Good Ethics in Human Resources Management Enhances Employee Loyalty
Human Resource Management, also known as HRM or HR is the term that is generally used to depict all the organizational activities that are associated with hiring and picking, planning work for, educating, training and developing, evaluating and recompensing, guiding, triggering off, and managing human resources/employees. In other words, Human Resources Management refers to the outline of ideas, guiding principles, modus operandi and performance for the administration and supervision of the bond that is present between a company/manager and member of workforce (Wilton 2011).
Boxall and Purcell (2003) have described the term human resource management as "anything and everything associated with the management of employment relationships in the firm" (as qtd. In Wilton 2011). According to Price (2007), on the other hand, HRM is "a philosophy of people management based on the belief that human resources are uniquely important in sustained business success. An organization gains competitive advantage by using its people effectively, drawing on their expertise and ingenuity to meet clearly defined objectives. HRM is aimed at recruiting capable, flexible and committed people, managing and rewarding their performance and developing key competencies" (as qtd. In Wilton 2011).
Ethics in HRM
The term "ethics" does not have a unanimously approved definition. It simply deals with the character and behavior of morality of individuals. According to The Charter for the Public Service in Africa, ethics is a standard that includes values and principles such as competence, professional obedience, self-respect, impartiality, open-mindedness, sprite, and courteousness in the fulfillment of assigned tasks (Ssonko 2010).
Today, ethical, fair and moral thoughtfulness is turning out to be an ever more essential aspect to Human Resource departments in industries worldwide. Time and again, a strain is observable between a corporation's pecuniary targets and tactics for improvement of profits, and ethical concerns with appropriate conduct considerations. In view of the fact that human resources departments of any organization are most attentive on employees and employee behavior, it automatically becomes their responsibility to define ethical conduct, communicate specifically-designed moral codes, and keep the working staff informed or elaborate on expected right-behavior. In short, human resource management structures are expected to be in touch with the employees in order to communicate ethical values for improving company performance and ensuring employee loyalty ("Human Resource Information Systems" 2009).
It means that if human resource management systems practice inappropriately and design improper and wrong policies, such malpractices can intimidate professionalism, moral behaviors and intelligibility resulting in low levels of loyalty and commitment from the workforce. Such malpractices take place when there are institutional deficiencies in the Human Resource Management systems. For instance, if the human resource management department of an organization is unsuccessful in stating and enforcing fundamental ethical principles in its general strategy and policies, it could leave HRM void of providing reliable direction. Also, if HRM fails to sketch out and restrict opinionated and individual influences in order to preserve lucidity, failures like this can permit such influences to pierce the decisions of HRM. Similarly, if a clearly stated and obligatory policy to encourage professionalism in Human Resource Management is absent, it allows the entire organization to be defenseless to unprofessional conduct, negligence, mismanagement and corruption (Ssonko 2010).
To cut a long story short, the lack of a code of ethics for providing guidance to the employees and putting the standards of HRM units and employees into effect can direct to a lack of answerability and responsibility. Thus, a lack of direction and good ethics can give rise to non-professionalism and consequently would result in lowered employee loyalty. Therefore, it is exceedingly necessary for every human resources management department to formulate a system of measures in order to build up an environment that allows the promotion of ethics, liability, veracity, precision and professionalism (Ssonko 2010).
In other words, a professional and ethical environment can only be created if the human resources management systems of an organization make use of reasonable and crystal clear policies and practices. An ethical environment can only be created if the Human Resources Departments maintain "the merit principle in recruitment and promotions, transparency in the selection process, sound performance management and setting a good example by managers" (Ssonko 2010). Moreover, the implementation and enforcement of well-designed and just HR policies on suitable salary, training opportunities, corrective measures etc. can be helpful in the promotion of a culture of professionalism and satisfaction (Ssonko 2010).
Importance and Impact of Employees
In this contemporary age of globalization and liberalization, the human resources have turned out to be a competitive advantage for businesses and industries. A business may possibly administer with average and ordinary employees. However, capable, skilled and proficient employees can elevate a normal business to greater heights. In the similar manner, a bad, unskilled and inefficient workforce can shake the foundations of flourishing business empires until their disintegration. Therefore, in today's unyielding labor market, it has become indispensable for organization and businesses to recruit and keep good employees and eventually develop employee loyalty as an ongoing challenge. The rigid labor market in the present era, therefore, needs employers to formulate such strategies for retaining their key experts and important skillful human resources (Wan 2012).
This is the time in which potential employers are incessantly bidding for top performers. This is the reason why it has become an important task for the human resources management to create strategies and ethical principles concerning employees and allocating sufficient resources in order to keep them motivated, satisfied and loyal towards their respective company. It is exceedingly important as a satisfied employee has a lesser chance of pursuing greener pastures (Wan 2012).
As a consequence, the implementation of advantageous hand attractive human resource management policies can positively affect employee loyalty. In addition to this, employees can be made more committed towards the company provided that "continuous and systematic approach to training and development, recruitment policies that reduce job-hopping and ensure long-term employment, internal promotion practices with a little recognition given to seniority and the implementation of the productivity-linked wage system" (Wan 2012) are created by the human resources management systems.
Usually, the expression "employee loyalty" is used to define an emotional connection or obligation to the business/company/organization developed as a result of increase contentment and satisfaction (Wan 2012). In other words, employee loyalty is the commitment of the employees "to the success of the organization and believing that working for this organization is their best option. Not only do they plan to remain with the organization, but they do not actively search for alternative employment and are not responsive to offers."
Such a sense of fulfillment is the consequence of a process of an internal appraisal. In case an employee's expectation level is convened or surpassed, it is natural that his/her satisfaction level increases. Employee loyalty is then transformed into a generalized emotional feeling towards the organization. In other words, the more content a worker is concerning his/her working surroundings, the more prone he/she will be to develop a sense of dedication and obligation towards the organization on the whole. Such attitudes of the workforce towards the organization then increase the behavioral component of loyalty (Wan 2012).
Thus, an employee who has developed a fondness for the organization is perhaps more likely to exhibit a dedicated, faithful and steadfast behavior and works sincerely towards the overall goals of the organization. Such loyal behaviors result in enhanced output, better competence, and a first-rate service orientation to the clients (Wan 2012).
Relationship between HRM Policies And Employee Loyalty
In the continuing times, the success of an organization/company would critically depend on the recruitment and maintenance of employees. The organizational performance is directly associated with the employee loyalty. It simply means that the methods and approaches undertaken by the human resources management are the chief factors for the attainment of competitive performance. The changes in generation have brought along with them the changes of work ethics. Therefore, the way workforce//employees are managed by the human resources management departments should reveal new models of behavior (Wan 2012).
Thus, companies that facilitate their personnel deal with the dual demands of work and home always become known as winners. Employees demonstrate more commitment and more willingness for working hard if they observe that their official contributions are appreciated, respected and prized and that the company is concerned about them. Research points out that if affirmative steps are taken to create a work environment in which employees are appreciated and cherished, such a working environment can increase and enhance employee loyalty (Wan 2012).
To cut a long story short, evenhandedness, quality of management and maintenance and sustenance for employee life style are the indispensable elements in employee loyalty. Research reveals that "participation in goal setting; performance feedback; supportive communications with immediate supervisors and upper management; justice in performance appraisals; objective measures of performance; sufficiency of pay, benefits and rewards; quality of supervisory; favorable developmental opportunities and clearly stated guidelines defining appropriate work behavior and job…