe and Hollenbeck, 2010. Thus, an important function of HRM would include actions to measure phenomena such as motivation, satisfaction, turnover intention and engagement (Armstrong, 2011).
It is generally accepted that people are the most important assets of an organisation (Armstrong, 2011; Huselid and Becker, 2011; Levictus, 2017). Therefore, employees should be valued and given the credit they deserve, especially when they have performed in line with organisational performance standards and achieved excellence.
One of the aspects in an organisation that would underscore the importance of employees achieving motivation, satisfaction, acceptable levels of engagement and reduced turnover
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intention is the manner in which HRM policies and practices are applied. Employees expect HRM policies and practices to be applied equally (Imani, 2017; Minge, 2017). It is therefore expected that each employee should be treated equally when compared to the treatment of other employees, irrespective of their rank or level of employment (Minge, 2017).
2.2.1 Personnel management and human resource management
Having considered the theoretical background to this research, it would be sensible to discuss the concepts of personnel management (PM) and HRM. Hence, this section, explore the general background of the HRM concept. While in the process focusing on the differences between PM and HRM. The discussion further focuses on how the concept of personnel management began and evolved over the years into HRM.
The earliest role of PM in the 1970s was to manage employees. More importantly, it was to hire and fire employees and to ensure that employees were productive (Adeniji and Osibanjo 2012; Gomez-Meija et al., 2012). This period was at the time when employees had limited workplace rights (Adeniji and Osibanjo 2012; Gratton, 2010), in comparison to the present situation.
Therefore, what was personnel management? Personnel management described the way people were managed in an organisation. This was before the emergence of the HRM concept (Gomez-Meija et al., 2012).The primary functions of personnel management included the employment and dismissal of employees, and to some extent capturing employees’ leave and handling the payroll (Adeniji and Osibanjo 2012; Gomez-Meija et al., 2012; Oladipo and Abdulkadir, 2011).
Personnel management fulfilled more of an administrative role (Oladipo and Abdulkadir, 2011; US Office of Personnel Management, 2010), and there was less focus on other issues that affected employees, such as employee wellness, not to mention other equally important aspects, such as employee motivation, satisfaction and engagement.
Personnel management transformed for a number of reasons. One of these reasons is the employment of a younger generation. Research studies undertaken on the phenomenon of PM (US Office of Personnel Management, 2010) brought about changes in the workplace, and this led to a shift on the management of employees.
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Contrary to the popular view that HRM is a concept that evolved from PM, a number of authors, notably Gomez-Meija et al. (2012), link HRM with PM by asserting that the term HRM is no different from PM.
Gomez-Meija, Balkin and Cardy (2012) state that if there is any dividing line between the two concepts this line is thin. According to Nankervis, Compton, Baird and Coffey (2011) PM and HRM are two sides of the same coin, although the difference in the choice of terminology highlights a difference in focus and emphasis with regard to specific functions.
The view held by Gomez-Meija, Balkin and Cardy (2012), which is supported by Tiwari and Saxena (2012), that there is actually no difference between PM and HRM, is that it is difficult to differentiate between the two concepts. Gomez-Meija, Balkin and Cardy (2012) and Tiwari and Saxena (2012) furthermore, argue that if there is any difference between the two concepts it could be ascribed to the fact that HRM is a modern, expanded version of the traditional PM.
However, Soomro, Gilal and Jatoi (2011) state to the contrary that the difference between PM and HRM is that PM is considered workforce-centred because it neglects other important issues concerning employees, such as employee satisfaction, and employee engagement, while HRM is an all-inclusive concept, inclusive of all employee-related issues.
Armstrong and Taylor (2014) take this a step further by suggesting that the concept HRM should be detached from PM. The reason for this assertion is that HRM is specifically encompassing the maximum utilisation of employees and the integration of employees with the long-term strategic goals of the organisation.
Irrespective of the differences in the interpretation, conceptualisation, origin and history of HRM, the academic fraternity has accepted the existence of HRM as existing in modern society. That is why HRM has been researched extensively (Armstrong and Taylor, 2014;
Christie, 2010; Fitzgerald and Mills, 2012; Gomez-Meija et al., 2012; Soomro et al., 2011;
Tiwari and Saxena, 2012).
The gradually diminishing use of the term PM, and the emergence and acceptance of HRM as an area of interest, has led to a number of changes in the working environment (Adeniji and Osibanjo 2012). These changes were because of an attempt to give a clear description of this new concept and on how it differs from PM.
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Some of these changes notably included issues like employee wellness, employee training and development and employee motivation, to mention a few. Therefore, HRM not only focuses on the functions that are alluded to above, but also to focus on and achieve a well- motivated, highly skilled and flexible workforce (Armstrong, 2011; Christie, 2010; Fitzgerald and Mills, 2012; Gratton, 2011a).
The evolving nature of the concept HRM over the last two decades has widely become the focus of this professional practice (Fitzgerald and Mills, 2012). This paradigm shift ensured that employees in organisations are an integral part of the organisation in its pursuance of achieving its intended organisational objectives.
The constantly evolving nature of HRM has caused organisations to realise that there is a dire need to move away from the traditional administrative functions of the earlier PM to a more inclusive HRM philosophy (Armstrong and Taylor, 2014). This is to ensure that there is an alignment between HRM goals and the objectives of the organisation (Soomro et al., 2011).
The shift from PM to HRM has affirmed the importance of HRM and its role in an organisation (Fitzgerald and Mills, 2012). That is why HRM not only focuses on its main functions, like recruitment and selection (Cummins, 2015), but also on issues like employee motivation, satisfaction, engagement, commitment and wellbeing.
Motivated employees are likely to perform at their maximum potential, and in so doing, they would achieve their personal goals and in the process contribute to the organisation achieving its goals (Fitzgerald and Mills, 2012). In addition, motivated employees are intrinsically willing to work for the organisation.
Once employees’ level of satisfaction is at an acceptable level, they are likely to increase productivity in the organisation. The organisation’s productivity is in line with the customer and investor demands (Mathis and Jackson, 2011; Ployhart and Moliterno, 2011). In respect of customers, employees will strive to meet customer expectations and provide customers with an excellent service (Mathis and Jackson, 2011). Organisations do this in order to be competitive and attract more customers.
On the other hand, investors or shareholders expect returns on their investment from the organisation. Motivated and satisfied employees are likely to meet the expectations of the investors by increasing their work rate and being more productive in the job that they perform (Ployhart and Moliterno, 2011).
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In reality, an organisation would find it difficult to meet investors’ expectations when its human capital lacks the necessary creativity. Therefore, it is crucial for HRM to ensure that there is an acquisition of competent employees. The objective of acquiring competent employees is to increase the level of productivity, which ultimately culminates in improved profit (Ployhart and Moliterno, 2011).
Besides the aforementioned responsibility, HRM must further ensure that the organisation has adequate resources both human and physical resources. It is also incumbent on the HRM to train these employees in order to provide an excellent service to customers.
However, in order to attract excellent employees, an organisation’s HRM policies and practices should be distinct from those of its competitors (Mathis and Jackson, 2011).
In this regard, it is important that HRM should be mindful of how its policies and practices affect the way organisations treat its employees. Thus, the development and implementation of HRM policies and practices is in such a way that these policies do not suppress employees.
The issues previously mentioned, namely employee satisfaction, engagement and motivation, have an influence on the treatment of employees in the organisation. If employees have the perception that their treatment is different, motivation is likely to be negatively affected, which in turn leads to lower levels of productivity. The equal treatment of employees in an organisation is thus a key factor contributing to a healthy organisation.