HUMAN RESOURCE MANAGEMENT

.

HUMAN RESOURCE

MANAGEMENT

SEVENTH EDITION

MANAGEMEN DEREK TORRINGTON

LAURA HALL

STEPHEN TAYLOR

HUMAN RESOURCE MANAGEMENT

7th EDITION

TORRINGTON

HALL

TAYLOR

‘This is an excellent and highly engaging text. It is clearly written and makes

good use of real life examples, research fi ndings, case studies and opportuni￾ties for web-based learning. I would certainly recommend this textbook to

students and HRM professionals alike.’

Rory Donnelly, Manchester Business School

‘This is a compulsory, benchmark text for all students embarking on a course

in HRM. The focus on skills is excellent and provides students with rich insights

into the application of HRM in real organisational contexts.

It is one of the best, contemporary HRM textbooks available.’

Edel Conway, Dublin City University Business School

Written from a practical perspective in a clear and

engaging style, this book is highly valued as an intro￾duction to HRM for undergraduate, postgraduate and

professional programmes, including the CIPD diploma.

Derek Torrington is Emeritus Professor of Management,

University of Manchester.

Laura Hall and Stephen Taylor are both Senior Lecturers

in HRM at Manchester Metropolitan University, as well as

National Examiners for the CIPD.

Keeping you at the cutting edge of the fi eld, this market-leading text provides:

A contemporary and strategic analysis of all the key areas of HRM practice

Over 150 engaging ‘Window on Practice’ illustrations of HRM in action in organisations

such as Barclays, PricewaterhouseCoopers and Jamie Oliver’s Fifteen

‘Focus on Skills’ sections develop specifi c work-based people management skills, such

as interviewing for selection and appraisal

And new to this edition:

The latest debates in the fi eld: human capital measurement, the changing HR function,

and the future of work

The most recent developments in practice: HR information systems, continuous

professional development, and coaching skills

International examples explore issues that cross national and cultural boundaries

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Cover image: Andy Roberts/Getty Images

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Visit the Human Resource

Management, seventh edition

Companion Website at

www.pearsoned.co.uk/torrington

to find valuable student learning

material including:

• Over 250 multiple choice

questions to test your

understanding

• Extra case studies and exercises

• Extensive links to valuable

resources on the web

• An online glossary to explain

key terms

HUMAN RESOURCE

MANAGEMENT

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seventh edition

HUMAN RESOURCE

MANAGEMENT

Derek Torrington

Laura Hall

Stephen Taylor

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Pearson Education Limited

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and Associated Companies throughout the world

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First published in Great Britain under the Prentice Hall Europe imprint in 1987

Second edition published 1991

Third edition published 1995

Fourth edition published 1998

Fifth edition published 2002

Sixth edition published 2005

Seventh edition published 2008

© Prentice Hall Europe 1987, 1991, 1995, 1997

© Pearson Education Limited 2002, 2005, 2008

The rights of Derek Torrington, Laura Hall and Stephen Taylor to be identified

as authors of this work have been asserted by them in accordance with the

Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this publication may be reproduced, stored

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ISBN: 978-0-273-71075-2

British Library Cataloguing-in-Publication Data

A catalogue record for this book is available from the British Library

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Guided tour xvi

Preface xix

Acknowledgements xxi

Part 1 Introduction 1

1. The nature of human resource management 3

2. Strategic human resource management 30

3. Planning: jobs and people 50

4. The international dimension 72

Part 1 Focus on skills 93

Part 2 Resourcing 105

5. Strategic aspects of resourcing 107

6. Contracts, contractors and consultants 123

7. Recruitment 145

8. Selection methods and decisions 167

9. Staff retention 191

10. Ending the contract 210

Part 2 Focus on skills 231

Part 3 Performance 251

11. Strategic aspects of performance 253

12. Organisational performance: knowledge and learning 271

13. Employee performance management 293

14. Leadership and change 317

15. Managing absence and attendance 337

Part 3 Focus on skills 357

v

Brief contents

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Part 4 Development 375

16. Strategic aspects of development 377

17. Context, competence and competencies 393

18. Learning and development 412

19. Career development 440

Part 4 Focus on skills 465

Part 5 Employee relations 483

20. Strategic aspects of employee relations 485

21. Employee involvement 510

22. Health, safety and welfare 526

23. Equality: the legal framework 547

24. Equal opportunities and diversity 569

25. Grievance and discipline 595

Part 5 Focus on skills 615

Part 6 Reward 631

26. Strategic aspects of reward 633

27. Salaries 653

28. Incentives 676

29. Pensions and benefits 697

Part 6 Focus on skills 716

Part 7 Emerging issues 737

30. Ethics and corporate social responsibility 739

31. Work-life balance 759

32. The changing HR function 782

33. Information technology and human capital measurement 807

34. The future of work 828

Part 7 Focus on skills 845

Glossary 858

Index 865

Brief contents

vi

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Supporting resources

Visit www.pearsoned.co.uk/torrington to find valuable online resources

Companion Website for students

• Over 250 multiple choice questions to test your understanding

• Extra case studies and exercises

• Extensive links to valuable resources on the web

• An online glossary to explain key terms

For instructors

• Complete, downloadable Instructor’s Manual

• Over 1,000 PowerPoint slides that can be downloaded and used for

presentations

• Testbank of question material

Also: The Companion Website provides the following features:

• Search tool to help locate specific items of content

• E-mail results and profile tools to send results of quizzes to instructors

• Online help and support to assist with website usage and troubleshooting

For more information please contact your local Pearson Education sales

representative or visit www.pearsoned.co.uk/torrington

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ix

Contents

Guided tour xvi

Preface xix

Acknowledgements xxi

Part 1 Introduction 1

1 The nature of human resource

management 3

Human resource management for the

twenty-first century 4

Businesses, organisations and human

resource management 5

Defining human resource management 6

The evolution of personnel and

HR management 11

HRM and the achievement of

organisational effectiveness 15

Debates in HRM 16

A philosophy of human resource

management 25

Summary propositions 26

General discussion topics 27

Further reading 27

References 27

2 Strategic human resource

management 30

Strategic human resource management

and human resource strategy 31

The link between business and

HR strategy 32

Theoretical perspectives of strategic

human resource management 35

Summary propositions 46

General discussion topics 46

Further reading 46

References 47

3 Planning: jobs and people 50

The contribution and feasibility

of HR planning 51

The scope of human resource planning 53

Analysing the environment 54

Forecasting future human resource

needs 58

Analysing the current situation and

projecting forward 61

Reconciliation, decisions and plans 65

Summary propositions 69

General discussion topics 69

Further reading 70

References 70

4 The international dimension 72

International human resource

management 75

Cultural differences in management 77

International communication and

coordination 83

Summary propositions 90

General discussion topics 90

Further reading 90

Web links 91

References 91

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Contents

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Part 1 Focus on skills 93

Interactive skill 1: Face-to-face skills 93

Summary propositions 101

General discussion topics 101

Further reading 101

Web links 102

References 102

Review of Part 1 102

Part 1 case study problem 104

Part 2 Resourcing 105

5 Strategic aspects of resourcing 107

Responding to labour market trends 108

Analysing labour markets 111

Flexible resourcing choices 114

Ready made or home grown? 118

Summary propositions 120

General discussion topics 121

Further reading 121

References 121

6 Contracts, contractors and

consultants 123

Contracts of employment 124

Working patterns 126

Flexible working hours 129

Atypical contractual arrangements 131

Consultants 137

Outsourcing 140

Summary propositions 142

General discussion topics 143

Further reading 143

References 143

7 Recruitment 145

Determining the vacancy 147

Internal recruitment 149

Methods of recruitment 150

The recruitment methods compared 151

Recruitment advertising 151

E-recruitment 155

Recruiting overseas 158

Employer branding 159

Control and evaluation 161

Correspondence 161

Shortlisting 163

Summary propositions 164

General discussion topics 164

Further reading 165

References 165

8 Selection methods and decisions 167

Selection as a two-way process 168

Selection criteria and the person

specification 169

Choosing selection methods 171

Selection methods 171

Final selection decision making 186

Validation of selection procedures 187

Summary propositions 188

General discussion topics 188

Further reading 188

References 189

9 Staff retention 191

Turnover rates and trends 192

The impact of staff turnover 194

Turnover analysis and costing 196

Staff retention strategies 200

Summary propositions 206

General discussion topics 207

Further reading 207

References 207

10 Ending the contract 210

Unfair dismissal 211

Constructive dismissal 225

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Contents

Compensation for dismissal 226

Wrongful dismissal 227

Notice 228

Summary propositions 228

General discussion topics 229

Further reading 229

References 229

Legal cases 230

Part 2 Focus on skills 231

Interactive skill 2: Selection interviewing 231

Practical exercise in selection

interviewing 243

Summary propositions 244

General discussion topics 244

Further reading 244

Web links 245

References 245

Review of Part 2 246

Part 2 case study problem 248

Part 3 Performance 251

11 Strategic aspects of performance 253

A change in perspective: from

employment to performance 254

Influences on our understanding

of performance 255

Do people-management processes

contribute to high performance? 256

How do HR policies and practices

affect performance? 259

Current directions in HRM-performance

thinking 264

Major performance initiatives 265

Summary propositions 266

General discussion topics 267

Further reading 267

References 267

12 Organisational performance:

knowledge and learning 271

Organisational performance ‘initiatives’ 272

Learning organisations 273

Knowledge management 281

Managing knowledge 283

Summary propositions 289

General discussion topics 289

Further reading 289

References 290

13 Employee performance

management 293

Performance management and

performance appraisal 294

Stages in a performance management

system 299

Individual versus team performance

management 304

Implementation and critique of

performance management 306

360-Degree Feedback 308

Summary propositions 312

General discussion topics 313

Further reading 313

References 314

14 Leadership and change 317

Leadership and management 318

What are the traits of leaders and

effective leaders? 319

What is the ‘best way to lead’?

Leadership styles and behaviours 321

Do leaders need different styles for

different situations? 323

Do we really need heroes? 326

Leadership and change 329

Summary propositions 333

General discussion topics 334

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Contents

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Further reading 334

References 335

15 Managing absence and

attendance 337

The national context 338

The organisational context 340

Process and causes of absence 341

Managing for attendance 343

Summary propositions 354

General discussion topics 354

Further reading 354

References 355

Part 3 Focus on skills 357

Interactive skill 3: Appraisal interviewing 357

Summary propositions 368

General discussion topics 369

Further reading 369

Web links 369

References 370

Review of Part 3 371

Part 3 case study problem:

Bakersfield University 372

Part 4 Development 375

16 Strategic aspects of

development 377

The national picture and strategy 379

Organisational strategy and HR

development strategy 382

The external labour market and HR

strategic integration 385

Training and development roles 386

Summary propositions 389

General discussion topics 390

Further reading 390

References 390

17 Context, competence and

competencies 393

National training framework 394

Competences and NVQs 399

Behavioural competencies 403

Summary propositions 409

General discussion topics 410

Further reading 410

References 410

18 Learning and development 412

The nature of learning 413

Practical characteristics of learning and

development 414

Methods of learning and development 420

Evaluation of training and development 434

Summary propositions 435

General discussion topics 436

Further reading 436

References 437

19 Career development 440

How and why are careers changing? 442

Definitions and importance of career

development 446

Understanding careers 447

Individual career management 452

Organisational support for career

development 456

Summary propositions 461

General discussion topics 461

Further reading 461

References 462

Part 4 Focus on skills 465

Interactive skill 4: Coaching and

presentation 465

Summary propositions 477

General discussion topics 478

Further reading 478

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Contents

Web links 478

References 478

Review of Part 4 479

Part 4 case study problem: Micropower 480

Part 5 Employee relations 483

20 Strategic aspects of employee

relations 485

Key trends in employee relations 486

Strategic choices 492

Union recognition and derecognition 497

The study of employee relations 503

International perspectives 504

Summary propositions 506

General discussion topics 506

Further reading 506

References 507

21 Employee involvement 510

Terminology 511

Information sharing 513

Consultation 517

The legal duty to consult 519

Co-determination 522

Summary propositions 524

General discussion topics 524

Further reading 524

References 525

22 Health, safety and welfare 526

HRM and health, safety and welfare 527

Health and safety law 529

Managing stress and emotional welfare 536

Managing physical welfare 540

Occupational health services 543

Summary propositions 544

General discussion topics 544

Further reading 544

References 545

Legal cases 546

23 Equality: the legal framework 547

Discrimination on grounds of sex or

marital status 549

Race discrimination 554

Disability discrimination 556

Discrimination on grounds of sexual

orientation 559

Discrimination on grounds of religion

or belief 561

Age discrimination law 562

Trade union discrimination 563

Part-time workers 564

Fixed-term workers 565

Ex-offenders 565

Summary propositions 566

General discussion topics 567

Further reading 567

References 568

Legal cases 568

24 Equal opportunities and diversity 569

Current employment experiences of

socially defined minority groups 570

Different approaches to equality 576

Implications for organisations 584

Summary propositions 590

General discussion topics 590

Further reading 590

References 591

25 Grievance and discipline 595

The Milgram experiments with obedience 597

What do we mean by discipline? 600

What do we mean by grievance? 602

The framework of organisational justice 603

Grievance procedure 608

Disciplinary procedure 609

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Contents

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Are grievance and discipline processes

equitable? 610

Summary propositions 613

General discussion topics 613

Further reading 613

References 614

Part 5 Focus on skills 615

Interactive skill 5: Grievance and

disciplinary interviewing 615

Summary propositions 625

General discussion topics 626

Further reading 626

Web links 626

References 627

Review of Part 5 627

Part 5 case study problem:

Industrial disputes at British

Airways, 1997–2007 628

Part 6 Reward 631

26 Strategic aspects of reward 633

Total reward 634

Reward strategies 637

Setting base pay 643

The elements of payment 646

The importance of equity 649

Summary propositions 650

General discussion topics 651

Further reading 651

References 652

27 Salaries 653

Salary structures 654

Broadbanding 660

Job evaluation 661

Employee participation in job evaluation 666

The legal framework for pay and reward 667

Summary propositions 672

General discussion topics 673

Further reading 673

References 674

Legal cases 674

28 Incentives 676

Basic choices 677

The extent to which incentives are paid 681

Payment by results schemes 682

Disadvantages of PBR schemes 684

Performance-related pay 686

Skills-based pay 690

Profit sharing 691

Summary propositions 693

General discussion topics 694

Further reading 694

References 694

29 Pensions and benefits 697

Pensions 698

Occupational pensions and HRM 706

Sick pay 708

Company cars 709

London allowances 711

Flexible benefits 712

Summary propositions 713

General discussion topics 714

Further reading 714

References 715

Part 6 Focus on skills 716

Interactive skill 6: Negotiation 716

Summary propositions 732

General discussion topics 732

Further reading 732

Web links 733

References 733

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