Training, Teaching and Learning Materials (TTLM)

QUEENS COLLEGE

The Ethiopian TVET-System

Human Resource Supervision
Level - IV
Learning Guide
Unit of Competence: MANAGE EMPLOYEES MOVEMENT AND SEPARATION
Module Title: MANAGING EMPLOYEES MOVEMENT AND SEPARATION
LG Code: EIS HRS4 M10 LO1-5 1012
TTLM Code: EIS HRS4 TTLM V1 1012

LO 01: ADMINISTER PROMOTION

LO 02: CARRYOUT TRANSFER OF EMPLOYEES
LO 03: ADMINISTER DEMOTIONS
LO 04: HANDLE EMPLOYEES LAYOFF
LO 05: MANAGE DISCHARGE AND RETIREMENTS

Introduction Learning Guide

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This learning guide is developed to provide you the necessary information regarding the
following content coverage and topics:

 Administer Promotion
 Carryout Transfer Of Employees
 Administer Demotions
 Handle Employees Layoff
 Manage Discharge And Retirements

This guide will also assist you to attain the learning outcome stated in the cover page.
Specifically, upon completion of this Learning Guide, you will be able to :-

 Internal candidates are identified and recruited in accordance with organizational policies.
 Criteria for promotion are developed and validated according pre set criteria.
 Decisions are made in selecting employees from internal candidates according to
organization’s regulations.
 Internal candidates received an offer stating such things as new salary, starting date, etc.
 Promotion activities are monitored and evaluated in accordance with organizational
policies development process.
 Transfer policies, procedures and practices are identified.
 The need for transfer is determined in accordance with policy of organization.
 Decisions are made in transferring employees based on organizational policy and
procedure.
 Policies, legal requirements, procedures and practices in relation to demoting an employee
are identified.
 Reasons for demoting an employee are identified based on organizational regulations.
 Reasons for demoting an employee are analyzed in accordance to organization polices and
legal requirement.
 Decisions are made in demoting an employee based on organization’s regulations.
 An employee received a letter stating the position demoted to, salary and starting date, etc
following work procedures.

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  Employees for layoff are identified in accordance to organizational policies and legal
requirements.
 Employees to be laid off are notified following work procedures.
 Retained employees are assigned to new jobs based on organization’s guideline.
 Benefits and assistance to be given to lay off employees are determined and provided as
per the organizational policies and legal requirements.
 Policies and procedures are identified for discharge and retirement following work
procedures.
 Employee and the organization are agreed on redeployment procedures as per the
contract of employment.
 Communication systems are established which provide all necessary information about
termination procedures, and ensure early notification of discharge, retirement or
resignation.
 Dismissals for incapacity to perform or misconduct are carried out in accordance with
organizational policies and legal requirements.
 Reports are generated regularly indicating the retirement intentions of employees in the
ground of age.
 Outplacement assistance is provided in accordance with organizational policies and legal
requirement.
 Exit interview are conducted with separated employees based on guideline.
 Feedback from exit interview is collected and used as an input to performance
improvement processes throughout the organization.
 Separation/termination procedures are regularly reviewed and evaluated, and
improvements introduced in accordance with the evaluation and organizational policies.
Learning Activities

1. Read the specific objectives of this Learning Guide.

2. Read the information written in the “Information Sheets”.

3. After reading the information sheets, go to your instructor and get the copy of self check.

4. Accomplish the “Self-check” in page 40

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5. If you earned a satisfactory evaluation proceed to LO-2. However, if your rating is
unsatisfactory, see your teacher for further instructions.

6. Submit your accomplished Self-check. This will form part of your training portfolio.

Note:

1. You can ask the assistance of your trainer/instructor to show you and explain further the
topic you can’t understand.

2. You can check your answer in self-check by using the answer key

INTRODUCTION
Employee Separations
I. Employee Separations
An employee separation occurs when an employee ceases to be a member of an organization.
The rate of employee separations in an organization (the turnover rate) is a measure of the rate at
which employees leave the firm.
A. The Costs of Employee Separations
There are always costs associated with employee separations. The cost may be more or less,
depending on whether managers intend to eliminate the position or to replace the departing
employee. Costs included in separations include: recruitment costs, selection costs, training
costs, and separation costs.
1. Recruitment costs.
2. Selection costs.
3. Training costs.
4. Separation costs.
B. The Benefits of Employee Separations
While many people understand the costs of employee separations, there are benefits as well.
Some of the benefits of separations include: reduced labor costs, replacement of poor performers,
increased innovation, and the opportunity for greater diversity.
1. Reduced labor costs.
2. Replacement of poor performers.
3. Increased innovation.
4. Opportunity for greater diversity.

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II. Types of Employee Separations
Employee separations can be divided into two categories based on who initiates the termination
of the employment relationship. Voluntary separations (quits and retirements) are initiated by the
employee.

Involuntary separations (discharges and layoffs) are initiated by the employer.

A. Voluntary Separations
1. Quits.
2. Retirements.
B. Involuntary Separations
Involuntary separations occur when management decides to terminate its relationship with an
employee due to economic necessity or a poor fit between the employee and the organization.
1. Discharges.
2. Layoffs.
3. Downsizing and rightsizing. A reduction in the number of people employed by a firm (also
known as restructuring and rightsizing); essentially the reverse of a company growing and
suggests a one-time change in the organization and the number of people employed
V. Outplacement
Outplacement is a human resource program created to help separated employees deal with the
emotional stress of job loss and to provide assistance in finding a new job
The Goals of Outplacement:
The goals of outplacement reflect the organization's need to maintain employee productivity. The
most important of these goals are (1) reducing the moral problems of employees who will be laid
off so that they will remain productive; (2) minimizing the amount of litigation initiated by
separated employees; and (3) assisting separated employees in quickly finding comparable jobs.
Outplacement Services: The most common outplacement services provided to separate
Employees are emotional support and job-search assistance. These services can help achieve the
Goals of outplacement.
1. Emotional support.

2. Job-search assistance.

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The role of HR Department in employee separations and outplacement
Cooperation and teamwork characterize the relationship between managers and HR staff in the
employee separation process. HR staff can act as valuable advisers to managers, particularly in
the dismissal process, by helping them avoid mistakes that can lead to claims of wrongful
discharge. They can also help protect the employee whose rights may be violated by managers.
Furthermore, they may assist in the development of and/or selection of the contents of voluntary
severance plans or buyouts, early retirement plans, and outplacement services

INFORMATION SHEET 01 ADMINISTER PROMOTION

Meaning of Promotion

 Promotion means an improvement in pay prestige, position and responsibilities of an

employee within his/ her organization
 A mere shifting of an employee to a different job which has better working hours, better
location and more pleasant working conditions is not promotion.
 The new job is a promotion for the employee only when it carries increased responsible and
enhanced pay.
Purposes of Promotion

 The purposes of promotion may be outlined as follows:

1. To motivate employees to higher productivity.
2. To attract and retain the services of qualified and competent people.
3. To recognize and reward the efficiency of an employee.
4. To increase the effectiveness of the employee and of the organization.
5. To fill up higher vacancies from within the organization.
6. To build loyalty, morale and a sense of belongingness in the employee.
7. To impress upon others that opportunities are available to them too in the organization, if
they perform well.
Principles of promotion

 The policy of promotion should be close on the following matter:

(i) The management must make it clear whether to fill up higher positions by internal promotions
or recruit people from outside.

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(ii) When it has been decided to fill up higher positions with promotions, a further decision on
determining the basis of promotion should be made by the management.

(iii) Another point to be made clear about the policy of promotion is whether to promote
employees against vacancies or non-vacancies.

(i) A promotion policy should establish a well-defined promotion chart,

showing who can go up to what level in the organization.
(ii) Frequent promotions are inadvisable from the point of view of the employer
and the employees.
(iii) A promotion should be preceded by a job analysis, and performance
appraisal
(iv) The promotion policy should be discussed with labour unions, and their
acceptance should be obtained in the form of an agreement
(v) When promotions are made on the basis of competence, openings for
promotion should be displayed prominently at several places to enable
interested people to apply
Types of Promotion

 Promotions may be classified in to the following types:

(i) Horizontal Promotion This type of promotion involves an increase in responsibilities and
pay, and a change in designation. But the employee concerned does not transgress the job
classification. For example, a lower division clerk is promoted as an upper division clerk. This
type of promotion is referred to as ‘upgrading’ the position of an employee.

(ii) Vertical Promotion This type of promotion results in greater responsibility, prestige and
pay, together with a change in the nature of the job. A promotion is vertical when a canteen
employee is promoted to an unskilled job. The concerned employee naturally transgresses the job
classification.

(iii) Dry Promotions Day promotions are sometimes given in lieu of increases in remuneration.
Designations are different but no change in responsibilities. The promote may be given one or
two annual increments.

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INFORMATION SHEET 02 CARRYOUT TRANSFER OF
EMPLOYEES
Definition of Transfer

 A transfer involves a change is the job of an employee without a change in responsibilities or

remuneration.
 A transfer differs from a promotion in that the latter involves a change in which a significant
increase in responsibility, status and income occurs, but all these elements are stagnant in the
former.
 Another difference is that transfers are regular and frequent, as in banks other government
establishments, but promotions are frequent if not irregular.
Reasons for Transfers

 The reasons for transfers vary from organization to organization, and from individual to
individual within an organization.
 The following are the reasons for transfers:
1. There is a shortage of employees in one department or plant because of a heavy demand which
necessitates an increase in the number of shifts or expansion of production capacity. In another
department or plant of the same organization, employees may be surplus because of slackened
demand for the products manufactured by that department. If the demand is undisturbed,
increased mechanization may render some employees redundant. Workers are transferred from
the surplus department to another department or plant where there is a shortage of staff.

2. Removal of the incompatibilities between the worker and his or her boss and between one
worker and another worker

3. Correction of faulty initial placement of an employee.

4. A change has taken place in the interests and capacities of an individual, necessitating his or
her transfer to a different job.

5. Over a period of time, the productivity of an employee may decline because of the monotony
of his or her job. To break this monotony, the employee is transferred.

6. The climate may be unsatisfactory for an employee’s health. He or she may request a transfer
to a different place where his or her health will not be affected by its climate.

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7. Family related issues cause transfers, especially among female employees. When they get
married, the female employees want to join their husbands, and this fact necessitates transfers or
resignations.

Principles of Transfers

 The management must frame a policy on transfers and apply it to all the transfers instead of
treating each case on its own merits.
 Such a policy must be based on the following principles:
1. The frequency of transfers and the minimum period between transfers need to be decided upon
and made known to all the employees. Defense personnel and government employees, for
example, are subjected to transfer once in three years. The employs in these establishments know
when they are due for a transfer and are prepared for it.

2. The authority which would handle transfers is to be decided upon. The usual practice is that
transfers in each department are handled by the person in charge of that department. The best
course is to centralize the authority handling transfers, and make the HR department responsible
for them.

3. The criteria for entertaining transfers need to be laid down and strictly adhered to.

4. The area of the organization over which transfers can be made need to be defined.

5. The area of the organization over which transfers can be made need to be defined.

6. Transfers should be clearly defined as permanent or temporary.

7. The performance of the employee needs to be assessed before transferring him or her to a
different job. Similarly, the job itself must be properly described. Job description and employee
assessment enable the management to know whether the individual fits the new job or whether
he or she needs training before taking up the new assignment.

8. The interests of the organization are not be forgotten in framing a policy of transfers.

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Types of Transfers

 Transfers may be production, replacement, versatility, shift and remedial.

(i) Production Transfers. Shortage or surplus of the labor force is common in different
departments in a plant or several plants in an organization. Surplus employees in a department
have to be laid off, unless they are transferred to another department. Transfers affected to avoid
such imminent lay-offs are called production transfers.

(ii) Replacement Transfers Replacement transfers, too are intended to avoid imminent lay-offs,
particularly, of senior employees. A junior employee may be replaced by a senior employee to
avoid laying off the latter. A replacement transfer program is used when all the operations are
declining, and is designed to retain long-service employees as long as possible.

(iii) Versatility Transfers Versatility transfers are effected to make employees versatile and
competent in more than one skill. Clerical employees in banks, for example, are transferred from
one section to another over a period of time so that they may acquire the necessary skills to
attend to the various activities of the bank. Versatile operations are valuable assets during rush
periods and periods when work is dull. Versatile transfers may be used as a preparation for
production or replacement transfers.

(i) Shift Transfers Generally speaking, industrial establishments operate more than
one shift. Transfers between shifts are common, such transfers being made mostly
on a rotation basis. Transfers may also be effected on special requests from
employees. Some request a transfer to the second shift or the night shift in order to
avail the free time during the day to take up part time jobs, although this is not
permitted by law.
(ii) Remedial Transfers Remedial transfers are effected at the request of employees and
are, therefore, called personal transfers. Remedial transfers take place because the
initial placement of an employee may have been faulty or the worker may not get
along with his or her supervisor or with other workers in the department. He or she
may be getting too old to continue in his or her regular job, or the type of job or
working conditions may not be well-adapted to his or her present health or accident
record. If the job is repetitive, the worker may stagnate and would benefit by
transfer to a different kind of work

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INFORMATION SHEET 03 Administer demotions
Down ward internal movement in an organization that usually involves cuts in pay and reduced
status, privileges, and opportunities.

INFORMATION SHEET 04 Handle employees layoff

Manage discharge and retirements

Meaning of Separation

 Lay-offs, resignations and dismissals separate employees from their employees.

Lay-off

 A lay-off is a temporary separation of the employee from his or her employer at the instance
of the latter without any prejudice to the former.
 A lay-off may be occasioned by one of the following reasons;
1. Shortage of coal, power or raw materials.
2. Accumulation of stocks.
3. Breakdown of machinery.
4. For any other reason.
IV. Managing Layoffs
Generally, an organization will institute a layoff when it cannot reduce its labor costs by any
other means.
Managers should first try to reduce labor costs with layoff alternatives.
Alternatives to Layoffs: There are many alternative methods of reducing labor costs that
management should explore before deciding to conduct a layoff. These alternatives include
things such as early retirements, employment policies (attrition and hiring freeze), job redesign
(job sharing), pay and benefits policies (pay freezes and cuts), training, and other voluntary
workforce reductions.
1. Employment policies.
2. Changes in job design.
3. Pay and benefits policies.
4. Training.
5. Nontraditional alternatives to layoffs.
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Implementing a Layoff: A layoff can be a traumatic event that affects the lives of thousands of
people, so managers must implement the layoff carefully. Issues that need to be considered
include how to notify employees, developing layoff criteria, communicating to laid-off
employees, coordinating media relations, maintaining security, and reassuring survivors of the
layoff.
1. Notifying employees.
2. Developing layoff criteria.
3. Communicating to laid-off employees.
4. Coordinating media relations.
5. Maintaining security.
6. Reassuring survivors of the layoff.
Resignation

 A resignation refers to the termination at the instance of the employees.

 An employee resigns when he or she secures a better job elsewhere, in the case of a female
employee, when she marries and had to quit for personal reasons, or when an employee
suffers from ill health, and for other reasons.

INFORMATION SHEET 05 Manage discharge and retirements

II. Types of Employee Separations

Employee separations can be divided into two categories based on who initiates the termination
of the employment relationship. Voluntary separations (quits and retirements) are initiated by the
employee.

Involuntary separations (discharges and layoffs) are initiated by the employer.

A. Voluntary Separations
1. Quits.
2. Retirements.
B. Involuntary Separations
Involuntary separations occur when management decides to terminate its relationship with an
employee due to economic necessity or a poor fit between the employee and the organization.
1. Discharges.

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2. Layoffs.
3. Downsizing and rightsizing. A reduction in the number of people employed by a firm (also
known as restructuring and rightsizing); essentially the reverse of a company growing and
suggests a one-time change in the organization and the number of people employed
Managing Early Retirements
When a company realizes that it needs to downsize its scale of operations, its first task is to
examine alternatives to layoffs. One of the most popular of these methods is early retirement.
The Features of Early Retirement Policies: Early retirement policies consist of two features:
(a) a package of financial incentives that make it attractive for senior employees to retire earlier
than they planned and (b) an open window that restricts eligibility to a fairly short period. After
the window is closed, the incentives are no longer available to senior employees.
􀂃 Avoiding Problems with Early Retirements: Managing early retirement policies requires
careful design, implementation, and administration. When not properly managed, early
retirement policies can cause a host of problems. All managers with senior employees should
make certain that they do not treat senior employees any differently than other employees.
Dismissal or Discharge

 Where the termination of employment is initiated by the employer, it is known as dismissal

or discharge which is a drastic step and should be taken after careful thought
 The following reasons lead to the dismissal of an employee:
1. Excessive absenteeism.
2. Serious misconduct.
3. False statement of qualification at the time of employment.
4. Theft of company’s property.
 Dismissal shall be the last step and may be resorted to after all the efforts is salvaging the
employee have failed
Retrenchment

 Retrenchment refers to the termination of the services of employees because of the

replacement of labour by machines or the closure of a department due to continuing lack of
demand for the products manufactured in that particular department of the organization.
 Retrenchment differs from dismissal.
 An employee is dismissed because of his or her own fault.

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  Retrenchment, on the other hand, is forced on both the employer and his employees.

Self-Check Written Test

Name:-

Date:-

Instruction I: Answer all the questions listed below, if you have some clarifications- feel free to
ask your teacher.

1. What are the Types of Employee Separations? Describe it clearly

2. Write down the difference between Production Transfers and Replacement

Transfers?

3. What are the purpose and principle of promotion?

4. What are the role of HR Department in employee separations and outplacement?

5. What are The Benefits of Employee Separations?

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