Page 33 - DMGT406_HUMAN_RESOURCE_MANAGEMENT

Human Resource Management

Notes Internal Supply
The techniques used for this purpose are:
1. Potential Losses and Potential Gains: They can be of four different types:

Permanent Total, Permanent Partial, Temporary Total, Temporary Partial
Lay off New hires Department Promotion out
Retrenchment Promotions in Or Deputation out
Dismissal Transfer in Sub-unit Absenteeism
Voluntary Demotion in Present Loss of some skills,
Quits Acquiring Human capability, etc. due to
new skills Resource ill health or accident
Knowledge Demotion out Loss of values,
Transfer out aptitude,
etc. due to change in
the attitude of existing
employees towards

job, department and
organization
2. Turnover Rate: Turnover is defined as the number of people leaving the organization
in a given period of time, usually one year. The turnover rate can be expressed by a
number of different formulas. These involve such terms as accessions, addition to
payroll, separations, quits, discharges, retirement, deaths, replacements, one
accession plus one separation and average workforce, number at the beginning of
the period plus number at the end of the month divided by 2. If our workforce
averages 1000 employees this month, during which time there were 50 accessions
and 58 separations, the accessions rate is 5%, the separation rate is 5.8%, and the
replacement rate is 0.8%.

Number of separations during one year
Turnover Rate =
Average number of employees during the year
For example: If in a year, 30 out of an average force of 150 skilled fitters of a company
left (20% turnover) and this trend continued, then the company will have to recruit
110 fitters during the following year, in order to increase and hold the labour force
at 200 in that year (50 extra fitters, plus 40 to replace the 20% separation of the
average 200 fitters employed, plus 20 percent to replace separation of the 90 recruits)

3. Conditions of work and absenteeism: Changes in condition of work such as normal
weekly working hours, overtime policies, length and timings of holidays, retirement
policy for employees part-timers and shift systems need to be taken care properly.
On the other hand, absenteeism is the title given to a condition that exists when a
person fails to come to work.

Absenteeism is understood as unauthorized absence from work. Stated differently,
it amounts to absenteeism when an employee is scheduled to work but fails to
report for duty.
Number of persons – days lost
Absenteeism =
Average number of persons × number of working days

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