1. Human Resource Management
By Prof. Jayalakshmi
Promotions & Transfers
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2. Meaning of Promotion
• According to E.B. flippo “promotion involves a
change from one job to another that is better
in the terms of status and responsibilities.”
• According to Scott and Spreigal: “A Promotion
is the transfer an employee to a job that pays
more money or that enjoys some preferred
status.”
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3. Purpose of Promotions
1. Recognize and reward employee’s good/superior performance and
commitment.
2. Promote a feeling of content with the existing conditions of the
company and a sense of belongingness.
3. Build loyalty and to boost morale and job satisfaction.
4. Retain skilled and talented employees and reduce discontent and
unrest.
5. Promotions acts as a tool for reducing labour turnover.
6. Increase interest in acquiring higher qualifications, training and self
development with a view to meet the requirements of promotion.
7. Reduce/Eliminate problems created by the leader of workers’
unions by promoting them to the officer’ levels where they are
less effective in creating problems.
8. Ultimately it improves organizational health.
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4. Seniority
1. Seniority means length of
recognized service in an
organization.
2. Seniority means the calculation of
time from when an employee has
joined the company and served for
how many years in the company.
3. The senior most person in the
lower grade shall be promoted as
and when there is an opening in
the higher position
4. Seniority is suggested as the criteria
for promotion on the plea that
there is a positive correlation
between length of the service and
talent
Merit
1. Merit means ability to work.
2. It denotes an individual employee’s
skill, knowledge, ability, efficiency and
aptitude as measured from
educational, training and past record
3. If the merit is adopted as basis of
promotion then the person in the lower
grade ,no matter his junior most in the
company, shall be promoted.
4. It encourage all employee to improve
their efficiency
Basis for Promotions
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5. Seniority Based
1. Easy to measure the length
of service
2. Trade unions generally emphasis on
seniority.
3. Security and certainty.
4. Minimize the scope of grievances
and conflicts.
5. Reduce labour turnover
6. Sense of satisfaction to senior
employees and is in line with the
Indian Culture of respecting
seniority in all walks of life.
Merit Based
1. Difficult to judge merit.
2. Implies the knowledge, skills and
performance record of an employee.
3. Motivates competent employees to
work hard and acquire new skills.
4. Maintains the efficiency of the
organization by recognizing talent
and performance
5. Attracts and retains young and
promising employees in the
organization
Advantages of Seniority and Merit Based
Promotions
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6. Seniority Based
1. Length of Service is not directly
proportional to talent.
1. Performance and potential of an
individual is not recognized.
2. Demotivates and demoralizes
the young employees who are
talented.
3. Kills the zeal and interest for self
development
4. Fails to attract young and
hardworking employees
Merit Based
1. Measuring Merit is not easy.
Subjective judgement may be
involved.
2. Many, particularly trade unions
distrust the management’s integrity
in judging merit.
3. When younger employees are
promoted over the older one, the
older employees may feel insecure
or leave.
Disadvantages of Seniority and Merit
Based Promotions
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7. As both seniority and merit as basis suffer from certain
limitations, a sound promotion policy should be based on a
combination of both seniority and merit.
A proper balance between the two can be maintained by
differentiating the way minimum length of service is
prescribed.
Relative weightage may be assigned to seniority and merit and
employees with a minimum performance record and
qualifications are treated eligible for promotion. Seniority is
used to choose from the eligible candidates
Seniority cum Merit as a Basis for
Promotion
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8. Transfers
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9. • A transfer is a horizontal or lateral movement of an
employee from one job, section, department, shift plant or
position to another at some other place where salary, status
and responsibility are usually the same.
• Transfer is defined as “a lateral shift causing movement of
individuals from one position to another usually without
involving any kind of change in duties, responsibilities, skills
needed or compensation”.
Meaning of Transfer

10. Types of Transfers
1. Production Transfer: Such transfers are resorted to when there is a need
of manpower in one department and surplus manpower in another
department. Such transfers are made to meet the company
requirements.
2. Replacement Transfers: Replace an existing employee who has been in
the organization for a long time with a new employee and thereby giving
some relief to an old employee from the heavy pressure of work.
3. Remedial Transfers: As the name suggest, these transfers are made to
rectify the situation caused by faulty selection and placement
procedures. Such transfers are made to rectify mistakes in placement
and recruitments.
4. Versatility Transfer: Such transfers are made to increase versatility of the
employees in more than one job and department. This type of transfer,
also referred to as ‘Job Rotation’ is a tool to train employees.
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11. 5. Shift Transfers: are transfers of workers from one shift to another on
the same type of work. Workers generally dislike second or third shift
as it affects their participation in community life.
6. Selection Transfers: they are made within the department or
section. It is to be train the workers and prepare them to handle
different types of operations within the department.
7. Departmental Transfers: transferring from one department to
another department within the plants.
8. Inter-Plant transfers: if there is more than one plant under the
control of same management transfer may be made from one plant
to another for varied reasons. Such transfers are called inter- plant
transfers.
Types of Transfers, contd.,
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12. 1. Increase in productivity and effectiveness of the
organization.
2. Greater job satisfaction to employees.
3. Stabilize fluctuating job needs.
4. Improve employee skills.
5. Remedy for wrong placement.
6. Improve labour relationships.
7. Develop employees for future promotions.
8. Avoid monotony and boredom.
Benefits of Transfer

13. 1. Meet the organizational requirements and also personal requirements of employees.
2. Satisfy employee’s needs.
3. Utilize employees’ skill, knowledge etc., where they are more suitable or badly
needed.
4. Correct inter-personal conflicts.
5. Avoid favoritism and nepotism.
6. Creates transparency among the employees and their work
7. Maintain healthy relationship among staff in order to ensure harmonious
environment and to avoid unnecessary disputes.
8. Limits the ability of an employee to take advantage and sole control over the seat or
section.
Reasons for Transfer
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14. • The process of reorganizing or restructuring a business by
cost-cutting, reduction of workforce or reorganizing upper-
level management. The goal is to get the company molded
properly to achieve maximum profit. The term rightsizing is
often used by companies instead of downsizing because it
sounds less drastic.
• It is proactive and needs to be a constant part of the process
of managing an organization. To do rightsizing of an
organization, the leaders first look at market needs and
trends, technologies, alternative approaches, and new ideas.
Right Sizing the Workforce
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15. 1. Ensures that the required functions are properly
maintained.
2. Cost-control and to Maximize Profits
3. Avoid formation of trade unions
4. Enhance employee performance and
productivity
5. Improve employee collaboration
6. Create a sense of belongingness within the
employees.
Need for Right Sizing
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16. Demotion has been defined as the assignment
of an individual to a job of lower rank and pay
usually involving lower level of difficulty and
responsibility.
Demotions serves as a useful purpose in the
sense that they keep the employees alert and
alive to their responsibilities and duties.
Demotion

17. Separation
Separation means cessation of service from the organisation
for one or more reasons.
The employee may be separated from HR payroll due to:
• Resignation
• Discharge and dismissal
• Suspension and retrenchment
• Lay off
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18. References
Books
Human Resources Management by Aswathappa
Human Resources Management by Shashi. K. Gupta and Rosy Joshi
Web References
Reference for Business
http://www.referenceforbusiness.com/management/De-Ele/Downsizing-and-
Rightsizing.html#ixzz3iOSzC3ou
CiteMan
http://www.citeman.com/949-bases-of-promotion-of-employees-in-
organization.html
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19. Learnito Study Series for Business Students
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