Course Code : MBA-204

Course Title : Human Resources Management

Assignment No. : MBA-204/ 2022
Maximum Marks : 30

Q1. State some key of the HR practices of Indian organizations.

Ans. When establishing human resource (HR) polices in India, foreign companies need to strike a balance between
their own best practices and local norms in the country.

Foreign companies should seek to establish a strong understanding of laws and regulations that inform HR
administration as a basis for their HR policies in the country. This is particularly important in country like India,
where federal, state, and industry-specific regulations govern labor laws.

However, employers may also use HR policies to gain a competitive advantage. Good HR policies can make
employers more attractive to talent in the labor market and lower costly attrition rates. Meanwhile, strong HR and
payroll administration can help instill company values locally and improve workforce efficiency.

Foreign companies that have not yet entered India typically review local HR costs and practices before entering the
country, while companies that have established often conduct HR health checks or audits to maintain compliance
and employ best practices for their industry.

Here, we briefly discuss 10 key areas that foreign employers should pay attention to when handling staff in India.
These tips should serve as a good introduction or refresher for any HR professional.

1. Employment Contracts

India does not mandate a written employment contract for local employees. However, it is advisable for companies
to use contracts to limit risk and define the terms and conditions of employment. Indian employment laws are
diverse and form a complex framework that employers must navigate carefully when constructing contracts. Apart
from labor laws, there are industrial laws, The Companies Act, and the Contract Act, 1872 that govern employment
conditions in India.

Both the state and federal governments create and enforce laws pertaining to employment, which can complicate
compliance for those that are unfamiliar with the country. HR managers should keep themselves updated and
develop employment contracts in accordance with these to prevent future legal complications.

2. Wages

Employers should seek to periodically audit their wage structure to ensure it remains competitive within the local
labor market. However, it is perhaps more important to ensure wages are compliant with prevailing laws.

Under the Minimum Wages Act, 1948, all employers in the organized sector must provide ‘the basic cost of living’ to
employee categories specified within the act. The Code on Wages Bill, 2019 further enables the federal government
to fix minimum statutory wage for millions of workers.

The Equal Remuneration Act, 1976 mandates non-discrimination for payment of wages to men and women,
while The Payment of Wages Act, 1936 orders the timely disbursement of wages to employees.

Payment of wages below the minimum wage limits amounts to forced labor. This is prohibited under the Bonded
Labor System (Abolition) Act, 1976.

Companies should ensure that employment contracts consider this while defining the terms and conditions for the
remuneration for employees.

3. Termination of employment

Employees in India may only be terminated as per the terms and conditions within their employment contract.
However, companies should note that all employers must adhere to the federal and state labor laws when laying off
or terminating workers – the conditions drafted in company contracts cannot supersede these legal statues.

Finally, termination without notice is prohibited in India. Termination periods vary by function and length of
employment.

4. Maternity and paternity leave

The Maternity Benefits (Amendment) Act, 2017 applies to all shops and any establishments that employ over 10
workers. Under the Act, 26 weeks of paid leave is available for women for the first two children, and 12 weeks
subsequently. Companies employing more than 50 people must also provide crèche services.
The Paternity Benefits Bill, 2017 is set to be up for discussion in the next parliamentary session. However, a
significant number of organizations, especially foreign companies like Microsoft and IKEA, already include a mutually
decided paternity leave clause within their company policy.
This practice has been well received by the Indian workforce and lauded as a good HR move.

5. Prevention of sexual harassment in the workplace

The Indian government has brought the safety of women in the workplace to the forefront of its law making.

An Internal Complaints Committee must be set up by all organizations with more than 10 employees in accordance
with the norms laid out in the Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal)
Act, 2013. All complaints should be actively pursued, evidenced, and redressed immediately.
To guarantee employee safety, companies must draft appropriate HR policies within the firm, and ensure they are
clearly communicated to all personnel.
HR personnel should organize workshops or sensitization programs and encourage communication to promote an
organizational culture that provides for a fair and safe working environment for all its employees.

6. Public holidays and work weeks

India observes three national holidays – Republic Day (January 26), Independence Day (August 15), and Gandhi
Jayanti (October 2).
On these days, all institutions, whether public or private, must remain closed.
Government approval is necessary for any organization to function on these days. Only certain establishments, such
as factories, and industries where the work process is considered to be continuous, including hospitals, and travel
agencies, are allowed to operate over 24 hours across 365 days. However, establishments that operate on these
days are subject to provide additional wages for staff working on those days.
Additionally, firms must inform the annual list of holidays and weekly offs available to employees each year. The
number of leaves and categories of leave must ideally be explained in the employee contract.
Many laws in India, such as the Factories Act, 1948, also provide for the maximum number of work hours and the
amount of overtime wages to be paid to labor employed.

7. Restrictive clauses in employment contracts

Employers should note that including restrictive clauses into a contract might not be enforceable through the Indian
courts. The Contract Act, 1872, necessitates the fundamental right of all citizens to carry on any profession, trade, or
business.
Non-compete, non-disclosure, non-solicitation, and ‘garden leave’ clauses are examples of restrictive clauses that
can only be imposed by the courts if plausible grounds – with respect to time-period and nature of activities involved
– are provided.
The best way to ensure enforceability is to restrict the scope of the clauses as much as possible within these
dimensions. However, this does not guarantee legal protection to employers.

8. Gratuity and Provident Fund

The Payment of Gratuity Act, 1972 provides the guidelines for gratuity owed to an employee.
The number of years of service of the employee is the criteria for deciding the amount of gratuity owed, and this
payment by the company is obligatory by law.

The minimum amount (more may be approved) must be given to an employee in case of the following
circumstances:

 Retirement;
 Resignation;
 Disablement due to accident or illness; or,
 Death of the employee (gratuity paid to employee’s nominees).

However, if an employee is dismissed for proven criminal or moral reasons, no gratuity is owed to him.

Similarly, the Employees Provident Fund Organization of India (EPFO) oversees and regulates the Employee’s
Provident Fund (EPF).

Under this scheme, the employer and employee contribute an equal amount to the fund every month, which is
accessible to the employee at certain points in their career.

The EPF scheme is mandatory for a salary below Rs 15,000 (US$220) and voluntary thereafter.

Q4. Explain the evolution of human resource management.

Ans. The evolution of human resource management has developed through the following Stages.

1. The Commodity Concept

Before the Industrial revolution, the guild system was the beginning of HRM. Guild was a closely knit group
concerned with selecting, training, rewarding & maintaining workers. The separation of owners from managers
breaks the close relationships between owners & employees. Labour began to be considered a commodity to be
bought & sold.

2. The Factor of the Production Concept

Under this concept, employees were considered a factor of production, just like land, materials & machinery.
Taylor’s scientific management stressed proper selection & training of employees To maximize productivity. The
employees were treated primarily as operating organizations of machines or as mere appendages in the process of
production. However, this concept was an improvement in so far as employers gained through better working
conditions and higher earnings.

3. The Paternalistic Concept

Employees organized together based on their shared interests & formed trade unions to improve their lot. The
growing strength of democracy gave impetus to collective bargaining. The state also recognized that workers had a
right to protection in employment. It is the main evolution of Human Resource Management. Due to all these forces,
employers provide different schemes to workers. Employers have a fatherly and protective attitude towards their
employees. The welfare schemes included health facilities, recreation facilities, pension plans, group insurance
schemes, etc. Employers & employees both began to realize that they cannot survive and prosper without each
other.

4. The Humanitarian Concept

Under the paternalistic approach, the employer provides employee benefits as a favour. The humanitarian system is
based on the belief that employers have certain Unalienable rights as human beings. The employer has to protect
these rights. Industrial psychologists pointed out that an employer was not merely interested in material rewards.
Instead, social and psychological Satisfaction was equally important. Hawthorne experiments with considerable
Interest in human-generated problems in the Workplace. The approach is also known, therefore, as a human
relations concept.
5. The Human Resource Concept

Several studies were conducted to analyze & understand human behavior. These studies applied behavioral science
to the problems in Individual & group behavior at work. Motivation, Group dynamics, organizational climate,
organizational conflict, etc., have become popular concepts. Employees began to be considered valuable assets of an
organization. Efforts were made to integrate employees with the organization so the organization’s goals and
employees’ could be achieved simultaneously. Focus shifted towards management practices like two-way
communication, management by objectives, the role of informal groups, quality circles, etc. It plays a crucial role in
the evolution of Human Resource Management.

6. The Emerging Concept

Now, employees are considered partners in the Industry. They are gradually being given shares in the company’s
stock membership. Workers’ representatives are being appointed to the board of directors. This emerging trend
aims to create a feeling among workers that the organization is their own. Slowly but steadily, HRM is emerging as a
particular academic discipline & as a profession with distinction. It is growing as a career with distinct specializations
like human resource development, Industrial relations, etc.

Conclusion

In this write-up, we have discussed the complete stages in the evolution of human resource management. HRM
began as a record-keeping function. Later on, the administration of labor agreements became its primary task. After
some time, the focus shifted to the scientific aspect involving systematic techniques for employee selection, training
& Compensation. On the other hand, the emerging concept looks upon them as a resource, an asset & an
opportunity.

Q6. What are your strategies for successful transfer and separation?

Ans.

TRANSFER

A transfer refers to lateral movement of employees within the same grade, from one job to another. According to
Flippo “a transfer is a change in the job (accompanied by a change in the place of the job) of an employee without a
change in responsibilities or remuneration”.

Transfer differs from promotion in the sense that the latter involves a change of job involving increase in salary,
authority, status and responsibility, while all these remain unchanged /stagnant in the case of former. Also, transfers
are frequent and regular whereas promotions are infrequent, if not irregular.

There are some public sector organizations like Minerals and Metals Trading Corporation (MMTC) who have entered
into agreements, with employees for creating two cadres of officers, namely. Local Officers and All India Officers
wherein promotions to and within the former are less accelerated than in the latter, but do not entail transfer.

Need of Transfer-

The need for making transfer is left for various reasons as listed below:

(i) To Meet Organisational Needs

Changes in technology, volume of production, production schedule, product line, quality of products, organisational
structure, etc. necessitate an organisation to reassign jobs among employees so that right employee is placed on the
right job.

(ii) To Satisfy Employee Needs

Employees may request for transfer in order to satisfy their desire to work in a particular department, place and
under some superior. Personal problems of employee like health, family circumstances, and interpersonal conflicts
may also necessitate transfer.
(iii) To Better Utilize Employee

When an employee is not performing satisfactorily on one job and management thinks that his/her capabilities
would be utilized better elsewhere, he/she may be transferred to other job.

(iv) To Make the Employee More Versatile

In some organizations like banks, employees after working on a job for a specified period are transferred to other job
with a view to widen their knowledge and skill and also reduce monotony. This is also called ‘job rotation.

(v) To Adjust the Workforce

Work force can be transferred from the departments / plants where there is less work to the departments/plants
where more work is.

(vi) To Provide Relief

Transfers may be made to give relief to the employees who are overburdened or doing hazardous work for long
period.

(vii) To Punish Employee

Management may use transfer as an instrument to penalize employees who are indulged in undesirable activities. As
a disciplinary action, employees are transferred to remote and far-flung areas.

Types of Transfer

(i) Production Transfer

Such transfers are made when labour requirements in one division or branch is declining. The surplus employees
from such division are transferred to those divisions or branches where there is shortage of employees. Such
transfers help avoid lay off and stabilize employment.

(ii) Remedial Transfer

Such transfers are affected to correct the wrong selection and placement of employees. A wrongly placed employee
is transferred to more suitable job. Such transfers protect the interest of the employee.

(iii) Replacement Transfer

Replacement transfers are similar to production transfers in their inherent, i.e. to avoid layoffs. Replacement
transfers are affected when labour requirements are declining and are designed to replace a new employee by an
employee who has been in the organization for a sufficiently long time. The purpose of these transfers is to retain
long service employees in the organization and also give them some relief from the heavy pressure of work.

(iv) Versatility Transfer

These transfers are also known as ‘job rotation? In such transfers, employees are made move from one job to
another to gain varied and broader experience of work. It benefits both the employee and organization. It reduces
boredom and monotony and gives job enrichment to the employee. Also, employees’ versatility can be utilized by
the organization as and when needed.

(v) Shift Transfers

These transfers are affected in the organizations where work progresses for 24 hours or in shifts. Employees are
transferred from one shift to another usually on the basis of mutual understanding and convenience.

(vi) Penalty Transfer

Management may use transfer as an instrument to penalize employees’ involved in undesirable activities in the
organization. Employee transfer from one’s place of convenience to a far-flung and remote area is considered as a
penalty to the employee.
SEPARATION

Employee separation is a sensitive issue for any organization. Usually, an employee leaves the organization after
several years of service. Thus, the permanent separation of employees from an organization requires discretion,
empathy and a great deal of planning. An employee may be separated as consequence of resignation, removal,
death, permanent incapacity, discharge or retirement. The employee may also be separated due to the expiration of
an employment contract or as part of downsizing of the workforce. Organizations should never harass the
employees, especially in the case of resignation, just because they are quitting the organization. In fact, a quitting
employee of the organization must be seen as a potential candidate of the future for the organization and also the
brand ambassador of its HR policies and practices. However, many organizations are still treating their employees as
“expendable resources” and discharging them in an unplanned manner whenever they choose to do so

Each organization must have comprehensive separation policies and procedures to treat the departing employees
equitably and ensure smooth transition for them. Further, each employee can provide a wealth of information to the
organization at the time of separation. Exit interviews can be conducted by the HR department to ascertain the
views of the leaving employees about different aspects of the organization, including the efficacy of its HR policies.

Reasons for Separation of Employees

Employee separation constitutes the final stage in the staffing process of an organization. An employee can leave the
organization for any reason which he deems fit for seeking separation. However, separation is classified basically into
two types. These are: voluntary separation and involuntary separation. Voluntary separation refers to the separation
of employees on their own request, while involuntary separation means the separation of employees for
organizational reasons which are beyond the control of the employees. We shall now discuss the causes of these
separations in detail.

(i) Voluntary Separation: Voluntary separation, which normally begins after a request is placed in this regard by the
employee, can happen due to two reasons: professional reason and personal reason. We shall now discuss these
reasons in detail.

(ii) Professional reasons: Employees may seek separation when they decide to seek better positions, responsibilities
and status outside the present organization. Efficient employees would seek to expand their realm of knowledge and
skills continuously by working in different capacities/positions in various organizations. In their quest for greater
responsibility, power and status, they may seek separation from the organization.

(iii) Personal reasons: The important personal reasons for voluntary separation are relocation for family reasons like
marriage of the employees and health crisis of family members, maternity and child-rearing. For instance, when
working women get married, they often prefer to settle in the partners place of occupation. Similarly, an employee
may seek voluntary separation to look after the child or parent.

(iv) Involuntary Separation: As mentioned earlier, an involuntary separation is caused by the factors which remain
beyond the purview of the employees. However, these factors may be classified broadly into health problems,
behavioural problems and organizational problems. We shall now discuss these factors in detail

(v) Health problems: Major health problems crippling the employees may make them invalid or unfit to continue in
the profession. For instance, accidents causing permanent disabilities and illness of the employees like brain stroke
and other terminal illnesses can lead to their involuntary separation. Death of employees is another factor which
results in their involuntary separation.

(vi) Behavioural problems: An employee’s objectionable and unruly behaviour within the organization may also lead
to his involuntary separation from the organization. When the employees behaviour is unethical or violates the code
of conduct in force, the organization may initiate disciplinary actions, which may eventually result in his termination.
This may constitute an act of involuntary separation. Consistent failure to reach performance goals by an employee
can also result in his involuntary separation.

(vii) Organizational problems: Organizational problems are another important factor that contributes to the
involuntary separation of employees. The poor financial performance of an organization may cause it to terminate
the services of some of its employees as part of cost control measure. Such terminations are also classified as
involuntary separation. Similarly, automation, organizational restructuring and rationalization can also result in
employee termination, discharge or layoff, broadly called involuntary separation.

Q7. Discuss the various financial and non-financial rewards in motivating modern employees.

Ans.

Financial/Incentives Techniques of Motivation:

Financial techniques refer to monetary rewards. Incentives are nothing but the inducements provided to employees
in order to motivate them. There should be direct relationship between efforts and rewards, financial reward should
be substantial in value and must be in parity with others.

Under -paying staff sends the message that your firm doesn’t value their work. Money is not a prime motivator but
this should not be regarded as a signal to reward employees poorly or unfairly.

The financial incentives include:

1. Pay and Allowances:

It includes basic pay, grade pay, and dearness allowance; travelling allowance, pay increments, etc. Good pay and
allowances help the organization to retain and attract capable persons.

However, good pay and allowances need not motivate all the people, especially who are enjoying security of job in
government organizations and those for whom corruption is a way of life.

Some of the other issues are associated with bad attitudes, grievances, absenteeism, turnover, poor organizational
citizenship, and adverse effect on employees’ mental and physical health.

2. Incentive Pay:

Incentive pay plans are meant to increase output, which can be measured quantitatively. For incentive plan targets,
the employees must have confidence that they can achieve the targets.

3. Gain Sharing:

It is a reward system in which team members earn bonus for increasing productivity or reduce wastages. To
illustrate, if the wastage is reduced from 5% to less the benefits may be shared equally with the team.

4. Profit Sharing:

It means sharing of profits with the employees by way of distribution of bonus. Profit sharing plan has its
shortcomings – one, that it has become a regular feature in government departments irrespective of performance
and two, it may have no relation with individual efforts.

5. Stock Options:

Many companies use employee stock options plans to compensate, retain, and attract employees. These plans are
contracts between a company and its employees that give employees the right to buy a specific number of the
company’s shares at a fixed price within a certain period of time.

Employees who are granted stock options hope to profit by exercising their options at a higher price than when they
were granted. In India, stock options have primarily been used as a retention tool for a more selective group of
employees.

6. Retirement Benefits:

It includes the accumulated provident fund, gratuity, leave encashment and pension. The provision of terminal
benefits provides assurance to employees during the service for their future
Non-financial Incentives/Techniques:

Non-financial incentives do not involve money payments. These are also important in motivating employees as they
bring in psychological and emotional satisfaction to them.

These include so many techniques. People do work for money-but they work even more for meaning in their lives. In
fact, they work to have fun.

Some of the important non-financial incentives include:

1. Job security:

Nothing can motivate a worker, appointed temporarily, better than provision of job security. Even if a temporary
worker puts in greater efforts, lack of job security will always pose a threat. If such a worker is given job security, he
will be more committed to the organization.

2. Challenging work:

Workers, who are dynamic in nature, do not show preference for routine jobs. They are always ready to accept
challenging assignments, challenge can be brought through mentoring, job redesigning – job enlargement and job
enrichment. Understand the capabilities of every individual in the organization and accordingly assign him work.

3. Recognition:

It is important that the employer recognizes hard work. Even a word of appreciation from him would motivate the
employees to maintain the same level of performance or do even better. Employees ranked a personal ‘thank you’
as the most sought after form of recognition, followed by a handwritten note of appreciation from the boss.

4. Better job Titles:

Job titles do matter. Employees do show preference for certain designations. A salesman, for example, would like to
be designated as a sales executive and a sweeper to be Sanitary Inspector.

5. Opportunities for Advancement:

There should never be a stagnation point for any employee during the prime time of his career. The employer must
always provide opportunities for his employees to perform well and move up in the hierarchy.

6. Empowerment:

To stimulate an employee is his involvement in certain crucial decisions. For example, if the management decides to
buy a new machinery for the factory, the workers’ viewpoints may be secured before making the final decision. The
management should avoid unilateral decisions on such matters.

7. Competition:

The management can encourage healthy competition among the employees. This would, certainly, motivate them to
prove their capabilities. The management can also rank the employees according to performance. Such of those
employees who have performed very well may be given merit certificates.

8. Job Rotation:

By job rotation we mean that the employees will be exposed to different kinds of job. This certainly would break the
monotony of employees. For example, in a bank an employee may work in the Savings Bank Section for sometime
after which he may be posted to the cash section. Such a change not only motivates the employees to perform well
but also prepares him to be versatile.

9. Lead by Example — be passionate and energetic:

Leaders should demonstrate the attitudes, values, actions, and mindsets that they want among their staff. Leaders
are always considered as role models.

10. Encourage the use of humour and creativity:

Incorporating humour into the workplace can alleviate stress and create a more positive environment for everyone.
Strategies to enhance humour include having a daily cartoon or joke sent to all staff via e-mail, encouraging laughter,
finding fun in events that did not turn out as planned or expected etc.

11. Treat your people as human beings – neither inferior, nor superior:

Show trust and respect, motivate them for creativity, create a ‘safe-to-risk environment’, keep them informed of
relevant developments inside the organisation, mistakes be treated as learning tools instead of blaming them, act as
an advocate for their employees and be a visible champion for them, provide resources and support required by staff
to complete their jobs, promote and provide two-way feedback, address stress and burnout, and implement
work/life balance initiatives.

Q10. Discuss the various internal and external sources of recruitment.

Ans. Internal Sources

Internal recruitment consists of two main resources that are transfers and promotions.

 Transfers: Transfer refers to the moving of an employee from one job to another, one department to
another, or from one shift to another without any significant change in a person’s responsibility, status, or
pay. In some cases, it may bring about some changes in responsibilities, or working conditions, but it cannot
result in a change in the salary of the employee. Transfer can help fill vacancies with employees from
departments that are over-staffed. It is the horizontal movement of employees. If employees are insufficient
in one branch or department, it can be filled through transfer. It is also important in avoiding termination
and helping solve the employee’s problems. During the transfer, it should be kept in mind that the employee
who is transferred to another job is capable of performing it. Transfer also helps the employees learn about
different jobs as well.

 Promotions: In most business organizations, there is a practice of promoting the employees from a lower
level to a higher position. It is the movement of employees from a lower level to fill in the vacancy of a
higher authority. Promotions influence the employees greatly as a promotion at one level leads to a chain of
promotions in the levels lower than it.

Merits of Internal Sources

Internal recruitment or filling vacancies within the organization have the following advantages.

1. Higher Motivation level: Internal recruitment may help the employees to boost their performance.
Promotions at a higher level lead to a chain of promotions at the lower levels. This also increases their
status and pay, and motivates the employees to improve their performance. This increases their motivation
and commitment to the organization. The employees, thus remain loyal and satisfied with the organization.

2. Simple Process: Internal recruitment makes the process of selection and placement simple. The working of
the employees can be evaluated in a better way. This type of recruitment is better as the employees know
about the organization well.

3. Develops future managers: Transfer is a method through which employees are trained for higher jobs. The
people who are transferred within the organization do not need induction or orientation training.

4. No over or under staffing: Another benefit of transfers is that the organization can shift employees from one
department to another where there is a shortage.

5. Economical: The process of internal recruitment is cheaper in comparison with external sources.
Demerits of Internal Sources

The limitations of internal sources are as follows:

1. Lack of fresh talent: The internal sources reduce the opportunity of getting fresh talents. Therefore, being
completely dependent on internal sources can give rise to the danger of inbreeding by not letting new
people join the organization.

2. Decrease in enthusiasm level: The employees tend to become lazy because they know that they will be
promoted.

3. Low productivity: The productivity of the organization may get hampered due to the frequent transfer of
employees.

4. Lack of competition: The employees may lose their motivation and spirit of competition as there is no
competition from the outside world.

5. Limited choice: All the organizations cannot fill in all their vacancies through internal sources of recruitment,
especially new organizations.

External Sources

Since the filling up of all the vacancies in an organization is not possible through internal sources, there are several
external forces for various positions. There might be a possibility that there are not sufficient men or that they do
not fulfil the eligibility criteria for the job. The external sources of recruitment provide a vast range of choices and
the introduction of fresh talents to the organization. The most used external sources are as follows-

 Direct Recruitment: Under the process of direct recruitment, a notice is placed outside on the notice board
of the organization. The notice contains all the details of the job available. The people who are interested
gather outside the premises of the organization on the specified date and time, and selection is done then
and there. This method of direct recruitment is usually used for finding candidates for unskilled or semi-
skilled jobs. Such people are paid wages daily and are referred to as casual workers or ‘badli’ workers. This
type of recruitment is economical, as it does not require any form of advertising and thus, a lot of money is
saved. It can be really helpful in situations when there is a rush of work or when the permanent workers are
off-duty.

 Casual Callers: A lot of business organizations keep a record of uninvited job applicants in their offices. These
candidates can be of benefit to the organization. Such a list of job-seekers can be evaluated, and used for
filling up vacancies as required. This type of recruitment can decrease the price of recruiting the workforce.

 Advertisement: When a wide choice is required, advertisement is the frequently used method.
Advertisements can be done through newspapers or trade or professional journals. A lot of senior positions
in the industry as well as commerce are filled through advertisement. The benefit of advertisement is that a
lot more detail about the organization and the job can be provided. It helps the management of the
organization select from a larger range of candidates. Advertisements given in leading newspapers can bring
in a lot of responses, but most of the time they are from candidates who are not quite suitable.

 Employment Exchange: Government-run employment exchanges are considered a good source of

recruitment for both skilled as well as unskilled jobs. In a few cases, the organizations are necessarily
required to notify the employment exchange of vacancies available. Therefore, employment exchange work
as a link between the job-seekers and the employers by matching the personnel demand and supply. But a
lot of times, the records of employment exchange are not quite suitable, as they might not meet up the
expectations of the job.

 Placement agencies and Management consultants: Private agencies and professional bodies appear to be
doing considerable work in technical and professional fields. Placement agencies help provide nationwide
service by matching personnel demand and supply. These kinds of agencies evaluate the bio-data of several
candidates and provide suitable names to their clients. These types of agencies are useful where large-scale
 screening is necessary and they charge fees for such services. These professional agencies attract higher-
level executives by providing the right kind of offers. Management consultancy firms facilitate the
organizations to recruit technical, professional, and managerial personnel. They especially deal in middle and
top-level executive placements. These firms manage huge sets of data people with different qualifications
and skills, and also advertise jobs in the place of their clients to recruit the right person for the right job.

 Campus Recruitment: Recruitments are also done through colleges and institutions of management and
technology. These have become a significant source of recruitment for technical, professional, and
managerial jobs. Several huge organizations keep close contact with universities, vocational schools, and
management institutes to recruit qualified candidates for different kinds of jobs. Educational institutions are
a widespread and normal practice for businesses for recruitment.

 Recommendations of Employees: A lot of times, the present employees, or their friends or relatives may
introduce applicants. This might be a good source of recruitment. Also, the background detail of the
candidates are well known, so it is easier to select them. Some kind of introductory screening takes place
because the employees working there know the company as well as the candidates, and therefore, would try
to satisfy both of them.

 Labour Contractors: Labour contractors are helpful as they keep close contact with labourers and in
providing the necessary amount of unskilled workers in a short period. The labour contractors are
themselves employees of the organization and perform the work of recruiting labourers whenever
necessary. But if the same employee of the organization who is the labour contractor chooses to leave the
organization, the labourers hired by him will also leave.

 Advertising on Television: Proving advertisements on television is now becoming much more popular these
days. It is attracting the attention of a large number of people. Also, whenever there is a vacancy, the job
details and required skills regarding the job are posted along with the profile of the organization.

 Web Publishing: The most common source of recruitment nowadays is the Internet. People can apply as
well as post jobs through websites that are specially designed for this purpose. These websites are
frequently visited by both candidates or job-seekers and organizations in search of required employees.

Merits of External Sources

Following are the advantages of the external sources of recruitment:

1. Qualified Personnel: With the help of external sources of recruitment, the management can get skilled and
trained candidates who are qualified for that particular job which is vacant in the organization.

2. Wider Choice: When advertisements regarding vacancies are made widely, several applicants from outside
the organization apply. Therefore, the management has a wide variety of choices.

3. Fresh Talent: Sometimes, the present employees in the organization may not be enough or able to fulfil the
requirements of the organization. Therefore, external sources are very useful in bringing new and fresh
talents to the organization.

4. Competitive Spirit: If an organization utilizes external sources, the existing employees will have to compete
with outsiders. They will be motivated to work harder to perform better.

Demerits of External Sources

Following are the disadvantages of the external sources of recruitment:

1. Dissatisfaction among existing staff: External recruitment may result in dissatisfaction and frustration
among present employees. The employees may feel deprived of their chance to get a promotion.

2. Lengthy process: Recruitment from external sources follow long procedures and thus, can be time-taking.
The organizations have to evaluate and give notice about any vacancy available, and then wait for the
applications to be processed.
3. Costly process: The process of recruitment through external sources can be quite expensive. Advertisement
and evaluation of applications for selection can be costly as a lot of money has to be spent.